Move, Inc. v. Real Estate Alliance Ltd. (Fed. Cir. 2018)

By Michael Borella --

One of the more frustrating aspects of the current judicial patent eligibility framework is the propensity for courts, even the Federal Circuit, to carry out the two-part test from Alice Corp. v. CLS Bank Int'l in a conclusory fashion.  When this occurs, the claims under review are most likely going to be found non-statutory and invalid under 35 U.S.C. § 101.  In this case, the Federal Circuit actually provides ample reasoning for finding that claims fail the test, albeit in a nonprecedential case.

Real Estate Alliance Ltd. ("REAL"), is the assignee of U.S. Patent Nos. 5,032,989 and 4,870,576 (both expired over the course of this long litigation, but still relevant for purposes of determining past infringement).  The '989 patent is a continuation-in-part of the '576 patent, and both are directed to geographically searching for real estate properties on a computer.  This process involves "identifying a geographic region of interest for acquiring property and then selecting an inner area within this geographic region by designating boundaries on a map displayed on the screen."  Then, the inner area is "zoomed in on and a second area is selected within the zoomed region."  One can "change the world coordinate display" such that the "size of the viewport remains constant" and the "display now appears to have zoomed down closer to earth."  The elected area "is then cross-referenced with the database of available properties whose approximate locations are then pictorially displayed on screen."  Keep in mind that the '576 patent was filed in 1986 and the '989 patent was filed in 1989, well before such technologies were widely available on personal computers and smartphones.

Claim 1 of the '989 patent recites:

A method using a computer for locating available real estate properties comprising the steps of:
    a) creating a database of the available real estate properties;
    b) displaying a map of a desired geographic area;
    c) selecting a first area having boundaries within the geographic area;
    d) zooming in on the first area of the displayed map to about the boundaries of the first area to display a higher level of detail than the displayed map;
    e) displaying the zoomed first area;
    f) selecting a second area having boundaries within the zoomed first area;
    g) displaying the second area and a plurality of points within the second area, each point representing the appropriate geographic location of an available real estate property; and
    h) identifying available real estate properties within the database which are located within the second area.

The aforementioned Alice case set forth a test to determine whether claims are directed to patent-eligible subject matter under § 101.  One must first decide 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 decide whether any element or combination of elements in the claim is sufficient to ensure that the claim amounts to "significantly more" than the judicial exclusion.  But generic computer implementation of an otherwise abstract process does not qualify as significantly more.  On the other hand, a claimed improvement to a computer or technological process is typically patent-eligible.

The District Court for the Central District of California applied the test and found that the '989 patent was directed to "a method for collecting and organizing information about available real estate properties and displaying this information on a digital map that can be manipulated by the user."  This, according to the District Court, is an abstract idea.

Reviewing this decision, the Federal Circuit stated that the part one analysis "requires us to consider the claims in their entirety to ascertain whether their character as a whole is directed to excluded subject matter."  The Court quickly determined that the level of detail in claim 1 was insufficient to conclude that it was anything other than abstract.  Particularly, the claim "is aspirational in nature and devoid of any implementation details or technical description."  The Court helpfully clarified that not "every claim involving the collection, organization, manipulation, or display of data is necessarily directed to an abstract idea."  On the other hand, the Court found that claim 1 had much in common with the ineligible data processing claims of Electric Power Group, LLC v. Alstom S.A. and Intellectual Ventures I LLC v. Capital One Fin. Corp.

Indeed, the Court observed that the claim was similar to others that were found to fail the Alice test due to "simply us[ing] computers to serve a conventional business purpose."  In those cases, the claims recited at a high level what method steps were to be carried out, but not how these steps were implemented.  Thus, the claims were not limited to a particular implementation.  Similarly, while claim 1 "provide[s] steps for using the computer to perform the search, they contain no technical details or explanation of how to implement the claimed abstract idea using the computer."

REAL attempted to counter this position by arguing that the "creating a database" and "zooming in" steps were technical advancements.  REAL relied on expert testimony to do so, the expert asserting that "databases at the time of the invention could not be queried graphically and that zooming on a computer-displayed map to depict a higher level of detail was neither routine nor conventional."  But the Court remained hung up with the lack of detail in the claim -- recitation of the function to be performed rather than the way that this function is carried out was problematic in the Court's view.  That, and the claim's business focus, failed to convince the Court that there was a technical improvement recited.

Instead, the Court looked to the specification for discussion of such an improvement.  In doing so, the Court looked for evidence that the invention improved the operation of a computer, as opposed to the business goal of identifying available real estate properties.  Finding none, the Court determined that the claim was directed to an abstract idea.

Turning to part two of Alice, the Court described this inquiry as "examin[ing] the claim limitations more microscopically, to determine whether they contain additional features constituting an inventive concept."  But any such recited features (i.e., a "computer" and a "database") were determined to be generic, thus having no weight in the inventive concept analysis.  Further, the specification stated that the invention could be carried out on a general purpose computer.

As noted above, REAL's expert argued that the invention provided a technical improvement, stating that:

It was considered neither routine nor conventional in the mid-1980s for a computer-displayed map to be able to zoom to display a higher level of detail in the sense of displaying information that wasn't present at the lower level of detail at all, and this zooming step cannot be performed by a human.

But the Court dismissed this testimony as conclusory, noting that "[the expert's] declaration provides no citations to support this assertion and contains no additional rationale."  This, combined that the observations that "the claim language does not explain what is inventive about the zoom feature or explain how it is accomplished" and that "REAL also has not pointed us to any portion of the specification that fills this gap," resulted in the Court concluding that the claim did not recite "significantly more" than the abstract idea therein.  Consequently, failing both steps of the Alice test, the claim was held to be invalid under § 101.

While not providing a formal precedent, the Federal Circuit's reasoning herein points to a few observations that can be made regarding the ability of a claim to survive a § 101 challenge.

First, the Court was looking for a nexus between the invention as claimed and an improvement to technology.  This nexus will not be found in a claim that recites steps at a high level that can be performed on generic hardware.

Second, while the Court repeatedly focused on the claim's lack of implementation detail, it was willing to look to the specification for an explanation of how the invention was a technical improvement.  This approach harmonizes well with other cases, such as Core Wireless Licensing S.A.R.L. v. LG Electronics, Inc. and Thales Visionix Inc. v. U.S., in which very broad and arguably vague claims were found eligible because their specifications explained how they were advancements in their technical fields.  In other words, claim language matters, but the specification may matter just as much.

Third, expert testimony as to the improvements provided by an invention had best be more than conclusory.  The mere opinion of an expert may not be sufficient, and the expert should supplement this opinion with at least some support from other sources.  This also reopens a can of worms regarding what is the evidentiary standard for both sides in a § 101 challenge, a question that has yet to be answered.

Move, Inc. v. Real Estate Alliance Ltd. (Fed. Cir. 2018)
Nonprecedential disposition
Panel: Circuit Judges Lourie, Wallach, and Stoll
Opinion by Circuit Judge Stoll

Comments

[Greg DeLassus]

"One of the more frustrating aspects of the current judicial patent eligibility framework is the propensity for courts... to carry out the two-part test from Alice... in a conclusory fashion."

This is the understatement of the century!

[Skeptical]

That frustration is very much part and parcel of the "gift" from the Supreme Court and their "Gist/Abstract" sword.

That sword was provided WITHOUT defining such things as "abstract" or even "significantly more."

Add to that the OBVIOUS incongruity of the body of the various Supreme Court decisions themselves on 101 (paying attention to the historical back and forth as witnessed by some of the writers of the various decisions - instead of ignoring THAT context), and there is ONE inescapable conclusion.

And one (legislative) solution).

[Paul Cole]

Very sadly, the claimed subject matter amounts to little more than I have been doing on my PC for years, and I can see nothing innovative. One does not have to be Skeptical to conclude that this was a fairly hopeless case.

"But the Court remained hung up with the lack of detail in the claim -- recitation of the function to be performed rather than the way that this function is carried out was problematic in the Court's view."

There is precedent going back over 150 years to support this approach.

[skeptical]

While perhaps not novel, one CAN hope to conclude that 101 will not be used for novelty.

It appears that you have slipped a little in your appreciation of our law.