United States: A View From The Trenches: Section 101 Patent Eligibility Challenges In The Post-Bilski Trial Courts

A. Introduction

"Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title."1 A "magisterial statute [of] sweeping inclusion,"2 35 U.S.C. § 101 is simply worded, yet has generated three trips to the United States Supreme Court in just three years,3 and a soon-to-be fourth trip after causing a "judicial deadlock" by the United States Court of Appeals for the Federal Circuit sitting en banc.4

While much has been written about the continuing dialogue between the U.S. Supreme Court and the Federal Circuit concerning precisely which inventions meet the statute's "coarse eligibility filter,"5 considerably less attention has been devoted to how trial court judges have handled "the murky morass that is § 101 jurisprudence"6 since the Federal Circuit's 2008 In re Bilski decision.7 This article surveys the trends that have emerged from the roughly 65 post-Bilski decisions issued by United States District Courts or the International Trade Commission (ITC) that have considered a § 101 patentability challenge to a U.S. patent.

B. It's Not Just Business Method Patents Being Challenged

In Bilski v. Kappos, the U.S. Supreme Court concluded that petitioner's business method patent, directed to "hedging risk in the energy market," was "not a patentable 'process'" under U.S. patent law.8 While Bilski produced sharply divergent opinions on whether business method patents categorically are excluded from § 101 patent eligibility,9 all nine Justices agreed that Mr. Bilski's putative invention was not patent-eligible subject matter.10 The Bilski decision had been expected to be a death knell for business method patents, but it is clear – more than 3 years out from that decision – that business method patents have neither monopolized recent § 101 jurisprudence at the trial courts, nor have they universally suffered the same fate as Mr. Bilski's methods for hedging against risk in the energy market.

For this analysis, patent claims challenged in district court or at the ITC on § 101 patentability grounds were divided into three broad categories: (1) business method patents; (2) medical diagnostic or treatment patents of the type at issue in the Supreme Court's Prometheus decision;11 and (3) a catch-all category of technology-based patents, including hardware and software patents.12 Of the roughly 65 decisions analyzed, 7 cases considered diagnostic/treatment patents and 27 considered business method patents.13 The business methods challenged in these decisions ranged from "the transfer of data regarding insurance cases from one electronic file to another,"14 to "administering and tracking the value of separate-account life insurance policies,"15 to "computing a price for the sale of a fixed income asset and generating a financial analysis output."16 But, for all the press devoted to business method patents in the immediate aftermath of the Bilski cases, these patents represent less than half of all patents challenged on § 101 grounds at the district courts and ITC in the post-Bilski era.

The take-away from this statistic: fully half of the challenged claims fell into that latter category of technology-based patents, including patents with software and hardware limitations. These challenged patents claimed widely-divergent technology, e.g.:

  • transmitters used to send secure signals to garage door openers;17
  • a "method for determining machining instructions to cut the root sections of turbine blades";18
  • "parsing information into packets based upon 'context-insensitive' parsing";19 and
  • "an industrial process for manufacturing a semiconductor device using claimed manufacturing equipment."20

Consistent with U.S. Supreme Court precedent, whether a § 101 patentability challenge to these patents succeeded depended on the degree to which the alleged mental process claimed in the patent was "manifestly abstract,"21 and/or how specific and integral to the claimed method the recited machine components were.22 Claims that "depend on sophisticated software running on particular machines"23 – or whose machine components were not merely "added as an afterthought"24 and thus "constitute[] the very heart of the invention"25 – were likely to survive a § 101 patentability challenge. But claims merely reciting a "general purpose computer that has been programmed in an unspecified manner"26 or "simply generic computer components ... [insufficient] to take the patents out of the realm of the abstract"27 were often invalidated on a motion to dismiss or at summary judgment. Simply put, the more specific a claim is regarding its recited machine components – and the more integral those components are to the overall claimed system or process – the more likely that claim is to survive a § 101 challenge.28

Specificity, moreover, appears to be the lifeline for business method patents challenged on § 101 grounds in the post-Bilski era. The narrow window of patentability for business method patents left open by the Supreme Court in Bilski29 has since remained open in the district courts. Although business method patents now appear categorically suspect, a small number of these patents have withstood recent validity challenges in trial-level courts on substantive, as opposed to procedural, grounds.30 These business method patents survived dispositive motions primarily because their hardware and/or software limitations, or field-of-use restrictions, were deemed sufficiently specific to take their claims "beyond an abstract idea and into an actual practical application."31

Section 101 defies bright line rules, so every § 101 patentability challenge ultimately will turn on the actual claim language at issue. But it is clear from the recent district court and ITC cases that a variety of patents beyond business method patents are being targeted for § 101 challenges, and that business method patents – although of dubious validity since the Bilski decisions – can withstand a § 101 challenge. Rumors of their demise are somewhat overstated.

C. A Majority of Challenged Claims Survive § 101 Validity Motions

The Supreme Court has reviewed several recent Federal Circuit § 101 decisions "and, in each instance, concluded that the claims at issue were not patent-eligible."32 The Federal Circuit has been somewhat more generous to patent holders in the post-Bilski era, sustaining the validity of about 50% of the patents substantively analyzed for § 101 patent eligibility.33 Patentees, however, have fared better in the district courts and at the ITC in recent years, with a roughly 56% overall success rate in defeating § 101 challenges. These victories are primarily at the pleadings or summary judgment stages, as shown in Chart 1:

District courts and the ITC have granted about 44% of § 101 invalidity motions, overwhelmingly by summary judgment or summary determination:

The 56% overall success rate for patentees in withstanding a § 101 patentability challenge, however, masks a disparity in the types of patents that survive, as depicted in Chart 3:

As Chart 3 clearly shows, business method patents and medical diagnostic/treatment patents remain far more vulnerable to § 101 challenges than more traditional, technology-based patents, including those with software and hardware limitations. These statistics appear to reflect the present state of § 101 jurisprudence – with its renewed focus on patents impermissibly claiming "laws of nature, physical phenomena, [or] abstract ideas"34 – as well as the apparent suspicions courts harbor toward business method and medical diagnostic/treatment patents following the U.S. Supreme Court's decisions in Bilski, Prometheus, and Myriad.

D. Timing is a Critical Consideration

When to challenge a patent under § 101 emerged as a key strategic consideration in the post-Bilski litigation era. A successful validity challenge at the pleadings stage, brought under either Fed. R. Civ. P. 12(b)(6) or 12(c), will avoid the time and financial cost of the most expensive parts of patent litigation: claim construction, fact and expert discovery, summary judgment, and trial/post-trial. But the courts – both the trial courts and the Federal Circuit – are decidedly split on whether § 101 motions are properly heard at the pleadings stage and/or before claim construction.

1. Motions to Dismiss are a Mixed Bag

The vast majority of § 101 challenges in the post-Bilski era have been heard at the summary judgment stage or later in the case (i.e., at a bench trial or at post-trial briefing).35 But a sizable minority of the cases – 20 of the approximately 65 cases analyzed – were decided at the pleadings stage on a Rule 12 motion. Only about 7 of these decisions, however, invalidated the disputed claims.36 The majority of the motions to dismiss were denied, either on procedural grounds or on the merits.

Procedural denials. Numerous courts simply refused, on procedural grounds, to adjudicate the validity of a patent on a motion to dismiss. The judges in these cases either: (a) cited the need for discovery37 and/or for a claim construction hearing38 to better understand the subject matter of the challenged patent, or (b) objected to the timing of the § 101 motion as premature "in advance of the normal schedule for dispositive motions."39 Denial of the motion to dismiss in these cases is usually without prejudice to re-file the motion after discovery or claim construction.40

Denials on the merits. Decisions denying motions to dismiss on the merits primarily cite the "heavy burden ... required to support a finding of unpatentability" on a Fed. R. Civ. P. 12 motion.41 The focus by these judges on the heavy burden Rule 12 places on movants is consistent with the recent instruction provided by the Federal Circuit in the Ultramercial case, on remand from the Supreme Court. In that decision, the Court of Appeals made clear that a Rule 12 dismissal "is appropriate only if .... the only plausible reading of the patent [is] that there is clear and convincing evidence of ineligibility."42 This particularly heavy burden to overcome a patent's presumptive validity,43 moreover, remains solely on the party challenging validity at the pleadings stage.44 The Ultramercial Court further instructed that Rule 12 dismissal for lack of eligible subject matter should "be the exception, not the rule," and, indeed, that "it will be rare that a patent infringement suit can be dismissed at the pleadings stage for lack of patentable subject matter."45 Ultramercial – at least on paper – increases the burden accused infringers face in proving § 101 invalidity at the pleadings stage. "But rare does not mean never," and district courts do remain willing, even after Ultramercial, to invalidate a patent on the pleadings "when 'the only plausible reading of the patent [is] that there is clear and convincing evidence of ineligibility.'"46

2. Mixed Messages on the Need for Claim Construction

District courts post-Bilski have wrestled with the question of whether formal claim construction is important or even necessary for deciding a § 101 patent-eligibility challenge. This struggle likely is due in no small part to the Supreme Court's silence on the issue47 and on the Federal Circuit's mixed messages on this topic. On the one hand, the Court of Appeals has instructed that "claim construction ... is an important first step"48 and "normally will be required" in a § 101 analysis.49 On the other hand, the Federal Circuit also "has never set forth a bright line rule" requiring claim construction as "an inviolable prerequisite to a validity determination under § 101."50 Whether formal claim construction will be required ultimately remains a fact-specific determination, turning in any given case on whether "a definition of the invention via claim construction can clarify the basic character of the subject matter of the invention."51

District courts have cited a number of reasons excusing the need for formal construction before undertaking a § 101 patent eligibility analysis, e.g.:

  • The "'basic character of the claimed subject matter'" was "clearly evident to the Court," thus requiring "no further construction of the claims."52
  • The patentee had requested formal claim construction but only in the vaguest terms, failing to detail how construction of specific claim terms "would materially impact the § 101 analysis."53
  • The court could resolve the § 101 motion by – consistent with Fed. R. Civ. P. 12 and 56 – construing the claim terms "in a light most favorable" to the patentee.54

Trial courts that have explained why claim construction is necessary for a § 101 analysis primarily cite the "different pictures of the [patented] subject matter" presented by the parties.55 In these cases, whether the patent was manifestly abstract or claimed a law of nature – and invalid under § 101 – was dictated by which party's claim construction ultimately was adopted by the Court.56 For example, claim construction could clarify whether a claim recited merely "a general purpose computer that has been programmed in some unspecified manner"57 (likely invalid), or a computer "specially programmed to perform [steps] necessary for the invention to have any useful purpose" (likely valid).58

These decisions discussing the necessity for claim construction, however, appear to be the outliers of the surveyed cases. In the vast majority of post-Bilski decisions, the parties' differing positions on the patented subject matter and on claim construction appear to have played a negligible role in the § 101 analysis.59 Even in cases where a claim construction order had already issued, the § 101 validity decision usually focused on the claim language itself, as opposed to the court's construction of any disputed terms. Indeed, in at least one case, the district court previously had ordered extensive claim construction briefing "before making a final determination on [§ 101] invalidity," but later invalidated the asserted claims on summary judgment without reference to the actual claim construction order.60 Ultramercial may have stated that claim construction "normally will be required" for a § 101 analysis,61 but the district court cases appear to belie this contention.

Whether a § 101 patentability motion is properly considered on the pleadings or before claim construction ultimately remains a case-by-case inquiry lacking bright-line rules. But it is advisable – based on the post-Bilski district court cases – that patentees seeking to defer a § 101 challenge until after fact and expert discovery offer more than just vague speculation that claim construction might affect the court's analysis. They should instead proffer specific claim terms and explain how their proper construction will "materially impact the § 101 analysis."62

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* Mr. McNamee is an associate of Cadwalader, Wickersham & Taft LLP, where he primarily practices intellectual property law. He received his J.D., cum laude, from Fordham University School of Law. Michael B. Powell, also an associate of Cadwalader, Wickersham & Taft LLP, assisted in the preparation of this article. Mr. Powell received his J.D., cum laude, from New York University School of Law.

1 35 U.S.C. § 101.

2 CLS Bank Int'l v. Alice Corp. Pty, 717 F.3d 1269, 1334 (Fed. Cir. 2013) (additional reflections of Rader, C.J.). During the drafting of this article, the U.S. Supreme Court granted certiorari. Alice Corp. Pty. Ltd. v. CLS Bank Int'l, No. 13-298 (U.S. Dec. 6, 2013).

3 Ass'n for Molecular Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107 (2013); Mayo Collaborative Servs. v. Prometheus Labs., Inc., 132 S. Ct. 1289 (2012); Bilski v. Kappos, 130 S. Ct. 3218 (2010); see also Alice Corp. Pty. Ltd. v. CLS Bank Int'l, No. 13-298 (U.S. Dec. 6, 2013) (order granting certiorari).

4 CLS Bank, 717 F.3d at 1321 (Newman, J., concurring in part, dissenting in part). Judge Newman characterized the CLS Bank decision – which "hoped to ameliorate" uncertainty to inventors – as instead resulting in "three incompatible standards, devoid of consensus, serving simply to add to the unreliability and cost of the system of patents as an incentive for innovation." Id.

5 Ultramercial, Inc. v. Hulu, LLC, 722 F.3d 1335, 1341 (Fed. Cir. 2013) (citing Research Corp. Techs. v. Microsoft Corp., 627 F.3d 859, 869 (Fed. Cir. 2010)).

6 MySpace, Inc. v. GraphOn Corp., 672 F.3d 1250, 1260 (Fed. Cir. 2012).

7 545 F.3d 943 (Fed. Cir. 2008) (en banc).

8 130 S. Ct. at 3231.

9 Compare id. at 3228 (Kennedy, J., delivering the opinion of the Court) ("Section 101 similarly precludes the broad contention that the term 'process' categorically excludes business methods."), with id. at 3232 (Stevens, J., joined by Justices Ginsburg, Breyer and Sotomayor, concurring in judgment) ("[A] claim that merely describes a method of doing business does not qualify as a 'process' under § 101.").

10 Id. (Kennedy, J., delivering the opinion of the Court); id. at 3257 (Stevens, J., joined by Justices Ginsburg, Breyer and Sotomayor, concurring in judgment) (concluding that "petitioners' claim is not a 'process' within the meaning of § 101"); id. at 3258 (Breyer, J., joined by Justice Scalia, concurring in judgment) (highlighting "the Court's unanimous agreement that the claims at issue here are unpatentable abstract ideas").

11 The claims at issue in Prometheus "cover[ed] processes that help doctors who use thiopurine drugs to treat patients with autoimmune diseases determine whether a given dosage level is too low or too high." Prometheus, 132 S. Ct. at 1294.

12 Different categories or sub-categories are obviously possible, and the line between a "business method patent" and a "software patent" can be amorphous.

13 See, e.g., Acorda Therapeutics Inc. v. Apotex Inc., 2011 U.S. Dist. LEXIS 102875, at *3, *76-77 (D.N.J. Sept. 6, 2011) (rejecting § 101 challenge to claims directed to dosing the drug multiparticulate tizanidine with food to reduce unwanted side effects); SmartGene, Inc. v. Advanced Biological Labs., SA, 852 F. Supp. 2d 42, 45 (D.D.C. 2012) (invalidating claims directed to "guiding the selection of therapeutic treatment regimens for complex disorders ... by ranking available treatment regimens and providing advisory information"); Ariosa Diagnostics, Inc. v. Sequenom, Inc., 2013 U.S. Dist. LEXIS 156554, at *25 (N.D. Cal. Oct. 30, 2013) (invalidating claims directed to "methods of detecting paternally inherited cffDNA in maternal plasma or serum").

14 Accenture Global Servs., GmbH v. Guidewire Software, Inc., 800 F. Supp. 2d 613, 620 (D. Del. 2011), aff'd, 728 F.3d 1336 (Fed. Cir. 2013).

15 Bancorp Servs., L.L.C. v. Sun Life Assur. Co., 771 F. Supp. 2d 1054, 1056 (E.D. Mo. 2011), aff'd, 687 F.3d 1266 (Fed. Cir. 2012).

16 Graff/Ross Holdings LLP v. Fed. Home Loan Mortg. Corp., 892 F. Supp. 2d 190, 197 (D.D.C. 2012).

17 Chamberlain Group, Inc. v. Lear Corp., 756 F. Supp. 2d 938, 969 (N.D. Ill. 2010) (denying summary judgment of § 101 invalidity).

18 Oleksy v. Gen. Elec. Co., 2013 U.S. Dist. LEXIS 89351, at *5 (N.D. Ill. June 26, 2013) (denying summary judgment of § 101 invalidity).

19 Compression Tech. Solutions LLC v. EMC Corp., 2013 U.S. Dist. LEXIS 78338, at *2, *13 (N.D. Cal. May 29, 2013) (granting early summary judgment of invalidity, because patent claimed "no more than an abstract idea").

20 In re Certain Flash Memory & Prods. Containing Same, 2010 USITC LEXIS 2425, at *2-3 (USITC Nov. 15, 2010) (denying summary determination of § 101 invalidity).

21 IconFind, Inc. v. Google, Inc., 2012 U.S. Dist. LEXIS 5460, at *8 (E.D. Cal. Jan. 18, 2012) (denying Fed. R. Civ. P. 12(c) motion for judgment on the pleadings).

22 Compare Netgear, Inc. v. Ruckus Wireless, Inc., 2013 U.S. Dist. LEXIS 140047, at *59 (D. Del. Sept. 30, 2013) (denying summary judgment on wireless communication patent, because recited "receiver" component "plays an integral part in permitting the [claimed] system ... to be performed"), with id. at *71-73 (invalidating separate claim to an abstract strategy, because recited means did not "tie the otherwise abstract idea to a specific way of performing it, or link the abstract idea to a particular machine implementing a process").

23 Applied Innovation, Inc. v. Commercial Recovery Corp., 2013 U.S. Dist. LEXIS 115596, at *4 (E.D. Wash. Aug. 14, 2013).

24 In re Certain Flash Memory, 2010 ITC LEXIS 2425, at *3.

25 Chamberlain, 756 F. Supp. 2d at 969.

26 DealerTrack, Inc. v. Huber, 657 F. Supp. 2d 1152, 1155 (C.D. Cal. 2009) (invalidating claims on summary judgment), aff'd in relevant part, 674 F.3d 1315, 1330-35 (Fed. Cir. 2012).

27 Fuzzysharp Techs. Inc. v. Intel Corp., 2013 U.S. Dist. LEXIS 160897, at *41 (N.D. Cal. Nov. 6, 2013).

28 Compare Advanced Software Design Corp. v. Fiserv, Inc., 2012 U.S. Dist. LEXIS 67755, at *18 (E.D. Mo. May 15, 2012) (rejecting validity challenge to claim reciting "a scanner and programmed data processing device, [which] requires complex programming for a specific application to a narrow field"), with Fannie Mae v. Graff/Ross Holdings LLP, 893 F. Supp. 2d 28, 37-38 (D.D.C. 2012) (invalidating dependent claims, because their "various field of use limitations ... fail to provide meaningful limits" on claim scope).

29 The Bilski majority refused to place "business methods ... categorically outside of § 101's scope." Bilski v. Kappos, 130 S. Ct. 3218, 3228 (2010).

30 Numerous decisions have refused to adjudicate § 101 invalidity at the motion-to-dismiss stage, or prior to claim construction and/ or discovery. See cases cited infra notes 37, 38, and 39.

31 LML Patent Corp. v. JPMorgan Chase & Co., 2010 U.S. Dist. LEXIS 144649, at *9, *30-31 (E.D. Tex. Sept. 20, 2010) (rejecting validity challenge to patent "directed to electronic consumer payments as an alternative to paper checks, credit cards, or cash"); see also Big Baboon, Inc. v. Dell, Inc., 2011 U.S. Dist. LEXIS 155536, at *10, *43 (C.D. Cal. Feb. 8, 2011) (rejecting validity challenge, because a "specially programmed, web-enabled DBMS [database management system]" was "central" to the claimed business-to-business web commerce solution); Island Intellectual Prop. LLC v. Deutsche Bank AG, 2012 U.S. Dist. LEXIS 16413, at *8, *24-28 (S.D.N.Y. Feb. 6, 2012) (limitations in methods claims, enabling financial institutions to sweep client funds into external interest-earning accounts at multiple FDIC-insured banks, "'far removed [the asserted claims] from purely mental steps'").

32 CLS Bank, 717 F.3d at 1313 (Moore, J., joined by Chief Judge Rader and Judges Linn and O'Malley, dissenting-in-part).

33 Of the 16 Federal Circuit decisions containing substantive § 101 analysis by the panel majority or en banc court, 8 cases found the challenged claims invalid and 8 cases sustained validity. This statistic includes panel decisions that were ultimately reversed by the Supreme Court or the Federal Circuit sitting en banc.

34 Bilski, 130 S. Ct. at 3225.

35 This includes several long-pending cases in which the § 101 defense appears to have first been raised and addressed by the district court in the aftermath of In re Bilski. See, e.g., Chamberlain, 756 F. Supp. 2d 938 (filed 2005); CyberSource Corp. v. Retail Decisions, Inc., 620 F. Supp. 2d 1068 (N.D. Cal. 2009) (filed 2004), aff'd 654 F.3d 1366 (Fed. Cir. 2011); DealerTrack, 657 F. Supp. 2d 1152 (filed 2006), aff'd in relevant part, 674 F.3d 1315, 1330-1335 (Fed. Cir. 2012); Every Penny Counts, Inc. v. Bank of Am. Corp., 2009 U.S. Dist. LEXIS 53626 (M.D. Fla. May 27, 2009) (filed 2007); Graff/Ross Holdings LLP v. Fed. Home Loan Mortgage Corp., 2010 U.S. Dist. LEXIS 141399 (D.D.C. Aug. 27, 2010) (filed 2007); Oleksy, 2013 U.S. Dist. LEXIS 89351 (filed 2006); Research Corp. Techs., Inc. v. Microsoft Corp., 2009 U.S. Dist. LEXIS 71883 (D. Az. July 28, 2009) (filed 2001), rev'd in relevant part, 627 F.3d 859 (Fed. Cir. 2010).

36 BuySAFE, Inc. v. Google Inc., 2013 U.S. Dist. LEXIS 105601 (D. Del. July 29, 2013); Cardpool, Inc. v. Plastic Jungle, Inc., 2013 U.S. Dist. LEXIS 9280 (N.D. Cal. Jan. 22, 2013); Content Extraction & Transmission LLC v. Wells Fargo Bank, 2013 U.S. Dist. LEXIS 107184 (D.N.J. July 31, 2013); Glory Licensing LLC v. Toys "R" Us, Inc., 2011 U.S. Dist. LEXIS 51888 (D.N.J. May 16, 2011); OIP Techs., Inc. v. Amazon.com, Inc., 2012 U.S. Dist. LEXIS 129396 (N.D. Cal. Sept. 11, 2012); Sinclair-Allison, Inc. v. Fifth Ave. Physician Servs., LLC, 2012 U.S. Dist. LEXIS 179138 (W.D. Okla. Dec. 19, 2012); UbiComm, LLC v. Zappos IP, Inc., 2013 U.S. Dist. LEXIS 161559 (D. Del. Nov. 13, 2013).

37 InvestPic, LLC v. FactSet Research Sys., 2011 U.S. Dist. LEXIS 112891, at *3 (D. Del. Sept. 30, 2011) (declining to "address the merits of defendants' arguments ... in the absence of either discovery or claim construction"); Infonow Corp. v. Zyme Solutions, Inc., 2013 U.S. Dist. LEXIS 113325, at *23 (D. Colo. Apr. 29, 2013) (declining to "resolv[e] questions of validity prior to discovery or claim construction").

38 Classen Immunotherapies, Inc. v. Biogen IDEC, 2012 U.S. Dist. LEXIS 75039, at *22 (D. Md. May 29, 2012) (refusing to invalidate patent "without the benefit of a claim construction hearing"); Spark Networks USA, LLC v. Humor Rainbow, Inc., 2011 U.S. Dist. LEXIS 153506, at *9 (C.D. Cal. July 7, 2011) (requiring at least "minimal claim construction .... because the parties have presented fundamentally different pictures of the [patent's] subject matter"); see also Zillow, Inc. v. Trulia, Inc., 2013 U.S. Dist. LEXIS 127606, at *23 (W.D. Wash. Sept. 6, 2013) (denying motion to dismiss with leave "to raise this issue again following claim construction").

39 Lendingtree, LLC v. Zillow, Inc., 2012 U.S. Dist. LEXIS 78332, at *5 (W.D.N.C. June 4, 2012); Edge Capture L.L.C. v. Barclays Bank PLC, 2011 U.S. Dist. LEXIS 11562, at *3 (N.D. Ill. Jan. 31, 2011) (invalidity judgment "would be inappropriate on the record ... before the Court" on a motion to dismiss); In re Certain Mach. Vision Software, 2010 USITC LEXIS 752, at *4-5 (USITC May 3, 2010) ("[I]t is simply too early in the game to state that ... the moving party is entitled to complete victory, i.e., the invalidation of the patents.").

40 Zillow, 2013 U.S. Dist. LEXIS 127606, at *2 (denying motion to dismiss "but without prejudice to re-filing following claim construction").

41 Sandborn v. Avid Tech., Inc., 2013 U.S. Dist. LEXIS 126772, at *15 (D. Mass. Sept. 5, 2013).

42 Ultramercial, 722 F.3d at 1339 (emphasis in original) (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007)).

43 35 U.S.C. § 282.

44 Versata Software, Inc. v. Sun Microsystems, Inc., 2009 U.S. Dist. LEXIS 37811, at *4-5 (E.D. Tex. Mar. 31, 2009) (denying Fed. R. Civ. P. 12(c) motion, because accused infringer "has not met its burden to prove there are 'no disputed issues of material fact and only questions of law remain'"); IconFind, 2012 U.S. Dist. LEXIS 5460, at *8 (same; defendant failed to show "under the applicable 'clearly established' standard of Rule 12(c) that the [patented] concepts" were "manifestly abstract").

45 Ultramercial, 722 F.3d at 1338, 1339.

46 Lumen View Tech. LLC v. Findthebest.com, Inc., 2013 U.S. Dist. LEXIS 166852, at *40 (S.D.N.Y. Nov. 22, 2013); see also UbiComm, 2013 U.S. Dist. LEXIS 161559, at *20 (citing Ultramercial's Rule 12 standard but nevertheless invalidating claims on the pleadings); see also Content Extraction, 2013 U.S. Dist. LEXIS 107184, at *14-15 (granting post-Ultramercial motion to dismiss under § 101).

47 Both the Federal Circuit and several district courts have noted that the Supreme Court reached the § 101 validity issue on the merits in Bilski without undertaking claim construction. See, e.g., Ultramercial, 722 F.3d at 1339; Digitech Info. Sys. v. BMW Fin. Servs. NA, LLC, 864 F. Supp. 2d 1289, 1292-1293 (M.D. Fla. 2012); Lumen View, 2013 U.S. Dist. LEXIS 166852, at *41.

48 Bilski, 545 F.3d at 951.

49 Ultramercial, 722 F.3d at 1339.

50 Bancorp, 687 F.3d at 1273.

51 Ultramercial, LLC v. Hulu, LLC, 657 F.3d 1323, 1325 (Fed. Cir. 2011).

52 Content Extraction, 2013 U.S. Dist. LEXIS 107184, at *14 (invaliding asserted claims on a Fed. R. Civ. P. 12(b)(6) motion); Cardpool, 2013 U.S. Dist. LEXIS 9280, at *10 (same).

53 OIP Techs., 2012 U.S. Dist. LEXIS 129396, at *14, *69 (invaliding claims on motion to dismiss); CyberFone Sys., LLC v. Cellco P'ship, 885 F. Supp. 2d 710, 715 (D. Del. 2012) (granting summary judgment of § 101 invalidity); Digitech, 864 F. Supp. 2d at 1292-1293 (same).

54 Big Baboon, 2011 U.S. Dist. LEXIS 155536, at *11-12 (adopting plaintiffs' construction solely for purpose of resolving summary judgment; § 101 motion denied); Compression Tech., 2013 U.S. Dist. LEXIS 78338, at *9 (same; § 101 motion granted); CyberSource, 620 F. Supp. 2d at 1073 (same; § 101 motion granted).

55 Spark Networks, 2011 U.S. Dist. LEXIS 153506, at *8-9 (deferring defendants' motion to dismiss until after receiving "evidentiary submissions" on claim construction).

56 Spark Networks, 2011 U.S. Dist. LEXIS 153506, at *7-8 (noting that the disputed claim was abstract under defendants' proposed construction but patentably "computer specific" under plaintiff's proffered construction); In re Certain Video Game Machs., 2009 USITC LEXIS 673, at *12-16 (USITC Mar. 26, 2009) (holding that genuine issue of material fact precluded summary determination of invalidity); cf. Zillow, 2013 U.S. Dist. LEXIS 127606, at *22-23 (deferring motion to dismiss, because claim construction "may assist the court" in conducting § 101 inquiry); DealerTrack, 657 F. Supp. 2d at 1156 (citing claim construction order to show how recited machine components were not "particular machines" under Bilski).

57 Bancorp, 771 F. Supp. 2d at 1064 (invalidating claims on summary judgment).

58 Advanced Software Design, 2012 U.S. Dist. LEXIS 67755, at *15 (E.D. Mo. May 15, 2012) (denying summary judgment).

59 See, e.g., Oleksy, 2013 U.S. Dist. LEXIS 89351 (denying summary judgment of § 101 invalidity before turning to the proper construction of disputed claim terms).

60 Planet Bingo, LLC v. VKGS, LLC, 2013 U.S. Dist. LEXIS 116898, at *3, *20-41 (W.D. Mich. Aug. 19, 2013).

61 Ultramercial, 722 F.3d at 1339.

62 OIP Techs., 2012 U.S. Dist. LEXIS 129396, at *14.

Originally published in New York Intellectual Property Law Association, Inc. December 2013/January 2014

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:
  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.
  • Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.
    If you do not want us to provide your name and email address you may opt out by clicking here
    If you do not wish to receive any future announcements of products and services offered by Mondaq you may opt out by clicking here

    Terms & Conditions and Privacy Statement

    Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

    Use of www.mondaq.com

    You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


    Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

    The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


    Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

    • To allow you to personalize the Mondaq websites you are visiting.
    • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
    • To produce demographic feedback for our information providers who provide information free for your use.

    Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

    Information Collection and Use

    We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

    We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

    Mondaq News Alerts

    In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


    A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

    Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

    Log Files

    We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


    This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

    Surveys & Contests

    From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


    If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


    From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

    *** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


    This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

    Correcting/Updating Personal Information

    If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

    Notification of Changes

    If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

    How to contact Mondaq

    You can contact us with comments or queries at enquiries@mondaq.com.

    If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.

    By clicking Register you state you have read and agree to our Terms and Conditions