- Mitchell International, Inc. v. Audatex North America, Inc.All claims unpatentablePTAB · Feb 19, 2016 · CBM2014-00173 · APJ Lora M Green · CBM · Final written decision
Claims 1–31 are unpatentable under § 101 and §§ 102(b)/103(a) over Reimel; the motion to amend with substitute claims 32–62 is denied.
RulingsFinal written decision- Claim Construction › Intrinsic evidence (Phillips canons) › Plain and ordinary meaning to a POSITATerm construed board ownDecided for petitioner
“not agree that the broadest reasonable interpretation of “insurance claim,” when read in light of the Specification, is a “request to recover market value or repair cost in association with an insurance policy.” The portion of the Specification Petitioner is relying upon is only describing the state of the art at the time of invention. Moreover, it uses terms such as “may” and “typically,” and, thus, does not explicitly define “insurance claim” as Patent Owner would have us do. Thus, we see no reason to deviate from the construction of the claim term “data relating to an insurance claim for a damaged vehicle” that we adopted in the Decision on Institution; that is, as encompassing, but not being limited to, any data that would be used in making an insurance claim, so long as the data includes a vehicle year, model, and geographic location. Dec. 12–13. Moreover, even if we were to adopt Patent Owner’s more limited construction of “insurance claim,” Patent Owner does not explain how that would further limit the data that would be entered, and in fact, Patent Owner notes (PO Resp. 1) that it does not disagree with the interpretation of “data” we adopted in the Decision on Institution.” slip op. at 11
- Claim Construction › Threshold & procedure › Whether a term needs construction (O2 Micro)No construction neededOther
“3. Other Claim Terms We determine that we need not interpret expressly other claim limitations for purposes of this decision. See, e.g., Wellman, Inc. v. Eastman Chem. Co., 642 F.3d 1355, 1361 (Fed. Cir. 2011) (“[C]laim terms need only be construed ‘to the extent necessary to resolve the controversy.’”) (internal citations omitted).” slip op. at 14
- Patent Eligibility (§101) › Alice/Mayo step one — 'directed to'Step1 directed to exceptionUnpatentable
“Here, we observe that each challenged claim is directed to the fundamental concept of providing a vehicle valuation using information about the vehicle. Patent Owner contends that, unlike the claims in Parker v. Flook, 437 U.S. 584 (1978), the claims at issue in the instant proceeding are not drawn to an algorithm. PO Resp. 12–14. When the claims are analyzed as a whole, as urged by Patent Owner (id. at 10), however, the claims recite nothing more than the collection of information to generate a valuation report for a damaged vehicle. Moreover, all the steps could be performed without the use of a computer. Specifically, the steps and calculations covered by the claims essentially require determining the value of a damaged vehicle by entering data related to an insurance claim, such as mileage and vehicle condition, and processing the data to generate a valuation report for the damaged vehicle; a calculation that can be performed by the human mind, or with the aid of pencil and paper. See, e.g., Mortgage Grader, Inc. v. First Choice Loan Servs. Inc., No. 2015-1415, 2016 WL 362415, at *7 (Fed. Cir. Jan. 20, 2016) (noting that the steps of the claims could be performed by a human without the use of a computer in concluding that the claims at issue were drawn to an abstract idea). The fact that the claims at issue are not per se drawn to an algorithm does not insulate them from being found an abstract idea. The claims in Alice were drawn to “a computer-implemented scheme for mitigating ‘settlement risk’ . . . by using a third-party intermediary.” Alice, 134 S. Ct. at 2351–52. The claims at issue in Mortgage Grader were drawn to a computer-implemented system that allowed borrowers to shop anonymously for loan packages from a plurality of lenders. Mortgage Grader, 2016 WL 362415, at *1. Thus, the fact that the claims in those cases were not specifically drawn to an algorithm did not prevent them from being drawn to an abstract idea. We are persuaded that, similar to the concept of intermediated settlement in Alice, the concept of risk hedging in Bilski, and the concept of shopping anonymously for loan packages in Mortgage Grader, the concept at issue here—obtaining a vehicle valuation report for a damaged vehicle— is “a fundamental economic practice long prevalent in our system of commerce,” and “squarely within the realm of ‘abstract ideas.’” Alice, 134 S. Ct. at 2356–57; Bilski, 130 S. Ct. 3231. Accordingly, we determine that Petitioner has demonstrated that the challenged claims are directed to a patent-ineligible abstract idea.” slip op. at 17
- Patent Eligibility (§101) › Alice/Mayo step two — inventive conceptStep2 no inventive conceptUnpatentable
“We agree with Petitioner’s analysis that the claims do not add additional substantive limitations that transform their nature into a patent-eligible application of an abstract idea. The only technological features recited in the claims at issue in this proceeding are generic computer implementation systems performing generic computer functions. As acknowledged by Patent Owner’s expert, the claims do not improve the function of the computer, they do not solve a problem unique to the internet, nor are they tied to a particular machine or apparatus. Ex. 1015, 223:4–20; 231:9–232:1. Simply utilizing a generic computer system to generate a vehicle valuation report is not enough to transform a patent-ineligible claim into a patent-eligible invention. See Bancorp Servs. LLC v. Sun Life Assurance Co. of Canada, 687 F.3d 1266, 1279 (Fed. Cir. 2012) (finding a claim not patent-eligible when “the computer simply performs more efficiently what could otherwise be accomplished manually”); SiRF Tech., Inc. v. Int’l Trade Comm’n, 601 F.3d 1319, 1333 (Fed. Cir. 2010) (“In order for the addition of a machine to impose a meaningful limit on the scope of a claim, it must play a significant part in permitting the claimed method to be performed, rather than function solely as an obvious mechanism for permitting a solution to be achieved more quickly.”). Nearly every computer has the capability of performing basic calculation, storage, and transmission functions. See Alice, 134 S. Ct. at 2360. At most, the computer implementation involved in the claims at issue here is an attempt to limit use of the abstract concept to a particular technological environment. Claims that simply instruct the practitioner to implement the abstract idea with routine, conventional activity do not transform an abstract idea into patent eligible subject matter. Ultramercial, 772 F.3d at 716. The claims simply instruct the practitioner to use the internet to obtain a vehicle valuation, without reciting further unconventional features of that system.” slip op. at 20
Patent outcomesUS 8,468,038 unpatentableClaim construction§ 101 eligibility§ 102 anticipation§ 103 obviousnesscites Alice · Mayo · Phillips · KSR · GrahamPatents in suitUS 8,468,038 - Westlake Services, LLC v. Credit Acceptance Corp.All claims unpatentablePTAB · Jan 25, 2016 · CBM2014-00176 · APJ David C Mckone · CBM · Final written decision
Claims 10–12 and 14–33 are unpatentable under § 101 because they claim an abstract financing process using generic computer components.
RulingsFinal written decision- Claim Construction › Threshold & procedure › Whether a term needs construction (O2 Micro)Term construed board ownNo construction neededOther
“As explained in the 008-FWD, the Specification describes an advance amount as the amount of money a lender agrees to pay to the dealer. Ex. 1001, 8:45–46. “[T]he advance amount is determined by the party extending financing based on the customer’s credit score, the dealership’s past collection history, the particular vehicle being considered and other factors.” Id. at 9:21–24. Although the advance amount could be less than the sales price minus the down payment, the Specification does not require that it be so. In any case, Patent Owner has since accepted our construction of “advance amount” and has chosen not to contest it in this proceeding. Tr. 28:1–12. We maintain that construction on the full record of this proceeding. The parties do not argue in this proceeding for different constructions of “front-end profit” and “database.” We maintain these constructions on the full record of this proceeding. Additionally, in the 008-FWD, we determined that the following terms, also relevant to claims at issue in this proceeding, required no express construction: “receiving information related to a database,” “receiving information from the customer,” “calculating,” “determining,” “presenting . . . to the dealer,” “automatically recalculated,” “transmitted,” “generating,” and “selectable criteria.” 008-FWD, 10–18. In the Petition, Petitioner addressed several of these terms, contending, inter alia, that “receiving information related to a database of a dealer’s inventory,” “receiving information from the customer,” “calculating a credit score for the customer based at least in part on the information gathered from the customer,” and terms including “determining” are indefinite under 35 U.S.C. § 112, second paragraph. Pet. 32–33, 39, 41. We declined to institute on that ground, concluding that the Petition’s showing was unpersuasive. Dec. 27. The parties propose no other constructions for these terms. On the complete record of this proceeding, we maintain our decision not to construe these terms expressly. 3. Additional Terms Construed in the Decision to Institute In the Decision to Institute, we preliminarily construed “calculation unit” to mean “a computer component configured to calculate” and “financing package generating unit” to mean “a computer component that generates financing packages and contains a database and a calculation unit.” Dec. 7. In the Petition, Petitioner contends that these terms are indefinite. Pet. 36. As stated above, we declined to institute on the asserted ground of indefiniteness. Dec. 27. The parties do not dispute further these” slip op. at 9
- Patent Eligibility (§101) › Alice/Mayo step one — 'directed to'Step1 directed to exceptionUnpatentable
“costs, for items in a dealer’s inventory; receiving down payment information from a customer wishing to buy a product from the dealer; calculating a credit score for the customer; determining how much a lender will advance to the dealer (advance amount) for each product in the inventory (which need only include two products); calculating profits for the inventory items2 (using arithmetic based on the advance amount, dealer cost, and down payment); and presenting a financing package (with unspecified information) to the dealer for each product in the inventory. The underlying concept of claim 1, when viewed as a whole, simply is to receive information from a customer’s credit application, process that information, 1 Claim 10, at issue in this case, depends from claim 1. Thus, our analysis of claim 10 starts with claim 1. 2 Claim 1 does not recite using such profit information. Claim 12 later recites sorting the financing packages based on selectable criteria, which could be profit. dealer. Rephrased, this is the abstract idea of “processing an application for financing a purchase.” Claim 10 depends from claim 1 and adds providing generic computer structure for performing the steps of claim 1 (a “user terminal” for entering customer information; and a “server” connected to the user terminal “via a network,” for receiving information, accessing the database, performing claim 1’s arithmetic to generate financing packages, and transmitting the financing packages to the user terminal). Thus, claim 10 recites the same abstract concept as recited in claim 1, performed with generic computer components.” slip op. at 15
- Patent Eligibility (§101) › Alice/Mayo step two — inventive conceptStep2 no inventive conceptUnpatentable
“applying the steps of claim 1 (which we determined in CBM-008 to be abstract) using generic, conventional computer components, recited in purely functional language. Pet. 22–23. We agree, and conclude that the generic computer components recited in claim 10 do not transform the nature of the claim such that claim 10, as a whole, recites an inventive concept. Claim 1, from which claim 10 depends, recites a database, which stores information about a dealer’s inventory. Claim 10 adds to claim 1 a server for performing calculations, a user terminal for entering the information to be calculated, and a network for moving the information back and forth. As Petitioner argues, claim 10 provides no details as to the components are recited generically, using purely functional language. In essence, claim 10 recites applying the abstract idea of claim 1 using generic computer components. Put differently, claim 10 simply limits the method of claim 1 to a particular technological environment. This is analogous to the claims at issue in Alice, which generically recited a “data storage unit” and “computer,” for example (detailed more fully in the Federal Circuit’s opinion in CLS Bank Int’l v. Alice Corp. Pty. Ltd., 717 F.3d 1269, 1285–90 (Fed. Cir. 2013)), and those at issue in Accenture, 728 F.3d at 1344–45, which recited a “database,” “client component,” “server component,” and “automated method,” for example. In the words of the Alice Court, claim 10 essentially “[s]tat[es] an abstract idea while adding the words ‘apply it with a computer.’” 134 S. Ct. at 2358. Nor does claim 10 purport to improve the functioning of the computer itself. See buySAFE, 765 F.3d at 1354; compare with DDR Holdings, 773 F.3d at 1258 (“In short, the claimed solution amounts to an inventive concept for resolving this particular Internet-centric problem, rendering the claims patent-eligible.”).” slip op. at 23
Patent outcomesUS 6,950,807 unpatentableClaim construction§ 101 eligibilitycites BilskiPatents in suitUS 6,950,807 - Westlake Services, LLC D/B/A Westlake Financial Services, LLC v. Credit Acceptance Corp.All claims unpatentablePTAB · Mar 24, 2015 · CBM2014-00008 · APJ Gregg I Anderson · CBM · Final written decision
Claims 1–9, 13, and 34–42 are unpatentable under § 101 because they claim an abstract financing process implemented with routine computer use.
RulingsFinal written decision- Claim Construction › Threshold & procedure › Whether a term needs construction (O2 Micro)Term construed board ownOther
“Claim 1 recites in pertinent part “calculating a front-end profit to be realized by the dealer for each individual product in the dealer inventory based on the dealer cost associated with each individual product, the advance amount determined for each individual product, and the down payment amount” (emphases added). The actual claim language as to calculation of the “front-end profit” is repeated in the Specification. Ex. 1001, 3:63–66. “Put simply, the front-end profit, is equal to the down payment amount plus the advance amount minus the dealer’s costs.” Id. at 8:60–63. “Advance amount” is construed immediately hereafter. Thus, we construe “front-end profit” to mean “the down payment amount plus the advance amount minus the dealer cost.”” slip op. at 7
- Claim Construction › Intrinsic evidence (Phillips canons) › Plain and ordinary meaning to a POSITAPlain and ordinary meaningNo construction neededOther
“Patent Owner’s cites to the Specification are not directly supportive of its proposed construction. PO Resp. 40–42. Patent Owner cites to the Nerenberg Declaration, as it did previously, for the proposition that automation of financing options through a computer is quicker than doing so manually. Id. at 41 (citing Ex. 2008 ¶ 53). The speed with which a computer may perform calculations is not a part of the construction of the term at issue. Further, we see no reason why the claims should be construed to require communication over a “network,” when the term is not recited in any of the challenged claims (but is recited in others, such as claim 14, for example). We determine that the term “receiving information from the customer” is plain on its face and requires no express construction.” slip op. at 10
- Patent Eligibility (§101) › Alice/Mayo step one — 'directed to'Step1 directed to exceptionDecided for petitioner
“We conclude that claim 1 is directed to an abstract idea and, at most, merely recites implementing it with a computer. See Bilski, 130 S. Ct. at 3231. The abstract idea of processing an application for financing a purchase claimed is a known concept described in the ’807 patent. Ex. 1001, 1:33–2:50. Specifically, the ’807 patent describes processing a financing application as: a customer completing a credit application; obtaining financing from a financing institution; the customer providing a down payment and signing a promissory note to the dealer; and the financing institution paying the dealer the balance for the purchase after applying the down payment. Id. at 1:33–2:14. If the financing is not completed, the process is repeated. Id. at 2:15–50; see Tr. 34:6–35:10. Patent Owner’s arguments that the claims are directed to a specific method are relevant, if at all, to the second step of the Alice framework, not the first, and are therefore unpersuasive. We disagree that claim 1 taken “as a whole” is any more than an abstract idea relating to the general method of processing an application for financing a purchase. Claim 1 simply describes receiving information, including sale prices and dealer costs, for items in a dealer’s inventory; receiving down payment information from a customer wishing to buy a product from the dealer; calculating a credit score for the customer; determining how much a financer will advance to the dealer (advance amount) for each product in the inventory; calculating profits for the inventory items (using basic arithmetic based on the advance amount, dealer cost, and down payment); and presenting financing packages (with unspecified information) to the dealer. Ex. 1001, 12:56–13:14. The arguments and evidence presented by Petitioner are persuasive that claim 1 is directed to no more than this abstract idea, not tied to any specific machine, of processing an application for financing a purchase. Pet. 37 (citing Ex. 1006 ¶¶ 280, 285). Patent Owner’s evidence and arguments in this case do not persuade us otherwise. For purposes of the first step of Alice, Patent Owner has not distinguished any of the other independent or dependent claims from claim 1. Thus, we determine that Petitioner has proven that claims 1–9, 13, and 34–42 are directed to an abstract idea.” slip op. at 26
- Patent Eligibility (§101) › Alice/Mayo step two — inventive conceptStep2 no inventive conceptDecided for petitioner
“We are not persuaded that the claims include something beyond the abstract idea that transforms the claimed abstract idea into patent eligible subject matter. Merely using a computer to speed the steps of generating a financing package for each item of inventory is not such a transformation. See Bancorp Services, 687 F.3d at 1278 (“The computer required by some of Bancorp’s claims is employed only for its most basic function, the performance of repetitive calculations, and as such does not impose meaningful limits on the scope of those claims.”). Likewise, the ability to create an “immediate offer” does nothing more than speed up that which can be done by a human. Although we agree that the claimed steps require a computer, there is insufficient evidence for us to conclude that the computer is being utilized for anything beyond routine or conventional use. We have reviewed the Nerenberg Declaration, including specifically paragraphs 130–153, and find it to be conclusory and lacking sufficient underlying facts or data. As such, we give the declaration minimal weight in our determination. See 37 C.F.R. § 42.65(a). As noted above, routine use of a computer is not enough to meet the inventive concept step of Alice. Ultramercial III, 772 F.3d at 716; see Alice, 134 S. Ct. at 2358 (“Given the ubiquity of computers, wholly generic computer implementation is not generally the sort of additional featur[e] that provides any practical assurance that the process is more than a drafting effort designed to monopolize the [abstract idea] itself.”) (citations and quotation marks omitted); Accenture, 728 F.3d at 1344–45 (claims reciting a “database,” “client component,” “server component,” and “automated method,” for example); CLS Bank Int’l v. Alice Corp. Pty. Ltd., 717 F.3d 1269, 1289 (Fed. Cir. 2013) (claims reciting a “data storage unit” and “computer,” for example). Even assuming some of the claimed steps were not previously known in the art is not alone enough to confer patent eligibility. Id. Moreover, the ’807 patent itself describes the steps in a financing process as they existed before the ’807 patent. Ex. 1001, 1:33–2:50. Thus, the record supports our conclusion that the steps of the method were known previously. Further, Patent Owner acknowledges the steps individually are known but argues the steps as a whole transform the claim into patentable subject matter. Tr. 31:21–32:1. This argument is not supported sufficiently by any evidence beyond attorney argument to persuade us of patent eligibility. Patent Owner argues that there are many ways of providing financing that do not require calculating either a “front-end profit” or an “advance amount.” PO Resp. 10 (citing Ex. 2008 ¶ 120). Mr. Nerenberg testifies that examples where the two terms are not required for financing are mortgages and student education loans. Ex. 2008 ¶ 120. Nevertheless, calculating an amount a lender will advance or an amount by which a dealer will profit from a transaction are routine, conventional activities for financial transactions. See, e.g., Ex. 1001, 1:34–2:10. Furthermore, our construction of the terms “front-end profit” and “advance amount” supports that they are conventional. Regardless, neither term, alone or in combination, “transform[s] the nature of the claim” into patent eligible subject matter. Mayo, 132 S. Ct. at 1294, 1297.” slip op. at 29
Patent outcomesUS 6,950,807 unpatentableClaim construction§ 101 eligibilitycites Alice · BilskiPatents in suitUS 6,950,807
Holdings, summaries, rulings, issues, outcomes, winners and claim constructions shown for a decision were generated by a large language model reading the opinion. They are a guide to the decision, not the decision. Confirm every one against the court's own text before relying on it. Outcomes read from the patent owner’s side. Party names are extracted from the decision and are missing on about 900 short Director denials and scans, which carry the trial number instead.