Category Archives: Software

Federal Circuit starts 2018 with two favorable decisions for software patents

After issuing two very negative decisions that called the future of software patent-eligbility into question, in January 2018 the Federal Circuit moved its software patent-eligibility pendulum back in the direction of finding eligible subject matter in software patents.

In Core Wireless Licensing S.A.R.L.. v. LG Electronics, Inc. (Jan. 25, 2018), the court affirmed a district court decision that denied a request for summary judgment that the claims of patents 8,713,476 and 8,434,020 were directed to ineligible subject matter.

The patents disclosed and claimed “improved display interfaces, particularly for electronic devices with small screens like mobile telephones…. The improved interfaces allow a user to more quickly access desired data stored in, and functions of applications included in, the electronic devices.”

Claim 1 of the ‘476 patent recited (with emphases added by the court):

1.  A computing device comprising a display screen, the computing device being configured to display on the screen a menu listing one or more applications, and additionally being configured to display on the screen an application summary that can be reached directly from the menu, wherein the application summary displays a limited list of data offered within the one or more applications, each of the data in the list being selectable to launch the respective application and enable the selected data to be seen within the respective application, and wherein the application summary is displayed while the one or more applications are in an un-launched state.

Claim 1 of the ‘020 patent recited (with emphases added by the court): Continue reading

Defensive Patent Strategies for Blockchain and Distributed Ledger Technologies

Many companies who offer next generation cybersecurity technologies are experiencing significant growth in both corporate share value and revenue. To help protect against competition, many companies are seeking patents to cover their blockchain and other distributed ledger technologies, security awareness training systems, and innovative real-time data analytics methods.

As of January 2018, United States Patent and Trademark Office (USPTO) records revealed just over fifty granted patents in which the phrase “blockchain” or “distributed ledger” appeared. Twenty-five of these patents included those terms in the title, abstract or claims. Some of the patents were awarded to cryptocurrency startups that launched or are about to launch initial currency offerings (ICOs). Others were awarded to U.S. software and business services industry titans who already have large patent portfolios. Approximately one-third of those patents were awarded to businesses that appear – at least for now – to be non-practicing entities, which could signal a risk of patent litigation on the near horizon.

A strategically developed patent portfolio can have several benefits. In addition to increasing corporate value and providing a weapon against infringement, patents can serve as a defensive mechanism against high-stakes patent litigation. A competitor who holds patents may hesitate before filing a patent infringement suit against a company that owns a strong patent portfolio that it can assert in a counterclaim. Strong patent portfolios also can provide companies with the opportunity for favorable cross-licensing arrangements, with fewer royalties being paid and potentially more royalties coming in.

Patent applicants must consider how to draft effective patent applications. Tips for doing this include:

  • Distributed ledger technologies typically require actions by multiple entities. However, it can be difficult to establish infringement of a patent claim unless all elements of the claim are used or performed by a single entity. Patent applications should draft claims with a single infringer in mind, rather than to a distributed system.
  • The U.S. and many other countries around the world take a negative view of software patents that cover mere “abstract ideas” rather than innovations in technology. A new business application of an existing blockchain technology is unlikely to be patentable. Instead, patent applications should cover innovations that provide a technical solution to a technical problem.

Patent strategies for distributed ledger technologies also need to consider the tension between the limited monopoly that a patent provides and the open source platform that a distributed ledger necessarily requires.

For the last few years, several companies have openly discussed and favored the idea of a blockchain “patent pool” in which stakeholders share access to each others’ blockchain-related patents. The Blockchain Patent Sharing Alliance (BPSA) is one such entity that is trying to gather a critical mass of stakeholders and companies. In addition, in 2016, the Linux Foundation formed the Hyperledger Project, which seeks to create an open-source framework for distributed ledger technologies.

Some stakeholders are taking matters into their own hands. In 2016 blockchain developer Blockstream publicly pledged that it will never use its blockchain patents as a weapon. Instead, Blockstream pledged that all of its blockchain software patents are available under the terms of a defensive patent license. Under that license, Blockstream will only use its patents for “defensive purposes” against a party who brings or threatens a patent infringement claim against Blockstream or against a user of Blockstream’s technologies.

Third in a four-part series. For other posts in this four-part series, see:
Intellectual Property Strategies For Next Generation Cybersecurity Technologies
Trends in Patenting Blockchain Technologies
Cybersecurity Patent Strategies vs. the Growing Barriers to Software Patents 

Trends in Patenting Blockchain Technologies

With the recent rise in values of cybercurrencies such as bitcoin, and with increasing interest in initial currency offerings (ICOs), businesses around the world are rushing to build value with new blockchain technologies and applications.

This presents many opportunities to patent innovative blockchain and other distributed ledger technologies. This is a relatively recent trend. The first recorded appearance of the word “blockchain” in any U.S. patent or published patent application was in 2012, approximately three years after the launch of bitcoin.

As of January 2018, United States Patent and Trademark Office (USPTO) records revealed:

  • 25 granted patents with the term “blockchain” or “distributed ledger” in their title, abstract or claims; and
  • at least 275 published patent applications include one or both of those terms in the title, abstract or claims.

When the data set is expanded to patents and applications that include the word “blockchain” anywhere in the text, the list grows to 56 granted patents and over 500 published applications. These include:

Patent Number Title Grant Date Assignee
US9862222 Digitally encoded seal for document verification 2018-01-09 UIPCO LLC
US9853819 Blockchain-supported, node ID-augmented digital record signature method 2017-12-26 Guardtime IP Holdings LTD.
US9836908 System and method for securely receiving and counting votes in an election 2017-12-05 Blockchain Technologies Corporation
US9824031 Efficient clearinghouse transactions with trusted and un-trusted entities 2017-11-21 International Business Machines Corporation
US9807106 Mitigating blockchain attack 2017-10-31 British Telecommunications PLC
US9785369 Multiple-link blockchain 2017-10-10 Accenture Global Solutions Limited; GSC Secrypt LLC
US9794074 Systems and methods for storing and sharing transactional data using distributed computing systems 2017-10-17 Nasdaq Technology AB
US9747586 System and method for issuance of electronic currency substantiated by a reserve of assets 2017-08-29 CPN Gold B.V.
US9749140 Systems and methods for managing digital identities 2017-08-29 Cambridge Blockchain LLC
US9722790 Identity management service using a blockchain providing certifying transactions between devices 2017-08-01 Shocard, Inc.
US9641338 Method and apparatus for providing a universal deterministically reproducible cryptographic key-pair representation for all SKUs, shipping cartons, and items 2017-05-02 SkuChain, Inc.
US9338148 Secure distributed information and password management 2016-05-10 Verizon Patent and Licensing Inc.; Cellco Partnership

Most of the granted patents cover new or improved aspects of the blockchain itself. Only a small number of U.S. patents have issued to date for new applications of existing blockchain technologies. This is likely because many companies are merely using existing blockchain technologies to implement different types of transactions.

Over half of the granted patents were examined within the USPTO’s Technology Center 2400, which covers networking, multiplexing, cable and security technologies. TC 2400 includes over 200 examiners who focus on security technologies.

In each of the past three years USPTO Examiners from TC 2400 have participated in a Cybersecurity Partnership meeting, in which the USPTO has interacted with stakeholders in the cybersecurity and network security sector to share ideas, experiences, and insights. Information that the USPTO shared in these meetings includes:

  • The top 15 filers of patent applications for information security and cryptography technologies in each year during 2014-2016 included Amazon, Google, IBM, Intel, Microsoft, Qualcomm, Samsung, Symantec, and Tencent. Top filers in 2015 and 2016 also included Bank of America, Cisco, and EMC.
  • While the vast majority of U.S. patent applications for information security and cryptography technologies have been filed by U.S. companies, the USPTO has also received a significant number of filings from companies that are based in Japan, China, Korea, Germany, France and Israel, among other countries.
  • The average pendency (time between filing and either grant or abandonment) of patent applications for information security and cryptography technologies was approximately 27 months in 2016.

Globally, as of January 2018 World Intellectual Property Office (WIPO) records show 197 published Patent Cooperation (PCT) applications with the term “blockchain” or “distributed ledger” in their title, abstract or claims. However, relatively few of these PCT applications have reached the national stage. The European Patent Office database includes only 21 such patents and published applications. According to a recent report from Clarivate Analytics, in 2016 China experienced significant growth in new patent filings for blockchain technologies and is second only to the U.S. for new filings involving blockchain technologies.

This post is the second in a four-part series. For other posts in this series, see:
Intellectual Property Strategies For Next Generation Cybersecurity Technologies
Defensive Patent Strategies For Blockchain and Distributed Ledger Technologies
Cybersecurity Patent Strategies vs. the Growing Barriers to Software Patents 

Intellectual Property Strategies for Next Generation Cybersecurity Technologies

Cybersecurity technology has become one of the most important industries in the world today. With products that are critical to businesses in countless fields, including finance, healthcare, transportation, public utilities, manufacturing, defense and government, experts have predicted that the global market for cybersecurity technologies will grow by 10% per year through 2020.

Cybersecurity technologies are also one of the biggest drivers in corporate value today. 129-year-old Eastman Kodak Company recently saw the value of its stock jump by 200% after announcing a new service that will use blockchain technologies to help photographers get paid in a new cryptocurrency when others use their photos. A New York-based beverage distributor experienced a 289% share price increase after it simply renamed itself from “Long Island Iced Tea Company” to “Long Blockchain Corp.” and announced that it would start to offer blockchain technology solutions.

Next generation cybersecurity technologies include more than just blockchain-based payment systems. Distributed ledger technologies have applications in multiple fields, including document sharing, video and audio streaming, and biomedical applications. And although blockchain is all the rage at the moment, other cybersecurity technologies such as network attack simulations, network security awareness training through methods such as simulated phishing, and real-time analytics are equally important, if not more so.

With this background in mind, what intellectual property protection options are available for next generation cybersecurity technologies? Continue reading

Fox launches GDPR Check app

Fox Rothschild LLP has launched a new mobile app to help businesses catalog their data management practices and determine necessary steps to comply with the European Union’s General Data Protection Regulation (GDPR), which will take effect in May 2018.

GDPR Check maps an organization’s data management practices in 17 areas that are key to determining compliance, and it produces a report for each key area that a company can share with its attorneys and compliance team.

For more details on the GDPR Check app and a link to the free download in the Apple App and Google Play stores, vist the GDPR Check announcement on the Fox Rothschild website at this link.

One step forward, two steps back for software patents at the Federal Circuit

In the past year, several Federal Circuit decisions defined situations in which software inventions could be eligible for patenting in the United States. However, two recent Federal Circuit decisions show that the path for patent-eligibility is not yet clear, especially for patents that claim methods of processing or presenting data.

In Secured Mail Solutions LLC v. Universal Wilde, Inc. (Fed. Cir. Oct. 16, 2017), the court considered seven patents covering the use of intelligent mail barcodes, QR codes, and personalized URLs on a package to communicate information about the package. The court considered a representative claim of U.S. patent 8,429,093 that read:

1. A method for providing electronic data to a recipient of a mail object, comprising:

   Generating, by a processor, a barcode for a mail object, said barcode including at least a first set of mail data, said first set of mail data including data corresponding to said recipient of said mail object;
affixing said barcode to said mail object;
   submitting said mail object to a mail carrier for delivery to said recipient of said mail object;
receiving said first set of mail data, including data corresponding to said recipient of said mail object, from a reception device of said recipient via a network;
   providing said electronic data to said reception device via said network in response to receiving said first set of mail data, said electronic data including a content of said mail object;
   wherein said reception device displays said electronic data to a recipient of said mail object by displaying said electronic data on a screen of said reception device.

The district court found all of the patents’ claims to be directed to the abstract idea of “communicating information about [a mail object] by use of a marking.” The Federal Circuit agreed and explained that the claims “are not directed to specific details of the barcode or the equipment for generating and processing it.” The Federal Circuit also noted that in the claims there “is no description of how the unique identifier … is different from a personal name, or return address.”

After agreeing that the claims were directed to an abstract idea, the court noted that the claims did not include sufficiently more than the idea because they were “‘replete’ with routine steps, including ‘affixing mail identification data,’ such as a barcode, to a mail object.” The patent holder argued that the generation of the unique identifier is inventive, but the court noted that “the use of barcodes was commonplace and conventional” when the patent applications were first filed, and “sending a personalized URL to a recipient was not an unconventional use of the Internet” at that time.

In Smart Systems Innovations, LLC v. Chicago Transit Authority (Fed. Cir. Oct. 18, 2017), the court considered four patents relating to open-payment fare systems in mass transit networks. A representative claim from U.S. patent 7,568,617 read:

13. A method for validating entry into a first transit system using a bankcard terminal, the method comprising:
downloading, from a processing system associated with a set of transit systems including the first transit system, a list of bankcards comprising, for each bankcard in the list, a hash identifier of a bankcard previously presented, by a respective holder of the bankcard, to the processing system, wherein the bankcard comprises one of a credit card and a debit card;
receiving, from a bankcard reader, bankcard data comprising data from a bankcard currently presented by a holder of the bankcard;
generating a hash identifier based on the bankcard data from the currently presented bankcard, wherein the hash identifier comprises a hash of at least part of the bankcard data;
determining whether the currently presented bankcard is contained in the list of bankcards;
verifying the currently presented bankcard with a bankcard verification system, if the bankcard was not contained in the list of bankcards; and
denying access, if the act of verifying the currently presented bankcard with the bankcard verification system results in a determination of an invalid bankcard.

The court found the claims to be directed to the formation of financial transactions in the field of mass transit. The court stated: “[t]he Asserted Claims are not directed to a new type of bankcard, turnstile, or database, nor do the claims provide a method for processing data that improves existing technological processes. Rather, the claims are directed to the collection, storage, and recognition of data.” The court also stated that the claims’ improvement on the operation of existing fare collection systems, and their limitation to the field of mass transit, did not save them from being considered an abstract idea.

Notably, in Smart Systems Innovations the court stated: “[o]ur mandate from the Supreme Court under Alice step one is to ascertain what the claims are ‘directed to,’ not the ‘thrust,’ ‘heart,’ or ‘focus’ of the invention.” The court also appeared to limit the applicability of its previous decisions in Enfish Corporation v. Microsoft LLC and DDR Holdings, LLC v. Hotels.com, L.P. to the specific “claims [that the patentee shows] are directed to an improvement in computer technology.” The court also suggested that its McRO v. Bandai NAMCO Games America, Inc. decision was limited to a particular “claimed process us[ing] a combined order of specific rules [that] improved upon existing technological processes.” Continue reading

Will the Federal Circuit or Congress boost the ITC’s ability to block the importation of infringing digital files?

Section 337 of the Tariff Act of 1930 authorizes the International Trade Commission (ITC) to halt the importation of articles that infringe patents and other intellectual property rights. Until late last year, the ITC used this authority to block imports of digital files in response to allegations of patent infringement. However, the Federal Circuit upended that tactic in November when it ruled that “articles” do not include digital data files.

The Federal Circuit’s ruling in ClearCorrect Operating LLC v. International Trade Comm’n (Fed. Cir. Nov. 10, 2015) related to a situation in which the ITC acted on a complaint filed by Align Technology, Inc., which asserted that a Pakistan-based company and its U.S. subsidiary infringed Align’s patents for methods of creating and using orthodontic aligners. The court noted that “the only purported ‘article’ found to have been imported was digital data that was transferred electronically, i.e., not digital data on a physical medium such as a compact disk or thumb drive.”

The Tariff Act does not define the term “article,” so the court looked at various dictionary definitions, as well as other sections of the Tariff Act, and concluded that intangibles such as digital data are not “articles” that are within the ITC’s authority to block. The court also noted that Congress has debated various updates to the relevant sections of the Tariff Act in recent years, but it has not implemented any changes that would update the Act to expressly include digital data within the ITC’s authority.

The ITC has requested an extension of time (through January 27) to request an en banc rehearing of the decision. It is widely expected that the ITC will file the rehearing petition.

The ClearCorrect decision followed another Federal decision (Suprema v. International Trade Comm’n) that expanded the ITC’s authority to block importation of devices (e.g., fingerprint scanners) that are not infringing upon entry into the U.S., but which do infringe after certain software is loaded on the devices. Some may view the Suprema and ClearCorrect decisions to be at odds with each other. If the Federal Circuit revises the ClearCorrect decision in a rehearing, the result could create a significant roadblock for importers of products, software and data sets that infringe U.S. intellectual property rights.