On July 11, 2014 the Federal Circuit released its Digitech and H-W Tech. decisions addressing patentability of digital conversion technology, and implications of the timing of a certificate of correction vis-à-vis the filing of a lawsuit.
In Digitech Image Techs., LLC v. Electronics for Imaging, Inc., the Federal Circuit released its first opinion to reference the recent Supreme Court decision of Alice v. CLS Bank. Similar to the Supreme Court in Alice, the Federal Circuit assessed the patentability of a computer-implemented abstract idea.
Digitech held a patent for electronically capturing an image and converting the properties of the image into a format readable by other devices. This initial conversion yielded reduced distortion when transferring the image to another device (e.g. a printer). The claims are directed to creating appropriate “device profiles,” which ensure reduced distortion when the image is transferred to the other device.
The Federal Circuit found that these “device profiles,” which consisted of several sets of data, were unpatentable subject matter due to their transitory nature. The court also cited the Supreme Court's recent affirmance in Alice of the unpatentability of abstract ideas. Digitech’s method claims were found to be simply an application of a mathematical formula (abstract idea), and too "abstract and sweeping” to be patentable.
The court noted that abstract ideas do not become patent eligible subject matter “merely by adding the words ‘apply it’”; i.e., merely by reciting some application of the idea in the claim. The Federal Circuit therefore affirmed that mere computer-implementation of an abstract idea does not render an abstract idea patent-eligible under 35 U.S.C. §101, consistent with the Supreme Courts' recent ruling in Alice v CLS Bank.
In H-W Tech. v. Overstock.com, the Federal Circuit clarified whether a district court can consider a certificate of correction issued more than one year after an infringement suit commences.
H-W filed an infringement suit against Overstock.com in March 2012. One of the claims sought to be enforced was missing a limitation in the printed patent due to a Patent Office error. H-W did not seek a certificate of correction for the incorrect claim until May 2013. The district court decided a motion for summary judgment against H-W, determining that the claim was indefinite, without applying the certificate of correction to correct the claim.
The Federal Circuit held that a district court has no authority to correct a claim unless it is “evident on its face” that there is error. Because the uncorrected claim could be construed without the missing term, there was no evident error. That the parties agreed that the Patent Office's error was clear from the file history did not provide the district court authority to correct the acknowledged error.
The Federal Circuit also read 35 U.S.C. § 254 to make certificates of corrections effective only for actions filed after the issue of the certificate. Thus, the district court was required to consider the claim as uncorrected by the certificate of correction. Despite this ruling, the Federal Circuit noted that the claim “as corrected, has not yet been litigated and, thus, has not been held invalid.” Therefore, a certificate of correction, while effective in future litigation, may not be introduced into a proceeding that was initiated before receipt of the certificate.