page_title: Versata Development Group, Inc. v. SAP America, Inc.
section_title: Commentary on Federal Circuit ruling
hierarchical_section_title: Versata Development Group, Inc. v. SAP America, Inc. / Commentary on Federal Circuit ruling
caption_attribution_description: A picture of a wallet.
context_page_description: Versata Development Group, Inc. v. SAP America, Inc., 793 F.3d 1306, is a July 2015 decision of the Federal Circuit affirming the final order of the Patent Trial and Appeal Board, the recently created adjudicatory arm of the United States Patent and Trademark Office, invalidating as patent ineligible the claims in issue of Versata's U.S. Patent No. 6,553,350. This was the first case in the Federal Circuit reviewing a final order in a Covered Business Method invalidation proceeding under the America Invents Act. The case set an important precedent by deciding several unsettled issues in the interpretation of the CBM provisions of the AIA>, including what are business-method patents under the AIA and whether the AIA authorizes the PTO to hold such patents invalid in CBM proceedings on the ground that they are patent ineligible under 35 U.S.C. § 101 as "abstract ideas."
context_section_description: One commentator took issue with the definitions of "financial product" and "technological" that the PTAB used and the court sustained. He asserted that under the definition of "financial product" that the court accepted—"pertaining or relating to money matters"—a 19th century cash register or even a wallet would be financial products. Even a modern gasoline pump is a financial product because it determines the transaction price in real time as the user pumps the gas, and it also conducts a financial transaction with the user's financial card. He concludes: "Moreover, once it's determined that these are financial products eligible for CBM review, it takes only a few steps to find such inventions patent ineligible.  As for the price determination and the payment, "A gas station attendant used to do that by mental steps."
  This commentator also objected to the Federal Circuit's "brusque treatment of Versata's argument that its invention improved the performance of the computer system" by saying "these supposed benefits are not recited in the claims." He asserted:
  If my inventive nutcracker cracks nuts ten times faster than the prior art, I don't claim 'wherein said nut-cracking machine cracks nuts at least ten times faster than the cited references,' or other hortatory statement. ...{If} I did claim this benefit, then someone can copy the structure, but just adjust the machine so it operates a bit more slowly.
  Professor Crouch commented that the affirmance of the PTAB decision to institute a CBM proceeding, while at the same time asserting a judicial power to review the determination to institute, was "in petit Marbury v. Madison style." That is, as in that case, the decision of the court here on reviewability was immune to further review by any party: the USPTO and SAP won on the merits and therefore could not appeal at all; Versata had appealed the preliminary point, was successful, and therefore could not appeal reviewability either.
  A law firm blog commented on Versata that its result was consistent with congressional intent:
  Since its introduction, CBM filings have been devastating to business method patents; this is exactly what Congress intended.  When Congress created this special class of challenge it was to specifically defeat patents believed to be invalid under 101, but too cost prohibitive to defeat in district court. This decision will go a long way in maintaining the current momentum.
caption: A trifold wallet
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