Alice is Alive and Well!
April 21 2022
Not everything is patentable. First, only inventions are patentable. Second, only certain inventions are patentable. Four types of inventions are patentable: articles of manufacture, machines, processes, and compositions of matter. 35 U.S.C. §101. These four types of inventions are referred to as patent-eligible subject matter. Some things, referred to as patent-ineligible subject matter, are not patentable: laws of nature, natural phenomena, and abstract ideas.
In 2014, the Supreme Court established a two-part test to determine whether an invention is patent-eligible. Alice Corp. Pty. Ltd. v. CLS Bank International, 573 U.S. 208, 216, 219 (2014). The first step is a determination of whether the claimed invention falls within one of the categories of patent-ineligible subject matter. If it does, then the second step is a determination of whether the claimed invention has an inventive concept that transforms the patent-ineligible subject matter into something patentable.
Since Alice was decided in 2014, the federal courts have applied the Alice test to invalidate hundreds of patents on the grounds that they are directed to patent-ineligible subject matter. Through 2000, about 60% of the claims that have been challenged under §101 have been invalidated.
The Federal Circuit Court of Appeals recently invalidated two patents in cases under Alice. In Repifi Vendor Logistics v. Intellicentrics, 2022 U.S. App. LEXIS 6558 (Fed. Cir., March 15, 2022), the Federal Circuit affirmed a Texas district court’s dismissal of a patent infringement case. The patent covered a method of managing visitor access to access-controlled locations, such as hospitals. The method essentially automated the typical process in which a receptionist checks a visitor’s identification and provides them with access credentials. The claimed method included the steps of providing a credentialing system to visitors via a smartphone with GPS capability, enrolling the visitor in the credentialing system, and having the visitor check-in on the credentialing system. Repifi sued Intellicentrics for infringement in 2020. Intellicentrics moved to dismiss the case on the grounds that the patent was invalid under 35 U.S.C. §101. The district court granted the motion.
On appeal, the Federal Circuit affirmed. The court agreed with the district court that the claimed invention, a method of credentialing visitors and checking them in, was patent-ineligible subject matter. According to the court, “credentialing processes are a well-established business practice, a method for organizing human activity, and an abstract idea.” Thus, the first step of the Alice was met. The patent owner argued that step two of the Alice test was satisfied because the electronic badge system that the claimed method required to monitor visitors in real time was an inventive concept that transformed the patent-ineligible subject matter into patent-eligible subject matter. The court rejected this argument, finding that the use of electronic badges is conventional and not inventive. The court held that the claimed invention “stem[med] from the automation of a historically human process” and, therefore, failed to satisfy Alice’s second step.
In Worlds Inc. v. Activision Blizzard (Fed. Cir., March 10, 2022), the Federal Circuit summarily affirmed a Massachusetts district court’s grant of summary judgement of patent invalidity. Worlds owned patents covering methods of managing interactions of remote users in a virtual world. Worlds sued Activision in 2012, alleging that Activision’s “Call of Duty” game infringed Worlds’ patents. The district court applied the first step of the Alice test and held that the claimed method was directed to patent-ineligible subject matter, the abstract idea of crowd control through filtering. The court then held that the claimed method failed step two of the Alice test because there was no inventive concept that transformed the patent-ineligible subject matter into patent-eligible subject matter.