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Transaction Authentication Claims Using Known Computer Components Are Patent Ineligible

In Universal Secure Registry LLC v. Apple Inc., No. 2020-2044 (Fed. Cir. Aug. 26, 2021), the Federal Circuit affirmed the district court’s determination that four patents related to securing credit card transactions without a credit card magnetic strip are patent ineligible under 35 U.S.C. § 101.

At the lower court, Apple moved to dismiss USR’s complaint, arguing all four patents claimed patent-ineligible subject matter. The magistrate judge initially found they are not, finding that “a more secure authentication system” is an improvement to computer functionality. However, the district court disagreed, finding that “the secure verification of a person’s identity” is an abstract idea and the remaining claim elements are not transformative.

The Federal Circuit agreed with the district court. Addressing each patent individually, at Alice Step One, the Federal Circuit determined each patent is directed to authentication, which is an abstract idea using “conventional tools” to perform “generic steps and results.” At Alice Step Two, the Court found the claim elements are not transformative because the specifications describe the individual elements as conventional, and there is no plausible indication that the combination of conventional techniques “achieves more than the expected sum of the security provided by each technique.”

© 2022 Finnegan, Henderson, Farabow, Garrett & Dunner, LLPNational Law Review, Volume XI, Number 243
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About this Author

Forrest A. Jones Patent Litigation Attorney Finnegan, Henderson, Farabow, Garrett & Dunner Washington, DC
Associate

Forrest Jones focuses on patent litigation, including at the International Trade Commission (ITC), as well as inter partes review (IPR) proceedings before the Patent Trial and Appeal Board (PTAB) and appeals before the U.S. Court of Appeals for the Federal Circuit. He has technical and legal experience in various areas of electrical and computer engineering, including computer software, signal processing, wireless networking, power electronics, power generation, and consumer electronics such as televisions, laptop computers, smartphones, and gaming systems.

Forrest manages complex...

202-408-4019
Christina Ji-Hye Yang Patent Litigation Attorney Finnegan Law Firm Washington, DC
Associate

Christina Ji-Hye Yang focuses her practice on patent litigation and client counseling in the areas of biotechnology and pharmaceuticals, with particular emphasis on Abbreviated New Drug Application (ANDA) cases.

Christina is involved in all phases of litigation, including pre-litigation analysis, fact discovery, and expert discovery. She also has experience in Section 337 litigation at the International Trade Commission (ITC) and post-grant proceedings at the Patent Trials and Appeals Board (PTAB), including inter partes reviews (IPRs). Christina has also advised clients in...

202-408-4465
Elizabeth Ferrill Patent Attorney Finnegan Law Firm
Partner

Elizabeth Ferrill is an “undisputed expert on design patents” who is “always updated and enlightening others with her deep knowledge,” “very involved in the design bar,” and “gives her clients an outstanding service” as noted in Intellectual Asset Management Patent 1000. She focuses her practice on all aspects of design patents, including prosecution, counseling, post-grant, and litigation.

Elizabeth counsels clients who hold design patents as well as those accused of infringement. She has experience with design patents related to consumer and industrial products, medical...

202 408 4445
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