District Judge Alvin K. Hellerstein granted defendants JP Morgan’s and subsidiaries’ motion for summary judgment as to three of five patents asserted by Intellectual Ventures II, on the basis that they claim patent-ineligible subject matter. The court applied the two-step test set forth by the Supreme Court in Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 134 S. Ct. 2347, 2354 (2014): (1) whether the claim is directed to a patent-ineligible concept; and (2) whether the claim includes an inventive concept that adds something more than an abstract idea.

The patents at issue are U.S. Pat. Nos. 6,826,694, entitled “High Resolution Access Control” (“the ’694 patent”); 6,314,409, entitled “System for Controlling Access and Distribution of Digital Property” (“the ’409 patent”); and 6,715,084, entitled “Firewall System and Method Via Feedback from Broad-Scope Monitoring for Intrusion Detection” (“the ’084 patent”), each claiming methods directed to data security.

Claim 1 of the ’694 patent is directed to selecting and implementing an access rule according to the data contained in two or more received packets. The court concluded that because the ’694 patent “does not describe the nature of the rule, what in the [packet] determines the rule to be selected, how the rule determines who may access the packet and to what degree, or anything about the rule itself,” the claim amounts to a mental process.

Claim 1 of the ’409 patent is directed to: (1) encrypting portions of data; (2) distributing the encrypted data; and (3) controlling access to decrypted portions of the distributed data by applying various, unspecified rules defining access rights. The court concluded that “the process of controlling access . . . describes nothing more than an abstraction, completely lacking any corporeal application or particular function.”

Claim 1 of the ’084 patent is directed to (1) detecting anomalies and intrusions in a computer network by analyzing network communications entering two or more computer sites; (2) using “pattern correlations” across the network devices to determine which devices are likely to be affected by the anomaly or intrusion; and (3) alerting any potentially affected devices. The court concluded that the first step amounts to a mental process and the second step amounts to the use of a mathematical formula to identify patterns corresponding to network intrusions.

The court also found the claims to be broad enough to raise serious preemption concerns because they are not limited to a particular device or software program. In addition, the court determined that the claims fail the “machine-or-transformation” test because they are applicable to any medium of intellectual property and executable on generic computer technology. Finally, with respect to the second step of the Alice two-step test, the court determined that both the independent and the dependent claims recite merely routine and conventional activity.

Case: Intellectual Ventures II LLC v. JP Morgan Chase & Co., No. 13-CV-3777 (AKH) (S.D.N.Y. Apr. 28, 2015)