The alleged infringer moved to dismiss based on lack of patent-eligible subject matter. The district court agreed and dismissed the case for that reason, and the patentee appealed. The Federal Circuit affirmed.
The patent related to “a system and method of detecting fraud and/or misuse in a computer environment based on analyzing data such as in log files, or other similar records, including user identifier data.” Under step one of Alice, the Federal Circuit agreed with the district court that the claims of the patent were directed to collecting and analyzing information, which is a combination of previously identified abstract ideas. The court distinguished this case from its decisions in McRO and Enfish. Unlike those cases, the technological improvement in this case was caused by the existing capabilities of the computer, not by a change in the method of collecting and analyzing the data. Although the court recognized that an abstract claim may be patent-eligible if the claim language is directed to a patent-eligible application of that concept, the claims here were not—they simply implemented “an old practice in a new environment.”
Under step two of Alice, the Federal Circuit again agreed with the district court’s analysis that the claim limitations of the patent, when analyzed alone and in combination, failed to add “something more” to “transform” the claimed abstract idea. The court reasoned that the claimed invention here was directed to the broad concept of monitoring log data, and that only limiting the claims to the computer field would not transform them into a patent-eligible application.
The court rejected the patentee’s claims that the system claims were patent-eligible under Alice step two. The general rule is that system claims in a patent with ineligible method claims containing insignificant limitations are ineligible. These system claims are no exception to that general rule, as the system claims “merely graft generic computer components onto otherwise-ineligible method claims.”
Finally, the Federal Circuit held that the district court’s dismissal under Rule 12(b)(6) was appropriate considering the factual issues favorable to the patentee, that the claims did not include patent-eligible subject matter.