OIP Technologies, Inc. v. Amazon.com, Inc.
788 F.3d 1359
| Fed. Cir. | 2015Background
- OIP Technologies sued Amazon alleging infringement of U.S. Patent No. 7,970,713, which claims a computer-implemented method for offer-based price optimization in e-commerce.
- Claim 1 describes: testing multiple prices by sending electronic offers, gathering machine-readable statistics on customer responses, using a computerized system to estimate outcomes, selecting a price, and sending offers at the selected price.
- District court granted judgment on the pleadings under Rule 12(c), holding the claims ineligible under 35 U.S.C. § 101 as an abstract idea implemented with conventional computer/data-gathering steps.
- On appeal, the Federal Circuit applied the Alice two-step framework: (1) whether claims are directed to an abstract idea; (2) whether claim elements transform that idea into patent-eligible subject matter.
- The court treated the claims as directed to the abstract concept of offer-based price optimization and found the additional limitations were routine, conventional computer and data-gathering activities that do not supply an ‘‘inventive concept.’’
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the asserted claims are directed to patent-eligible subject matter under § 101 | OIP argued the claims are a patentable computer-implemented improvement (analogous to Diehr) and not merely an abstract idea | Amazon argued the claims recite the abstract idea of price optimization implemented with generic computer steps and routine data collection | Court held claims are directed to the abstract idea of offer-based price optimization |
| Whether the claim elements, individually or as an ordered combination, provide an ‘‘inventive concept’’ | OIP argued automation and specific computer implementation make the claims inventive | Amazon argued the computer functions and data-gathering steps are well-understood, routine, conventional activities that add nothing inventive | Court held the recited computer and data-gathering steps are conventional and fail to transform the abstract idea into patent-eligible subject matter |
| Whether resolving § 101 on the pleadings was procedurally proper | OIP contended § 101 should not be decided at pleading stage without discovery/claim construction | Amazon and district court relied on precedent allowing early dismissal where claims plainly ineligible | Concurring judge agreed threshold § 101 defects can be resolved on pleadings to conserve resources; court affirmed dismissal on pleadings |
| Whether limiting to e-commerce or non-preemption of all price optimization affects eligibility | OIP argued narrowing to e-commerce or limited scope avoids abstractness | Amazon argued such limitations do not remove the abstract nature and do not supply an inventive concept | Court held limited field or non-preemption does not make the abstract idea patent eligible |
Key Cases Cited
- Ass’n for Molecular Pathology v. Myriad Genetics, 133 S. Ct. 2107 (U.S. 2013) (laws of nature, natural phenomena, and abstract ideas not patentable)
- Mayo Collaborative Servs. v. Prometheus Labs., 132 S. Ct. 1289 (U.S. 2012) (routine data-collection steps cannot supply inventive concept)
- Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 134 S. Ct. 2347 (U.S. 2014) (two-step test for abstract ideas and inventive concept)
- Diamond v. Diehr, 450 U.S. 175 (U.S. 1981) (computer implementation may be patent-eligible when claiming a specific technological improvement)
- Bilski v. Kappos, 561 U.S. 593 (U.S. 2010) (fundamental economic concepts are abstract)
- Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709 (Fed. Cir. 2014) (advertising/exchange concepts and routine steps insufficient)
- buySAFE, Inc. v. Google, Inc., 765 F.3d 1350 (Fed. Cir. 2014) (generic computer implementation does not make abstract idea patentable)
- Accenture Global Servs. v. Guidewire Software, 728 F.3d 1336 (Fed. Cir. 2013) (automation of business practice on generic computers is not patent-eligible)
- Content Extraction & Transmission LLC v. Wells Fargo Bank, Nat’l Ass’n, 776 F.3d 1343 (Fed. Cir. 2014) (claims involving data extraction and collection held abstract)
- Bancorp Servs., L.L.C. v. Sun Life Assur. Co. of Can., 687 F.3d 1266 (Fed. Cir. 2012) (basic computer functions do not meaningfully limit claim scope)
- DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245 (Fed. Cir. 2014) (claims may be eligible when reciting a specific computer-centered solution to a problem unique to the internet)