Eligibility: ChargePoint takes its Network-Controlled Charging Station to the Supreme Court

by Dennis Crouch

ChargePoint, Inc., v. SemaConnect, Inc. (Supreme Court 2019) [Petition]

Another new eligibility petition, this one filed by by top Supreme Court Carter Phillips. Questions presented:

  1. Whether a patent claim to a new and useful improvement to a machine or process may be patent eligible even when it “involves” or incorporates an abstract idea.
  2. Whether the Court should reevaluate the atextual exception to Section 101.

I drive a Honda Clarity -- a Plug-in Hybrid Electric Vehicle (PHEV) -- and use ChargePoint connected charging stations when I travel out of town. The patent here -- U.S. Patent No. 8,138,715* -- essentially covers remote-control of the charging station (i.e., via your phone). Asserted claim 1 requires a transceiver that receives a "turn on" signal from a remote server. The transceiver then sends a signal to a "controller" that then triggers a switch ("control device").  Dependent claim 2 adds an electrical coupler whose electric supply is switched on/off by the control device. My understanding is that all of these items could be configured within item 110 (below) that the inventors lexicographed as a "Smartlets™" -- although the claims do not require the apparatus to take the cute boxy-shape displayed below. 

The district court dismissed the case for failure to state a claim -- finding the claims ineligible as a matter of law. On appeal, the Federal Circuit affirmed with the following holdings:

Alice Step 1: The focus of the claims - as a whole - is the abstract idea of the internet-of-things (IoT):  "communication over a network to interact with a device connected to the network." In reaching that conclusion, the court looked to "problem" identified in the specification -- a lack of communication network to allow for efficient charging control, including paying for the electricity consumed. From the specification, the court found it "clear that the problem perceived by the patentee was a lack of a communication network for these charging stations, which limited the ability to efficiently operate them from a business perspective."

In short, looking at the problem identified in the patent, as well as the way the patent describes the invention, the specification suggests that the invention of the patent is nothing more than the abstract idea of communication over a network for interacting with a device, applied to the context of electric vehicle charging stations.

The court went-on to hold that the claim breadth "would preempt the use of any networked charging stations."

Alice Step 2: At step-2, ChargePoint argued that it solved practical problems in the field by creating a new way of remote control and network control of a charging system. The problem for the Court was that the alleged inventive concept here is network control -- which the court already found to be the problematic abstract idea.

The court gives ChargePoint props for a good idea and implementation -- but the problem here really is the breadth of the claims that basically join together two well-known concepts.

In short, the inventors here had the good idea to add networking capabilities to existing charging stations to facilitate various business interactions. But that is where they stopped, and that is all they patented. We therefore hold that claim 1 is “directed to” an abstract idea. As to dependent claim 2, the additional limitation of an “electrical coupler to make a connection with an electric vehicle” does not alter our step one analysis.

Id.

The petition calls-out Alice as a "failed experiment" especially when placed "in the Federal Circuit's hands."

[T]he Federal Circuit and various parties have used the chaos that has trailed the Court’s decision to eliminate numerous patents. Indeed, the period following Alice has seen, by one estimate, a 914% increase in the number of patents invalidated under Section 101. [Citing Sachs]. Alice’s warning to “tread carefully in construing [the Section 101] exclusionary principle lest it swallow all of patent law,” 134 S. Ct. at 2354, has largely been realized.

Petition.


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Unwired Planet v. Huawei: An English Perspective on FRAND Royalties

FRONDGuest Post by Professor Jorge L. Contreras

In the latest decision by the UK High Court of Justice (Patents) in Unwired Planet v. Huawei ([2017] EWHC 711 (Pat), 5 Apr. 2017], Mister Justice Colin Birss has issued a detailed and illuminating opinion regarding the assessment of royalties on standards-essential patents (SEPs) that are subject to FRAND (fair, reasonable and non-discriminatory) licensing commitments.  Among the important and potentially controversial rulings in the case are:

  1. Single Royalty: there is but a single FRAND royalty rate applicable to any given set of SEPs and circumstances,
  2. Significance of Overstep: neither a breach of contract nor a competition claim for abuse of dominance will succeed unless a SEP holder’s offer is significantly above the true FRAND rate,
  3. Global License: FRAND licenses for global market players are necessarily global licenses and should not be limited to a single jurisdiction, and
  4. Soft-Edge: the “non-discrimination” (ND) prong of the FRAND commitment does not imply a “hard-edged” test in which a licensee may challenge the FRAND license that it has been granted on the basis that another similarly situated licensee has been granted a lower rate, so long as the difference does not distort competition between the two licensees.

Background

This case began in 2014 when Unwired Planet, a U.S.-based patent assertion entity, sued Google, Samsung and Huawei for infringement under six UK patents (corresponding actions were filed in Germany).  Unwired Planet claimed that five of the asserted patents, which it acquired from Ericsson in 2013 as part of a portfolio comprising approximately 2000 patents, were essential to the 2G, 3G and 4G wireless telecommunications standards developed under the auspices of the European Telecommunications Standards Institute (ETSI).  Because Ericsson participated in development of the standards at ETSI, any patents shown to be SEPs would necessarily be encumbered by Ericsson’s FRAND commitment to ETSI.

The UK proceedings involved numerous stages, including five scheduled “technical trials” which would determine whether each of the asserted patents was valid, infringed and essential to the ETSI standards.  During these proceedings Google and Samsung settled with Unwired Planet and Ericsson (which receives a portion of the licensing and settlement revenue earned by Unwired Planet from the patents), leaving Huawei as the sole UK defendant.  By April 2016 three of the technical trials had been completed, resulting in findings that two of the asserted patents were invalid and that two were both valid and essential to the standards.  These findings are currently under appeal. The parties then agreed to suspend further technical trials.  In October 2016 a “non-technical” trial began regarding issues of competition law, FRAND, injunction and damages.  Hearings were concluded in December 2016, and the court’s opinion and judgment were issued on April 5, 2017.

A. The High Court’s Decision – Overview

The principal questions before the court were (1) the level of the FRAND royalty for Unwired Planet’s SEPs, (2) whether Unwired Planet abused a dominant position in violation of Section 102 of the Treaty for the Formation of the European Union (TFEU) by failing to adhere to the procedural requirements for FRAND negotiations outlined by the European Court of Justice (CJEU) in Huawei v. ZTE (2014), and (3) whether an injunction should issue in the case.  In the below discussion, Paragraph numbers (¶) correspond to the numbered paragraphs in the High Court’s April 2017 opinion.

B. FRAND Commitments – General Observations

Justice Birss begins his opinion with some general observations and background about the standard-setting process and FRAND commitments.  A few notable points emerge from this discussion.


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