Federal Circuit Affirms Dismissal Of Complaint Asserting Ineligible Patent Claims
On March 15, 2022, the U.S. Court of Appeals for the Federal Circuit (“CAFC”) affirmed the judgment of the U.S. District Court for the Eastern District of Texas, dismissing the complaint of plaintiff Repifi Vendor Logistics, Inc. (“Repifi”) for failure to state a claim upon which relief can be granted, because the asserted claims are ineligible for patent protection under 35 U.S.C. § 101. Repifi Vendor Logistics, Inc. v. IntelliCentrics, Inc., __ F.4th __ (Fed. Cir. Mar. 15, 2022).
Repifi sued IntelliCentrics, Inc. and IntelliCentrics Global Holdings, Ltd. (“IntelliCentrics”) for infringement of a patent relating to methods of managing visitor access to restricted environments like hospitals, health care facilities, office buildings, and the like. Where conventional methods for managing visitor access typically involved a human receptionist sitting at a reception desk, verifying a visitor’s identity and issuing a temporary, limited-use paper identification badge, the claimed method of Repifi’s asserted patent purports to automate this credentialing process using, inter alia, an electronic badge that includes a display, and which is connected to a smartphone with GPS capability.
Shortly after Repifi filed its complaint, IntelliCentrics moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), on the grounds that the asserted claims of the patent are ineligible under Section 101 of the Patent Act. The district court granted IntelliCentrics motion, and Repifi appealed to the CAFC.
A patent eligibility analysis under Section 101 is governed by the Supreme Court’s two-step test set forth in Alice Corp. Pty. v. CLS Bank Int’l, 573 U.S. 208 (2014). Step one of the Alice test involves an analysis of whether the claims are directed to an ineligible concept (e.g., an abstract idea). If the claims are directed to a patent-ineligible concept, the analysis proceeds to step two, which asks whether the elements of the claim both individually and as an ordered combination transform the nature of the claim into a patent-eligible application.
On appeal, in response to the district court’s step-one-determination that Repifi’s asserted claim is directed to the abstract idea of “credentialing visitors and checking them in and out of an access-controlled environment,” Repifi argued that the claimed method is actually a technological solution that (i) provides improved visitor documentation compliance, (ii) obviates the need for unreliable hardware upon entry, and (iii) obviates the need for a human receptionist, as well as providing (unclaimed) improvements to computer operation. In rejecting Repifi’s argument, the CAFC agreed with the district court’s explanation that automating a credentialing process using existing technology such as smart phones and electronic badges does not save the claim from targeting an abstract concept.
With respect to step two of the Alice test, Repifi argued that the claimed method’s use of an electronic badge with a display that changes in real time is an inventive concept. However, the CAFC agreed with the district court’s rejection of this argument, explaining that the asserted patent’s specification acknowledged that these kinds of electronic badges were conventional and commercially available. The CAFC further agreed with the district court’s determination that the ordered combination of the asserted claim limitations does not satisfy step two of the Alice test, given that the purported improvements of the asserted patent—increasing speed and efficiency and removing the need for a printer—all stem from the automation of a historically human process. The CAFC stated that “automation of a long-standing human process cannot be the inventive concept because such automation is itself an abstract idea.”