In 2014, the Supreme Court, in Alice Corporation, Pty., Ltd. v. CLS Bank (read here), ruled that “an idea of itself is not patentable,” and instantly laid waste to thousands of business method patents. But as so often in this case, the Alice decision throws back, without a great deal of guidance, on to lower courts to decide just what is an “abstract” idea, and therefore non-patentable.
Because a finding of invalidity kills a patent infringement suit, the defense community has been active at seeking those determinations as early in a case as possible, even as part of an initial response to a complaint. The results have been mixed. In Berkheimer v. HP Inc., the federal circuit ruled that sufficient factual allegations of an invention was not “routine and conventional,” could preclude a court from making a ruling on patent eligibility early in a case.
This week, though, the Federal Circuit upheld a Maryland courts’ decision to dismiss a patent infringement action against a manufacturer of electric vehicle charging stations Chargepoint, Inc., claimed that its’ patents created a “paradigm-shifting concept” in how to charge electric vehicles in a networked environment, despite “widespread industry skepticism” about the system. Alleged infringer, SemaConnect, Inc., demurred, arguing that Chargepoint’s patents amount to nothing more than the application of an abstract Idea. The Maryland court agreed, writing: “network communication is the only possible inventive concept. Because this is the abstract idea itself, this cannot supply the inventive concept.”
I see this as a very Supreme Court worthy issue. There’s simply too much at stake – the difference between a case that is dismissed on the pleadings versus one that has to go to trial can be millions of dollars in legal costs. Defendants will keep pushing for early dismissal, and patent holders will continue to resist them, until this difference can be settled.
THE BUSINESS TAKE-AWAY: Early motions to dismiss remain a vital tool in the defense arsenal. The rulings post-Alice have gone both directions. One of the few things that can be said is to stress the importance of characterizing the patent as simply a high-tech restatement of a long-understood concept, as SemaConnect successfully did around the concept of networking electronic devices.