Panel Majority Rejects Consideration of Patentability Under Section 101 as an Antecedent Question Before Considering Invalidity
March 02, 2012
Last Month at the Federal Circuit - April 2012
Judges: Newman, Mayer, Plager
[Appealed from: N.D. Cal., Judge LaPorte]
In MySpace, Inc. v. GraphOn Corp., No. 11-1149 (Fed. Cir. Mar. 2, 2012), the Federal Circuit affirmed the district court’s SJ grant of invalidity of the patents-in-suit owned by GraphOn Corp. (“GraphOn”).
Plaintiffs MySpace, Inc. (“MySpace”) and craigslist, Inc. (“craigslist”) sought a DJ that four of GraphOn’s patents were invalid and not infringed. GraphOn counterclaimed for infringement and asserted third-party claims against Fox Audience Network, Inc. (collectively with MySpace and craigslist referred to as “the MySpace parties”). The district court consolidated the suits.
The four GraphOn patents disclosed a method and apparatus that allow a user to create, modify, and search for a database record over a computer network. Specifically, the patents-in-suit claim various aspects of a system that enabled a user to control the creation and classification of the user’s own database entry over a computer network such as the Internet. In this manner, users could create a database entry with their own text and graphics and then choose or create searchable categories that best matched the information.
More than two years before the filing date of the priority application for the patents-in-suit, the Mother of all Bulletin Boards (“MBB”) was developed and was publicly available. The MBB enabled online Internet catalogues that could grow through user input. The data in the file system of the computer running the MBB was stored hierarchically, as opposed to relationally.
Collectively, the MySpace parties filed two SJ motions arguing that the MBB prior art system rendered all four patents invalid as anticipated or obvious. The district court granted the motions, concluding that all the claims were either anticipated or rendered obvious by the MBB, and entered a final Judgment against GraphOn. GraphOn appealed.
On appeal, the Federal Circuit rejected GraphOn’s contention that the district court improperly construed the term “database,” found in each of the 73 claims-at-issue. Rather than including both file (hierarchical) and relational systems, as construed by the district court, GraphOn urged that “database” is limited to relational databases, and that therefore hierarchical databases, such as the MBB, are not prior art. The Federal Circuit reviewed the patent specifications and found several broad descriptions of databases and no evidence that the patentee intended to limit the term to a relational database. Thus, the Court concluded that “[b]ecause the preferred embodiments describe features contained in multiple types of databases and the written description is devoid of a clear indication that the invention should be limited to one particular type of database, it would be improper to limit the construction to relational databases.” Slip op. at 10.
Turning to the district court’s SJ ruling, the Federal Circuit agreed with GraphOn that the subject matter as a whole must have been obvious at the time the invention was made, but found that the district court’s analysis was sufficient to establish invalidity. The Court noted that “[t]rial courts analyzing claim limitations should strive to connect those limitations to the context of the claim as a whole when making summary judgment determinations regarding validity.” Id. at 11. While “[s]uch a step may seem a bit pro forma,” the Court reiterated that “patent claims are not judged solely by their individual limitations.” Id. Here, however, “in which all the claims share a common term that lies at the heart of the invention, we conclude that the district court’s analysis of the ‘database’ term adequately supports the court’s assessment that there is no triable issue of fact as to whether the MBB is a database as used in the claims.” Id. at 12. Accordingly, the Court agreed that the claims were anticipated or obvious.
Next, the Federal Circuit addressed the dissent’s opinion that this case should be decided under 35 U.S.C. § 101, rather than under §§ 102 and 103. The majority noted that “[t]he problem with addressing § 101 initially every time it is presented as a defense is that the answer in each case requires the search for a universal truth: in the broad sweep of modern innovative technologies, does this invention fall outside the breadth of human endeavor that possibly can be patented under § 101?” Id. at 13. In sections 102, 103, and 112, validity of particular claims turns on the application of specific criteria of the statutory section that are well developed and well understood, whereas when it comes to explaining “abstract ideas in terms that are something less than abstract, courts have been less successful.” Id. at 14.
Indeed, the Federal Circuit cautioned courts to avoid “the swamp of verbiage that is § 101 by exercising their inherent power to control the processes of litigation . . . and insist that litigant initially address patent invalidity issues in terms of the conditions of patentability defenses as the state provides, specifically §§ 102, 103, and 112.” In so doing, the question of validity might be concluded under these provisions, and “it would be unnecessary to enter the murky morass that is § 101 jurisprudence.” Id. at 17. Further, the majority explained that such an approach might have beneficial practical effects, such as “preclude[ing] § 101 claims from becoming the next toss-in for every defendant’s response to a patent infringement suit, particularly in business method litigation.” Id. at 19. Thus, the majority found that the proper course of action is that followed by the trial court and the parties: addressing §§ 102 and 103 as Congress has instructed without considering § 101.
Finally, the Federal Circuit rejected GraphOn’s challenges to the district court’s conclusion that the MBB system practiced the other elements of the claims. In light of the Court’s invalidity determination with respect to the term “database,” it found that none of GraphOn’s contentions were “in any way determinative.” Id. at 21.
Accordingly, the majority affirmed the district court’s SJ of invalidity of the patents-in-suit. Judge Mayer dissented, expressing his belief that “[t]he issue of whether a claimed method meets the subject matter eligibility requirements contained in 35 U.S.C. § 101 is an ‘antecedent question’ that must be addressed before [the] court can consider whether particular claims are invalid as obvious or anticipated.” Mayer Dissent at 1-2. Relying on the Supreme Court’s decision in Bilski v. Kappos, 130 S. Ct. 3218 (2010), Judge Mayer emphasized the role and reach of § 101 and explained that in his view “[a] robust application of [§] 101 is required to ensure that the patent laws comport with their constitutionally-defined objective.” Id. at 13. In his view, the claims are unpatentable as an abstract idea, not because the claims lack any practical utility, but rather “because they are too useful and too widely applied to possibly form the basis of any patentable invention.” Id. at 4.
Summary authored by Mukta Jhalani, Esq.