The Federal Circuit’s decision in Vanda Pharm. Inc. v West-Ward Pharm. Intl. Ltd. (2016-2707, 2016-2708 April 13, 2018) provided some good news on the subject matter eligibility front for innovators and other stakeholders in the personalized medicine space, as discussed in a previous post. So there is some hope for getting issued claims that will withstand a validity challenge under the Mayo/Alice framework. But what about enforcement? How does one prove infringement of claims that require various discreet steps that can, and typically are, performed by separate actors?
The Federal Circuit provided a welcome boost for stakeholders in the field of personalized medicine with its recent decision in Vanda Pharm. Inc. v West-Ward Pharm. Intl. Ltd. (2016-2702, 2016-2708 April 13, 2018). Vanda Pharma’s asserted claims relate to a method of treating schizophrenia patients with iloperidone in which the dose is adjusted based upon the patient’s CYP2D6 genotype. The Federal Circuit agreed with the court below that these claims were both directed to patent eligible subject matter and infringed.
The Court of Appeals for the Federal Circuit ruled in February that it was wrong for a judge to rule that a patent was ineligible under the Alice standard because there were underlying factual disputes that could not be resolved on summary judgement. The case is Berkheimer v. HP Inc., case number 17-1437, in the U.S. Court of Appeals for the Federal Circuit.
Automated Tracking Solutions, LLC, (“ATS”) appealed findings of invalidity for failing to claim patent-eligible subject matter by the United States District Court for the Northern District of Georgia. In a decision rendered by the United States Court of Appeals for the Federal Circuit on February 16, 2018, the Court affirmed the district court’s finding that the subject matter was not patent-eligible.
Struggling to keep case law relating to subject matter eligibility organized? In February 2018, the United States Patent and Trademark Office (USPTO) released an improved Eligibility Quick Reference Sheet, providing patent practitioners with a useful tool for analyzing claims in view of 35 U.S.C. § 101 subject matter eligibility requirements.
Last week, the Federal Circuit held computer memory system patent claims not abstract and thus patent-eligible under Section 101, reversing a lower court dismissal of the case under Rule 12(b)(6). Visual Memory LLC v. NVIDIA Corp., No. 2016-2254, 2017 U.S. App. LEXIS 15187 (Fed. Cir. Aug. 15, 2017).
U.S. Patent No. 5,953,740 (“the ‘740 patent”) describes a memory system that can be tailored for use with multiple different processors without reducing performance. Id. at 3. The ‘740 patent explains that when “the [memory] system is turned on, information about the type of processor is used to self-configure the programmable operational characteristics.” Visual Memory, No. 2016-2254, slip op. at 4. “For example, depending on the type of processor, internal cache 16 can store both code and noncode data, or it can store only code data.” Id. at 4. Claim 1 recites the following:
In the recent decision of Clarilogic v. Formfree Holdings, the Federal Circuit invalidated the patentee’s (Formfree) claim to a “computer-implemented method for providing certified financial data indicating financial risk about an individual.” In sum, Claim 1 of Formfree’s patent recited (1) “electronically collecting financial account data” (e.g., historical transaction data) for an individual, (2) validating the data by “applying an algorithm engine” to identify exceptions that “indicate incorrect data or financial risk,” (3) confirming the exceptions by “collecting additional data and applying the algorithm engine to the additional data,” and (4) “generating, using a computer, a report from the financial account data and the valid exceptions.”
In recent years, software patents have come under fire from legislation (the American Invents Act) that has generally made patents easier to invalidate, and from court decisions (the Supreme Court’s decision in Alice v. CLS Bank and its progeny) that have made computer-implemented inventions more vulnerable to subject matter eligibility challenges. Some observers have concluded that software patents are no longer worth pursuing. We disagree. Although there are real challenges, and patents on some software or other computer-implemented inventions may now be quite difficult (or even impossible) to obtain or enforce, a well-written and well-prosecuted patent application can circumvent many of these obstacles.
To read our full advisory on software patent eligibility, please click here.
Two years after the Central District of California invalidated two 3-D animation patents under Section 101, the Federal Circuit reversed that court’s decision, finding that the lower court oversimplified the claims of a computer-related invention. McRO, Inc. v. Bandai Namco Games Am. Inc., Nos. 2015-1080, et al., 2016 U.S. App. LEXIS 16703 (Fed. Cir. Sep. 13, 2016) (opinion by Judge Reyna, joined by Judges Taranto and Stoll). While this case has stimulated discussion in the legal community, as being a ground-breaker for the patentability of software patents since the Supreme Court’s decision in Alice Corp. v. CLS Bank Int’l, 134 S. Ct. 2347, 2355 (2014), the Federal Circuit’s McRO decision conforms with existing principles in post-Alice Section 101 law. While the Federal Circuit disagreed with the lower court in applying these principles to the facts of this case, the McRO decision does not change the core principle that patent claims directed to specific improvements in computer technology are patent-eligible.
The patents at issue in McRo (U.S. Patent Nos. 6,307,576 and 6,611,278) involve 3-D computer animation. Their specifications describe that in the relevant art, applying the appropriate data points for basic sound phonemes, e.g. ‘aah,’ ‘ee,’ or ‘oo,’ was usually done using a “keyframe” approach. McRO, 2016 U.S. App. LEXIS 16703 at *7. In a keyframe approach, an animator sets the morph weights at certain important times, between which a computer program “interpolates” (filling in the data points between those morph weights). Id. at *8. The patents state that this method requires the animator to manually set a tediously high number of keyframes, which is time consuming, and can be inaccurate. Id.
On August 22, 2016, Administrative Law Judge David Shaw of the International Trade Commission (“ITC” or “Commission”) issued his final initial determination (“the ID”) in Certain Portable Electronic Devices and Components Thereof, Inv. No. 337-TA-994. The ID invalidated all of the asserted claims for lack of patentable subject matter under 35 U.S.C. § 101, and terminated the investigation. This decision resulted from an early evidentiary hearing, conducted by order of the Commission within 100 days of its Notice of Institution under its “pilot program.” 81 Fed. Reg. 29307 (May 11, 2016).
The ID has implications related both to the implementation of the 100 day pilot program and continually developing Alice jurisprudence. For a more in depth discussion of those issues, please see our client alert here.