Shakespeare’s Juliet famously observes, “What’s in a name? That which we call a rose by any other name would smell as sweet.” The PTAB begs to differ. While a generic computing device may not render abstract claims patentable, introduce it with a fancy nom de guerre and you have got yourself patentable subject matter.
In Hulu, LLC v. iMTX Strategic, LLC (CBM2015-00147), the PTAB rejected arguments that a claim to a system and method for sending encrypted media files upon request was more likely than not unpatentable under Section 101. The Board found that recitation of a “media server” and a “transaction server” necessarily rooted the claim in non-abstract computer technology. In doing so, the Board relied upon the Federal Circuit’s decision in DDR Holdings, LLC v. Hotels.com, L.P. for only the fourth time to find challenged claims patentable.
In the last six months, the PTAB has three times rejected other challenges under Section 101 after determining that the challenged claims were “necessarily rooted in computer technology.” In June, 2015, the PTAB declined to institute Covered Business Method review on Section 101 grounds of claims in patents directed to digital rights management owned by ContentGuard. See CBM2015-00040 and CBM2015-00043. The PTAB determined that the claimed method and system for enforcing licensed access to items by means of “meta-rights in digital form,” a “state variable,” and a “repository,” were directed to a particular way of creating and enforcing rights that “specifically arises in the realm of computer networks.” The PTAB did not examine whether any of these limitations reflected unconventional computer processing.
Again in June, the PTAB determined that claims directed to methods and systems for authenticating web pages were patent eligible. The claims called for the insertion of an “authentication key” into data. The petitioner posited that the claims were simply a computerized version of a notary affixing a seal to a document. Ironically, because the claim was even more abstract than the steps common to a notary’s work, the PTAB viewed the analogy as “strained.” See CBM2015-00027 (“On its face, there is nothing immediately apparent about the data processing operations recited in claim 1 to persuade us that the claim is directed to an abstract idea of notarizing documents. . . . [The claim] does not recite any information about the signatory, the notary, or the execution of the document.”) The PTAB distinguished earlier Section 101 cases on grounds that there the claims “closely reflected their analogous abstract human activity.” In contrast, the PTAB viewed the challenged claims as having “a degree of particularity not found in an abstract idea.” The PTAB emphasized the claim’s requirements that the key be inserted into “received” data, that the insertion create “formatted” data, that the data be returned from an “authentication host computer,” and that the key enable location of a “preferences file” from which an “authentication stamp” is retrieved. Again, the PTAB did not stop to consider the conventionality of these purportedly “particular” requirements.
More recently (not to mention more troubling), in October, 2015, the PTAB declined to institute review on Section 101 grounds of claims directed to correlating particular “electronic media works” with “media work identifiers.” The PTAB ruled in favor of patent owner Network-1 Technologies, finding that because the invention contemplated a search of a large volume of data, the claims necessarily would “require” use of a computer, and therefore did not constitute the mere implementation of a known abstract idea “from the business context.” See CBM2015-00113.
In Hulu, the PTAB has continued its expansion of the holding in DDR Holding. The challenged method and system claims called for the use of “media servers” storing digital media files and a “transaction server” that receives requests from users for certain media files and retrieves those files from the media servers. Despite finding that the prerequisites for review were met (i.e. at least one claim directed to a financial product or service that did not claim a “technological invention”), the PTAB nevertheless declined to institute review under Section 101. The PTAB observed the claims did not involve either “mathematical algorithms, [or] fundamental economic or conventional business practices.” The PTAB agreed with the patent owner that the challenged claims were directed to securely delivering media files using “tangible and concrete hardware that has been adapted for that purpose.” The PTAB was persuaded that the patent’s “media server” and “transaction server” were not “generic computers,” and for this reason, that the risk of preemption was “minimized.”
We agree with Patent Owner that the ʼ854 patent describes a media server (Fig. 3) and transaction server (Fig 4) that are not “generic computers.”
In the PTAB’s view, patentability appears to depend on whether the claims accord functional names to generic computers. Despite the obvious importance of these “concrete,” “tangible” limitations to its decision, the PTAB inexplicably failed to provide any construction for either of these two all–important server limitations. The PTAB merely hints at its construction by favorably referring to the following description provided by the Patent Owner:
The “transaction server” is adapted to connect to and communicate over the Internet, as opposed to a closed network, is responsive to a received media file request from a player/receiver, determines which content provider site contains the requested media file and sends an authorization to the provider site, via the Internet, for authorizing delivery of the requested media file. The “media server” is adapted to connect to and communicate over the Internet, as opposed to a closed network, uniquely encrypts the requested media file and downloads the encrypted media file directly to the requesting player/receiver via the Internet.
If one were to imagine a claim that had instead recited a “sever” adapted to perform each of these routine, conventional computer functions, it is hard to imagine that such a claim could withstand scrutiny under the Supreme Court’s decision in Alice Corp. Pty. Ltd. v. CLS Bank Intern. After all, in Alice the Supreme Court was unpersuaded by similar arguments that “specific hardware” was adequately recited by reference to a “data processing system,” a “communications controller,” and a “data storage unit.” At most, these server limitations simply link the performance of the method to a particular “technological environment”—something that is insufficient to bestow patent eligibility.
These four recent PTAB decisions imply a dangerous weakening of Alice. Patent Owners looking to avoid the PTAB’s application of Section 101 would be well advised to emphasize that their claims are not directed merely to a mathematical algorithm or to a fundamental, economic or conventional business practice. These decisions suggest that to withstand challenge a patent owner need only identify “concrete” and “tangible” components for which it has coined a technical sounding name. Juliet had it wrong. A generic computer by any other name will smell far sweeter.