Federal Circuit Decision May Signal New Strategy for Patenting Computer-Related Inventions

Tuesday, May 31, 2016

In a recent case involving the patentability of patents covering “self-referential” databases, a three judge panel of the U.S. Court of Appeals for the Federal Circuit ruled that computer software inventions are not necessarily “abstract ideas,” a view that may open the door to more patents for computer-related inventions. Enfish, LLC v. MicroSoft Corp., No. 2015-1244 (Fed. Cir. May 12, 2016). In the wake of the Supreme Court’s decision in Alice Corp. Pty v. CLS Bank Int’l, 134 S. Ct. 2347 (2014) and Mayo Collaborative Servs. v. Prometheus Labs., Inc., 132 S. Ct. 1289 (2012), courts and the USPTO frequently have ruled that patents covering software and computer-implemented processes are not eligible for patenting. Most of those cases have assumed that inventions directed to computer processes are “abstract ideas,” which are not patent-eligible unless that claims recite a substantial limitation (referred to as an “inventive concept”) that limits the claim to something substantially less than the abstract idea itself. For example, in a significant post-Alice Federal Circuit decision ruling that a computerized process is eligible, the panel in DDR Holdings, LLC v. Hotels. Com, LP, 773 F. 3d 1245 (Fed. Cir. 2014) reasoned that even if the claims under review were directed to an abstract idea, they contained a sufficient inventive concept because the claims did “not merely recite the performance of some business practice known from the pre-Internet world along with the requirement to perform it on the Internet. Instead, the claimed solution is necessarily rooted in computer technology in order to overcome a problem specifically arising in the realm of computer networks.” In Enfish, a different Federal Circuit panel ruled that claims claiming a “innovative logical model for a computer database” were patent-eligible because they were not directed to an abstract idea at all. In order for the invention to be an abstract idea, the court held, the character of the claims “as a whole” must be directed to an abstract idea. The court observed that unlike patents that simply executed abstract ideas using a computer, the claimed self-referential database improved the function of a computer system itself. Such improvements may not necessarily be abstract ideas under Alice. The court explained:

We do not read Alice to broadly hold that all improvements in computer-related technology are inherently abstract and, therefore, must be considered at step two. Indeed, some improvements in computer-related technology when appropriately claimed are undoubtedly not abstract, such as a chip architecture, an LED display, and the like. Nor do we think that claims directed to software, as opposed to hardware, are inherently abstract and therefore only properly analyzed at the second step of the Alice analysis. Software can make non-abstract improvements to computer technology just as hardware improvements can, and sometimes the improvements can be accomplished through either route. We thus see no reason to conclude that all claims directed to improvements in computer-related technology, including those directed to software, are abstract and necessarily analyzed at the second step of Alice, nor do we believe that Alice so directs.

Slip op. at 11. The court concluded that unlike the bulk of cases invalidating claims under Alice, the “the plain focus of the claims [in the Enfish patent] is on an improvement to computer functionality itself, not on economic or other tasks for which a computer is used in its ordinary capacity.” Thus, the claims were not directed to an abstract idea, and so the court held that the claims were patent-eligible without even considering Alice’s second, “inventive concept” step. The Enfish case illustrates a potential approach for obtaining patents on computer-implemented processes. Although hardware-based improvements to computer functionality generally will pass muster under Section 101, the decision potentially expands the approach to software-based improvements. In addition, Enfish suggests that a software improvement may be eligible even if it operates on a general purpose computer, a configuration which sometimes lacked a clear inventive concept under Alice. Thus, the Enfish decision may lead the way to establishing patent eligibility for some software-based technologies.