BASCOM Glob. Internet Servs. v. AT&T Mobility LLC - 827 F.3d 1341 (Fed. Cir. 2016)

Rule:

A patent may be obtained for any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof. 35 U.S.C.S. § 101. The United States Supreme Court has long held that this provision contains an important implicit exception: laws of nature, natural phenomena, and abstract ideas are not patentable. The Supreme Court has also consistently held that § 101 provides a basis for a patentability/validity determination that is independent of—and on an equal footing with—any other statutory patentability provision. Courts may therefore dispose of patent-infringement claims under § 101 whenever procedurally appropriate. In Mayo Collaborative Servs. v. Prometheus Labs., Inc., the Supreme Court set forth a two-step analytical framework to identify patents that, in essence, claim nothing more than abstract ideas. The Supreme Court discussed that test in Alice Corp. Pty. Ltd. v. CLS Bank International, where it stated that a court must first determine whether the claims at issue are directed to a patent-ineligible concept. If so, the court must then consider 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.

Facts:

The '606 patent was filed in March 1997. According to the '606 patent, filtering software was first placed on local computers. Although the filtering software worked for its intended purpose, there were logistical problems with locating a tool for filtering Internet content on each local computer. The '606 patent described its invention as combining the advantages of the then-known filtering tools while avoiding their drawbacks. And, unlike the filtering tools that existed on local servers and remote Internet Service Providers (ISPs) servers at the time, the claimed filtering tool retained the advantage of a filtering tool that was located on each local computer. The claimed invention was able to provide individually customizable filtering at the remote ISP server by taking advantage of the technical capability of certain communication networks. The '606 patent described its filtering system as a novel advance over prior art computer filters, in that no one had previously provided customized filters at a remote server. Plaintiff Bascom Global Internet Services, Inc sued AT&T Inc. for patent infringement, added AT&T Mobility LLC and AT&T Corp., as defendants, and then dismissed AT&T Inc. from the case. Defendant moved to dismiss the plaintiff’s complaint under FRCP 12(b)(6), on the basis that each claim of the '606 patent was invalid under 35 U.S.C. § 101. Defendant argued, among others, that the claims were directed to the abstract idea of filtering content, filtering Internet content, or determining who gets to see what, each of which was a well-known method of organizing human activity like the intermediated settlement concept that was held to be an abstract idea. Plaintiff argued that the claims were not direct abstract ideas because they address a problem arising in the realm of computer networks, and provide a solution entirely rooted in computer technology. The district court agreed with the defendant and found that the claims were directed to the abstract idea of filtering content. Plaintiff appealed. 

Issue:

Did the district court err in dismissing the plaintiff’s patent infringement complaint?

Answer:

Yes.

Conclusion:

The appellate court vacated the district court’s dismissing the complaint and remanded the case for further proceedings. The court found that the district court erred when it found that plaintiff’s action alleging that the defendant infringed U.S. Patent No. 5,987,606 had to be dismissed because the '606 patent was invalid under 35 U.S.C.S. § 101. The court ruled that the '606 patent, which described a system for filtering content that was on the Internet, did not attempt to patent an abstract concept, but instead, the patent provided a solution for filtering content by installing a filter on an Internet service provider's servers in a way that provided individually customizable filtering by taking advantage of the technical capabilities of certain communication networks to avoid existing drawbacks such as modification by computer literate end-users, installation on individual end-user hardware and operating systems, and the need to rely on local area networks or a local server platform.