Since the 2014 U.S. Supreme Court ruling on patent eligibility in Alice v. CLS Bank, patent holders and applicants have seen an almost unchecked string of patent ineligibility holdings in U.S. courts and U.S. Patent and Trademark Office decisions related to software-implemented patents. The Alice decision swept aside many inventions as unpatentable because they relied on abstract concepts without sufficiently transforming the abstract concept to qualify for a patent. However, most inventions rely on some concept that has at least some element of abstraction, and the degree to which a concept is transformed is a bit subjective, so what is an inventor to do?
Guidance on Section 101 post-Alice has been sparse, and successes in upholding patent eligibility of software even rarer, but the recent decision by the Federal Circuit in McRO, Inc. v. Bandai Namco Games America, Inc. (September 13, 2016) gives a positive nod towards eligible subject matter in the area of software-based patents. In McRO, the Federal Circuit reversed the U.S. District Court for the Central District of California's finding that U.S. Patents No. 6,307,576 and 6,611,278 were invalid on the basis of ineligible subject matter. The two patents' claims are based on a design intended to automate lip and facial movements for three-dimensional animation of speech. Prior to the claimed inventions, artists blended weighted facial images and manually performed three-dimensional facial animation frame by frame to visually represent a face making a movement corresponding to a specific sound. The '576 patent and the '278 patent claimed inventions implementing rules for relating sequences of sounds, timing and morph-weight sets to reliably and automatically produce three-dimensional lip synchronization and facial animations for speech.
Although the claimed inventions greatly sped up the process of animating speech while reducing its cost, the defendants argued that the subject matter of animating speech using a computer was merely automating a conventional activity. The district court also held that the claims were abstract because they did not claim specific rules. In its reversal, the Federal Circuit emphasized the importance of "considering the claims in their entirety to ascertain whether their character as a whole is directed to excluded subject matter." The Federal Circuit took the position that in Alice a computer simply automated a manual task that had been previously performed. In McRo, the claimed rules for automating three-dimensional lip-synchronization and facial expression were based on an alternative process that was not identical to the former manual process. Thus, the computer will be performing a new method to achieve a result, not merely automating a known manual process. Further, the claims lay out the automated rules specifically enough to not encompass all rule-based lip movement and facial expression three-dimensional animation.
What does this mean to Patent Holders and Applicants?
- Courts cannot assume software-based claims are directed to abstract ideas.
- Software-based inventions may be eligible when the underlying process being performed by the software is eligible.
- Patent applications must distinguish claimed automated processes from existing manual processes.
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