On April 4, 2016, the Commission issued a quick affirmance of Judge Dee Lord’s Initial Determination (“ID”) finding two patents asserted in Certain Activity Tracking Devices, Systems, and Components Thereof, Inv. No. 337-TA-963, invalid under Section 101.
As we noted in an earlier post, Judge Lord’s March 3rd ID marked the first time since the Supreme Court’s Alice decision in 2014 that any Commission Judge had found claims invalid for failure to claim patentable subject matter. Indeed, Judge Lord noted in her ID that the full Commission had not addressed Section 101 issues since Alice. As discussed in our prior post, Judge Lord granted respondents’ motion for summary determination of invalidity, which was filed after claim construction had been completed. The Commission reviewed and affirmed Judge Lord’s determination without substantial comment on its reasoning. The Commission’s only modification of the ID was to amend a statement Judge Lord had made regarding the relevant presumptions. Judge Lord had stated that the presumption of patent validity did not apply to challenges under Section 101, citing a case from the District of New Jersey. The Commission disagreed, saying that “the law remains unsettled” with respect to this presumption, citing a case from the Eastern District of Virginia that said “[a]s a result of this deafening silence, district courts, not surprisingly, are split over the standard of proof applicable to §101 challenges.” In re TLI Communications LLC Patent Litig., 87 F. Supp. 3d 773, 797 (E.D. Va Feb. 6, 2015). However, the Commission went on to say that the claims at issue were directed to ineligible subject matter and, therefore, were invalid regardless of whether a presumption of validity applied.
While this investigation remains just one data point, the Commission’s speedy affirmance of Judge Lord’s ID suggests that Section 101 defenses may be an increasingly viable route for ITC respondents.