Is an improvement to an algorithm eligible for patent protection? KPN v. GEMALTO

A patent is a set of exclusive rights granted to the inventor of a new, useful and not obvious invention. In the United States an inventor gains a patent by filing a patent application with the United States Patent and Trademark Office. The patent application is reviewed by a patent examiner at the United States Patent and Trademark Office and if the patent application meets all the requirements, the inventor is granted a patent on the invention. A patent grants its owner the exclusive right to make, use, sell and import the invention in the United States.

Even after a patent is granted, it can still be invalidated. The subject matter to which the invention relates is one of the grounds on which a patent can be invalidated. Any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof is eligible for patent protection. §35 U.S.C. 101 There are also some judicially created exceptions to patent eligible subject matter, namely, laws of nature, physical phenomena, and abstract ideas. Patents that have been granted in the past can be deemed invalid if court precedent changes the definition of these judicially created exceptions.

Whether computer software is eligible subject matter for patent protection is an evolving question. Computer software typically takes algorithms, which can be considered an abstract idea, and applies these algorithms to perform a task. The first United States patent on a piece of computer software was issued in April 23, 1968. Since that time the definition of eligible subject matter has changed significantly, first enlarging and then shrinking the definition of what is considered patent eligible. Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 573 U.S. 208 (2014) articulates the present test to determine if computer software is eligible for patent protection. The first step in the Alice test is to determine whether the claims of the patent are directed to a patent-ineligible concept, like an abstract idea. If the first step is true, then each patent claim is reviewed both individually and ‘as an ordered combination’ to determine whether the additional elements ‘transform the nature of the claim’ into a patent-eligible application. This can be a difficult concept to grasp.

KONINKLIJKE KPN N.V., v. GEMALTO M2M GMBH, 2018-1863 (C.A.F.C. 2019) is a case which turns on whether a piece of computer software is merely an abstract idea. The Plaintiff in this case owns U.S. Patent No. 6,212,662 (’662 patent). The patent relates to the dynamic generation of “check data” for data transmission. Check data is used to confirm that data received is the same as the data which was originally transmitted. The patent identified a problem in the prior methods of generating check data that would allow corrupted data to be accepted as accurate and proposed a new method of generating check data which solved the problem. The plaintiffs sued the defendants for infringing on the ‘662 patent.

The defendants asserted that the claims of the ’662 patent were ineligible under 35 U.S.C. § 101 and moved for summary judgement. The district court granted the defendants motion with respect to all four claims, concluding that the claims recite no more than mere abstract data manipulation operations, such as “reordering data and generating additional data.” The district court explained that the claims of the ’662 patent are abstract because they do “not say how data is reordered, how to use reordered data, how to generate additional data, how to use additional data, or even that any data is transmitted.” The plaintiff appealed the District Court’s ruling to the Court of Appeals for the Federal Circuit.

The Federal Circuit reversed the District Court’s ruling. The Federal Circuit found that rather than being merely directed to the abstract idea of data manipulation, the claims of the ‘662 patent are directed to an improved check data generating device that enables a data transmission error detection system to detect a specific type of error that prior art systems could not. The Federal Circuit concluded that the claims of the ’662 patent are patent-eligible because they are directed to a non-abstract improvement in an existing technological process.

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