Into the Final Stretch: Surveying Bilski's Treatment in the Lower Courts

While everyone continues to fret over the issuance of the SCOTUS Bilski decision (which, by the way, is rumored to be delayed until at least May 17th), Blake Reese has published a timely article that survey's Post-CAFC-Bilski jurispridence in the Federal Circuit and the district courts.  The results aren't pretty - most of the patents challenged on section 101 grounds were found invalid.

FEDERAL CIRCUIT

In re Ferguson, 558 F.3d 1359 (Fed. Cir. 2009)
CLAIMED: A process for “marketing a product … using a shared marketing force” and a “paradigm for marketing a company….”
HELD: Unpatentable.  Methods of “organizing business or legal relationships in the structuring of a sales force (or marketing company)” do not transform “physical objects or substances” or “representati[ons] of physical objects or substances.”

Prometheus Labs., Inc. v. Mayo Collaborative Servs., 581 F.3d 1336 (Fed. Cir. 2009)
CLAIMED: "Methods for calibrating the proper dosage of thiopurine drugs, which are used for treating both gastrointestinal and nongastrointestinal autoimmune diseases.”
HELD: Patentable. The claims are transformative as that “[t]he transformation is of the human body following administration of a drug and the various chemical and physical changes of the drug’s matabolites that enable their concentrations to be determined.”   Unlike mere “data-gathering steps,” “[t]he asserted claims are in effect claims to method of treatment, which are always transformative when a defined group of drugs is administered to the body to ameliorate the effects of an undesiredcondition.”

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DISTRICT COURTS

Transamerica Life Ins. Co. v. Lincoln Nat’l Life Ins. Co., No. C 06-110-MWB, 2010 WL 785905, (N.D. Iowa March 8, 2010)
CLAIMED: “A five-step computerized method for administering a variable annuity plan having, inter alia, a guaranteed minimum payment feature associated with a systematic withdrawal program.”
RESULT: Court denied the alleged infringer's motion for leave to amend its pleadings aftger the CAFC Bilski decision was rendered.  However, the court interpreted Bilski to mean that the “machine-or-transformation test” is the sole test to determine the patent eligibility of method claims.

King Pharms., Inc. v. Eon Labs, Inc., 593 F. Supp. 2d 501 (E.D.N.Y. 2009)
CLAIMED: A method of “administering metaxalone to a patient with food.”
HELD: Unpatentable.  “The act of informing another person of the good effect of metaxalone does not transform the metaxalone into a different state or thing.” Id. court also noted that the claim’s recitation of “a particular transformation … must not constitute mere ‘insignificant postsolution activity.’”

Fort Props., Inc. v. Am. Master Lease, LLC, 609 F. Supp. 2d 1052 (C.D. Cal. 2009)
CLAIMED: A “method for creating an investment instrument out of real property.”
HELD:  Unpatentable.  The claims at issue “involve only the transformation or manipulation of legal obligations and relationships.”  In particular, those claims “only transform or manipulate legal ownership interests in real estate” and, therefore, “[u]nder Bilski, the [c]ourt [could not] find that those claims transform an article or thing.

CyberSource Corp. v. Retail Decisions, Inc., No. C 04-03268, 2009 WL 815448 (N.D. Cal. May 26, 2009)
CLAIMED:  “A method and system for detecting fraud in a credit card transaction between a consumer and a merchant over the internet.”
HELD:  Unpatentable.  Performing the method “over the Internet” was not a tie to a particular machine because “the internet is an abstraction … as [o]ne can touch a computer or a network cable, but one cannot touch ‘the internet.’ . . . [under Bilski] the use of the internet does not impose meaningful limits on the scope of the claims.”   Uunpatentable subject matter “does not become patentable by tossing in references to internet commerce.”

Versata Software, Inc. v. Sun Microsystems, Inc., No. 2-06-CV-358 (TJW), Memorandum Opinion & Order, Dkt. No. 90, at p. 2 (E.D. Tex. Aug. 19, 2008)
CLAIMED:  "A computer-based configuration system" for modifying configuration instances in a computer model.
RESULT: The accused infringer filed a motion for judgment on the pleadings, based on the recently-issued (CAFC) Bilski decision.  The court denied the motion, noting that the Federal CIrcuit "declined to adopt a broad exclusion over software or any other such category of subject matter beyond the exclusion of claims drawn to fundamental principles …[and noted] the process claim at issue in the appeal is not, in any event, a software claim. Thus, the facts here would be largely unhelpful in illuminating the distinctions between those software claims that are patent-eligible and those that are not.

Every Penny Counts, Inc. v. Bank of America Corp., No. 2:07-cv-042, slip op. (M.D.Fla. May 27, 2009)
CLAIMED: “A system whereby consumers can save and/or donate a portion of a credit or debit transaction.”
HELD:  Unpatentable.  The claimed “process” includes “a mathematical algorithm [that] uses machines for data input and data output and to perform the required calculations.”  But, “those machines do not … impose any limit on the process itself.”

DealerTrack, Inc. v. Huber, 657 F. Supp. 2d 1152, 1153 (C.D. Cal. July 7, 2009)
CLAIMED: “A computer aided method of managing a credit application.”
HELD:  Unpatentable.  Each of the structures were not a “particular machine” pursuant to Bilski.  The patent “does not specify precisely how the computer hardware and database are ‘specially programmed,’ and the claimed central processor is nothing more than a general purpose computer that has been programmed in some unspecified manner.”

Research Corp. Techs. v. Microsoft Corp., No. CV-01-658, 2009 WL 2413623. (D. Ariz. July 28, 2009)
CLAIMED: “Image halftoning technology used in computers and printers.”
HELD:  Unpatentable. While other claims reciting “the production of an image as a result of the comparison numbers” were transformative, the claims at issue that merely “assembl[ed] … gray scale images to generate final dot profiles” were not transformative because they did not “mandate a further visual display or image."


Abstrax, Inc. v. Dell, Inc., No. 2:07-CV-221-DF-CE, 2009 WL 3255085, at *2 (E.D. Tex. Oct. 7, 2009)
CLAIMED:  “a method for assembling a product having components wherein the variable portions of a set of abstract assembly steps are resolved in accordance with data from a desired configuration.”
HELD: Patentable.  The data in the claim “represents physical and tangible objects and their respective structures” because it concerns “how parts, pieces, or components of a product fit together and how they are configured . . . the raw data is transformed into assembly instructions for assembling the product to have the requested configuration.”

Fuzzysharp Techs. Inc. v. 3D Labs Inc., Ltd., No. C 07-5948 SBA, 2009 WL 4899215, at *1 (N.D. Cal. Dec. 11, 2009).
CLAIMED: “mathematical algorithms that can be used to reduce the number of calculations required to determine whether a 3D surface is visible or invisible on a display screen.”
HELD:  Unpatentable.  “The salient question is not whether the claims are tied to a computer,” but “[r]ather, as Bilski makes clear, the question is whether the claims are ‘tied to a particular machine.’ . . . Courts applying Bilski have concluded that the mere recitation of ‘computer’ or reference to using a computer in a patent claim is insufficient to tie a patent claim to a particular machine.”

Accenture Global Servs. GmBH v. Guidewire Software Inc., --- F. Supp. 2d ---, 2010 WL
771595, at *2 (D. Del. 2010)
CLAIMED:  Patent directed to “a computer program for developing component based software for the insurance industry. The program includes a data component, a client component, and a controller component. The client component is responsible for allowing users to edit tasks, add new tasks, and ‘achieve an insurance-related goal upon completion,’ as well as to generate a historical record of completed tasks.”
HELD:  Wait until SCOTUS issues opinion.  In the meantime, the court found that the claims manipulated “non-tangible information” such as “the cost of automobile repair, hours worked, or the amount of medical expenses.”  Accordingly, “even if a tangle visual ‘display’ [was] provided, that visual image would not represent any specific tangible objects (or type of data).”

 
Read/download "Judicially Re(De)Fining Software Patent Eligibility: A Survey of Post-Bilski Jurisprudence" (link)