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The Federal Circuit Court docket of Appeals has struck down many patents on the grounds that they’re invalid as directed to an summary concept, counting on the Supreme Court docket’s Alice determination. In In re Elbaum (Fed. Cir. 12/20/2023) 2023 U.S. App. LEXIS 33719, the Federal Circuit affirmed the Patent Trial and Attraction Board’s rejection of the claims in a patent software as directed to an summary concept.
The claims in Elbaum’s patent software had been directed to a technique of permitting retail “walk-in” shops to compete with on-line shops by providing the identical merchandise, which weren’t in inventory within the walk-in retailer, at decrease costs, for which the walk-in retailer receives a portion of the fee made to the vendor. The patent examiner rejected the claims on the grounds that the claims had been directed to patent-ineligible material below 35 U.S.C. part 101. The applicant appealed to the Patent Trial and Attraction Board; the PTAB affirmed the examiner’s determination.
Underneath part 101, solely sure sorts of innovations are patentable: machines, articles of manufacture, compositions of matter, and processes (strategies). These classes are known as “patent-eligible material.” Sure different classes are “patent-ineligible material:” legal guidelines of nature, pure phenomena, and summary concepts. Claims in a patent software directed to such material will not be patentable, and the patent examiner ought to reject the claims below part 101. If a patent software with such claims is allowed and points as a patent, the claims may be invalidated below part 101.
On enchantment, the Federal Circuit affirmed the PTAB’s determination, holding that Elbaum’s claims had been correctly rejected below part 101 as directed to an summary concept, not patent-eligible material.
The courtroom utilized the two-part check for material eligibility below the Supreme Court docket’s 2014 determination in Alice Corp. v. CLS Financial institution Worldwide, 573 U.S. 208. In step one, the courtroom held that the claims had been directed to patent-ineligible material. The courtroom discovered that the claims recited “managing sale transaction exercise by paying a transaction payment for gross sales of non-stocked objects,” which the courtroom said was a technique of “organizing human exercise” or “managing business and authorized interactions,” an summary concept.
The courtroom famous that it had beforehand held that one other patent software filed by Elbaum was directed to an summary concept. There, “the declare recited a technique for enabling an web vendor to pay a finder’s payment to a retail retailer when a buyer finds the web vendor’s product by promoting within the retail retailer.” The courtroom had discovered that this was “directed to mere formation and manipulation of financial relations.”
Within the second Alice step, the courtroom held that the claims didn’t embody any extra factor (an “creative idea”) that reworked the summary concept into patent-eligible material. Quite, the claims use “generic pc capabilities to handle business sale transaction actions by paying a transaction payment for gross sales of non-stocked objects.” The courtroom held that this isn’t an creative idea. Elbaum contended that his claims had been directed to patent-eligible material as a result of that they had sensible steps. The courtroom rejected his argument, stating “the utility of an summary concept is inadequate to verify patent eligibility.”
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