Method of delivering mobile ads that breaks operating system security deemed patent ineligible. FREE STREAM v. ALPHONSO

Method of delivering mobile ads that breaks operating system security deemed patent ineligible. FREE STREAM v. ALPHONSO

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 gives its owner the exclusive right to make, use, sell and import the invention in the United States.

After a patent is granted, it can still be invalidated.  One of the grounds for invalidating a patent is the subject matter to which the invention relates.  A patent can be granted on any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof.  This requirement is articulated in  35 U.S.C. § 101 of United States Patent Law.  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.

The United States Supreme Court has held that fundamental economic practices are not patent eligible because they are abstract ideas. Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 573 U.S. 208 (2014) articulates the present test to determine whether a patent which involves an abstract idea 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.

FREE STREAM MEDIA CORP. v. ALPHONSO INC., 19-1506 (C.A.F.C. 2021) is an example of a case where a patent was invalidated because it was directed to ineligible subject matter.

Plaintiff in this case owns U.S. Patent No. 9,386,356.  The ’356 patent is entitled “Targeting with Television Audience Data Across Multiple Screens.” The patent generally relates to a system providing a mobile phone user with targeted information (i.e., advertisements) that is deemed relevant to the user based on data gathered from the user’s television. The asserted claims utilize three main components: (1) a networked device (e.g., a smart TV); (2) a client device (e.g., a mobile device); and (3) a relevancy matching server.  The innovative method of this patent is piecing the security sandbox of a mobile phone’s operating system so that more precise targeted advertising can be delivered.

Plaintiff sued Defendant for infringement of that patent.  Defendant argued several points in its defense including that the patent was invalid because it was directed to patent ineligible subject matter.  Defendant filed a motion for summary judgment on the grounds that the patent was directed to the abstract idea of sending targeted ads to consumers.  The district court denied the motion but ultimately found that the Defendant did not infringe on the patent.  Plaintiff appealed the judgement of non infringement and the Defendant cross appealed the denial of  its motion to dismiss.

The Court of Appeals for the Federal Circuit noted that it had found targeted advertising to be patent ineligible subject matter in the past.  Abstract ideas implemented on a computer need to demonstrate some sort of improved computer functionality to qualify as patent eligible subject matter.  Using a method of breaking a mobile phone’s security to increase the effectiveness of targeted advertising was not an improvement in computer functionality.  The Federal Circuit found that the ‘356 patent disclosed an abstract idea, implemented on commodity computer hardware and therefore it did not have patent eligible subject matter.  Based on this conclusion the Federal Circuit reversed the District Court’s denial of the Defendant’s motion for summary judgement.

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