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By Peter Leung
Aug. 1 — Three patents that cover systems and methods for monitoring electric power grids are invalid because they cover unpatentable abstract ideas and lack inventive concepts, the U.S. Court of Appeals for the Federal Circuit ruled Aug. 1 ( Electric Power Group LLC v. Alstom SA, Fed. Cir., No. 15-1778, 8/1/16 ).
The Federal Circuit has been busy with cases applying the test for patentable subject matter from the U.S. Supreme Court decision in Alice Corp. v. CLS Bank Int'l, 189 L. Ed. 2d 296, 2014 BL 170103, 134 S. Ct. 2347 (U.S. 2014). This newest decision is notable because it provides detailed comparisons between the invalidated patents here and patentable inventions in other cases.
Since May, there have been four Federal Circuit decisions finding an invention patentable under the Alice test. Before that, there had only been one such case, DDR Holdings, LLC v. Hotels.com, LP, 2014 BL 342453, 773 F.3d 1245 (Fed. Cir. 2014).
Electric Power Group LLC (EPG) sued Alstom SA, alleging infringement of U.S. Patent Nos. 7,233,843, 8,060,259 and 8,401,710. The patents claim systems and methods for monitoring electric power grids in real time by collecting various data from various data sources, analyzing them and displaying the results.
General Electric Co. purchased Alstom's power and grid business for $10 billion, with the deal closing in November 2015.
Alstom challenged claims from all three patents, arguing that they cover an abstract idea, and that there was no “inventive concept” that would make the inventions patentable. The district court agreed and granted Alstom's motion for summary judgment.
The Federal Circuit affirmed. Applying the first step of the Alice test, it said that EPG's patent claims were verbose but did not go beyond describing the abstract idea of collecting, analyzing and displaying information.
It explained that collecting information, even when the invention limits that information to particular content, is still an unpatentable abstract idea. Analyzing information by going through mathematical algorithms or the equivalent of human mental steps, without more, is also abstract.
The court contrasted this to the claims in a recent case finding a software invention patentable (93 PTD, 5/13/16). In Enfish LLC v. Microsoft Corp, the invention was not an abstract idea because it improved computer functionality. By contrast, EPG's patents use existing computers to perform processes embodying abstract ideas, the court explained.
This distinction has “common-sense force even if it may present line-drawing challenges because of the programmable nature of ordinary existing computers,” the court acknowledged.
In reviewing whether the claim elements contained an “inventive step” that would make the invention patentable, the court found that EPG's patents call for merely selecting information for collection and analysis with nothing to differentiate them from unpatentable ordinary mental processes. It also found no inventive concept in how the invention achieved its desired result, finding that the processes take place on “a set of generic computer components.”
The court again compared this to previous cases where it found the invention passed the second step of the Alice test. In DDR Holdings, LLC v. Hotels.com, LP, 2014 BL 342453, 773 F.3d 1245 (Fed. Cir. 2014), the invention had an inventive concept since it modified the conventional mechanics in website displays to create a hybrid website from data from multiple sources.
Similarly, in BASCOM Glob. Internet Servs. v. AT&T Mobility, LLC (Fed. Cir. 2016), the court found enough of an inventive concept in the patent describing the installation of an internet filtering tool in a specific location away from the end user, while still having customizable filtering features for each individual user, which improved known technology (124 PTD, 6/28/16).
By contrast, EPG's inventions only outline entirely conventional and generic technology to perform the steps to reach the desired end, the court said. The EPG patents sought to cover a desired end result, rather than the particular means of achieving that end result, it said.
Comparing and contrasting to previous decisions is common practice, but the court's approach here may be particularly useful given that it's made four decisions in two months finding inventions patentable under the Alice test. Even as it sought to clarify how the test is applied, it reminded practitioners that there will be continuing struggles to draw bright lines around some of the concepts involved.
In fact, even the “two-step” nature of the test may be overstated. The court explained that “the two stages involve overlapping scrutiny of the content of the claims,” and that there can be “close questions about when the inquiry should proceed from the first stage to the second.”
Judges Richard G. Taranto, William C. Bryson and Kara F. Stoll decided the case, with Taranto writing the opinion. Lewis Roca Rothgerber Christie LLP represented EPG, while Shook, Hardy & Bacon LLP represented Alstom.
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