By Albert W. Vredeveld, Shumaker & Sieffert, P.A.

Patentees now have another valuable Federal Circuit decision to use to counter allegations that their claims are directed to ineligible subject matter under 35 U.S.C. § 101.

In Bascom Global Internet Services, Inc. v. AT&T Mobility LLC 15-1763, Judge Chen, joined by Judges Newman and O’Malley, held that US patent 5,987,606 (the ‘606 patent) claimed eligible subject matter under 35 USC 101.  The ‘606 patent relates to the filtering of internet content for the purpose of preventing users from accessing objectionable websites, such as entertainment-oriented websites or websites containing sexually-explicit content.  The ‘606 patent explained that the previous filtering systems involved software installed on individual local client devices.  Furthermore, the ‘606 patent indicated that such software was susceptible to circumvention, was not easily deployed, and had other shortcomings.  Other prior art described filtering software running on a local server, such as a server run by a corporation.  Still other prior art described filtering at a remote server of an Internet Service Provider (ISP).  However, the ‘606 patent indicated that these server-based solutions did not allow for customizing access for different users. 

The ‘606 patent purported to address these issues by having user-customizable filtering software run at a server of an ISP.  Claim 1 of the ‘606 patent reads:

1. A content filtering system for filtering content retrieved from an Internet computer network by individual controlled access network accounts, said filtering system comprising:

a local client computer generating network access requests for said individual controlled access network accounts;

at least one filtering scheme;

a plurality of sets of logical filtering elements; and

a remote ISP server coupled to said client computer and said Internet computer network, said ISP server associating each said network account to at least one filtering scheme and at least one set of filtering elements, said ISP server further receiving said network access requests from said client computer and executing said associated filtering scheme utilizing said associated set of logical filtering elements.

Bascom sued AT&T for infringement of the ‘606 patent.  In response, AT&T moved to dismiss the suit under FRCP 12(b)(6) on the basis that each claim of the ‘606 patent is invalid.  The district court sided with AT&T.  Specifically, the district court found that the claims were directed to the abstract idea of “filtering content” because “content provided on the Internet is not fundamentally different from content observed, read, and interacted with through other mediums like books, magazines, television, or movies.”  The district court further determined that the limitations in combination were not inventive either because “[f]iltering software, apparently composed of filtering schemes and filtering elements, was well-known in the prior art” and “using ISP servers to filter content was well-known to practitioners.”

Judge Chen agreed with the district court that the claims were directed to the abstract idea of filtering content under step 1 of the Alice test.  In his step 1 analysis, Judge Chen stated “We agree with the district court that filtering content is an abstract idea because it is a longstanding, well-known method of organizing human behavior, similar to concepts previously found to be abstract.”  Judge Chen distinguished the claims of the ‘606 patent from Enfish LLC v. Microsoft Corp., 2016 WL 2756255 (Fed. Cir. May 12, 2016), on grounds that the claimed subject matter is more of a “close call” than Enfish with regard to whether the subject matter is directed to an improvement in computer capabilities.  Specifically, Judge Chen stated,

This case, unlike Enfish, presents a “close call[ ] about how to characterize what the claims are directed to.” See id. at *8. The Enfish claims, understood in light of their specific limitations, were unambiguously directed to an improvement in computer capabilities. See id. at *5. Here, in contrast, the claims and their specific limitations do not readily lend themselves to a step-one finding that they are directed to a nonabstract idea.

Thus, rather than having to make a determination based solely on step 1 of the Alice analysis, Judge Chen moved on to the “significantly more” step 2 of the Alice test.  Judge Chen agreed with the district court that “the limitations of the claims, taken individually, recite generic computer, network and Internet components, none of which is inventive by itself.” 

However, in his step 2 analysis, Judge Chen held that the arrangement of the components was relevant in determining that the claim recites significantly more than the abstract idea. 

Filtering content on the Internet was already a known concept, and the patent describes how its particular arrangement of elements is a technical improvement over prior art ways of filtering such content. Filtering content on the Internet was already a known concept, and the patent describes how its particular arrangement of elements is a technical improvement over prior art ways of filtering such content. As explained earlier, prior art filters were either susceptible to hacking and dependent on local hardware and software, or confined to an inflexible one-size-fits-all scheme. BASCOM asserts that the inventors recognized there could be a filter implementation versatile enough that it could be adapted to many different users’ preferences while also installed remotely in a single location. Thus, construed in favor of the nonmovant— BASCOM—the claims are “more than a drafting effort designed to monopolize the [abstract idea].” Alice, 134 S. Ct. at 2357. Instead, the claims may be read to “improve[ ] an existing technological process. (Emphasis added)

Additionally, Judge Chen analogized the step 2 analysis to the analysis of 35 U.S.C. § 103.  Specifically, Judge Chen stated, with emphasis added,

The district court’s analysis in this case, however, looks similar to an obviousness analysis under 35 U.S.C. § 103, except lacking an explanation of a reason to combine the limitations as claimed. The inventive concept inquiry requires more than recognizing that each claim element, by itself, was known in the art. As is the case here, an inventive concept can be found in the non-conventional and non-generic arrangement of known, conventional pieces.

Furthermore, likening the claims of the ‘606 patent to those of DDR Holdings, LLC. v. Hotels.com, L.P., 773 F.3d 1245 (Fed Cir. 2014), Judge Chen noted that that ‘606 patent claims,

a technology-based solution (not an abstract-idea-based solution implemented with generic technical components in a conventional way) to filter content on the Internet that overcomes existing problems with other Internet filtering systems. By taking a prior art filter solution (one-size-fits-all filter at the ISP server) and making it more dynamic and efficient (providing individualized filtering at the ISP server), the claimed invention represents a “software-based invention[ ] that improve[s] the performance of the computer system itself.”

For patent practitioners, one significant takeaway from Bascom is that you can respond to a rejection under 35 USC 101 by arguing that, even if the individual components of your system are conventional, a specific arrangement of those components for the purpose of providing a technical improvement is sufficient to win under step 2 of the Alice test.  Hence, if the claims do not recite, for purposes of step 1 of the Alice test, subject matter that constitutes a specific improvement to the operation of a computer, per Enfish, eligibility still may be found under step 2 of the Alice test.

Furthermore, Bascom clarifies when to transition from step 1 to step 2 of the Alice test. For instance, the finding of patent eligibility in DDR Holdings seemed to be a mixture of steps 1 and 2 of the Alice test.  However, Bascom clarifies that when there are reasonable arguments on either side as to whether a claim is directed to an abstract idea in step 1, the question of patent eligibility can be resolved under step 2. 

Thus, when responding to a rejection of a claim under 35 U.S.C. § 101, a patent practitioner can first argue that the claim is unambiguously directed to a technological improvement using the analysis of Enfish, and thereby be ruled eligible under step 1 of the Alice test.  The patent practitioner can then transition to step 2 fallback arguments based on the analysis of Bascom, asserting that even if this is considered a “close call”, the claim recites patent eligible subject matter because the specific arrangement of features in the claim improves a technological process.