Got Application?

Ultramercial v. Hulu

Inventors who want their process patents to be all they can be might just find they're in good hands after the Federal Circuit's decision in Ultramercial v. Hulu.  In Ultramercial, the Federal Circuit let their fingers do the walking (again) on the question of subject matter eligibility under § 101. Though the Ultramercial court can't yet name everything that's in § 101 patentability's special sauce, it did find that a process patent that discloses a practical application of an abstract idea is a § 101 real thing. But it's not enough for process patents to just do it under § 101; they still must pass patent law's other, substantive patentability requirements. The bottom line? Process patent disputes will just keep going and going and going.

The patent at issue in Ultramercial involved a method for allowing Internet users to get copyrighted material for free, in exchange for viewing web-based advertisements. The claimed process consists of eleven steps, which include restricting access to the copyrighted material, having consumers interact with the advertising to gain access, and having the advertisers pay for the copyrighted material. Many of these steps employ computer interfaces and Internet technologies to complete the process. The patent holder sued Hulu and YouTube, which settled, and WildTangent, which did not.  WildTangent moved to dismiss for failure to state a claim. WildTangent argued that Ultramercial's claimed process does not add up to patent-eligible subject matter. The district court granted the motion and Ultramercial appealed.

On appeal, the Federal Circuit first looked at the question of whether courts must construe patent claims before determining an invention's patent eligibility. The court confirmed that no "bright line" test exists, leaving resolution of the question to the facts of the case. Sometimes, claim construction may help clarify the subject matter at stake and resolve issues of abstractness. But here, the invention fit within the broad categories of protection established by § 101, without the need for a separate claim construction.

The court found the claimed process satisfied § 101's "coarse eligibility" filter and did not present an unpatentable abstract idea. The court said that a disqualifying characteristic under § 101 should exhibit itself "manifestly." Though the concept of using advertising as currency is abstract, the patent claims at issue cover a practical application of the idea. In determining that the scope of the patent claims included a non-abstract, practical application, the court noted as important the fact that the claimed process requires extensive use of a computer interface and an Internet website.

Following Bilski, the court looked past "the machine of transformation test" to reach its decision that the claimed method satisfied the requirements of a patentable subject matter. The court decided that, though the patent doesn't specify "a particular mechanism for delivering media content to the consumer," it offers more than the "unpatentable mental process," and "purely mental steps" recently deemed patent ineligible in CyberSource. The key seemed to be the "controlled interaction with a consumer via an Internet website," which the court considered to be far removed from purely mental steps. But the court also emphasized that its § 101 determination did not resolve any questions that may exist regarding whether or not the claimed process satisfied patent law's other, substantive requirements for novelty, utility, enablement, and non-obviousness.

In the post-Bilski world, sometimes process-patent holders feel like a nut, sometimes they don't. With Cybersource, many method inventors watched their patent rights go Snap! Crackle! Pop! With Ultramercial, however, it looks like inventors who can point to some application requiring a degree of programming or computer interaction, beyond mere use of a website, might just have a patent that can take a licking and keep on ticking-as long as the claimed process is also novel, useful, enabled, and non-obvious. So how will the method-patent holder spell relief? Perhaps with a slogan that goes:

"Our process?  There's an app(lication) for that."

The articles on our Website include some of the publications and papers authored by our attorneys, both before and after they joined our firm. The content of these articles should not be taken as legal advice.