Internet Patents Corp. v. Active Network, Inc.

• Decision Date: 23 June 2015
• Docket Number: 2014–1061,2014–1062,2014–1063.,Nos. 2014–1048,s. 2014–1048
• Citation: Internet Patents Corp. v. Active Network, Inc., 790 F.3d 1343, 115 U.S.P.Q.2d 1414 (Fed. Cir. 2015)
• Parties: INTERNET PATENTS CORPORATION, f/k/a Insweb Corporation, Plaintiff–Appellant v. ACTIVE NETWORK, INC., the General Automobile Insurance Services, Inc., d/b/a the General, Permanent General Assurance Corporation, Permanent General Assurance Corporation of Ohio, QuinStreet, Inc., Tree.com, Inc. Defendants–Appellees.
• Court: U.S. Court of Appeals — Federal Circuit

790 F.3d 1343

115 U.S.P.Q.2d 1414

INTERNET PATENTS CORPORATION, f/k/a Insweb Corporation, Plaintiff–Appellant

v.ACTIVE NETWORK, INC., the General Automobile Insurance Services, Inc., d/b/a the General, Permanent General Assurance Corporation, Permanent General Assurance Corporation of Ohio, QuinStreet, Inc., Tree.com, Inc.Defendants–Appellees.

Nos. 2014–1048

2014–1061

2014–1062

2014–1063.

United States Court of Appeals, Federal Circuit.

June 23, 2015.

Joseph Greco, Beck, Ross, Bismonte & Finley, LLP, San Jose, CA, argued for plaintiff-appellant.Also represented by Justin Beck, Kimberly Zapata.

Matthew D. Murphey, Troutman Sanders LLP, Irvine, CA, argued for defendant-appelleeActive Network, Inc.Also represented by Meghan Canty Sherrill.

John Francis Triggs, Patterson Intellectual Property Law, P.C., Nashville, TN, argued for defendants-appelleesThe General Automobile Insurance Services, Inc., Permanent General Assurance Corporation of Ohio, QuinStreet, Inc.Defendants-appelleesThe General Automobile Insurance Services, Inc., Permanent General Assurance Corporation of Ohio also represented by Ryan D. Levy.Defendant-appelleeQuinStreet, Inc., represented by Thomas F. Fitzpatrick, Andy H. Chan, Pepper Hamilton LLP, Redwood City, CA.

Stephen S. Korniczky, Sheppard, Mullin, Richter & Hampton LLP, San Diego, CA, argued for defendant-appelleeTree.com, Inc.Also represented by Edward V. Anderson, Deepali Brahmbhatt, Michael Murphy.

Before NEWMAN, MOORE, and REYNA, Circuit Judges.

Opinion

NEWMAN, Circuit Judge.

Internet Patents Corporation(IPC) appeals the judgments of the United States District Court for the Northern District of California, dismissing the complaints in four related actions for infringement of U.S. PatentNo. 7,707,505(the '505 Patent) on the ground of patent ineligibility under 35 U.S.C. § 101.¹

IPC had filed suits for infringement of the '505 Patent against The General Automobile Insurance Services, Inc.(“The General”); Active Network, Inc.(“Active”); Tree.com, Inc.(“Tree.com”); and QuinStreet, Inc.(“QuinStreet”).The district court, applying 35 U.S.C. § 101, held the ' 505 Patent invalid for failure to meet the eligibility requirements of patentable subject matter.IPC appealed, and while the appeal was pending, the Supreme Court decided Alice Corp. v. CLS Bank International,––– U.S. ––––, 134 S.Ct. 2347, 189 L.Ed.2d 296(2014).We requested, and received, supplemental briefing addressing the relevance of Alice to this case.We now affirm the judgment of the district court.

Background

As the district court stated, the '505 Patent claims “the use of a conventional web browser Back and Forward navigational functionalities without data loss in an online application consisting of dynamically generated web pages.”Dist. Ct. Op.at 1269.The court described the '505 Patent subject matter as “retaining information lost in the navigation of online forms,”id., and deemed this to be an abstract concept and thus ineligible for patenting:

The Court finds that by setting out the abstract idea of a known technological challenge without setting out any specific disclosures, the Patent “added no elements or combination of elements, sometimes referred to as the inventive concept, sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the natural law [or the abstract idea].”

Id.(alteration in original)(quotingMayo Collaborative Servs. v. Prometheus Labs., Inc.,––– U.S. ––––, 132 S.Ct. 1289, 1294, 182 L.Ed.2d 321(2012) ).

Claim 1 is the broadest claim:

1.A method of providing an intelligent user interface to an online application comprising the steps of:

furnishing a plurality of icons on a web page displayed to a user of a web browser, wherein each of said icons is a hyperlink to a dynamically generated online application form set, and wherein said web browser comprises Back and Forward navigation functionalities;

displaying said dynamically generated online application form set in response to the activation of said hyperlink, wherein said dynamically generated online application form set comprises a state determined by at least one user input; and

maintaining said state upon the activation of another of said icons, wherein said maintaining allows use of said Back and Forward navigation functionalities without loss of said state.

A principal issue is whether the additional limitations in other claims of the '505 Patent rescue this method from ineligible abstraction.IPC argues that the invention is not an abstract idea, but a tangible and useful improvement over prior computer-implemented methods of entering information into online application forms.The specification states:

In contrast to the prior art, the present system, in all its embodiments, maintains virtual application information, relative dependencies, and information context obtained and/or derived from each pane accessed by the user/applicant.

'505 Patent, col. 9 ll. 60–66.IPC states that the specified limitations remove the claims from abstraction, citing the “maintaining state” limitation, the furnishing of icons as separate hyperlinks to an online application, and using the Back and Forward buttons without losing data previously entered in the application form.IPC states that its method is a technical advance over the prior art, referring to the Court's guidance in Alice.

The district court held that the several claimed steps did not add an inventive concept, including the “maintaining state” limitation on which IPC focuses on appeal.

Discussion

I

Section 101 defines patent eligible subject matter as “any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof.”Precedent has long established that eligible subject matter does not include laws of nature, natural phenomena, and abstract ideas.Other than as so limited, the patent system is described as available to “anything under the sun that is made by man.”Diamond v. Chakrabarty,447 U.S. 303, 309, 100 S.Ct. 2204, 65 L.Ed.2d 144(1980)(quotingS.Rep. No.1979, 82d Cong., 2d Sess., 5(1952);H.R.Rep. No.1923, 82d Cong., 2d Sess., 6(1952)).Yet the technologies of recent decades have challenged the understandings of a simpler past.

Recently, the courts have focused on the patent eligibility of “abstract ideas,” for precision has been elusive in defining an all-purpose boundary between the abstract and the concrete, leaving innovators and competitors uncertain as to their legal rights.The present framework starts with the case of Bilski v. Kappos,561 U.S. 593, 130 S.Ct. 3218, 177 L.Ed.2d 792(2010), where the Court held that the generally known idea of hedging commodities is not rescued from “abstraction” through the use of computer technology.

In Mayo, supra,the Court introduced the “inventive concept” protocol to probe the categories of laws of nature, natural phenomena, and abstract ideas.The Court set forth a two-step methodology for determining patent-eligible subject matter.“First, we determine whether the claims at issue are directed to one of those patent-ineligible concepts.”Alice,134 S.Ct. at 2355.If so, the court then considers the elements of each claim “both individually and ‘as an ordered combination’ to determine whether the additional elements ‘transform the nature of the claim’ into a patent-eligible application.”Id.(quotingMayo,132 S.Ct. at 1298, 1297 ).

The Court described this second step as “a search for an ‘inventive concept’—i.e., an element or combination of elements that is ‘sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the [ineligible] concept itself.’ ”Alice,134 S.Ct. at 2355(alteration in original)(quotingMayo,132 S.Ct. at 1294 ).By “consider[ing] all claim elements, both individually and in combination, [this methodology] is consistent with the general rule that patent claims ‘must be considered as a whole.’ ”Alice,134 S.Ct. at 2355 n. 3(quotingDiamond v. Diehr,450 U.S. 175, 188, 101 S.Ct. 1048, 67 L.Ed.2d 155(1981) ).

Under step one of Mayo/Alice , the claims are considered in their entirety to ascertain whether their character as a whole is directed to excluded subject matter.However, this determination alone does not render the subject matter ineligible.In Mayo, the excluded subject matter was a law of nature, “namely, relationships between concentrations of certain metabolites in the blood and the likelihood that a dosage of a thiopurine drug will prove ineffective or cause harm.”132 S.Ct. at 1296.The Court distilled this ineligible concept from the claims as a whole, and found no inventive concept in routine application of this law of nature.

In Alice,the Court found that the claims were directed to the abstract idea of intermediated settlement, and that no claim elements, alone or in combination, provided the inventive concept of patent-eligible subject matter.134 S.Ct. at 2356.The Court held that the known practice of reducing financial risk by passing funds through a “third-party intermediary” did not lose its character as an abstract idea.Although computer capability achieved financial activity of a scope not previously available, no inventive concept was found in the claims, for the “computer functions are ‘well-understood, routine, conventional activities' previously known to the industry.”Id. at 2359(quotingMayo,132 S.Ct. at 1294 ).

The two-step analytic protocol introduced in Mayo directs attention to whether the claim contains an “inventive concept.”Determination of what is an inventive concept favors inquiries analogous to those undertaken for determination of patentable invention, for a known idea, or one that is routine and conventional, is not inventive in patent terms, as the Court found in Bilski, Mayo , and Alice.For Bilski and Alice, the conventional idea was based on the use of computers to conduct known forms of financial transactions.For Mayo,the Court held that...