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IP LitigationFederal Circuit

Claims to Guaranteeing a Party’s Performance of an Online Transaction Were Invalid Under Section 101

December 9, 2014

IP LitigationFederal Circuit

Claims to Guaranteeing a Party’s Performance of an Online Transaction Were Invalid Under Section 101

December 9, 2014

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buySAFE, Inc. v. Google, Inc., 765 F.3d 1350 (Fed. Cir. Sept. 5, 2014) (TARANTO and Hughes) (D. Del.: Stark) (3 of 5 stars)

 

Federal Circuit affirms judgment on the pleadings that claims are invalid under section 101. The claims covered methods and machine-readable media encoded to perform steps for guaranteeing a party’s performance of its online transaction. They were patent-ineligible under the Supreme Court’s two-step inquiry from Mayo and Alice, under which a claim falls outside section 101 if (a) it is “directed to” an abstract idea, and (b) “’the additional elements’ do not supply an ‘inventive concept’ in the physical realm of things and acts—a ‘new and useful application’ of the ineligible matter in the physical realm—that ensures that the patent is on something ‘significantly more than’ the ineligible matter itself.” Slip op. at 6 (quoting Alice, 134 S. Ct. 2347, 2355, 2357 (2014)).
“The claims in this case do not push or even test the boundaries of the Supreme Court precedents under section 101.” Id. at 8-9. First, they were directed to an abstract idea because they were “squarely about creating a contractual relationship—a ‘transaction performance guaranty’—that is beyond question of ancient lineage.” Id. at 9. Dependent claims limited to particular types of familiar relationships were still abstract. Second, the claims’ invocation of computers added no inventive concept. “The computer functionality is generic—indeed, quite limited: a computer receives a request for a guarantee and transmits an offer of guarantee in return. There is no further detail. That a computer receives and sends the information over a network—with no further specification—is not even arguably inventive.”

Related Tags

CAFC Summary
Section 101
Federal Circuit

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Craig Countryman | Principal

Craig Countryman is a Principal in the Southern California office of Fish & Richardson and was named a 2016 Rising Star by Law360, and was named to the "Top 40 Under 40" lists in both the Daily Journal and the San Diego Daily Transcript.  His practice...

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