Significantly, the court clarified that a claim is abstract if it is “directed to” the abstract idea itself. In addition, the court explained that the claimed notebook tabs provided a functional improvement by enabling a user to avoid the burdensome task of navigating through spreadsheets in separate windows using arbitrary commands. The notebook tabs were not merely labeled buttons or generic icons, but were specific structures used in a three-dimensional spreadsheet environment.
Data Engine Technologies LLC (DET) owned U.S. Patent Nos. 5,590,259; 5,784,545; 6,282,551; and 5,303,146. The ’259, ’545 and ’551 patents are collectively referred to as the “Tab Patents.”2 The Tab Patents related to making complicated electronic spreadsheets more manageable by offering user-friendly interface notebook tabs to traverse the spreadsheets without having to use complex instructions.3
The Tab Patents recognized difficulties with navigating three-dimensional or multiple-page electronic spreadsheets. The Tab Patents described that complicated commands were needed to operate the three-dimensional spreadsheets. The Tab Patents employed an electronic spreadsheet scheme with a notebook interface having notebook pages with a range of information cells. Each page identifier had a tab member located along a bottom perimeter of the notebook. To pass between spreadsheet pages, the user chose the tab for that page.
Quattro Pro, the first commercial version of the invention, was applauded as revolutionizing three-dimensional electronic spreadsheets. DET provided seven articles dated between 1992 and 1993, all praising the benefits of notebook tabs in enhancing navigation of three-dimensional spreadsheets.5
DET sued Google LLC, contending infringement of claims 1–2, 12–13, 16–17, 19, 24, 46–47 and 51 of the ’259 patent; claims 1–2, 5–7, 10, 13 and 35 of the ’545 patent; and claims 1, 3, 6–7, 10, 12–13, 15 and 18 of the ’551 patent. The district court deemed claim 12 of the ’259 patent illustrative of all Tab Patent claims. Claim 12 of the ’259 patent recited:
12. In an electronic spreadsheet system for storing and manipulating information, a computer-implemented method of representing a three-dimensional spreadsheet on a screen display, the method comprising:
displaying on said screen display a first spreadsheet page from a plurality of spreadsheet pages, each of said spreadsheet pages comprising an array of information cells arranged in row and column format, at least some of said information cells storing user-supplied information and formulas operative on said user-supplied information, each of said information cells being uniquely identified by a spreadsheet page identifier, a column identifier, and a row identifier;
while displaying said first spreadsheet page, displaying a row of spreadsheet page identifiers along one side of said first spreadsheet page, each said spreadsheet page identifier being displayed as an image of a notebook tab on said screen display and indicating a single respective spreadsheet page, wherein at least one spreadsheet page identifier of said displayed row of spreadsheet page identifiers comprises at least one user-settable identifying character;
receiving user input for requesting display of a second spreadsheet page in response to selection with an input device of a spreadsheet page identifier for said second spreadsheet page;
in response to said receiving user input step, displaying said second spreadsheet page on said screen display in a manner so as to obscure said first spreadsheet page from display while continuing to display at least a portion of said row of spreadsheet page identifiers; and
receiving user input for entering a formula in a cell on said second spreadsheet page, said formula including a cell reference to a particular cell on another of said spreadsheet pages having a particular spreadsheet page identifier comprising at least one user-supplied identifying character, said cell reference comprising said at least one user-supplied identifying character for said particular spreadsheet page identifier together with said column identifier and said row identifier for said particular cell.6
The ’146 patent, titled “System and Methods for Improved Scenario Management in an Electronic Spreadsheet,” enabled users to monitor changes to electronic spreadsheets. Prior art spreadsheets had few or no options for generating and managing various “what if” scenarios. The ’146 patent addressed these shortcomings by offering an electronic spreadsheet system that tracked various data model versions or scenarios. The system included tools that tracked information cells and automatically determined modifications between “what if” scenarios.7
DET also asserted claims 1, 26–28 and 32–34 of the ’146 patent were infringed by Google. The district court viewed independent claims 1 and 26 as illustrative of the claims of the ’146 patent. Claims 1 and 26 recited:
1. In an electronic spreadsheet system for modeling user-specified information in a data model comprising a plurality of information cells, a method for automatically tracking different versions of the data model, the method comprising:
(a) specifying a base set of information cells for the system to track changes;
(b) creating a new version of the data model by modifying at least one information cell from the specified base set; and
(c) automatically determining cells of the data model which have changed by comparing cells in the new version against corresponding ones in the base set.
26. In an electronic spreadsheet system, a method for storing different versions of a spreadsheet model, the method comprising:
(a) maintaining a base version of the spreadsheet model as ordered information on a storage device; and
(b) for each new version of the spreadsheet model:
(i) determining portions of the new version which have changed when compared against the base version, and
(ii) maintaining the new version by storing additional information for only those portions determined to have changed.8
Before the district court, Google argued that the Tab Patents and the ’146 patent claims were not patent-eligible subject matter. The district court agreed with Google for the Tab Patents, holding that representative claim 12 of the ’259 patent recited the abstract idea of using notebook-type tabs to label and organize spreadsheets. In addition, for the ’146 patent, the district court determined that the claims recited the abstract idea of gathering and identifying modifications to spreadsheet data, and storing data about the modifications.9
DET appealed, and the Federal Circuit reversed the district court with respect to the ’259 patent and affirmed with respect to the ’146 patent.10 35 U.S.C. Section 101 states that “[w]hoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor.”11 In Alice Corp. v. CLS Bank International, the Supreme Court enunciated a two-step test for determining patent eligibility under Section 101. “We must first determine whether the claims at issue are directed to a patent-ineligible concept.”12 If the claims are not directed to a patent-ineligible concept, “the claims satisfy § 101 and we need not proceed to the second step.”13
If the claims recite a patent-ineligible idea, under step two, “the elements of each claim [are analyzed] both individually and ‘as an ordered combination’ to determine whether the additional elements ‘transform the nature of the claim’ into a patent-eligible application.”14
With respect to the Tab Patents, the Federal Circuit held that the claims were directed to patent-eligible subject matter.15 The court determined that claim 12 of the ’259 patent did not recite an abstract idea, but was directed “to a specific way of navigating three-dimensional electronic spreadsheets.”16 Prior art computer spreadsheets required users to comb through complicated menus to locate commands to perform easy computer operations. This was especially true for three-dimensional spreadsheets, which enabled the building of spreadsheet workspaces containing many two-dimensional spreadsheets, adding to the difficulty of using and navigating between multiple spreadsheets.17
The Tab Patents “solved this known technological problem in computers” by enabling quick access to and processing of data in three-dimensional spreadsheets. The court noted that the invention was praised for “improving computers’ functionality as a tool able to instantly access all parts of complex three-dimensional electronic spreadsheets.”18
The court explained:
Representative claim 12 recites precisely this technical solution and improvement in computer spreadsheet functionality. The claim recites specific steps detailing the method of navigating through spreadsheet pages within a three-dimensional spreadsheet environment using notebook tabs. The claim requires displaying on a screen display a row of spreadsheet page identifiers along one side of the first spreadsheet page, with each spreadsheet page identifier being a notebook tab. The claim requires at least one user-settable identifying character to label the notebook tab and describes navigating through the various spreadsheet pages through selection of the notebook tabs. The claim further requires a formula that uses the identifying character to operate on information spread between different spreadsheet pages that are identified by their tabs. The claimed method does not recite the idea of navigating through spreadsheet pages using buttons or a generic method of labeling and organizing spreadsheets. Rather, the claims require a specific interface and implementation for navigating complex three-dimensional spreadsheets using techniques unique to computers.19
The court remarked that claim 12 was analogous to the claims held patent-eligible in Core Wireless, where the invention related to an enhanced display interface enabling users to more efficiently retrieve stored data and programs using small-screen electronic devices. Core Wireless’ invention enhanced the functioning of the display interfaces of the devices. By displaying a subset of frequently used functions and data to select, the invention saved users from time-consuming navigating processes. According to the Federal Circuit, the claims were patent-eligible because they “recite[d] a specific improvement over prior systems, resulting in an improved user interface for electronic devices,” and thus were directed to “an improvement in the functioning of computers.”20
The court explained that claim 12 of the ’259 patent recited a method that was unlike prior art navigation methods and “provide[s] for rapidly accessing and processing information” in three-dimensional spreadsheets.21 Claim 12 recited a “specific” and “particular” manner of navigating a three-dimensional spreadsheet that improves the efficient functioning of computers.22
The court explained that claim 12 was also similar to the claims ruled patent-eligible in Trading Technologies International, Inc. v. CQG, Inc., where the claims encompassed a trading system with a graphical user interface that presented dynamic bid and ask prices and paired orders using a static display of prices to preclude orders that had modified prices. The “challenged patents ‘solve[d] problems of prior graphical user interface devices . . . in the context of computerized trading[ ] relating to speed, accuracy and usability.’”23 The claims “require[d] a specific, structured graphical user interface paired with a prescribed functionality directly related to the graphical user interface’s structure that is addressed to and resolves a specifically identified problem in the prior state of the art.”24
Google argued that the claims were directed to abstract methods of organizing and presenting information. The Federal Circuit disagreed.25 The court held that claim 12 was not merely focused on displaying a graphical user interface or gathering, manipulating or organizing data. Rather, claim 12 recited “a specific structure (i.e., notebook tabs) within a particular spreadsheet display that performs a specific function (i.e., navigating within a three-dimensional spreadsheet).”26
In addition, claim 12 did not just display data, without needing “a new source or type of information, or new techniques for analyzing it.”27 Further, the court reasoned that claim 12 recited a particular improvement to the functioning of computers. The court explained:
At Alice step one, “it is not enough to merely identify a patent-ineligible concept underlying the claim; we must determine whether that patent-ineligible concept is what the claim is ‘directed to.’”28 . . . And that inquiry requires that the claims be read as a whole. . . . We conclude that, when read as a whole, in light of the specification, claim 12 is directed to more than a generic or abstract idea as it claims a particular manner of navigating three-dimensional spreadsheets, implementing an improvement in electronic spreadsheet functionality.29
Google contended, however, that tabs had been used extensively to order information, citing tabbed notebooks, dividers, folders and the like. While the court acknowledged that tabs generally existed, the court was not persuaded that tabs existed in the context of electronic spreadsheets:
It is not enough, however, to merely trace the invention to some real-world analogy. The eligibility question is not whether anyone has ever used tabs to organize information. That question is reserved for §§ 102 and 103. The question of abstraction is whether the claim is “directed to” the abstract idea itself. . . . We must consider the claim as a whole to determine whether the claim is directed to an abstract idea or something more. Google fails to appreciate the functional improvement achieved by the specifically recited notebook tabs in the claimed methods. . . . The tabs are not merely labeled buttons or other generic icons. . . . Rather, the notebook tabs are specific structures within the three-dimensional spreadsheet environment that allow a user to avoid the burdensome task of navigating through spreadsheets in separate windows using arbitrary commands.30
The court then ruled that because claim 12 of the ’259 patent was not abstract under the first Alice step, there was no need to analyze claim 12 under the second Alice step.31 However, with respect to the ’146 patent, which related to tracking changes in three-dimensional spreadsheets, the Federal Circuit concurred with the district court that these claims were “directed to the abstract idea of collecting spreadsheet data, recognizing changes to spreadsheet data, and storing information about the changes.”32
The court noted that claims 1 and 26 were illustrative of the ’146 patent claims. The court explained that these claims described tracking modifications in a spreadsheet by merely creating a base or initial unmodified version of a spreadsheet, creating a new version with the changes and identifying which data cells were altered by comparing the modified and base versions of the spreadsheet. The court held that:
The concept of manually tracking modifications across multiple sheets is an abstract idea. The mere automation of this process does not negate its abstraction. Unlike claim 12 of the ’259 patent, nothing in the ’146 patent’s claims viewed in light of the specification convinces us that the claimed method improves spreadsheet functionality in a specific way sufficient to render the claims not abstract.33
Therefore, the court held that the ’146 patent claims were abstract and related only to the gathering, identifying and storing of identified information in memory.34
Having held that the ’146 patent claims were abstract under Alice step one, the court proceeded to determine whether the claims recited an inventive concept under step two of Alice. The court held that they did not because they recited only “the generic steps of creating a base version of a spreadsheet, creating a new version of the spreadsheet, and determining changes made to the original version.”35
Accordingly, the court held that the Tab Patent claims were patent-eligible subject matter under Alice step one, but the ’146 patent claims were directed to an abstract idea that contained no inventive concept and were as a result not patent-eligible under 35 U.S.C. § 101.36
Why it matters:
The Data Engine Techs. v. Google decision is noteworthy because the Federal Circuit clarified that a claim is considered abstract under step one of Alice Corp. v. CLS Bank International if it is “directed to” the abstract idea itself. In addition, the court explained that the claims were not abstract because they recited a particular manner of navigating three-dimensional spreadsheets and improved electronic spreadsheet functionality. Significantly, the court did not require the improvement to be in computer processing efficiency. Thus, this decision should increase the likelihood of patent eligibility for more computer software-related inventions.
1 Data Engine Techs. LLC v. Google LLC, 906 F.3d 999, 128 USPQ2d 1381 (Fed. Cir. 2018).
2 Id., 128 USPQ2d at 1382.
3 Id., 128 USPQ2d at 1382.
4 Id., 128 USPQ2d at 1382.
5 Id., 128 USPQ2d at 1383.
6 Id., 128 USPQ2d at 1384.
7 Id., 128 USPQ2d at 1384.
8 Id., 128 USPQ2d at 1385.
9 Id., 128 USPQ2d at 1385.
10 Id., 128 USPQ2d at 1385.
11 Id., 128 USPQ2d at 1385 (quoting 35 U.S.C. § 101).
12 Id., 128 USPQ2d at 1385–86 (quoting Alice Corp. v. CLS Bank Int’l, 134 S.Ct. 2347, 2355, 110 USPQ2d 1976, 1981 (2014)).
13 Id., 128 USPQ2d at 1386 (quoting Core Wireless Licensing S.A.R.L. v. LG Elecs., Inc., 880 F.3d 1356, 1361, 125 USPQ2d 1436, 1440 (Fed. Cir. 2018)).
14 Id., 128 USPQ2d at 1386 (quoting Alice Corp. v. CLS Bank Int’l, 134 S.Ct. 2347, 2355, 110 USPQ2d 1976, 1981 (2014); Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S. 66, 78–79, 101 USPQ2d 1961, 1968 (2012)).
15 Id., 128 USPQ2d at 1386.
16 Id., 128 USPQ2d at 1386.
17 Id., 128 USPQ2d at 1386.
18 Id., 128 USPQ2d at 1386.
19 Id., 128 USPQ2d at 1387.
20 Id., 128 USPQ2d at 1387 (quoting Core Wireless Licensing S.A.R.L. v. LG Elecs., Inc., 880 F.3d 1356, 1363, 125 USPQ2d 1436, 1441 (Fed. Cir. 2018)).
21 Id., 128 USPQ2d at 1387 (quoting US Patent No. 5,590,259, col. 3 ll. 53–54).
22Id., 128 USPQ2d at 1387 (citing Core Wireless Licensing S.A.R.L. v. LG Elecs., Inc., 880 F.3d 1356, 1363, 125 USPQ2d 1436, 1441 (Fed. Cir. 2018)).
23 Id., 128 USPQ2d at 1387 (quoting Trading Technologies Int’l, Inc. v. CQG, Inc., 675 F. App’x 1001, 1004 (Fed. Cir. 2017) (alterations in original)).
24 Id., 128 USPQ2d at 1387–88 (quoting Trading Technologies Int’l, Inc. v. CQG, Inc., 675 F. App’x 1001, 1004 (Fed. Cir. 2017)).
25 Id., 128 USPQ2d at 1388.
26 Id., 128 USPQ2d at 1388.
27 Id., 128 USPQ2d at 1388 (quoting Electric Power Group, LLC v. Alstom S.A., 830 F.3d 1350, 1355, 119 USPQ2d 1739, 1742 (Fed. Cir. 2016)).
28 Id., 128 USPQ2d at 1388–89 (quoting Rapid Litig. Mgmt. Ltd. v. CellzDirect, Inc., 827 F.3d 1042, 1050, 119 USPQ2d 1370, 1375 (Fed. Cir. 2016)).
29 Id., 128 USPQ2d at 1389.
30 Id., 128 USPQ2d at 1389.
31 Id., 128 USPQ2d at 1389.
32 Id., 128 USPQ2d at 1390.
33 Id., 128 USPQ2d at 1390.
34 Id., 128 USPQ2d at 1390.
35 Id., 128 USPQ2d at 1390.
36 Id., 128 USPQ2d at 1390.