The Court of Appeals for the Federal Circuit upheld a district court decision finding that certain patent claims were not patent-eligible under 35 U.S.C. § 101 and Alice Corp. v. CLS Bank Int’l, 134 S. Ct. 2347, 2355 (2014). The patent related to a “self-evolving generic index” for organizing information stored in a database. This indexing software organizes information about various items using classifications, parameters, and values. The Court viewed these indexes based upon classifications, parameters, and values as using “historical usage information.”“At Alice step two, it is irrelevant whether considering historical usage information while inputting data may have been non-routine or unconventional as a factual matter. As a matter of law, narrowing or reformulating an abstract idea does not add ‘significantly more’ to it.” BSG Tech LLC v. Buyseasons, Inc., Case No. 2017-1980 (Fed. Cir. Aug. 15, 2018) (pdf of opinion available here).
BSG Tech sued BuySeasons for infringement of several patents related to systems and methods for indexing information stored in wide access databases. BuySeasons sought dismissal of the suit based on its contention that none of the asserted patent claims were patent-eligible under 35 U.S.C. § 101. The district court ultimately agreed with BuySeasons and held all asserted claims invalid as ineligible under § 101. The Federal Circuit affirmed the lower court decision.
The BSG Tech patents are directed to a “self-evolving generic index” for organizing information stored in a database. This indexing software organizes information about various items using classifications, parameters, and values. For example, information about a car could be organized as a series of classifications, such as a first “Automobile” classification, a second “Used Vehicle” classification, and a third “Sports Utility Vehicle” classification. Alternatively, items could be described using parameters and values. A parameter is a set of qualities that an item could possess, while a value is the specific quality that the item possesses. For instance, items in the database could be classified using the “color” parameter, while each item in the database will have a specific color value like “red” or “blue.”
Prior art indices also organized information using classifications, parameters, and values.
Claim 1 recited: A method ] providing the users with a mechanism for posting the data as parametized items; [b] providing the users with listings of previously used parameters and previously used values for use in posting the data; [c] providing the users with summary comparison usage information corresponding to the previously used parameters and values for use in posting the data; and [d] providing subsequent users with the listings of previously used parameters and values, and corresponding summary comparison usage information for use in searching the network for an item of interest.
Another claim recited: A method of indexing an item on a database, comprising:[i] providing the database with a structure having a plurality of item classifications, parameters, and values, wherein individual parameters are independently related to individual item classifications, and individual values are independently related to individual parameters; [ii] guiding the user in selecting a specific item classification for the item from the plurality of item classifications; [iii] storing the item on the database as a plurality of user-selected item classification/parameter value combinations; and [iv] guiding the user in selecting at least one of (a) the parameters of the combinations by displaying relative historical usage information for a plurality of parameters previously used by other users, and (b) the values of the combinations by displaying relative historical usage information for a plurality of values previously used by other users.
Section 101 of the Patent Act provides that a patent may be obtained for “any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof.” This provision contains an implicit exception that “[l]aws of nature, natural phenomena, and abstract ideas are not patentable.” Ass’n for Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. 576, 589 (2013) (quoting Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66, 70 (2012)). The Court determines whether a claim covers ineligible subject matter under § 101 through a two-step test under Alice Corp. v. CLS Bank Int’l, 134 S. Ct. 2347, 2355 (2014). At step one, the Court “determine[s] whether the claims at issue are directed to one of those patent-ineligible concepts.” Id. “If so, we consider at step two whether the elements of each claim, both individually and as an ordered combination, ‘transform the nature of the claim’ into a patent-eligible application.’” Id. (quoting Mayo, 566 U.S. at 78).
The Federal Circuit agreed with the district court that the asserted claims are directed to the abstract idea of considering historical usage information while inputting data. Claim 1 of the ’699 patent recites a method of indexing wherein a user adds data to a database using “a mechanism for posting the data as parametized items” after receiving “summary comparison usage information” about parameters and values selected by prior users.
BSG Tech argues that the patent claims require a specific database structure. The “mechanism for posting the data as parametized items” limitation requires a database that allows users to input data and can store user-input data as classifications, parameters, and values.
Here, the recited database structure provides a generic environment in which the claimed method is performed. “The ’699 specification makes clear that databases allowing users to post parametized items were commonly used at the time of invention. Thus, the recitation of a database structure slightly more detailed than a generic database does not save the asserted claims at [Alice Corp] step one.”
Second, BSG Tech argues that the “summary comparison usage information” is narrower than“historical usage information.
“Moreover, regardless of how narrow ‘summary comparison usage information’ may be relative to the category of ‘historical usage information,’ this does not affect whether the claims are directed to an abstract idea at Alice’s step one. TLI Commc’ns, 823 F.3d at 611. In Content Extraction, Two-Way Media Ltd. v. Comcast Cable Communications, LLC, 874 F.3d 1329 (Fed. Cir. 2017). These cases reflect that a claim is not patent eligible merely because it applies an abstract idea in a narrow way. For an application of an abstract idea to satisfy step one, the claim’s focus must be something other than the abstract idea itself.”
Third, BSG Tech argued that its claims focus on a non-abstract improvement in database functionality.
The benefits described by BSG “are not improvements to database functionality. Instead, they are benefits that flow from performing an abstract idea in conjunction with a well-known database structure.”
“At step two, if claims are directed to a patent-ineligible concept, ‘we consider the elements of each claim both individually and ‘as an ordered combination’ to determine whether the additional elements ‘transform the nature of the claim’ into a patent-eligible application.’ Alice, 134 S. Ct. at 2355 (quoting Mayo, 566 U.S. at 78–79). … At step two, we search for an ‘inventive concept’ . . . that is ‘sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the [ineligible concept] itself.’ Alice, 134 S. Ct. at 2355 (internal quotation marks omitted) (quoting Mayo, 566 U.S. at 72–73). After identifying an ineligible concept at step one, we ask at step two ‘[w]hat else is there in the claims before us?’ Mayo, 566 U.S. at 78.”
Here, the only alleged unconventional feature of BSG Tech’s claims is the requirement that users are guided by summary comparison usage information or relative historical usage information. But this simply restates what we have already determined is an abstract idea. At Alice step two, it is irrelevant whether considering historical usage information while inputting data may have been
non-routine or unconventional as a factual matter. As a matter of law, narrowing or reformulating an abstract idea does not add “significantly more” to it. See SAP Am., Inc. v. InvestPic, LLC, No. 2017-2081, slip op. at 14 (Fed. Cir. Aug. 2, 2018).