HP Must Again Fight Data Archival Patent Infringement Charge

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By Tony Dutra

A federal appeals court Feb. 8 partially overturned an HP Inc. lower court win that killed a patent on a digital information archiving improvement.

The U.S. Court of Appeals for the Federal Circuit decision gives software patent owners an increased ability to present arguments to avoid early dismissal of their patent infringement complaints. It addresses ambiguities in how to analyze patent claim eligibility since the 2014 U.S. Supreme Court opinion in Alice Corp. v. CLS Bank Int’l.

The appeals court held that a computer-implemented method claim may not be an ineligible abstract idea if it reflects an unconventional inventive concept described in the patent description. The court also held that “unconventional” is a question of fact, determined by the state of the art at the time the patent application was filed, and often not something a district court can decide at the summary judgment stage.

Steven E. Berkheimer, asserting U.S. Patent No. 7,447,713 against HP’s Exstream customer management system, is the beneficiary of the court’s decision to vacate a district court’s ineligibility judgment as to four claims of the patent. On remand, Berkeimer and HP will battle over whether those four claims reflect improvements in data archiving in the early 2000s.

Specific Improvements in Dependent Claims

Since Alice, alleged infringers have been largely successful in killing patents as ineligible either through an initial motion to dismiss or in summary judgment, avoiding a factual dispute. The Federal Circuit’s opinion makes it more likely that the second step of Alice‘s two-step analysis will involve a question of fact.

The step asks a court to assess whether the patent claims an inventive concept that is more than well-understood, routine, and conventional aspects of computing. District courts have frequently ruled—and been upheld on appeal—that a patent’s inventive concept was nothing more than the abstract idea when the challenged patents use functions such as collecting, presenting, and storing data to implement that idea.

The Federal Circuit agreed with HP that independent claim 1 and three dependent claims of the ‘713 patent use only code parsing and data comparison functions that Berkheimer could not prove were his improvements to computing. Those features were no less conventional than collecting, presenting, and storing, the court said.

But dependent claims 4-7 added features Berkheimer labeled as storage “without substantial redundancy” and editing to “effect a one-to-many change” in an archived item. The Federal Circuit found in the specification support for Berkheimer’s contention that those features were his inventive concept.

The court held that Berkheimer presented a question of fact—not to be resolved at the summary judgment stage—as to whether those features were accurately reflected in the four patent claims, and whether they were improvements to computer functionality when he filed the patent application in 2001.

Other Claims Indefinite

The court ruled in HP’s favor on claim 10 and its nine dependent claims that were not challenged on patent eligibility grounds.

The claims could be infringed only when “the archive exhibits minimal redundancy.” The court held that persons skilled in computing technology couldn’t have a definite idea what “minimal redundancy” meant.

The court rejected Berkheimer’s argument that its decision would invalidate for indefiniteness a large number of patent claims that use such terms as “minimal” or “substantial.” Indefiniteness is determined on a case-by-case basis, the court said, depending on the evidence presented.

Judge Kimberly A. Moore wrote the court’s opinion, which was joined by Judges Richard G. Taranto and Kara F. Stoll.

Much Shelist P.C., Chicago, represented Berkheimer. Morgan, Lewis & Bockius LLP, Houston, represented HP.

The case is Berkheimer v. HP Inc. , 2018 BL 42983, Fed. Cir., 2017-1437, 2/8/18

To contact the reporter on this story: Tony Dutra in Washington at adutra@bloomberglaw.com

To contact the editor responsible for this story: Mike Wilczek at mwilczek@bloomberglaw.com

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