Docket No. 2016-1499
LOURIE, REYNA, STOLL
April 28, 2017
Brief Summary: DC decision that RC’s claims are ineligible under § 101 affirmed (e.g., “[a]dding one abstract idea (math) to another abstract idea (encoding and decoding) does not render the claim non-abstract”).
Summary: RecogniCorp (RC) appealed PTO finding that its US 8,005,303 related to a method and apparatus for building a composition facial image patent ineligible under § 101. The PTO issued a reexamination certificate (during which litigation was stayed) for the ‘303 patent after RC added the limitation “‘wherein the composition facial image code is derived by performing at least one multiplication operation on a facial code using one or more code factors as input parameters to the multiplication operation’ (or a limitation substantially identical)”. After this decision, Nintendo asserted to the DC that the claims were ineligible under § 101. The FC opinion summarized the two-part Alice test (US 2014; Mayo US 2012): 1) “determine whether the claims at issue are directed to one of those patent-ineligible concepts” (“where the claims are directed to ‘a specific means or method’ for improving technology or…simply directed to an abstract end-result” (McRO, FC 2015); and, 2) are “the patent claims an ‘inventive concept’ sufficient to ‘transform’ the claimed abstract idea into a patent-eligible application”? Here, the DC determined the ‘303 claims “are ‘directed to the abstract idea of encoding and decoding composite facial images using a mathematical formulation” (analogizing it to “paint by numbers”) (step 1) and that “the entirety of the ‘303 Patent consists of the encoding algorithm itself or purely conventional or obvious pre-solution activity and post-solution activity insufficient to transform the unpatentable abstract idea into a patent-eligible application” (step 2). The FC opinion also explained that “not all claims in all software patents are necessarily directed to an abstract idea” (Ultramercial, FC 2014;), “such as an improvement in the functioning of a computer” but not “generalized steps to be performed on a computer using conventional computer activity” (Enfish, FC 2016). It found ‘303 claim 1 to be “directed to the abstract idea of encoding and decoding image data” (Cf. Intellectual Ventures, FC 2017 (organizing, displaying and manipulating data encoded for human- and machine-readability is directed to an abstract concept)). The FC panel agreed with RC that Diamond (US 1981) that SCOTUS in that case “focused not on the presence of a mathematical formula but on the subject matter of the claims as a whole”. However, it disagreed with RC’s conclusion from Diamond that its claims are patentable because “[a]dding one abstract idea (math) to another abstract idea (encoding and decoding) does not render the claim non-abstract.” The FC panel also concluded the ‘303 claims do “not claim a software method that improves the functioning of a computer” (Enfish), comparing this case to Digitech (FC 2014) in which “[a] process that started with data, added an algorithm, and ended with a new form of data was directed to an abstract idea.” Regarding Alice’s step 2, the FC panel found that RC did “not allege a particularized application of encoding and decoding image data” as “claim 1 does not even require a computer; the invention can be practiced verbally or with a telephone”, and “lack an inventive concept that transforms” the claimed subject matter as required. The DC decision was therefore affirmed.