Source: https://www.dilworthip.com/resources/news/will-alice-become-the-new-markman/
Timestamp: 2019-04-18 21:23:39+00:00

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Buried amidst the flurry of recent Federal Circuit subject matter eligibility decisions is a question that could significantly change how Section 101 is applied in patent litigation. Specifically, the issue is whether performing Step 2 of the Mayo/Alice test can require a factual inquiry. If upheld, this interpretation of Alice could make patent litigation much more complicated and expensive. In fact, Section 101 inquiries could become convoluted mini-trials in their own right – similar to how Markman hearings are performed today.
Determining whether a patent covers an ineligible concept requires applying the two-step Mayo/Alicetest formulated by the Supreme Court in Mayo v. Prometheus and Alice Corp. v. CLS Bank. This test consists of two steps: 1) determining whether an invention is directed to a patent-ineligible concept (natural law, natural phenomenon, or abstract idea), and if it is, then 2) determining, after considering the elements of each claim both individually and as an “ordered combination,” whether the additional elements “transform the nature of the claim into a patent eligible application.” Step 2 is satisfied when the claim limitations involve more than performance of “well-understood, routine, [or] conventional activities previously known to the industry” (quoting Berkheimer v. HP, decided February 8, 2018). Previous Section 101 inquiries in patent litigation have conducted this process entirely within the preliminary stages of a trial, either during the pleadings or on a summary judgment motion and have treated the matter entirely as a question of law. Parties challenging the validity of a patent could simply assert that some step was routine or conventional without providing any evidence to support this contention. The CAFC’s recent decisions in Berkheimer v. HP, Aatrix v. Green Shades, and Automated Tracking Solutions v. Coca-Cola are the first to posit that whether an element of a claimed invention is ‘inventive’ is “a question of law which may contain underlying facts” (quoting Berkheimer).
Automated Tracking Solutions (“ATS”), decided February 16, 2018 (non-precedential), offers a counter to Judge Reyna’s complaints and may balance the concerns of patent holders and challengers moving forward. In this case, ATS pursued a strategy similar to that warned against by Judge Reyna in Aatrix, claiming that an element of its inventory control system was unconventional in the hopes of transforming Step 2 of Alice into a factual dispute. However, ATS was unable to point to any individual component or combination of components in its system that was novel, and the specification described the invention as depending upon standard technology. Lacking any supporting evidence, the court concluded that there was no genuine factual dispute and thus no reason to perform a factual inquiry.

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