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Credit Acceptance Corp. v. Westlake Services (859 F.3d 1044)

Representative Claim

25. A system for generating financing packages provided by a financing party, for a customer purchase of a product from a dealer’s inventory of a plurality of products, the system comprising:

a database for storing information related to products in the dealer’s inventory including a dealer cost associated with each product;

a user terminal, communicatively coupled to said database, for receiving financial information about the customer in relation to said products; and

a server having access to the data in the database adapted to communicate with the user terminal over a network, whereby the financial information about the customer may be transmitted to the server, the server generating a financing package for each product in the dealer’s inventory and transmit financing terms for each financing package to the user terminal via the network for presentation to the user for immediate purchase, wherein the server is further configured such that the financing terms of each financing package include an advance amount to be paid to the dealer by said financing party if the customer purchases the product associated with the financing package.


Appeal from the United States Patent and Trademark Office, Patent Trial and Appeal Board in No. CBM2014-00176.

Abstract Idea: Yes

The Federal Circuit agreed with the Board’s Step One determination that the claims are directed to the abstract idea of “processing an application for financing a purchase,” stating:

“We see no meaningful distinction between this type of financial industry practice and ‘the concept of intermediated settlement’ held to be abstract in Alice, 134 S. Ct. at 2356, or the ‘basic concept of hedging’ held to be abstract in Bilski v. Kappos, 561 U.S. 593, 611 (2010).”

The Federal Circuit went on to note that “the ’807 patent specification itself demonstrates that processing an application for financing a purchase is ‘a fundamental economic practice long prevalent in our system of commerce.’”

The Federal Circuit declined to accept arguments from the patentee that, like Enfish, “the claims are not abstract because they ‘improve[] the functionality of the general purpose computer by programming fundamentally new features.”  Instead, the Court reasoned that “mere automation of manual processes using generic computers does not constitute a patentable improvement in computer technology.”

Something More: No

The Federal Circuit also agreed with the Board’s Step Two determination that “the claims do not recite an inventive concept.”  Here, the Court explained that:

“The use and arrangement of conventional and generic computer components recited in the claims—such as a database, user terminal, and server— do not transform the claim, as a whole, into ‘significantly more’ than a claim to the abstract idea itself. Alice, 134 S. Ct. at 2360; see also In re TLI Commc’ns, 823 F.3d at 615 (holding that ‘vague, functional descriptions of server components are insufficient to transform the abstract idea into a patent-eligible invention’); Mortg. Grader, 811 F.3d at 1324 (holding no inventive concept where ‘the claims ‘add’ only generic computer components such as an ‘interface,’ ‘network,’ and ‘database’’). ‘We have repeatedly held that such invocations of computers and networks that are not even arguably inventive are ‘insufficient to pass the test of an inventive concept in the application’ of an abstract idea.’ Elec. Power Grp., 830 F.3d at 1355 (quoting buySAFE, Inc. v. Google, Inc., 765 F.3d 1350, 1353 (Fed. Cir. 2014)).