By Michael Borella --
The fallout from the Supreme Court's Alice Corp. v. CLS Bank Int'l case continues to reshape the landscape of patent-eligibility. Despite guidance from the USPTO, patentees still struggle with what exactly is patent-eligible under Alice. Federal Circuit jurisprudence has proven helpful in teaching what is not eligible, but has been less effective in teaching what is eligible. Particularly, the appeals court has found exactly one set of claims challenged under 35 U.S.C. § 101 to be patentable post-Alice, while finding many such claims unpatentable.
Therefore, when a case comes along in which a district court finds claims to pass muster under § 101, that case deserves attention.
Motio sued BSP Software and other defendants in the Eastern District of Texas alleging infringement of U.S. Patent No. 8,285,678. The patent is related to providing automatic version control in a business intelligence software system.
As explained in the background of the patent:
Business intelligence systems are used in substantially all industries to gather, store, analyze, and report on business data or business intelligence. For example, manufacturing facilities use business intelligence systems to evaluate and report on factory production and personnel productivity as well as other critical metrics. Retailers use business intelligence systems to analyze trends in sales and to prepare reports for upper management.
The defendants filed a motion for judgment on the pleadings, contending that the claims were invalid under § 101.
Claim 1 of the '678 patent recites:
1. In a general purpose computer, a method for providing automatic version control to a business intelligence system, comprising:
creating an initial version of a business intelligence artifact in the business intelligence system, wherein the business intelligence artifact is a user-authored object that produces output when the business intelligence artifact is executed in the business intelligence system, and wherein the business intelligence artifact is selected from the group consisting of: a report specification and an analysis cube;
providing an automated agent that interfaces with the business intelligence system to provide automated version control to the business intelligence artifact; the automated agent independently performing the steps of:
automatically storing the initial version of the business intelligence artifact with a version control system;
detecting a request to the business intelligence system to modify the initial version of the business intelligence artifact to create a subsequent version of the business intelligence artifact that includes the requested modification; and
automatically storing the subsequent version of the business intelligence artifact in the version control system.
The Court began its analysis by reviewing the two-prong eligibility framework set forth in Alice.
One must first determine whether the claim at hand is directed to a judicially-excluded law of nature, a natural phenomenon, or an abstract idea. If so, then one must further determine whether any element, or combination of elements, in the claim is sufficient to ensure that the claim amounts to something more than the judicial exception. Notably, generic computer implementation of an otherwise abstract process does not qualify as "something more."
With respect to the first prong, the Court concluded that the claims were "directed to the abstract idea of maintaining versions of electronic documents." The Court explained that "[w]hile the claims are directed toward a particular technological environment -- a computer -- a particular type of electronic document -- report specifications and analysis cubes -- and an application in business intelligence systems, this does not change the underlying abstract idea of maintaining versions, or version control, of electronic documents."
The Court also relied in the Federal Circuit's opinion in Content Extraction and Transmission LLC v. Wells Fargo Bank, Nat. Ass'n for the premise that claims involving collecting, recognizing, and storing data are abstract. Particularly, the Court determined that the claimed embodiments for maintaining electronic documents also require these three elements.
Turning to the second prong, the Court quickly disposed with the notions that the claimed features of taking actions automatically and report specifications lent patentability to the claims. The defendants further argued that "the computer-implemented limitations of the patent merely draw on the generic functionality of pre-existing computer systems" which are conventional.
But the Court also relied on its own construction of the claim term "automated agent" as "software that interfaces with a business intelligence system to provide automated version control to a business intelligence artifact." This agent solves the problem of version control in business intelligence systems, which, according to the Court, is "significantly more than a patent on the idea of maintaining versions of electronic documents itself." Particularly, the claims "describe an invention that serves as an addition to a business intelligence system rather than claiming a monopoly on all version control systems, particularly version control native to a business intelligence system."
Comparing the claims to those determined to be eligible in DDR Holdings, LLC v. Hotels.com, L.P., the Court found, similar to that case, that "the invention does not simply use a computer to automate was done previously, but rather improves upon what was previously done with computers, solving a computer specific problem." Specifically, the claimed invention "expands the functionality of existing computer software, local or on a computer network, by addressing a problem specific to the realm of computers."
Turning to preemption, the Court also observed that the patent "does not claim version control generally, but rather a specific method, using an automated agent distinct from a business intelligence system to improve the functionality of a business intelligence system." Consequently, the claims do not preempt all ways of performing version control in a business intelligence system.
Thus, the Court found that the defendants had failed to establish that the claims were patent-ineligible.
This case is yet another example of the outcome of the Alice test being based not only on the language of the claims themselves, but also on the reviewer's perspective. The Court could have easily viewed the invention as being directed to version control, but with the software-based elements of the claims all performing conventional computational activities that do not provide the needed "something more." While the Court seemed to reject the argument that the claims were a mere automation of human activity, if the Federal Circuit reviews this case, it could go the other way based on this premise.
What seemed to win the day was that the claimed invention, with its automated agent in software, effectively requires computer implementation. In other words, computer technology (the automated agent and its functionality) is being used to solve a problem in computing (version control in business intelligence systems). Without computers, the problem, and thus this invention, would not exist.
Further, the fact that the Court performed claim construction on critical claim terms may have played a significant role in the outcome. Rather than viewing the term "automated agent" in a vacuum, the Court defined what it was, and used this definition in its § 101 analysis.