Takeaway: It seems unconventional for the Federal Circuit to find software or business methods to be valid in light of the Alice v. CLS Bank decision back in 2014. The court seems to have carved out an exception that allows for known concepts to be applied in new platforms to create a protectable invention.

Even though patent eligibility in software-related inventions has been slow to recover from Alice v. CLS Bank, small steps have been made to bring clarity to the issues in the software industry over the last couple of years.

One of the more recent decisions in this line of post-Alice cases is Amdocs v. Openet Telecom, where the majority opinion reversed the district court’s decision to invalidate the claims and seemingly has assembled yet another piece of the software patent puzzle.

The software involved in Amdocs pertains to a software system designed to solve an accounting and billing problem faced by network providers. The district court initially found that the software, like many other products before, contained ineligible subject matter under section 101 through the two-step Alice framework.

Under step one of the Alice framework, the court looks to whether the claims at issue are directed to a patent ineligible concept (i.e., laws of nature, natural phenomena, and abstract ideas). If so, the court considers elements of each claim, both individually and as an ordered combination, to determine whether the additional elements transform the nature of the claim into a patent-eligible application. In the second step, the court looks to see if there is an element or ordered combination of elements in the claims that are sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the ineligible concept.

Here in Amdocs, the court found the claims to be similar to their recent decisions that have held in favor of patent eligibility. This is because the court found sufficient evidence of an inventive concept, in light of the specification, that added significantly more to the patent than just the abstract idea. For a further discussion on the most recent line of cases leading up to this decision, see the article “Is the Conundrum of Software Patentability Gone?” by Mark Nielsen, Ph.D., Esq.

As mentioned previously, the software involved was a system designed to solve an accounting and billing problem faced by network providers. The software essentially used computer code to enhance an accounting record from multiple sources. It would begin by retrieving one accounting record; if there was information missing from the record, the computer code would iteratively “enhance” the accounting record from differing sources to improve the accuracy and completeness of the information provided in the record.

The court found this concept to be an abstract idea under the first step of the Alice framework. More importantly, where this case turned, was on the court’s interpretation of the term “enhance.” The term “enhance” was given the meaning “to apply a number of field enhancements in a distributed fashion.” This definition shed light on the inventive portion of the patent, which the court found to be a “distributed network” that was used to make the process more efficient.

The court found that even though the patent includes generic concepts like network devices, computers, and code that gathered information from the Internet, it also entailed an “unconventional technological solution (enhancing data in a distributed fashion) to a technological problem (massive record flows which previously required massive databases).” This unconventional technological solution, applied to generic concepts, was, in the eyes of the court, an improvement in computer functionality that amounted to significantly more than the abstract idea of data gathering and record population.

Interestingly, the concept of distributed architecture has been around for a long time and is fairly common in the software industry. With that said, this case brings light to the fact that just because something has been around for a long time, does not mean the concept will prevent a patentable application of that theory. However, as the dissent in this case points out, “limitations on the context?as opposed to the manner?of accomplishing a desired result is typically not inventive, even if the context is novel.”

The final takeaway from this case seems to be, as an inventor or patent practitioner, we need to consider the manner in which an invention improves a technological problem. Generally, narrowing the issues to a contextual area of industry or practice will not be sufficient to make a concept inventive. Rather, at least in some circumstances, for a patent with generic concepts to be inventive, there will also need to be some type of limitation that is an unconventional technological solution to a technological problem.