New Federal Circuit decision affects patent eligibility of “computer readable medium” claims

This week Federal Circuit issued an important decision relating to software patents.  In Cybersource Corp. v Retail Decisions Inc. (No. 2009-1358, Fed. Cir. Aug. 16, 2011),  the Court held that a Beauregard-style claim is not patent-eligible under 35 U.S.C. 101 if the steps that follow the preamble do not cover a patent-eligible method when read by themselves.

A Beauregard claim, so named after a 1995 Federal Circuit decision that upheld such a claim, is one that starts with a preamble like “A computer-readable medium containing programming instructions that cause a computer processor to perform the steps of . . . ”   In the Cybersource decision, the Court said that it would treat a Beauregard claim as a process claim for patentability purposes.

The Court explained that In re Bilski’s “machine-or-transformation” test required that the claim recite more than just “incidental use of a computer to perform [a] mental process.”  Instead,it stated that the machine “must impose meaningful limits on the claim’s scope.”  Because all of the process steps in the claim at issue could be performed entirely by a human, the Court held that “the ‘computer-readable medium’ limitation of claim 2 does not make the otherwise unpatentable method patent-eligible under Section 101.”

The Cybersource opinion cautions that merely mentioning a computer in the steps that follow a Beauregard preamble may not be enough in all situations.  The opinion cites a few examples of patent-eligible and non-eligible processes from past cases.  The examples include:

•  a claim covering steps for converting BCD numbers into binary numbers is not patent-eligible because those steps can be performed mentally (even if the steps include storing the result in a computer memory);
•  a claim covering a method of calculating an absolute position of a GPS received is patent-eligible because it requires a GPS receiver; and
•  a claim covering a method of rendering a halftone image of a digital image by comparing, on a pixel-by-pixel basis, the digital image against a blue noise mask is patent-eligible because from a practical standpoint, no human could mentally perform the method.

Patent attorneys and agents who handle software patents should consider this case when drafting Beauregard-style claims.   The Court’s dicta notes that if the steps that follow a Beauregard-style preamble get close to an abstract idea — i.e., if the steps aren’t applied to a particular technical field, or if they don’t address how certain variables in the process are selected — the claims are less likely to be patent-eligible.