Important Patent Case Law Decisions

BitLaw contains hypertext versions of the most important recent court cases dealing with Patent law. This document contains a brief summary of the recent cases, and links to those cases that have been added to BitLaw.

You may wish to go directly to one of the topical subheadings for this index:

Infringement Issues

Commil USA, LLC, Petitioner v. Cisco Systems, Inc. (S.Ct. 2015)
The court addressed the issue as to whether a good faith belief of patent invalidity is a defense to an allegation that the defendant's actions induced another to infringe under 35 U.S.C. 271(b). The majority opinion that that even a good faith belief that a patent was invalid is not a defense to a claim of induced infringement.
Global-Tech Appliances, Inc. v. SEB S.A. (S.Ct. 2011)
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Aro Manufacturing Co., Inc., et al. v. Convertible Top Replacement Co., Inc. (ARO I) (S.Ct. 1961)
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Aro Manufacturing Co., Inc., et al. v. Convertible Top Replacement Co., Inc. (ARO II) (S.Ct. 1964)
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Limelight Networks, Inc. v. Akamai Technologies, Inc. (S.Ct. 2014)
In this case, the Supreme Court broadly holds that there can be no liability for inducing patent infringement under 35 USC 271(b) unless there is actual direct infringement by some party under 35 USC 271(a). In this case, the Federal Circuit had applied its Muniauction decision relating to split infringement, and found that no one party had performed all the steps of the claim at issue. Furthermore, since no party controlled the other party to the extent required in Muniauction, there was no direct infringement. The Supreme Court overturned the Federal Circuit's additional finding that there could nonetheless be infringement under Section 271(b) of the act in spite of the lack of direct infringement. Although the Supreme Court hinted that the Muniauction decision should be reconsidered, it declined to directly address this issue.
Akamai Technologies v. Limelight Networks (Fed. Cir. en Banc 2015)
The Federal Circuit reconsiders its Muniauction decision and decides to establish a new test for direct infringement under 35 USC 271(a). The court found that infringement can be found "when an alleged infringer conditions participation in an activity or receipt of a benefit upon performance of a step or steps of a patented method and establishes the manner or timing of that performance." Alternatively, infringement can be found when "where two or more actors form a joint enterprise." In this case, Limelight customers had to tag and serve content if they wanted to use Limelight's content delivery service. As a result, those method steps are attributed to Limelight and Limelight is guilty of direct infringement since all the method steps were performed by or attributable to Limelight.

Patentable Subject Matter

Historical Cases through the 1980s

Gottschalk v. Benson (S. Ct. 1972)
In this case, the Supreme Court struggled with whether an algorithm to convert binary-coded decimal numbers into true binary numbers was considered patentable. The Court felt that a patent on this concept would pre-empt the entire mathematical algorithm. Since mathematics could be considered an abstract idea, and abstract ideas are not patentable, the Supreme Court held that the algorithm in question is not patentable.
Parker v. Flook (S. Ct. 1978)
Here, the Supreme Court examined whether a method for updating an alarm limit (used to signal abnormal conditions) in a catalytic conversion process was patentable. The only difference between the prior art and the invention was the algorithm that calculated the new alarm limit. The Court held that this was not patentable even though an additional step was included in the claim beyond merely the calculation step. The Court explicitly rejected the notion that "post-solution activity [alone]... can transform an unpatentable principle into a patentable process." Specifically, the court held that the invention could not be patented "not because it contains a mathematical algorithm as one component, but because once that algorithm is assumed to be within the prior art, the application, considered as a whole, contains no patentable invention."
Diamond v. Diehr (S. Ct. 1981)
In this 1981 case, the U.S. Supreme Court ordered the P.T.O. to grant a patent on an invention even though computer software was utilized. The invention in this case relates to a method for determining how rubber should be heated in order to be best "cured." The invention utilizes a computer to calculate and control the heating times for the rubber. However, the invention (as defined by the claims) included not only the computer program, but also included steps relating to heating rubber, and removing the rubber from the heat. The Supreme Court stated that in this case, the invention was not merely a mathematical algorithm, but was a process for molding rubber, and hence was patentable. This was true even though the only "novel" feature of this invention was the timing process controlled by the computer.

State Street Bank Through Bilski

State Street Bank & Trust Co. v. Signature Financial Group, Inc. (Fed. Cir. 1998)
In this case, the Federal Circuit determined that software programs that transform data are patentable subject matter under Section 101 of the Patent Act even when there is no physical transformation of an article. The court emphasized that software or other processes that yield a useful, concrete and tangible result should be considered patentable. The court also "laid to rest" the business method exception. This means that while prior courts considered business methods inventions to be unpatentable, the State Street court found that these inventions are as patentable as any other inventions.
In re Bilski (Fed. Cir. 2008)
The analysis in this case was reviewed and refined by the Supreme Court's Bilski decision. This case analyzed the patentability of processes where the process steps are not not necessarily performed on a computer. The majority decision has set forth a single test for determining the patentability of processes. This test holds that a process is patentable if "(1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing." This machine-or-transformation test applies to process claims, but it is not clear whether the decision should alter the analysis of apparatus claims (such as computer implemented software claims).
Bilski v. Kappos (S. Ct. 2010)
The Supreme court rejected the Federal Circuit's holding in In re Bilski that the machine-or-transformation test is the sole test to determine whether a particular process constitutes patent-eligible subject mater. Instead the test should be viewed as "a clue" to this analysis. The majority decided that the Bilski invention was not patent-eligible subject matter because it was an attempt to preempt an abstract idea. It is not clear from this decision what test or analysis should be used going forward to analyze whether a particular process is merely an abstract idea or not.
Research Corp. Technologies v. Microsoft Corp. (Fed. Cir. 2010)
The Federal Circuit determined that a a method of halftoning gray scale images was statutory subject matter under Section 101. The Federal Circuit declined to define the term "abstract idea," and then found that it "perceives nothing abstract in the subject matter of the [claimed] processes."
Cybersource Corp. v. Retail Decisions, Inc. (Fed. Cir. 2011)
Federal Circuit opinion applies the Supreme Court's Bilski v. Kappos decision to determine the patentability of a method for detecting fraud in a credit card transaction over the Internet. The Federal Circuit determined that the method did not pass the machine-or-transformation test as the method was not tied to any machine, including a computer or even the Internet itself. The court held that the process was an unpatentable mental process, which it found to be a subcategory of unpatentable abstract idea, and affirmed the decision in Benson that "methods which can be performed mentally, or which are the equivalent of human mental work, are unpatentable abstract ideas."
Ultramercial, LLC v. Hulu, LLC (Fed Circ. 2011)
This decision was overturned by the 2014 Ultramercial decision. The Federal Circuit found that a patent which covered method for monetizing and distributing copyrighted products over the Internet was patentable subject matter under Section 101 of the Patent Act. The Federal Circuit emphasized that the Supreme Court in Bilski v. Kappos found that the Machine-or-Transformation test was not dispositive, and "has far less application to the inventions of the Information Age." The court then emphasized that there is no good definition of abstractness in the Bilski  opinion, and that the Federal Circuit refused to create its own definition in its  Research Corp. v. Microsoft decision. The court then confirmed that even if a claim encompasses an abstract idea, the claim is still patentable if it is limited to an application of that idea.
Dealertrack, Inc. v. Huber (Fed. Cir. 2012)
The Federal Circuit found that a "computer aided" method of receiving and sending data between "terminal devices" and data "entry and display devices" (which were defined by the district court to be "any device, e.g., personal computer or dumb terminal") was unpatentable as an abstract idea. The court summarized the claim as covering the "processing [of] information through a clearinghouse." The court noted that patent did "not specify how the computer hardware and database are specially programmed to perform the steps claimed in the patent." The court found the claims covered the abstract idea of a clearinghouse process, and "[s]imply adding a 'computer aided' limitation to a claim covering an abstract concept, without more, is insufficient to render the claim patent eligible."
Fort Properties, Inc. v. American Master Lease LLC (Fed. Circ. 2012)
The Federal Circuit found that a patent related to claims in this case relate to a real estate business technique designed to produce certain tax saving to be unpatentable as an impermissible attempt to patent an abstract idea. Some of the claims were not tied to any computer system, but instead included steps of aggregating real estate into a portfolio, encumbering the property with an agreement, and "creating deedshares." Other claims only added a computer in the context of "using a computer to generate a plurality of deedshares." The Federal Circuit found that any ties in the patent claim to the real world were insufficient to allow this abstract concept to be patentable. The court noted that the invention in Bilski was also tied to the real world through commodities and money. Abstract concepts such as those disclosed in the present patent and in the Bilski patent cannot be transformed into patentable subject matter merely because of limited connections to the physical world such as written contract, deeds, or real property.

Mayo, Alice Corp. and Progeny

Mayo Collaborative Services v. Prometheus Laboratories, Inc. (S. Ct. 2012)
In this unanimous 2012 decision, the U.S. Supreme Court determined that a medical testing patent was unpatentable as nonstatutory subject matter under Section 101 of the Patent Act. The Court then recited the well-settled rule that laws of nature, like natural phenomena and abstract ideas, are not patentable. Nonetheless, the Court acknowledged that while laws of nature are not patentable, claims that contain a law of nature can be patentable as long as the claim applies the law of nature. The court was guided by two principles: that it is important that the claim does not preempt the entire use of the natural law, and that the additional elements added to the claim beyond the natural law must be significant in that they cannot merely involve steps that are well-understood, routine, and conventional. In this case, the Court found that the claim preempted the law of nature.
Bancorp Services, L.L.C. v. Sun Life Assurance Co. of Canada (Fed. Cir. 2012)
The Federal Circuit held that a computer-implemented method of managing a stable value protected life insurance policy was an unpatentable abstract idea. The Court treated system and medium claims the same as method claims. Citing the Mayo decision, the court "set aside" the abstract ideas and insignificant computer-based limitations and asked "what else is in the claims before us?"
CLS Bank Int'l v. Alice Corp. Pty. Ltd. (Fed. Cir. 2013)
This decision was overturned by the Supreme Court's Alice Corp. decision. This en banc decision of the Federal Circuit consists of four different opinions, none of which obtained the support of a majority of Federal Circuit judges.
Ultramercial v. Hulu (Fed. Cir. 2013)
This decision was overturned by the 2014 Ultramercial decision. This case, heard after remand based on the Federal Circuit's 2011 decision, reaffirmed the patentability of a computer implemented method for distributing products over the Internet.
Accenture Global Services v. Guidewire Software (Fed. Cir. 2013)
The Federal Circuit held that a computer-implemented method (and related system) for generating insurance related tasks based on rules constituted non-patentable subject matter under section 101. The Court identified the abstract idea as "generating tasks based on rules to be completed upon the occurrence of an event," and attempted to determine whether any "additional substantive limitations ... narrow, confine, or otherwise tie down the claim so that, in practical terms, it does not cover the full abstract idea itself." The court found that the claim limitations did not add "significantly more than the underlying abstract concept," and found the claims to be patent ineligible.
Association for Molecular Pathology V. Myriad Genetics, Inc. (S. Ct. 2013)
The Supreme Court analyzed the patentability of gene sequencing inventions under Section 101. The court found that isolating naturally occurring gene fragments did not result in the invention of anything that was not found in nature. This is true even though "isolating DNA from the human genome severs chemical bonds and thereby creates a nonnaturally occurring molecule." Thus, these gene fragments were not patent eligible under section 101. In contrast, the creation of a cDNA sequence from mRNA results in an exons-only molecule that is not naturally occurring. As a result, the cDNA sequence molecule was patent eligible subject matter.
Alice Corp. v. CLS Bank Int'l (S. Ct. 2014)
Relying on its Mayo v. Prometheus and Bilski v. Kappos decisions, the Supreme Court unanimously decided that the claims in this case were unpatentable under Section 101. The Court set forth a two-part test for analyzing whether or not a claim is unpatentable for claiming an abstract idea. First, it is necessary to determine whether or not the claim is "directed to" an abstract idea. While every claim may be considered to relate in some manner to an abstract concept, this decision appears to indicate that many such claims are not "directed to" an abstract idea, at least not to an "abstract idea" as the Court has used that term. Second, it is necessary to determine whether or not the claim contains an "inventive concept" outside the abstract idea, with the term "inventive concept" defined to mean "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.'"
Digitech Image Tech's v. Electronics for Imaging (Fed. Cir. 2014)
Patent claims relating to the generation and use of "profiles" for an imaging device, where the profiles described various properties of the device, were directed to ineligible patent subject matter..
Planet Bingo, LLC v. VKGS LLC (Fed. Cir. 2014)
As the process for managing a bingo game consisted of "solely" of mental steps that can be carried out using a pen and paper, the claims were not eligible under the Alice Corp. test.
buySAFE, Inc. v. Google, Inc. (Fed. Cir. 2014)
The Federal Circuit determined that patent claims to relating a guaranty service for online transactions is not patent eligible.
Ultramercial, Inc. v. HULU, LLC (Fed. Cir. 2014)
The Federal Circuit reconsiders its Ultramercial decision for the third time, this time in light of the Supreme Court's Alice Corp. decision. The Federal Circuit found that the invention was not related to patentable subject matter.
DDR Holdings, LLC v. Hotels.com (Fed. Cir. 2014)
In this post-Alice Corp.. decision, the Federal Circuit examines whether a software- related invention is patentable. This is one of the few appellate decisions after the Alice Corp. decision that found the invention to be eligible for protection under Section 101.
In re BRCA1-& BRCA2-Based Hereditary Cancer Test (Fed. Cir. 2014)
The Federal Circuit applied the Myriad of the Supreme Court, and found that primers were "structurally identical to the ends of DNA strands found in nature" and therefore are not eligible for patent protection even though they are synthetically generated. Furthermore, a method which is directed to the abstract idea of comparing genetic sequences was ineligible subject matter under the Alice Corp. decision.
Content Extraction and Transmission. v. Wells Fargo Bank (Fed. Cir. 2014)
The Federal Circuit evaluated claims relating to the receipt of certain data (from a scanner), recognizing data fields from that data, and then storing that data. The Court found that the claim was directed toward the abstract idea of "data collection, recognition, and storage," and that the remainder of the claim only recited computer components performing routine and ordinary functions.
OIP Technologies, Inc. v. Amazon. com, Inc. (Fed. Cir. 2015)
The Federal Circuit determined that the claims were related to the abstract concept of "price-optimization," and that none of the claim elements added anything other than routine use of a general purpose computer.
Internet Patents Corp. v. Active Network, Inc. (Fed. Cir. 2015)
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Intellectual Ventures I LLC v. Capital One Bank (Fed. Cir. 2015)
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Versata Development Group v. SAP America, Inc. (Fed. Cir. 2015)
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Vehicle Intelligence And Safety LLC v. Mercedes-Benz USA, LLC (Fed. Cir. 2015)
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Mortgage Grader V. First Choice Loan Services (Fed. Cir. 2016)
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In Re Smith (Fed. Cir. 2016)
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ENFISH, LLC v. Microsoft Corporation (Fed. Cir. 2016)
For only the second time, the Federal Circuit considers a computer-implemented invention after the Alice Corp. decision and finds the invention to be patent eligible subject matter. The Enfish decision is important as it establishes a mechanism to evaluate the first step in the Alice test as to whether a claim is "directed to" an abstract idea. The court explains that the claim is to be considered as a whole, and the "focus" or "character" of the claim is to be determined based on an evaluation of the specification. If the focus of the claim is on a technological improvement (to the computer or to another technology), the claim is patent-eligible subject matter and there is no need to evaluate step two of the Alice test.
In re TLI Communications LLC (Fed. Cir. 2016)
Five days after Enfish, the Federal Circuit was able to apply the new step one test to another computer- implemented invention. However, the court found that, inlike Enfish, the inventor here was not faced with a technological problem with a technical solution. Although the invention was related to digital images taken and classified on a smart phone, and then automatically stored according to the classification information, the court felt this was an administrative as opposed to technical issue.
Bascom Global Internet Services, Inc. v. AT&T Mobility LLC (Fed. Cir. 2016)
Bascom is important because the Federal Circuit takes a new approach in analyzing step two of the Alice test. In particular, the Federal Circuit found that even when all of the claim elements being analyzed in step two are well-known, "an inventive concept can be found in the non-conventional and non-generic arrangement of known, conventional pieces." This opens a new avenue for explaining that a claim is subject matter eligible under step two of the Alice test.
Rapid Litigation Management LTD. v. CellzDirect, Inc. (Fed. Cir. 2016)
This decision found a process for re-freezing liver cells to be patent eligible under both step one and step two of the Alice test. Under step one, the court noted that it was “not enough to merely identify a patent-ineligible concept underlying the claim; we must determine whether that patent-ineligible concept is what the claim is ‘directed to.’” In this case, the claim was directed to a new and useful laboratory technique, not the natural law underlying the claim.
Electric Power Group, LLC v. Alstom SA (Fed. Cir. 2016)
The Federal Circuit applies the Enfish decision with respect to step one of the Alice test. The court looked at the character of the claim as a whole, but found the claim directed to the abstract idea of collecting and analyzing data. The claim was not patent- eligible, because it also failed to include an inventive concept under step two of the test.
McRO, INC. v. Bandai Namco Games America Inc. (Fed. Cir. 2016)
In McRO, the court again analyzed the claims "as a whole" under step one of the Alice test (as required by Enfish. After this analysis, the court found that claims directed to using a set of rules to set parameters for a digital animation software process was directed to a technological improvement, and not directed to an abstract idea. As a result, the claim is patent-eligible under step one.

Provisional Patent Applications

New Railhead Manufacturing L.L.C. v. Vemeer Manufacturing Co. (Fed. Cir. 2002)
In this case, the plaintiff invented a new drill bit where the bit body is "angled with respect to the sonde housing." While this angle was described in the non-provisional patent application, the angle was not disclosed in the originally filed provisional application. Unfortunately, the plaintiff had offered the drill bit for sale more than one-year before the non-provisional filing date, and therefore the patent would be invalid under the statutory bar section of 35 U.S.C. 102(b) unless the patent was entitled to the filing date of the provisional application. Since the claim limitation of the angled drill bit body was not adequately disclosed in the provisional application, the inventor could not claim the benefit of the provisional application and the patent was declared invalid.