Post-Grant Review May Be Used to Invalidate Patents Directed to Patent-Ineligible Subject Matter
Addressing patent-eligible subject matter issues, the Patent Trial and Appeal Board (PTAB or Board) issued a final written decision in a post-grant review (PGR) finding all claims of a newly issued patent unpatentable under 35 USC § 101. Netsirv v. Boxbee, Inc., Case No. PGR2015-00009 (PTAB, Aug. 2, 2016) (Saindon, APJ).
Netsirv filed a petition requesting PGR of all claims of an America Invents Act (AIA) patent directed to storage container tracking and delivery in the physical storage field. The PTAB instituted the PGR solely to determine whether the claims were unpatentable as being directed to patent-ineligible subject matter under § 101.
Under the Alice framework, the PTAB first determined that the claims were directed to an abstract idea: a bailment scheme using storage containers. The PTAB found that such bailment schemes have long been a prevalent economic practice and constitute an abstract idea. The PTAB also acknowledged the Enfish case, which explained that not all claims directed to improvements in computer-related technology are abstract, but found that because the claims merely used the computer as a tool and were not directed to the functionality of the computer itself, it was proper to proceed to the second step of the Alice test.
Under the second step, the PTAB analyzed the claims to determine whether they recited something significantly more than the abstract idea. In this case, the PTAB found that the claims only recited basic data operations and the mundane transfer and storage of data. Furthermore, the PTAB found nothing inventive in the nature of the data passed between computers. Hence, the PTAB concluded that the claims were directed to nothing more than a computerized application of a bailment scheme using storage containers.
Note: This case demonstrates that PGR proceedings enable petitioners to challenge patents on § 101 eligibility grounds. Thus, parties will still be able to challenge patents on § 101 grounds after the Transitional Program for Covered Business Method Patents phases out on September 16, 2020, as more post-AIA applications (those filed on or after March 16, 2013) mature into patents that are subject to PGR.