Kenneth Hartmann Harrity Team

Technical Details are Needed to Avoid Patent Eligibility Issues for Patent Applications

By Kenneth Hartmann, Associate

Many patent practitioners have likely found success in overcoming and/or avoiding 35 USC §101 rejections since the USPTO’s Revised Patent Subject Matter Eligibility Guidance was released last January.  However, the Federal Circuit (“the court”) recently made it clear that continued attention and care should be given when drafting patent applications focused on payment systems and/or payment processing.

In Innovation Sciences, LLC v., Inc. 2018-1495 (Fed. Cir. Jul. 2, 2019) (“Innovation Sciences v. Amazon”) the court determined that a claim to an “online method for a payment server to support online buying over the Internet” in U.S. Reissue Patent No. 46,140 (the ’140 patent) was ineligible under Step 2 of Alice.  More specifically, the court agreed with the district court that the claim was directed to the abstract idea of “securely processing a credit card transaction with a payment server” and that the claim lacked an inventive step, stating that the transmission of credit card payment information through the completion of a purchase are the same as those used in a “conventional Internet transaction system having adequate credit card information security” as admitted in the specification of the ’140 patent.

While Innovation Sciences argued that a “wherein” clause indicating the process involved a switch from a server with less security to a server with more security, the court held that that claim is directed to the abstract idea of “switching.”  The court further mentioned that the claim seeks to capture the broad concept of switching to a more secure server, rather than a “specific way of doing so.”  For Step 1 of the Alice test, the court indicated that the claim may have avoided being directed to an abstract idea if the claim and/or specification had indicated a specific way of carrying out the switch from a less secure server to a more secure server.

Patent applications directed to payments or other financial related processes will likely continue to receive the highest level of scrutiny with respect to patent eligibility due to the Alice decision being based on a financial/business method patent application.  The fact is, many of these patent applications and/or patents likely involve novel technical features, communications, and/or processes that were overlooked and/or not considered when the patent application was drafted.  In Innovation Sciences v. Amazon, the court specifically referred to a lack of detail with respect to switching between a less secure server and a more secure server.  In fact, the word “switched” is mentioned only ONCE in the specification and ONCE in a flowchart.  It is no wonder that the court found Innovation Science’s arguments regarding the switch between servers to be futile.

The ’140 patent claims priority to a patent application filed back in April 2000.  That was obviously a different era of patent preparation and prosecution.  Today, patent practitioners should consider and outline the technical aspects of processes (especially business method processes) without taking for granted that one or more steps of the process are inventive, in and of, themselves.  Clearly, the switch between servers, considered to be one step in the overall process for performing an online method for a payment server, involved its own processes and/or steps.  How/when was the decision made to switch the servers?  What parameters were used to select the new server?  How were those parameters analyzed to make the selection? What types of communications (and/or how many) were needed to perform the switch?  Again, it was a different era of drafting patent applications in 2000.  However, if the patent application drafter was able to predict the future, those are just a few example questions that, if answered in the claim and/or specification, would have improved Innovation Sciences’ case for patent eligibility.  Moreover, to have the best chances of success, patent drafters should continue to discuss the technical problems solved by these processes (and/or by the steps of the processes) and any corresponding technical benefits.

Kenneth Hartmann Harrity Team

Case Summary of Data Engine Technologies LLC v. Google LLC

By Ken Hartmann

Data Engine Technologies LLC v. Google LLC, 2017-1135 (Fed. Cir. Oct. 9, 2018) is an appeal from the district court for the District of Delaware (No. 1:14-cv-01115-LPS).  The district court held that the asserted claims of Data Engine Technologies’ (DET) US patents are ineligible under 35 USC §101.  This decision was based on finding that the asserted claims are directed to abstract ideas and fail to provide an inventive concept.

The patents at issue are U.S. Patent Nos. are 5,590,259; 5,784,545; 6,282,551; and 5,303,146.  The first three patents (referred to herein as “the Tab Patents”) are directed to electronic spreadsheets with tabs used to identify the spreadsheets and navigate between the spreadsheets.  The fourth patent (referred to herein as “the ‘146 patent”) is directed to identifying changes to spreadsheets.  This case law study analyzes the decision made by the court regarding the Tab Patents.

The Tab Patents are titled “Systems and Methods for Improved Spreadsheet Interface With User-Familiar Objects” and share a substantially common specification.  The Tab Patents describe a three-dimensional, electronic spreadsheet:

that includes a number of tabs to navigate through different two-dimensional matrices of the spreadsheet:

where each of the tabs include identifiers that enable access to information on the respective spreadsheets.

The Tab Patents describe the tabs as familiar, user-friendly interface objects to navigate through spreadsheets while circumventing arduous process of searching for, memorizing, and entering complex commands.  Accordingly, the Tab Patents present the tabs as a solution to problems that users had 25 years ago when navigating through complex spreadsheets, finding commands associated with the spreadsheets, manipulating the spreadsheets, etc.  Several articles associated with Quattro Pro (the commercial embodiment based on the claimed method and systems) were published that touted the usefulness of the technology in the Tab Patents.

DET filed suit against Google, asserting claims from the Tab Patents.  The district court considered claim 12 of the ‘259 patent as representative of all asserted claims of the Tab Patents.  Claim 12 of the ‘259 patent included the following features:

while displaying [a] first spreadsheet page, displaying a row of spreadsheet page identifiers along one side of said first spreadsheet page, each said spreadsheet page identifier being displayed as an image of a notebook tab on said screen display and indicating a single respective spreadsheet page, wherein at least one spreadsheet page identifier of said displayed row of spreadsheet page identifiers comprises at least one user-settable identifying character.

Google filed a motion for judgment on the pleadings under Federal Rule of Civil Procedure 12(c), arguing that the asserted claims of the Tab Patents are directed to patent-ineligible subject matter under § 101.  The district court granted the motion with respect to the Tab Patents, concluding that representative claim 12 is “directed to the abstract idea of using notebook-type tabs to label and organize spreadsheets” and that claim 12 “is directed to an abstract idea that humans have commonly performed entirely in their minds, with the aid of columnar pads and writing instruments.”  Further, the district court did not find that any features of claim 12 recited an inventive concept.

On appeal, the Court of Appeals for the Federal Circuit (the Court) analyzed whether the Tab Patents are patent eligible under §101 according to the two-step test of Alice Corp. v. CLS Bank International (“the Alice test).   In performing this analysis, the Court performed a de novo review of the Tab Patents and the evidence (including the articles about Quattro Pro) submitted to the district court.

The Court disagreed with Google, except with respect to claim 1 of the ‘551 patent.  Claim 1 of the ‘551 patent recites:

In an electronic spreadsheet for processing alphanumeric information, said […] electronic spreadsheet comprising a three-dimensional spreadsheet operative in a digital computer and including a plurality of cells for entering data and formulas, a method for organizing the three-dimensional spreadsheet comprising:

partitioning said plurality of cells into a plurality of two-dimensional cell matrices so that each of the two-dimensional cell matrices can be presented to a user as a spreadsheet page;

associating each of the cell matrices with a user-settable page identifier which serves as a unique identifier for said each cell matrix;

creating in a first cell of a first page at least one formula referencing a second cell of a second page said formula including the user-settable page identifier for the second page; and

storing said first and second pages of the plurality of cell matrices such that they appear to the user as being stored within a single file.

Note that claim 1 of the ‘551 patent does not include an “implementation of a notebook tab interface” as recited in representative claim 12 of the ‘259 patent.

In disagreeing with the district court and Google on representative claim 12 (and the remaining claims of the Tab Patents other than claim 1 of the ‘551 patent), the Court determined that claim 12 recites “a specific structure (i.e., notebook tabs) within a particular spreadsheet display that performs a specific function (i.e., navigating within a three-dimensional spreadsheet).”  The Court asserted that claim 12 claims a particular manner of navigating three-dimensional spreadsheets, implementing an improvement in electronic spreadsheet functionality.  The Court frequently referred to the benefits described in the specification with respect to navigating through the spreadsheets.  For example, the Court identified that claim 12 recited a structure that enables a user to avoid “the burdensome task of navigating through spreadsheets in separate windows using arbitrary commands.”

Further, the Court rejected Google’s notion that the claims merely cite “long-used tabs to organize information” and that such tabs are common in physical notebooks, binders, file folders, etc.  The Court stated that it is not enough to simply point to a real-world analogy of the electronic spreadsheet because eligibility is not based on such concerns.  Notably, the court acknowledged that those concerns are reserved for §102 and §103.  As such, the Court determined that claim 12 was not directed to an abstract idea, and thus was patent eligible according to step 1 of the Alice test.

On the other hand, during review of claim 1 of the ‘551 patent, the Court concluded, under step 1 of Alice test, that the above claim is directed to the abstract idea of “identifying and storing electronic spreadsheets.”  As mentioned above, claim 1 does not recite the notebook tab structure, but simply “associating each of the cell matrices with a user-settable page identifier which serves as a unique identifier for said each cell matrix.”  The Court concluded that claim 1 of the ‘551 patent does not recite the specific implementation of a notebook tab interface.  Furthermore, the Court concluded under step 2 of the Alice test that the additional features did not provide an inventive concept as the claim merely recites “partitioning cells to be presented as a spreadsheet, referencing in one cell of a page a formula referencing a second page, and saving the pages such that they appear as being stored as one file.”

This case provides a few practice insights for practitioners with a noticeable compare/contrast result between claim 12 of the ‘259 patent and claim 1 of the ‘551 patent.  First of all, it is important to identify any functionality that a particular feature of a claim may have.  Though an “identifier” may “identify,” such a feature is considered abstract.  The identifier in the Tab Patents included the function of enabling navigation between the tabs and reference to other information in spreadsheets associated with the tabs.  Including that functionality likely would have swayed the court to find the ‘551 patent eligible as well.  Additionally, the Court frequently referred to the benefits of the tabs.  These benefits included removing burdens on the user.  As such, it obviously would not hurt to acknowledge such benefits when preparing patent applications.  Best practices would also involve including and/or discussing any technical benefits that the tabs may have provided.  For example, among other technical benefits, the tabs may have conserved processing resources associated with navigating to other spreadsheets by enabling a single click of the tab, rather than navigating multiple clicks through menus and/or windows to reach other spreadsheets.

Download Data Engine Technologies LLC v. Google LLC

Harrity Blog

September 2018 – Creativity in Enhancing the Quality and Size of Patent Portfolios

By Nathan Phares and Kenneth Hartmann

One of the most challenging choices for an organization’s patent strategy is whether to focus on quality or quantity. A small number of high-quality patents may provide value and solid protection for some inventions, but innovation can occur at a fast pace, which may require rapid filings at a high volume. When presented with the challenge of increasing portfolio size without sacrificing patent quality or ballooning the budget, you, the patent practitioner (whether in-house or in private practice), may need to take creative steps to increase the number of ideas that are harvested from inventors, the number of patents that can be obtained for an idea or group of ideas, and the efficiency with which patents can be drafted. This article discusses several creative strategies to help grow a patent portfolio for your clients, whether they are a business unit of an organization or the organization itself. These creative strategies can be implemented prior to reaching the prosecution phase, both before patent applications are drafted and during the application drafting stage, without simply increasing patent expenditures.


Kenneth Hartmann Harrity Team

Kenneth Hartmann Joins Harrity & Harrity

Kenneth Hartmann has joined the firm as an Associate. He brings with him more than 10 years of experience in the patent field. Ken specializes in patent preparation and patent prosecution of electrical, electromechanical, and software technologies. He also has experience in portfolio analysis, validity and invalidity analysis, infringement analysis, and clearance opinions.
Prior to joining Harrity & Harrity, he worked in house at Hewlett Packard Enterprise. He also worked as a Patent Examiner at the United States Patent and Trademark Office.

Learn more about Ken and the rest of the Harrity & Harrity team HERE.