Another Court Invalidates Computer-Aided Method Claims

By Matt Osenga

Another district court has used In re Bilski‘s machine-or-transformation test to invalidate a method claim that included the aid of a computer.  In Dealertrack, Inc. v. Huber, et al., Doc. No. 06-2335 (C.D. Cal. 2009), the plaintiff asserted that U.S. Patent No. 7,181,427 was infringed by the defendant.

Claim 1 of the ’427 patent states:

1. A computer aided method of managing a credit application, the method comprising the steps of:

receiving credit application data from a remote application entry and display device;

selectively forwarding the credit application data to remote funding source terminal devices;

forwarding funding decision data from at least one of the remote funding source terminal devices to the remote application entry and display device;

wherein the selectively forwarding the credit application data step further comprises:

sending at least a portion of a credit application to more than one of said remote funding sources substantially at the same time;

sending at least a portion of a credit application to more than one of said remote funding sources sequentially until a finding source returns a positive funding decision; sending at least a portion of a credit application to a first one of said remote funding sources, and then, after a predetermined time, sending to at least one other remote funding source, until one of the finding sources returns a positive funding decision or until all funding sources have been exhausted; or;

sending the credit application from a first remote funding source to a second remote finding source if the first funding source declines to approve the credit application.

The claim is a “computer-aided method.”  The court ruled that the computer does not include hardware or a database that is specially programmed to perform the claimed method, but instead described the claim-related machines as “any device, e.g., personal computer or dumb terminal.”  This was a part of the court’s claim construction ruling issued over a year before.  The court cited a growing number of district courts and Board of Patent Appeals and Interferences (BPAI) decisions that are ruling against patent owners and applicants on this issue.

Thus, we wait with hopeful anticipation that the Supreme Court will fix the Federal Circuit’s mess yet again.


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