Federal Circuit Finds Computer Bingo Patents Invalid as Abstract Ideas

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Explore:  Corporate Counsel

On August 26, 2014, the Federal Circuit ruled that patent claims regarding computer-aided management of bingo games are invalid because they are directed to a patent-ineligible abstract idea. The ruling in Planet Bingo, LLC v. VKGS LLC[1] is notable because it is one of the first Federal Circuit rulings[2] regarding patent ineligibility after the Supreme Court's recent decision on that topic in Alice Corp. v. CLS Bank International[3], which we discussed in a recent Duane Morris Alert. In Alice, the Supreme Court described and applied a two-part test to determine if a patent claim is directed to a patent-ineligible concept under 35 U.S.C. § 101. The Planet Bingo ruling offers insight into how courts are applying, and will apply, Alice.[4]

The Claims at Issue

The claims at issue in Planet Bingo pertain to computer-aided management of the game of bingo. More particularly, Planet Bingo, LLC (the patent owner) accused VKGS LLC of infringing various method and system claims that "[g]enerally … recite storing a player's preferred sets of bingo numbers; retrieving one such set upon demand, and playing that set; while simultaneously tracking the player's sets, tracking player payments, and verifying winning numbers."[5]

The Court's Reasoning

The Federal Circuit reviewed the case on appeal from the Western District of Michigan, which granted summary judgment of invalidity of all asserted claims under § 101. The Federal Circuit noted that there is no meaningful distinction between the method and system claims at issue and applied the same analysis to all the claims. Specifically, the Court applied the following two-part test described by the Supreme Court in Alice:

1) Determine whether the claims at issue are directed to a patent-ineligible concept (such as an abstract idea, law of nature, or natural phenomenon); and

2) If the answer to the first question is "yes," determine whether additional elements in the claims transform the claims into a patent-eligible application of that concept.

Regarding the first part of the test described in Alice, the Federal Circuit found that that the claimed methods and systems for "managing a game of Bingo" are similar to the kind of "organizing human activity" that was described as patent-ineligible in Alice. The Court concluded that the claims at issue in Planet Bingo are directed to the abstract idea of "solv[ing a] tampering problem and also minimiz[ing] other security risks during bingo ticket purchases."[6] The Court also noted that the steps in the claims can be carried out mentally by a human using pen and paper, favoring a finding of patent ineligibility. The Supreme Court in Alice did not conduct this type of "mental steps" analysis. Planet Bingo is notable in part because the ruling suggests that the Federal Circuit may engage in "mental steps" analysis in future § 101 cases. The patent owner argued that the patented invention involves functionality that cannot be performed manually (e.g., processing of thousands of preselected bingo numbers), but the Court rejected that argument because such functionality is not recited in the claims.

As for the second part of the patent eligibility test, the Federal Circuit considered the claims that require "a computer with a central processing unit," "a memory," "an input and output terminal," "a printer," and "a video screen." The Court found that those limitations correspond to a "generic computer implementation of the covered abstract idea."[7] Furthermore, the Court found that the function performed by the "generic computer" at each step of the process recited in the claims is "purely conventional."[8] Accordingly, the Court held that the claims at issue are not eligible for patent protection and affirmed the district court's summary judgment of invalidity.

Lessons from the Court's Ruling

The Planet Bingo case offers several insights that may be relevant for future patent eligibility scenarios:

  1. Courts might engage in "mental steps" analysis for § 101 inquiries, even though the Supreme Court did not do so in Alice.
  2. For the mental steps analysis, courts will likely only consider what is set forth in the claims of a patent, not what a patent owner argues regarding unclaimed functionality.
  3. The Court's opinion states, "[w]e need not, and do not, address whether a claimed invention requiring many transactions might tip the scales of patent eligibility …."[9] Arguably, that statement at least leaves open the possibility that drafting a claim to require a large number of transactions (or something else that precludes manual performance of the claimed invention) might lead to a finding of patent eligibility.
  4. Courts are likely to continue to inquire whether the function performed by a computer at each step of a claimed process is "purely conventional." Although that type of analysis arguably conflates the inquiry under § 101 (patent eligibility) with the inquiries under §§ 102 (novelty) and 103 (obviousness) to some extent, the Court's reasoning in Planet Bingo suggests that one way for patent prosecutors to avoid a finding of patent ineligibility may be to focus at least one step of a claimed process (or system corresponding to a process) on a feature that is not "purely conventional."

Notes

  1. Planet Bingo, LLC v. VKGS LLC, No. 2013-1663 (Fed. Cir Aug. 26, 2014) (available at http://www.cafc.uscourts.gov/images/stories/opinions-orders/13-1663.Opinion.8-22-2014.1.PDF).
  2. In the only other majority opinion regarding patent eligibility issued by the Federal Circuit after Alice, the Federal Circuit affirmed the invalidity of claims directed to a device profile and a method for creating a device profile within a digital image processing system. Digitech Image Technologies, LLC v. Electronics For Imaging, Inc., Case No. 2013-1600 (Fed. Cir. July 14, 2014). In one other post-Alice Federal Circuit ruling, Judge Mayer expressed in a concurrence that he would have found claims directed to filtering information for relevance to a user's query invalid under 35 U.S.C. § 101. I/P Engine, Inc. v. AOL Inc., Case Nos. 2013-1307, -1313 (Fed. Cir. Aug. 15, 2014).
  3. Alice Corp. Pty. Ltd. v. CLS Bank Int'l, 134 S. Ct. 2347 (U.S. 2014).
  4. The Federal Circuit designated the ruling in Planet Bingo as nonprecedential, but it is still useful for analysis because it is one of the few post-Alice appellate rulings regarding 35 U.S.C. § 101.
  5. Planet Bingo at p.2.
  6. Id. at p.5.
  7. Id. at p.6.
  8. Id.
  9. Id. at p.5.

Topics:  Corporate Counsel

Published In: Civil Procedure Updates, Intellectual Property Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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