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Patent Ineligible Subject Matter Series 

Claims of U.S. Pat. 10,075,451 were asserted by Veripath. These claims were challenged by the defendant as ineligible subject matter under 35 U.S.C. § 101 (the patent statute) and were invalidated as patent ineligible by both the district court and the federal circuit court.

The Veripath patent solved a technical problem using a technical solution, but the claims that were invalidated by the courts (so far) are drafted broadly to a data privacy system that automatically determines how a particular customer's data is being used and gets permission from the customer (an opt in) for that use in exchange for using the particular online or mobile service or services. The patent described that the arrangement allows a component of an application, such as a mobile app, to determine what information is to be collected from a user, how that information will be used, and what permissions are required from that user for that user, apparently without human intervention. This is a significant improvement over the type of EULA / privacy policy opt in widely used in the industry, as the opt in was for how a particular customer's data would actually be stored and used. 

The claims recited a method that included the steps of identifying the type of personal information obtained through an API; determining, based on at least the type of personal information, a required opt in permission from the user for at least one proposed use of the personal information; presenting an offer to at least one enhanced function of the application in exchange for the required opt in; and providing the user with access to at least one enhanced function of the application only if the user provides the opt in. All of this was automated. 

The federal circuit, the appellate court for patent matters, used the two-part Alice test to analyze patent eligibility: 

Part I. Are the claims directed to an abstract idea?

The federal circuit held that the claim was directed to an abstract idea, because “at most, claim 1 is directed to no more than an improvement to the abstract notion of exchanging privacy for functionality that utilizes an API [application programming interface] to achieve a desired result.”  

Part II. If directed to an abstract idea, is the "inventive concept" of the claims something that transforms the nature of the claim into a patent eligible invention?

The court found that Veripath failed to show how its method was anything more than "conventional steps, specified at a high level of generality” and merely implemented using any generic computer.  According to the appellate court, Veripath failed to explain how generating a disclosure before it is presented to a user “is anything but routine and conventional.” 

This shows the pitfall for patent owners caused by the changing law of patent ineligibility. At the time Veripath secured its patent rights, it was possible to get a patent with the claims recited in Veripath's patent. Now, under the Alice test, it is the patentee's burden to show that the claims recite something more than a conventional process to implement an abstract idea. Instead, patents must be drafted with sufficient detail to show how a technological solution solves a technical problem. The narrower the technical problem and the more detailed the technological solution, the more more likely it is that the subject matter will be found patent eligible.

If a patent is drafted too narrowly and claims are drafted with too many limitations, this can limit the value of the patent to the patent owner. But if drafted too broadly and with too high of a level of "generality", the patent will be invalidated as patent ineligible. This conundrum increases the cost and complexity of patent filings, requiring patent counsel to require detailed disclosure of how the technical solution works. Specific examples need to be provided that show how the technical solution transforms the nature of the invention in a way that is unconventional. This means that the conventional way of doing things needs to be contrasted to the technological solution provided to solve some technological problem not addressed by the conventional way of doing things.

Without this added cost and complexity, method claims and non-method claims may both be found to be patent ineligible, if a court later determines that the claims are directed toward some abstract idea and at too high a level of generality. So far, the courts have not found any hard limit to what can be invalidated as ineligible, and Congress has been powerless to better define the law. Until the supreme court or Congress acts, patentees are going to be faced with higher costs and longer lead times in patenting computer implemented inventions and any inventions related in any way to mathematical algorithms and laws of nature.

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