On Monday, June 27, 2016, the Federal Circuit issued its decision in Bascom Global Internet Services, Inc., v. AT&T Mobility LLC (Appeal No. 2015-1763) in which the court overturned an order of the U.S. District Court for the Northern District of Texas. This case is significant in that it is only the third time since the Alice v. CLS decision that the Federal Circuit found the claims of a patent challenged under §101 to be directed to subject matter eligible for patentability under §101 in contrast to the 40 cases in which the Federal Circuit found patents to be ineligible since the decision.
The claims of Bascom’s patent No. 5,987,606 are generally directed to a content filtering system for restricting access to certain Internet content on a user’s computer or web-enabled device. Bascom asserted that the filtering system recited in the ‘606 patent was superior to prior known systems or software because the “claimed filtering system avoids being ‘modified or thwarted by a computer literate end-user,’ and avoids being installed on and dependent on ‘individual end-user hardware and operating systems’ or ‘tied to a single local area network or a local server platform’ by installing the filter at the ISP server” while retaining functionality for users “to customize how requests for Internet content from their own computers are filtered instead of having a universal set of filtering rules applied to everyone’s requests. According to the ‘606 patent, no one had previously provided customized Internet content filters at a remote server.
Bascom sued AT&T for infringement of the ‘606 patent in the U.S. District Court for the Northern District of Texas. AT&T moved to dismiss Bascom’s complaint on the basis that each claim of the ‘606 patent was invalid under §101. The District Court agreed with AT&T and dismissed the case.
On Appeal, the Federal Circuit disagreed with the decision of the District Court and vacated the order of the District Court dismissing the case and remanded the case for further proceedings. The Federal Circuit agreed with the District Court “that filtering content is an abstract idea because it is a longstanding, well-known method of organizing human behavior, similar to concepts previously found to be abstract.” The court, applying the two-step test for determining subject matter eligibility under 35 U.S.C. §101 from Alice, found that “the claims and their specific limitations do not readily lend themselves to a step-one finding that they are directed to a nonabstract idea” and thus proceeded to analyze the claims of the ‘606 patent under step two of the Alice test to determine if the ordered combination of claim limitations added “significantly more” to the claims than the abstract idea itself by reciting an “inventive concept” that transformed the abstract idea into a patent-eligible invention.
The court found that the claims of the ‘606 patent passed step two of the Alice test and were thus directed to patent eligible subject matter. In performing this analysis the court agreed with the District Court “that the limitations of the claims, taken individually, recite generic computer, network and Internet components, none of which is inventive by itself.” The court, however, disagreed with the District Court that the ordered combination of limitations of the claims of the ‘606 patent recited “well-understood, routine, conventional activit[ies].” The claims of the ‘606 patent were thus directed to a patent eligible subject matter.
One of the key takeaways from this case is that in performing an analysis of a claim for patent eligible subject matter, it is insufficient to analyze each limitation of the claim in isolation to determine if the limitations recite an inventive concept or something other than what is “well-understood, routine, conventional activit[ies].” Instead, as explained in the Bascom decision, “[t]he inventive concept inquiry requires more than recognizing that each claim element, by itself, was known in the art. As is the case here, an inventive concept can be found in the non-conventional and non-generic arrangement of known, conventional pieces.” A claim may be found eligible for patentability under 35 U.S.C. §101 even if the claim is directed to an abstract idea if the ordered combination of limitations of the claim add “significantly more” to the claims than the abstract idea itself. This “significantly more” may include improving an existing technological process or improving the performance of a computer system itself.
The full text of this decision may be found here.
The foregoing has been prepared for the general information of clients and friends of the firm. It is not meant to provide legal advice with respect to any specific matter and should not be acted upon without professional counsel. This material may be considered advertising under certain rules of professional conduct.
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