Monday, November 17, 2014

Ultramercial again: claims are the definition of what a patent is intended to cover

In Ultramercial v. Hulu, the CAFC worked through 35 USC 101 issues to affirm the district court:

The present posture of the case is that Ultramercial is
again appealing from the decision of the United States
District Court for the Central District of California. Upon
review of the ’545 patent and the standards adopted by
the Supreme Court, for the reasons set forth below, we
conclude that the ’545 patent does not claim patent eligible
subject matter and accordingly affirm the district
court’s grant of WildTangent’s motion to dismiss.

This particular decision was made in view of the Supreme Court Alice decision:

While WildTangent’s petition was pending, the Supreme
Court issued its decision in Alice Corp. v. CLS
Bank International, 573 U.S. __, 134 S. Ct. 2347 (2014).
In that case, the Court affirmed our judgment that method
and system claims directed to a computer-implemented
scheme for mitigating settlement risk by using a third
party intermediary were not patent-eligible under § 101
because the claims “add nothing of substance to the
underlying abstract idea.” See Alice, 134 S. Ct. at 2359–
60. The Court in Alice made clear that a claim that is
directed to an abstract idea does not move into § 101
eligibility territory by “merely requir[ing] generic computer
implementation.” Id. at 2357. (...)

As indicated, this case is back to this court on Ultramercial’s
original appeal from the district court’s dismissal,
but in its present posture we have the added benefit
of the Supreme Court’s reasoning in Alice. We review a
district court’s dismissal for failure to state a claim under
the law of the regional circuit in which the district court
sits, here the Ninth Circuit. Juniper Networks, Inc. v.
Shipley, 643 F.3d 1346, 1350 (Fed. Cir. 2011) (citation
omitted). The Ninth Circuit reviews de novo challenges to
a dismissal for failure to state a claim under Fed. R. Civ.
P. 12(b)(6). Livid Holdings Ltd. v. Salomon Smith Barney,
Inc., 416 F.3d 940, 946 (9th Cir. 2005). We review
questions concerning patent-eligible subject matter under
35 U.S.C. § 101 without deference. Research Corp. Techs.,
Inc. v. Microsoft Corp., 627 F.3d 859, 867 (Fed. Cir. 2010).

The CAFC noted:

We first examine the claims because claims are the
definition of what a patent is intended to cover. An
examination of the claim limitations of the ’545 patent
shows that claim 1 includes eleven steps for displaying an
advertisement in exchange for access to copyrighted

Judge Mayer concurred:

I agree that the claims asserted by Ultramercial, Inc. and Ultramercial, LLC (together, “Ultramercial”) are ineligible for a patent, but write separately to emphasize three points. First, whether claims meet the demands of 35 U.S.C. § 101 is a threshold question, one that must be addressed at the outset of litigation. Second, no presumption of eligibility attends the section 101 inquiry. Third, Alice Corporation v. CLS Bank International, 134 S. Ct. 2347, 2356–59 (2014), for all intents and purposes, set out a technological arts test for patent eligibility. Because the purported inventive concept in Ultramercial’s asserted claims is an entrepreneurial rather than a technological one, they fall outside section 101.


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