KCG Technologies, LLC v. CarMax Auto Superstores, Inc. et al. (19-cv-11101).

Judge Sorokin granted CarMax’s motion to dismiss, finding the asserted claims were directed to non-patentable subject matter.  The patent -in-suit, U.S. 9,671,955, is directed to a “virtual phone” in which a processor, memory, wireless communications and power ports, a touch screen, and a software application permits the emulation of the features of a handheld device (such as a smart phone) on the touch screen. This would allow a smartphone to be emulated on a touchscreen in a vehicle, permitting hands-free operation while maintaining the features and familiarity of location of the features of the phone. CarMax challenged the claims via a motion to dismiss for failure to state a claim on which relief could be granted, asserting that the claims do not meet the eligibility standard set forth in the Supreme Court’s Alice Corp. decision. Applying the test for eligibility set forth in that case, Judge Sorokin first determined that the claims were directed to the idea of emulating the features of a smartphone or other handheld device on a different screen. As was done in many other cases looking at eligibility, Judge Sorokin looked to prior decisions to see if this concept is meaningfully distinguishable from other concepts found to be abstract – courts do not appear to have a concrete method for determining whether the claimed idea is abstract, and instead analogize to prior cases. He did note that the claims recited a number of “generic computer components” without identifying how they worked together to create the claimed virtual smart phone, leaving the patent claiming the idea of an emulated smart phone rather than an actual functioning embodiment – he found the claims to be “merely drawn to the aspect of emulation and to the concept of generating a virtual smart phone – an abstract idea – and not to any particular concrete implementation of that idea.”

Having determined that the claims were directed to an abstract idea, Judge Sorokin next looked for an “inventive concept” that would transform the abstract idea into a patent-eligible application, noting that under existing case law, “more is required than well-understood, routine, conventional activity already engaged in by the scientific community.” Judge Sorokin found that the claims lacked any additional limitations that would ensure that they amounted to more than the ineligible concept itself. He stated that all of the claimed components were generically defined and conventional. Accordingly, he determined that the patent did no claim patent-eligible subject matter, and granted CarMax’s motion to dismiss.

While I am not suggesting that Judge Sorokin was or was not incorrect in this particular instance, the current Alice framework seems to be very subjective. The problem with this approach is that every patent claim can be stated in increasingly broad and abstract terms – Edison’s light bulb patent, for example, could be described as the abstract idea of running electricity through a resistive element so as to general light, and so described may not have been deemed patentable absent further, concrete limitations. Given that this first step of stating the concept or idea of the claims does not appear to have any objective framework, it becomes difficult to determine how a claim will be treated in any given litigation, and the validity of a given patent may well hinge on the particular judge and the persuasiveness of the respective parties’ attorneys rather than the actual content of the specification and claims. One way to potentially overcome this problem might be to rely on concrete components and describe clearly how the components interact, rather than focusing on the function of the device or result of the interaction of the components.

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