On April 14, 2020, the United States Court of Appeals for the Federal Circuit (“CAFC”) issued an opinion reversing a finding of patentability by the U.S. District Court for the Eastern District of Texas.
Ericsson Inc. v. TCL Commc’n Tech. Holdings Ltd., No. 2018-2003, __ F.3d __ (Fed. Cir. 2020). The CAFC first found in favor of appellant TCL on the procedural issue of whether it could decide TCL’s ineligibility argument, despite the issue not being raised below in its motion for judgment as a matter of law. Then, on the merits, the CAFC reversed the district court’s denial of TCL’s summary judgment motion that the asserted patent claims failed the Supreme Court’s two-step
Alice test, and were therefore unpatentable under 35 U.S.C. §101.
In November 2017, the district court denied TCL’s motion for summary judgment that the asserted claims of the patent-in-suit (the ’510 patent) were ineligible under Section 101. The case proceeded to trial, where the jury found claims 1 and 5 infringed, awarded damages, and further found TCL’s infringement willful. TCL moved for renewed judgment as a matter of law (“JMOL”) and a new trial on damages and willfulness, but did not raise issues related to patent eligibility. The district court ultimately denied both motions.
TCL appealed, raising, among other issues, that the claims were directed to patent ineligible subject matter, per Section 101.
Even though TCL did not address the Section 101 issue in its JMOL, the CAFC ruled that TCL did not waive its right to appeal the issue. The CAFC determined that, under CAFC and Fifth Circuit precedent (which appellee Ericsson argued applied), the district court’s denial of summary judgment effectively entered judgment of validity for Ericsson, which was sufficient to preserve the issue for appeal. The CAFC then ruled that it had discretion to hear the issue even if it was waived, citing CAFC and Fifth Circuit precedent to show that policies supporting the general waiver rule (
e.g., finality, conserving judicial resources, and avoiding “ambushes” on opposing parties) were not implicated because the issue had been fully briefed and heard by the district court and CAFC.
Turning to the merits, the CAFC addressed the two-step
Alice test for determining patent eligibility under 35 U.S.C. §101:
- determine whether the claims at issue are directed to one of the patent-ineligible concepts (such as an abstract idea); and if so, then
- determine whether the elements of the claim, considered both individually and as an ordered combination, recite an “inventive concept”—i.e., an element or combination of elements that is sufficient to ensure that the practice amounts to significantly more than a patent upon the [ineligible concept] itself.
Alice Corp. v. CLS Bank Int’l, 573 U.S. 208, 217–18 (2014) (internal quotation and citation omitted).
The ’510 patent is directed to “a system and method for controlling access to a platform for a mobile terminal for a wireless telecommunications system.” The asserted claims 1 and 5 require:
1. A system for controlling access to a platform, the system comprising:
a platform having a software services component and an interface component, the interface component having at least one interface for providing access to the software services component for enabling application domain software to be in-stalled, loaded, and run in the platform;
an access controller for controlling access to the software services component by a requesting application domain software via the at least one inter-face, the access controller comprising:
an interception module for receiving a request from the requesting application domain software to access the software services component;
and a decision entity for determining if the request should be granted wherein the decision entity is a security access manager, the security access man-ager holding access and permission policies; and
wherein the requesting application domain soft-ware is granted access to the software services component via
5. The system according to claim 1, wherein:
the security access manager has a record of re-questing application domain software; and the security access manager determines if the re-quest should be granted based on an identification stored in the record.
At
Alice Step One, the CAFC ruled that the claims amount to the “bare abstract idea” of “controlling access to resources by receiving a request and determining if the request for access should be granted.” The Court found unpersuasive Ericsson’s argument that this “idea” does not fall within the established categories of abstract ideas under §101 (
i.e., a “mathematical algorithm,” “method of organizing human activity,” or “fundamental economic practice”). The Court further found unpersuasive Ericsson’s argument that the claims are not directed to an abstract idea because they are limited to a specific environment (
i.e., mobile telephone systems), because limiting the abstract idea to a particular environment does not make the idea any less abstract. Finally, the Court rejected Ericsson’s argument that the claims are not abstract because they solve the specific problem of controlling app access in resource-constrained mobile phones, noting that nothing indicates that the asserted claims are limited to mobile platform technology.
At
Alice Step Two, Ericsson argued that the architecture of the invention provides the requisite inventive concept, as the arrangement of
horizontally partitioned functional software units is novel. Again, the CAFC disagreed, finding that particular arrangements are only read into the claim language when the patent specification is taken into account, and since the specification cannot be used to create details that are not expressly claimed, nothing in the claim language supported Ericsson’s argument.
The CAFC also addressed the district court’s finding of inventive concept. First, while the district court ruled that the claims create a technological improvement to the problem of limited memory resources in mobile phones, nothing in claims 1 or 5 are limited to mobile phones or make any mention of limited memory or resources. Second, the district court erred in construing a conclusion from a prior
inter partes review as suggesting that the claims are not merely conventional applications of computer technology. Accordingly, the CAFC ruled that the claims do not recite an inventive concept that would render eligible a claim directed to an abstract idea.
The reversal wiped out the jury’s verdict.
Although recent decisions have made it easier for patent owners to create issues of fact to defeat Section 101 motions (and district courts have become more reluctant to grant such motions, such as the Eastern District of Texas), this case is an interesting example showing that it is still possible for accused infringers to ultimately succeed on Section 101 grounds on the papers.
