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US patents: buySafe patent called out under Section 101




A two-judge panel of the Federal Circuit recently held that buySAFE's patent directed to guaranteeing payment in an online transaction failed meet the post-Alice patent eligibility requirements of 35 USC § 101. In a short and direct opinion, the Federal Circuit found that the claims encompassed the "ancient" idea of ensuring transaction performance, and that the invocation of a generic computer failed to supply the requisite inventive concept.

Significant in the court's analysis of the claims is the statement that buySAFE's claims did not push or even test the boundaries of the Supreme Court's precedents. Rather, the panel found it a "straightforward matter" to conclude that buySAFE's claims were patent ineligible. Such bluntness may signal a rough road ahead for claims of a scope similar to that of buySAFE's claims.

In stark contrast to many pre-Alice Federal Circuit opinions addressing subject matter eligibility, this panel of the Federal Circuit took just over nine pages to dispense with buySAFE's claims. The panel began by reviewing the Supreme Court's decisions in Bilski, Mayo, and Alice, making clear that this new authority eliminated any need for the panel to parse Federal Circuit precedent.

Applying the two-step Alice analysis, the panel first concluded that buySAFE's claims were directed to an abstract idea. The panel found that creating a contractual relationship, specifically one that is a performance guarantee, was an abstract idea that "is beyond question of ancient lineage", citing a 1927 article on suretyship. Since the claims were determined to be directed to an abstract idea, the panel then considered whether the use of a computer provided an inventive concept and held it did not. The panel found that the claims only invoked a computer to perform generic functions of receiving a request for a guarantee and transmitting an offer in return. In the panel's opinion, this amounted to nothing more than using a computer to send and receive information over a network, which the panel characterised as "not even arguably inventive".

Practitioners should take note of not only the tone of the panel's opinion, but also the fact that this case is a precedential opinion. This opinion and its tone should be kept in mind when drafting or analysing claims with a generic recitation of a computer that performs an abstract idea.

Mark A Williamson Sean M Walsh

Fitzpatrick, Cella, Harper & Scinto
1290 Avenue of the Americas
New York, NY 10104-3800
Tel: +1 212 218 2100
Fax: +1 212 218 2200
info@fchs.com
www.fitzpatrickcella.com


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