Originally published September 15, 2011
In the recent decision of CyberSource Corp. v. Retail
Decisions, Inc., the Federal Circuit affirmed the District
Court for the Northern District of California's summary
judgment holding two software method claims to be invalid because
they are drawn to an un-patentable mental process.
CyberSource's claimed invention relates to a method for
detecting fraud in a credit card transaction by utilizing Internet
Protocol (IP) information, e.g., a user's IP address. The court
held that the method claims do not meet the requirements of the
machine-or-transformation test and, furthermore, recite an
un-patentable mental process that could be performed in a human
mind.
Of particular note in this case is the court's treatment of
the second claim under consideration, a so-called "Beauregard
claim" directed to a computer readable medium containing
program instructions to execute the disclosed method. Specifically,
the court declined to recognize the computer readable medium as a
statutory manufacture or machine and invalidated the claim on the
same grounds as the method claim. The court stated that it looks to
the underlying invention of the claim and is not bound by the
"statutory category...a claim's language is crafted to
literally invoke." In this case, the underlying invention of
both claims was identical, i.e., the method of fraud detection.
Explaining further, the court noted that merely reciting a computer
readable medium does not guarantee patent eligible subject matter
where a computer device is not required to perform the
method.
Although post-Bilski law is still in an early
development stage, practitioners should consider implications this
holding may have when drafting software method claims. In
particular, practitioners should consider drafting method claims
that cannot be performed in the human mind alone. Of particular
help may be two cited cases, SiRF Tech, Inc. v. Int'l Trade
Comm'n and Research Corp. Techs. V. Microsoft
Corp., in which software methods were held to be patentable
due to the inability to perform the methods without a computer or
other manufactured device.
To read the Federal Circuit's opinion, click here.
This update is for information purposes only and should not be construed as legal advice on any specific facts or circumstances. Under the rules of the Supreme Judicial Court of Massachusetts, this material may be considered as advertising.
