Patent Riffs and Links: ‘Issues of Fact’ in 101 Litigation

Another § 101 Motion Bites the Dust: Existence of Potential Factual Determinations Precludes Motion to Dismiss | BLOGS.ORRICK
A trend? “The Sound View court’s ruling indicates that the recent Federal Circuit decisions in Berkheimer and Aatrix Software may indeed have signaled a trend towards courts rejecting early § 101 motions. The challenged claims were directed to methods of improving how computers operate, the types of technology which already had been viewed as more patentable under the Alice two part test, as set forth in DDR Holdings v. Hotels.Com, L.P.., 773 F.3d 1245 (Fed. Cir. 2014) and Enfish v. Microsoft, 822 F.3d 1327 (Fed. Cir. 2016). The Sound View court considered the patent specification, the allegations in the amended complaint, and the language of the asserted claims together—instead of just considering the technical subject matter of the patent. This type of detailed analysis at the motion to dismiss stage suggests that courts are starting to more carefully scrutinize § 101 motions, and may be inclined to defer judgment on patentability determinations until after the factual record in the case has been developed.”

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Text from the decision: “In two recent decisions, the Federal Circuit has highlighted facts potentially significant to a Section 101 analysis. Berkheimer v. HP Inc., 881 F.3d 1360 (Fed. Cir. 2018) reiterated that ‘whether a claim recites patent eligible subject matter is a question of law which may contain underlying facts. Id. at 1368 (citations omitted). Berkheimer noted that, ‘[w]hether something is well-understood, routine, and conventional to a skilled artisan at the time of the patent is a factual determination. Id. at 1369. Berkheimer determined that some of the claims at issue were patent-ineligible based on the record presented because they did not ‘recite any of the purportedly unconventional activities disclosed in the specification. Id. For other claims, there was at least a genuine issue of material fact in light of the specification regarding whether the claimed steps were performed in an inventive manner. Id.
Aatrix Software, Inc. v. Green Shades Software, Inc., 882 F.3d 1121 (Fed. Cir. 2018) echoed Berkheimer. Aatrix added that allegations in a complaint, which are properly pleaded, to the effect that individual elements of a claim are not well-understood, routine, or conventional, can be sufficient to survive a motion to dismiss based on invalidity under Section 101. Id. at 1128. Aatrix emphasized that there was no evidence in the patent itself showing that a particular disputed claim limitation was conventional. Id. However, ‘[w]hether the claim elements or the claimed combination are well-understood, routine, conventional is a question of fact. And in this case, that question cannot be answered adversely to the patentee based on the sources properly considered on a motion to dismiss, such as the complaint, the patent, and materials subject to judicial notice. Id.”