“Based on the Chargepoint decision, inventors, business leaders and attorneys cannot, or should not, rely on the USPTO’s new 101 guidance. Unfortunately, with this decision, the guidance is now worthless.”

In ChargePoint Inc. v. SemaConnect, Inc., (2018-1739) the Federal Circuit considered the following claim:

An apparatus, comprising: a control device to turn electric supply on and off to enable and disable charge transfer for electric vehicles; a transceiver to communicate requests for charge transfer with a remote server and receive communications from the remote server via a data control unit that is connected to the remote server through a wide area network; and a controller, coupled with the control device and the transceiver, to cause the control device to turn the electric supply on based on communication from the remote server.

The Court inexplicably stated in its opinion that “[i]t is clear from the language of claim 1 that the claim involves an abstract idea—namely, the abstract idea of communicating requests to a remote server and receiving communications from that server, i.e., communication over a network.” The Court further stated, “[w]e therefore continue our analysis to determine whether the focus of claim 1, as a whole, is the abstract idea. As explained below, we conclude that it is.”

In reaching this conclusion, the panel rationalized that “the broad claim language would cover any mechanism for implementing network communication on a charging station, thus preempting the entire industry’s ability to use networked charging stations. This confirms that claim 1 is indeed “directed to” the abstract idea of communication over a network to interact with network-attached devices.”

A Perplexing Analysis

As an electrical engineer and patent attorney, I am truly perplexed by this statement. Claim 1 recites numerous physical electrical components, a control device (on/off switch), transceiver to communicate with a remote server and a controller to activate the on/off switch based on communications from the server. The configuration of the components may be anticipated or obvious under the patent statute based on prior art, but they are anything but abstract and do not preempt all ways of charging a vehicle using a network. Congress specifically stated in 35 U.S.C. 101 that there are four statutory categories of patentable subject matter: process, machine, manufacture, or composition of matter. If claim 1 is not a machine, I don’t know what is.

The Court even went so far as to cite O’Reilly v. Morse, 56 U.S. 62 (1853), stating that “[i]n Morse, the [Supreme] Court upheld claims related to the details of Samuel Morse’s invention of the electromagnetic telegraph but invalidated a claim for the use of ‘electromagnetism, however developed for marking or printing intelligible characters, signs, or letters, at any distances.’” The claims considered by the Court in Chargepoint, however, do not claim network communication, however developed for charging a vehicle. They claim machines with specific technological limitations. Based on the Court’s reasoning, all Internet of Things (IoT) inventions are merely claiming the “abstract” idea of network communications.

The Court’s conclusion is entirely incorrect and in effect overrules the new USPTO guidance just 80 days after its effective date of January 7, 2019.

Don’t Rely on the USPTO Guidance

Director Iancu’s new patent eligibility guidance was overwhelmingly viewed as needed to provide some predictability to the U.S. patent system. The guidance, however, is just that— guidance for the USPTO examiners and judges to follow. The guidance has no precedential authority to either district courts or the Federal Circuit.

In announcing the new guidance, the USPTO stated that, “in accordance with judicial precedent and in an effort to improve certainty and reliability, the revised guidance extracts and synthesizes key concepts identified by the courts as abstract ideas to explain that the abstract idea exception includes certain groupings of subject matter: mathematical concepts, certain methods of organizing human activity, and mental processes.”

The new guidance included a two-prong inquiry for whether a claim is directed to a judicial exception. First, examiners evaluate whether the claim recites a judicial exception and, if so, examiners then evaluate whether the claim recites additional elements that integrate the identified judicial exception into a practical application. If a claim both recites a judicial exception and fails to integrate that exception into a practical application, then the claim is directed to a judicial exception. In such a case, further analysis pursuant to the second step of the Alice/Mayo test would be required.

Based on the Chargepoint decision, inventors, business leaders and attorneys cannot, or should not, rely on the USPTO’s guidance. Unfortunately, with this decision, the guidance is now worthless. A patent may issue based on the guidance, but it is already out of line with the Court and has no certainty of being valid under 101.

The claims at issue in Chargepoint clearly do not recite a mathematical concept, certain methods of organizing human activity, and mental processes. As such, they are eligible under the new guidance. Even if the claims somehow fall into a judicial exception, the second prong would determine that the claim “integrates a judicial exception into a practical application.” According to the USPTO “[w]hen the exception is so integrated, then the claim is not directed to a judicial exception and is eligible.” There is no question that a vehicle charging station is a practical application. If there is any question, simply look at claim 31 considered by the Court:

31. A network-controlled charge transfer system for electric vehicles comprising: a server; a data control unit connected to a wide area network for access to said server; and a charge transfer device, remote from said server and said data control unit, comprising: an electrical receptacle configured to receive an electrical connector for recharging an electric vehicle; an electric power line connecting said receptacle to a local power grid; a control device on said electric power line, for switching said receptacle on and off; a current measuring device on said electric power line, for measuring current flowing through said receptacle; a controller configured to operate said control device and to monitor the output from said current measuring device; a local area network transceiver connected to said controller, said local area network transceiver being configured to connect said controller to said data control unit; and a communication device connected to said controller, said communication device being configured to connect said controller to a mobile wireless communication device, for communication between the operator of said electric vehicle and said controller.

The Court ignored all of the claim elements that demonstrated a practical application, instead stating that:

“[i]n essence, the alleged ‘inventive concept’ that solves problems identified in the field is that the charging stations are network-controlled. But network control is the abstract idea itself, and “a claimed invention’s use of the ineligible concept to which it is directed cannot supply the inventive concept that renders the invention ‘significantly more’ than that ineligible concept.”

The Alice Warning

The Chargepoint Court concluded that:

“[i]n short, we agree with SemaConnect that the only possible inventive concept in the eight asserted claims is the abstract idea itself. ChargePoint, of course, disagrees with this characterization, arguing that its patents claim ‘charging stations enabled to use networks, not the network connectivity itself.’ But the specification gives no indication that the patented invention involved how to add network connectivity to these charging stations in an unconventional way. From the claims and the specification, it is clear that network communication is the only possible inventive concept. Because this is the abstract idea itself, this cannot supply the inventive concept at step two. The claims are therefore ineligible.”

The Supreme Court warned in Alice to “tread carefully in construing this exclusionary principle lest it swallow all of patent law. At some level, ‘all inventions… embody, use, reflect, rest upon, or apply laws of nature, natural phenomena, or abstract ideas.’ Thus, an invention is not rendered ineligible for patent simply because it involves an abstract concept.”

I am afraid the Federal Circuit just swallowed all of patent law by ignoring the other sections of the patent statute and exclusively relying on 101.

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