Federal Circuit Holds That a Computer-Aided Clearinghouse is a Patent-Ineligible Abstract Idea
By Laura Fishwick – Edited by Adam Lewin

Dealertrack, Inc. v. Huber, Nos. 2009-1566, 2009-1588, 2012 WL 164439 (Fed. Cir. Jan. 20, 2012)
Slip Opinion

The Court of Appeals for the Federal Circuit affirmed the U.S. District Court for the Central District of California’s grant of summary judgment regarding the invalidity of Dealertrack’s U.S. Patent 7,181,427 (filed Sep. 3, 1997) (“the ’427 patent”), which had claims that covered an automated clearinghouse system for car dealerships. The district court had applied the then-definitive “machine-or-transformation” test from In re Bilski, 545 F.3d 943 (Fed. Cir. 2008) (en banc) (“Bilski I”), requiring the claimed process either to be tied to a particular machine or apparatus or to transform an article into a different state or thing. Dealertrack had not argued that its claim effected a transformation, and the district court found that Dealertrack’s patent did not involve a particular machine as required by Bilski I’s test because the computer involved was a general purpose computer that was not “specially programmed.” For this reason, the district court held that the subject matter of Dealertrack’s patent was not eligible for protection under 35 U.S.C. § 101 of the Patent Act because Dealertrack had claimed an abstract idea.

Reviewing the patentable subject matter issue de novo, the Federal Circuit held that Dealertrack had claimed “an abstract idea preemptive of a fundamental concept or idea that would foreclose innovation in this area,” and therefore its patent was invalid. The court found that the claim’s language was too broad in scope, and that neither including a general computer to the method nor restricting the method to a particular field of use saved the patent’s validity.

PatentlyO provides an overview of the case and discusses the case in context of other recent Federal Circuit decisions.  (more…)

Federal Circuit Clarifies the Level of Contribution Required for Joint Invention of a Chemical Compound
By Yana Welinder – Edited by Adam Lewin

Falana v. Kent State Univ., No. 2011-1198, 2012 WL 171550 (Fed. Cir. Jan. 23, 2012)
Slip Opinion

The Federal Circuit affirmed in part the ruling of the U.S. District Court for the Northern District of Ohio, which held that Dr. Olusegun Falana should have been listed as co-inventor on a patent that described the use of his protocol for controlled synthesis of a category of chemical compounds for use in liquid crystal displays (“LCDs”).

Judge Linn, joined by Judge Prost and Judge Reyna, affirmed the district court’s order to add Falana as co-inventor to U.S. Patent No. 6,830,789 (filed Sept. 24, 2001) (“the ’789 patent”). The court found that Falana “envisioned the structure of a novel chemical compound and contributed to the method of making it” because he developed a procedure for synthesizing a new class of compounds that was later used to synthesize a compound that exhibited a desired temperature independence. Slip op. at 13. In so holding, the court considered Falana’s contribution to “the entire class of compounds covered by the plain language of the claims” and rejected the defendants’ narrow reading of the claims to be limited to compounds that can perform “across a temperature range of +10°C to +50°C.” Id. at 7, 9.

PatentlyO provides an overview of the case. IP Frontline criticizes the decision because as applied to patents “with countless claims [it] opens the door to the possibility that at least one of the claims was jointly invented by someone not named in the patent,” which might enable patent defendants to recruit unlisted co-inventors as part of a patent litigation defense strategy.  (more…)

Written by Heather Whitney
Edited by Kassity Liu
Editorial Policy

United States v. Jones (U.S. Jan. 23, 2012)
2012 WL 171117; No. 10-1259

In a hotly anticipated decision, the Supreme Court unanimously found that the Government’s warrantless attachment of a Global Positioning System (GPS) tracking device to a vehicle to monitor its movement constituted a Fourth Amendment violation. While unanimous in judgment, the Court split on both its underlying reasoning and with regards to whether the tracking amounted to a search at all. The Court also did not reach the question of whether the search was reasonable. Due to the Court’s fractured analysis, it remains unclear when the Government must obtain a warrant to track a vehicle’s movements, particularly in the case of short-term monitoring. In concurrence, Justice Alito also suggests that if the public views the losses of privacy brought on by new technologies as inevitable, his Katz analysis would be different in future cases.  (more…)

Megaupload.com indicted by Department of Justice
By Daniella Adler – Edited by Abby Lauer

U.S. v. Kim Dotcom et al., 1:12-cr-3 (E.D. Va.)
Indictment

The Department of Justice recently brought a criminal indictment against Megaupload.com and related websites in the Eastern District of Virginia on three different counts of copyright infringement as well as money laundering and racketeering.

The indictment calls the operators of Megaupload.com and its environs the “Mega-Conspiracy” and describes it as a “worldwide criminal organization.” The government estimates that $175 million in profits from subscriptions and advertising comes directly from the large volume of copyrighted material illegally posted on the website. Among the individuals indicted were Megaupload.com founder Kim Dotcom and several of the sites’ main employees and officers.

Currently, when users attempt to access any of the “Mega” sites, they are confronted with an FBI Piracy Warning, which explains that the domain has been seized, states that the “individuals and entities” associated with the crimes have been indicted, and lists the charges.  (more…)

District Court Holds that Defendant Cannot Refuse to Decrypt Hard Drive under Fifth Amendment
By Brittany Horth – Edited by Abby Lauer

U.S. v. Fricosu, No. 10-CR-00509 (D. Colo. Jan. 23, 2012)
Slip Opinion hosted by Internet Cases

Judge Robert E. Blackburn of the United States District Court for the District of Colorado granted the government’s motion to compel Ramona Camelia Fricosu to provide an unencrypted copy of her hard drive for evidentiary purposes. The court considered whether the act of producing the unencrypted hard drive was privileged and not whether the contents of the hard drive were privileged.

Judge Blackburn held that the Fifth Amendment is not implicated by requiring Fricosu to provide the government with the unencrypted contents of her laptop pursuant to a valid search warrant.  He reasoned that Fricosu was not being compelled to self-incriminate because the government had already met its burden of proof by demonstrating that it knew of the location and existence of the relevant computer files and it knew that Fricosu was the sole or primary user of the laptop.  Additionally, the government offered immunity to Fricosu, under which it could not use her production of the unencrypted contents against her. The production of the unencrypted hard drive could thus not be incriminating in and of itself.

Time Techland provides a brief overview of the case. Internet Cases features a concise analysis of Judge Blackburn’s reasoning. The Electronic Frontier Foundation, who filed an amicus brief in the case, criticizes the court for “dodg[ing] the question of whether requiring Fricosu to type a passphrase into the laptop would violate the Fifth Amendment” and failing to recognize the potential testimonial value of the encrypted data. CNet News summarizes the long-debated issue of whether a defendant can legally be compelled to decrypt his or her computer files as well as the likelihood that the debate will continue.  (more…)