Intellectual Ventures I LLC v. Erie Indemnity Company
711 F. App'x 1012
Fed. Cir.2017Background
- Intellectual Ventures I LLC and Intellectual Ventures II LLC (IV) sued Erie Indemnity Company alleging infringement of U.S. Patent No. 7,757,298 (the ’298 patent) concerning identification/characterization of unwanted electronic files.
- Erie moved to dismiss under Fed. R. Civ. P. 12(b)(6) on the ground that all claims are patent-ineligible under 35 U.S.C. § 101; the district court granted the motion.
- The Federal Circuit reviewed de novo the § 101 issue on appeal and treated independent claim 1 as representative of the patent claims.
- Claim 1 recites a computer-implemented method: selecting files using one of three criteria (size-based aggregation, content vs. filename mismatch, or data past end-of-file marker), generating an identification value (e.g., checksum), comparing against unauthorized-file identifiers, and characterizing matches as unauthorized.
- IV argued the claims improve computer file-detection technology and are not abstract; Erie argued the claims are directed to an abstract idea and only use generic computer implementation.
- The Federal Circuit affirmed: the claims are directed to an abstract idea and lack an inventive concept under the Alice two-step framework, so they are patent ineligible and dismissal under Rule 12(b)(6) was appropriate.
Issues
| Issue | Plaintiff's Argument (IV) | Defendant's Argument (Erie) | Held |
|---|---|---|---|
| Whether the ’298 claims are directed to an abstract idea under Alice step one | Claims improve how computers detect unauthorized files using specific selection criteria humans didn’t use; thus not abstract | Claims recite identifying/categorizing unwanted files and data-collection—an abstract idea that could be done manually | Held: Directed to an abstract idea (claims are about identifying/characterizing unwanted files/data collection) |
| Whether the claims supply an "inventive concept" under Alice step two | The three selection criteria and digital-signature lookup are novel software innovations added during prosecution and provide inventive concept | Claims merely implement the abstract idea using conventional computer components and generic functions; dependent limitations (e.g., checksums) do not save eligibility | Held: No inventive concept—claims recite generic computer implementation and routine functions |
| Relevance of USPTO guidance, prosecution history, and source code | USPTO Guidelines and disclosed source code/examples show the claims are analogous to patent-eligible software; prosecution-added limitations are novel | PTO allowance and prosecution history do not control § 101; source code was not claimed and representative claim governs | Held: USPTO guidance and prosecution history/source code do not alter § 101 outcome |
| Appropriateness of deciding § 101 on Rule 12(b)(6) motion | IV argued district court lacked a complete record | Erie and court noted § 101 issues can often be resolved on the pleadings | Held: Deciding § 101 at Rule 12(b)(6) stage was proper; dismissal affirmed |
Key Cases Cited
- Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 134 S. Ct. 2347 (2014) (establishes two-step framework for § 101)
- Content Extraction & Transmission LLC v. Wells Fargo Bank, Nat’l Ass’n, 776 F.3d 1343 (Fed. Cir. 2014) (collecting precedent on abstract ideas like collecting/recognizing data)
- Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d 1350 (Fed. Cir. 2016) (describes Alice step one/step two structure)
- Enfish, LLC v. Microsoft Corp., 822 F.3d 1327 (Fed. Cir. 2016) (claims directed to specific improvement in computer operation can be eligible)
- McRO, Inc. v. Bandai Namco Games America Inc., 837 F.3d 1299 (Fed. Cir. 2016) (software claims applying specific rules that change how results are produced may be eligible)
- FairWarning IP, LLC v. Iatric Sys., Inc., 839 F.3d 1089 (Fed. Cir. 2016) (automated fraud-detection claims directed to abstract idea)
- BASCOM Global Internet Servs., Inc. v. AT&T Mobility LLC, 827 F.3d 1341 (Fed. Cir. 2016) (content-filtering system found directed to an abstract idea at step one)
- DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245 (Fed. Cir. 2014) (distinguishes claims that are inextricably tied to computer technology)
- buySAFE, Inc. v. Google, Inc., 765 F.3d 1350 (Fed. Cir. 2014) (narrowing to particular relationships does not necessarily overcome abstraction)
- Diamond v. Diehr, 450 U.S. 175 (1981) (novelty alone does not resolve § 101 eligibility)