ChargePoint, Inc. v. SemaConnect, Inc. (Fed. Cir. 2019)

By Michael Borella --

On July 23, 2019, the Federal Circuit denied ChargePoint's request for panel rehearing and en banc review of its March 28, 2019 decision rendering four ChargePoint patents invalid under 35 U.S.C. § 101.  Since we did not review this case when the panel decision came down, and because the case subsequently garnered attention as being one of the more problematic § 101 decisions of late, today we provide a review and some perspective of the substantive issues at hand.

ChargePoint sued SemaConnect in the District of Maryland, asserting infringement of U.S. Patent Nos. 8,138,715, 8,432,131, 8,450,967, and 7,956,570.  All four patents share the same specification.  SemaConnect moved for dismissal under Rule 12(b)(6) on the grounds that the patents failed to meet the eligibility requirements of § 101.  The District Court sided with SemaConnect.  ChargePoint appealed.

2014's Alice Corp. vs. CLS Bank Int'l Supreme Court case set forth a two-part test to determine whether claims are eligible for patenting under § 101.  One must first decide whether the claim at hand involves 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 elements or combinations of elements that are well-understood, routine, and conventional will not lift the claim over the § 101 hurdle.  While this inquiry is generally carried out as a matter of law, factual issues can come into play when determining whether something is well-understood, routine, and conventional.

As described by the Court, the focus of the claimed inventions is "charging stations for electric vehicles."  Traditionally, charging was a long, slow, one-way process that required parking overnight or for a long period of time.  ChargePoint's technology purported to solve two semi-related problems with this charging.  First, allowing restaurants, shopping centers, or apartment complexes to control access to vehicle chargers on their premises.  Second, allowing electric vehicles to transfer power to the electrical grid in times of high demand on the grid.  In the words of the Court:

ChargePoint contends that its inventors created improved charging stations that address the various needs inherent in electric vehicle charging.  This was accomplished by creating networked charging stations.  According to ChargePoint, this network connectivity allows the stations to be managed from a central location, allows drivers to locate charging stations in advance, and allows all users to interact intelligently with the electricity grid.

Claims 1 and 2 of the '715 patent recite:

1.  An apparatus, comprising:
    a control device to turn electric supply on and off to enable and disable charge transfer for electric vehicles;
    a transceiver to communicate requests for charge transfer with a remote server and receive communications from the remote server via a data control unit that is connected to the remote server through a wide area network; and
    a controller, coupled with the control device and the transceiver, to cause the control device to turn the electric supply on based on communication from the remote server.

2.  The apparatus of claim 1, further comprising an electrical coupler to make a connection with an electric vehicle, wherein the control device is to turn electric supply on and off by switching the electric coupler on and off.

In addressing procedural aspects of the § 101 inquiry, the Court noted that "we have found the specification helpful in illuminating what a claim is 'directed to.'"  On the other hand, "while the specification may help illuminate the true focus of a claim, when analyzing patent eligibility, reliance on the specification must always yield to the claim language in identifying that focus."

With that in mind, the Court rapidly concluded that "[i]t is clear from the language of claim 1 that the claim involves an abstract idea—namely, the abstract idea of communicating requests to a remote server and receiving communications from that server, i.e., communication over a network."  But this was insufficient to determine whether the focus of the claim was an abstract idea.  So the Court continued by looking to the specification to understand the problem being solved by the inventors.

Reviewing its own precedent, the Court observed that statements made by the inventors in the specification can be used to determine this focus.  But hardware components described only at a high level of detail or functionally are generally outside of this focus.

The problem facing the inventors, according to the Court, was "the lack of a communication network that would allow drivers, businesses, and utility companies to interact efficiently with the charging stations."  "From these statements," the Court concluded, "it is clear that the problem perceived by the patentee was a lack of a communication network for these charging stations, which limited the ability to efficiently operate them from a business perspective."  To further justify its interpretation, the Court observed that "the specification never suggests that the charging station itself is improved from a technical perspective, or that it would operate differently than it otherwise could . . . [n]or does the specification suggest that the invention involved overcoming some sort of technical difficulty in adding networking capability to the charging stations."  Thus, "the specification suggests that the invention of the patent is nothing more than the abstract idea of communication over a network for interacting with a device, applied to the context of electric vehicle charging stations."

After establishing the problem to be solved, the Court turned to the language of the claims and found that it would "preempt the use of any networked charging stations."  The Court indicated that the breadth of the claims dictated such an expansive preemption, as the claims would effectively cover all solutions for achieving a desired result.

To sum up the analysis of claim 1:

In short, the inventors here had the good idea to add networking capabilities to existing charging stations to facilitate various business interactions.  But that is where they stopped, and that is all they patented.  We therefore hold that claim 1 is "directed to" an abstract idea.

The Court shot down claim 2 on similar grounds, finding that the limitation of an "electrical coupler to make a connection with an electric vehicle" does not change the nature of the invention being claimed.  Thus, both claims are directed to an abstract idea.

The Court applied a similar analysis to the claims of the other patents and came to the same outcome.  Indeed, the Court made the dangerously sweeping statement that "[c]ommunication over a network for [the purpose of device interaction] has been and continues to be a building block of the modern economy" -- an abstract idea.  Undoubtedly, these words will be quoted over and over in future district court and Federal Circuit litigation in attempts to establish that any invention involving networked communication is per se ineligible under § 101.  Patent professionals are sadly shaking their heads at this all-too-likely and probably unintended consequence.

In any event, the Court moved on to part two of the Alice test.  ChargePoint contended that it has presented factual allegations that, under Berkheimer v. HP, would preclude a Rule 12(b)(6) dismissal.  These included purported unconventional approaches involving "(a) the ability to turn electric supply on based on communications from a remote server; (b) a network-controlled charging system; and (c) a charging station that receives communication from a remote server, including communications made to implement a demand response policy."

The Court's response -- unfortunately predictable at this point -- was that these innovations were directed to network control, which is the abstract idea itself.  To that end, the Court noted that "a claimed invention's use of the ineligible concept to which it is directed cannot supply the inventive concept that renders the invention 'significantly more' than that ineligible concept."

The Court wrapped up:

ChargePoint, of course, disagrees with this characterization, arguing that its patents claim "charging stations enabled to use networks, not the network connectivity itself."  But the specification gives no indication that the patented invention involved how to add network connectivity to these charging stations in an unconventional way.  From the claims and the specification, it is clear that network communication is the only possible inventive concept.  Because this is the abstract idea itself, this cannot supply the inventive concept at step two.

Thus, the claims were ruled ineligible under § 101 and invalidated accordingly.

Yes, the claims were broad.  Yes, they were vague, and the specification probably didn't describe the invention as well as it should have.  But for the 5,000th time, we have more well-founded and objective tests for these issues in §§ 102, 103, and 112.  Lumping obviousness and written description into § 101 results in the skewed analysis that you see here and in other eligibility decisions.

And the outcome herein is indicative of the hazard associated with applying a variation of the "technical solution to a technical problem" test.  Sure, such a test has been used in Europe and other jurisdictions for quite some time.  But it is being used differently here (i.e., the problem and state of the art are based on statements in the specification rather than prior art, and the test is separate from the obviousness analysis).  As a result, the Federal Circuit is shooting more holes in the long-standing principle that the invention is defined by the claims.  Instead, the invention is now defined by a subjective evaluation of what a judge believes to be the problem being solved, and then this identified problem is used to color the interpretation of the claims under § 101.  If the problem is viewed as non-technical, then the claims can easily be found abstract, as was the case with ChargePoint.  The fact that the Federal Circuit has previously found claims that solve business problems to be eligible under § 101 (e.g., DDR Holdings v. Hotels.com) seems to be beside the point.

The ensuing cognitive dissonance -- ChargePoint's device-oriented claims being viewed as abstract -- illustrates the judicial-exception-creep that has been occurring since Alice.  Since the § 101 inquiry can be applied in an outcome oriented fashion, more and more non-abstract devices, systems, structures, and components are now being lumped into the abstract idea classification or ignored as "conventional" in part two of the Alice test.  The abstract idea exception is a legal fiction that has been expanded to the point of meaninglessness -- thinking about network communication is truly abstract, but actual network communication or the facilitation thereof is not.

Indeed, the language of the claims matter little when one can try to infer from the specification what the claims "really mean" and then analyze that ascribed meaning rather than what the claims actually recite.  The door is left open for bad actors to try to convince the judiciary that virtually everything involving a computer, software, or a network is abstract.  At what point do we realize that, as just one example, the little computers we carry around in our pockets use software in a tangible fashion to communicate and have a concrete impact on themselves and other devices?  At what point does the legal fiction of the abstract idea swallow all of patent law?  Hint: this case.

ChargePoint Inc. v. SemaConnect Inc. (Fed. Cir. 2019)
Per Curiam

Comments

[EG]

"But for the 5,000th time, we have more well-founded and objective tests for these issues in §§ 102, 103, and 112. Lumping obviousness and written description into § 101 results in the skewed analysis that you see here and in other eligibility decisions."

Hey Michael,

Completely agree with your statement. Section 101 is not the correct statute to judge these claims by.

[Atari Man]

What complete and utter b.s. on the part of the court. Shame on the district court for ruling as it did, shame on the CAFC for sustaining the district court's judgement, and shame again on the CAFC for denying rehearing en banc. There's NOTHING abstract about:

An apparatus, comprising:
a control device ...;
a transceiver ...; and
a controller...

You can touch that apparatus.

Is weed now legal in the District of Columbia? Sure seems like it.

[Skeptical]

As pointed out (now, more than five years ago), the Supreme Court has fashioned a weapon comprising a double-edged blade: the leading edge is the “Gist,” in which the Court dispenses with the words of Congress as to exactly whom has been granted the great power (and the great responsibility) of defining what the invention is; and the trailing edge is the “Abstract,” in which the Court violates the Void for Vagueness prohibition by not actually defining the term (not its parameters), thereby inserting an open-ended (And never ending) RE-WRITING of statutory law with a Common Law mechanism that is untethered to any actual interpretation OF LEGAL WORDS of statutory law.

No matter how much glass anyone tries to put on the “Gist/Abstract” Sword — and often merely with an Ends justifies the Means mantra — the legal fault remains in what the Supreme Court has done.

[martin snyder]

1) A workable solution turns on the meaning of two words: "process" and "abstract".

2) Abstract inventions are not the same as abstract claims, so we have two separate problems.

3) With no human mind, there can be no abstraction.

There is little controversy around inventions claimed as machines, compositions of matter, or manufactures. The trouble is mainly with inventions claimed as processes, because just about anything people do can be considered a process.

Many software, business, and diagnostic methods are claimed as processes. The Supreme Court has firmly declined to define or limit the meaning of process. Common sense suggests at least one thing that we can rely on regarding processes: every process must have an intended result.

Just as our trouble is limited to just one of the four permissible kinds of inventions listed in Section 101, our trouble among the three judicial exceptions to Section 101 is also mostly limited to just one exception.

We don’t have much controversy with laws of nature or natural phenomena, but we have serious problems defining “abstract ideas”. One reason for that trouble is that “abstract ideas” are actually two different problems.

Inventions are things in the world, while patent claims are words used to describe them. Every patent claim is an abstraction.

Claims that are too abstract will turn on extrinsic factors such as the state of the prior art and the construction of the notional person having ordinary skill in the art.

On the other hand, there should be something easily identifiable about an invention that makes it intrinsically abstract.

What makes an invention intrinsically abstract? Mere intangibility does not preclude eligibility according to the Supreme Court.

The most basic definition of the word abstract, from its Latin root, is when one thing is drawn from another. We usually invoke a meaning as that which is drawn, but we can also define abstraction as a form of consumption.

Thus my test: is the invention a process? If yes, is the useful result of performing the process some species of information? If yes, does the utility of the invention arise from human consumption of that information? If yes, the invention is abstract and ineligible.

A human mind consuming information should be beyond the reach of the Constitution.

If the utility of the process arises from non-human use of the information, the invention should be eligible as a process, because without a human mind to host it, there can be no abstraction.

While the claims may describe an eligible invention, but unless they meet the requirements of Sections 103 and 112, they will not be valid. Intrinsic abstraction should be dealt with at the pleading stage, and extrinsic abstraction should be managed as a mixed question of law and fact, with appropriate adversarial safeguards- in other words, exactly as claims are construed today in Markman procedures

This simple framework handles the patent problems of the information age. It allows for patenting of new, useful, non-obvious algorithms and standards such as MPEG, advances in encryption, robotics, networking, genetic medical devices, etc. while removing all kinds of processes relating to human-created meaning, such as stock trading, online shopping, user-interfaces, games, etc.

Improving techniques of handling information unrelated to the human meaning of the information would still be eligible inventions.

Human affairs are impossibly ambiguous and should not be the proper subjects of the patent system. This is the philosophical core of the current debate.

Ideally, all logic and instructions should be excluded from the systemhttps://papers.ssrn.com/sol3/papers.cfm?abstract_id=2709289 details these ideas in depth, including scholarly support, sample cases, etc.

[Skeptical]

Egads,

(not its parameters) => (nor its parameters)
how much glass => how much gloss

[Skeptical]

Mr. Snyder,

You keep on wanting to push your agenda and you keep on losing credibility with statements like:

“There is little controversy around inventions claimed as machines, compositions of matter, or manufactures.”

When you are digging yourself into a hole, digging more, or digging faster will NOT get you out of that hole.

[Fat Bastard]

This is turning into a traveshamockery.