Tenon & Groove, LLC, et al. v. Plusgrade S.E.C., et al, C.A. No. 12-1118-GMS-SRF, January 6, 2015

Fallon, M.J.  Report and recommendation on Defendants’ motion for summary judgment of invalidity recommends granting motion and dismissing the action.

The disputed technology relates to applications used particularly in the airline industry.  Defendants allege the patents-in-suit are invalid for unpatentable subject matter under § 101.  The court finds that the patents-in-suit do not pass the machine-or-transformation test. Merely using a computer to perform more efficiently what could be accomplished manually does not confer patent-eligibility. Here, the specifications themselves reveal that the processes may be performed manually.  The patents recite at best a general purpose computer and do not therefore become patent eligible. The court further examines the abstract nature of the claims, and concludes that the patents are directed to the unpatentable fundamental concept of using a computer to facilitate negotiations between an airline and its customer that results in an upgrade. Nor is an airline’s capacity to track variables such as preferences of multiple passengers, flight availability, and value for an upgrade option an inventive concept. The claimed concept is furthermore not directed to any specific device or system or limited to a concrete application.  Pursuant to Alice, the recitation of specific hardware elements is insufficient to confer specificity. The court, finding no patentable subject matter, recommends granting defendants’ motion for summary judgment.