Unruly Distribution: Meeting 101 Conditions in Computer-related Claims

In Sanderling Management Ltd. vs. Snap, Inc., the Federal Circuit held that a method for using distribution rules to load digital image branding functions to users when certain conditions are met are not patent eligible under 101.  The claim in question recited:

1. A computerized method of distributing a digital image processing function, said computerized method comprising:

using at least one server having at least one hardware processor and over a network to access a database storing at least one digital image processing function associated with at least one distribution rule defining a geographic location;
receiving, over said network, a Global Positioning System (GPS) location indication from each of a plurality of mobile devices, each said location indication is determined according to a GPS module executed by one of said plurality of mobile devices;
matching, using said at least one at least one hardware processor, each said GPS location indication with said geographic location; and
automatically forwarding, over said network and in response to receiving said Global Positioning System (GPS) location indication, said at least one digital image processing function to at least one mobile device of said plurality of mobile devices, said at least one mobile device having a respective said GPS location indication which matches said geographic location;
wherein said at least one image processing function is set to be used by an application executed on said at least one mobile device to process a digital image designated at said at least one mobile device to create an output digital image.

The dispute between the parties centered around a common specification wherein distribution rules are applied to a digital imaging brand function which transforms an image based on certain conditions for targeting specific end users. The district court applied the Alice test and concluded that the representative claim fails both Alice steps: the “distribution of information is an abstract idea” and “the representative claim does not constitute an inventive concept.”

Patent eligibility is governed by 35 U.S.C. § 101, which provides that “[w]hoever 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.” “Laws of nature, natural phenomena, and abstract ideas” are, however, “an important implicit exception” to Section 101. Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 573 U.S. 208, 216 (2014). Accordingly, Alice directs us to determine whether a patent claims patent ineligible subject matter in two steps: first we “determine whether the claims at issue are directed to one of those patent-ineligible concepts” (“step one”); and, if so, we next search for an “inventive concept” by “consider[ing] the elements of each claim both individually and as an ordered combination to determine whether the additional elements transform the nature of the claim into a patent-eligible application” (“step two”).

After considering the district court’s two-pronged application of Alice, the Federal Circuit backed the verdict that the representative claim fails the Alice test by way of the “application of ‘the distribution rule’ is an abstract idea using common computer components”.  Focusing on step one of Alice, the Court found that the asserted patents do not claim a specific improvement in computer functionality, but instead use computers as a tool for identifying when a condition is met and distributing information based on that condition. Specifically, the claims are directed towards the abstract idea of providing information, such as processing functions, based on meeting a condition, such as matching a GPS location indication with a geographic location. Although the information being distributed may be of a particular variety, such as digital imaging processing, it is still considered an abstract idea since distribution of information is inherently abstract. The district court’s formulation of this concept was deemed accurate by the Court.

During the second step of the Alice inquiry, the Court assessed whether the claims contain any “additional features” that constitute an inventive concept. This concept must go beyond routine and conventional activity. After undertaking this analysis, the Court agreed with the district court’s ruling that the elements of the representative claim, both individually and in combination, do not constitute an inventive concept. If a claim’s only inventive aspect is the application of an abstract idea using conventional techniques, it does not transform the claim into a patent-eligible application of an abstract idea.  In this case, the distribution rule is simply the application of the abstract idea using common computer components.

Thus, the Court held that the asserted claims fail both steps of Alice inquiry and therefore are patent ineligible.