by Dennis Crouch
As you’ll read below, the Supreme Court has vacated the Secure Axcess CBM decision on mootness grounds. This means that the “financial services” limitation of the covered-business-method provisions are again up for interpretation.
In the America Invents Act (AIA) of 2011, Congress created a trio of AIA-Trials: Inter Partes Reviews; Post Grant Reviews; and Covered Business Method (CBM) Reviews.
The CBM program is particularly targeted at claims for data processing or other operations used in the “practice, administration, or management of a financial product or service” and not covering “technological” inventions. In PNC Bank v. Secure Axcess, the Federal Circuit narrowly interpreted the eligibility for CBM review – holding that the claims themselves must be directed to a financial service. A patent does not qualify for CBM simply because it can be used in the financial service industry.
- Fed. Cir. Opinion: Secure Axcess, LLC v. PNC Bank Nat’l Ass’n, 848 F.3d 1370 (Fed. Cir. 2017); See Dennis Crouch, For CBM Review: _Claims_ Must be Directed to Financial Service, Patently-O (2017).
- En Banc Denial (with concurring and dissenting opinions): Secure Axcess, LLC v. PNC Bank Nat’l Ass’n, 859 F.3d 998 (Fed. Cir. 2017). See Dennis Crouch, CBM Review Keeps its Narrow Scope: Narrowly Surviving En Banc Challenge, Patently-O (2017)
PNC then petitioned the Supreme Court for writ of certiorari asking the following question:
- Whether the U.S. Court of Appeals for the Federal Circuit’s judgment should be vacated and remanded with instructions to dismiss the appeal as moot, in accordance with United States v. Munsingwear, Inc., when the claims of the challenged patent are invalid, and there is no longer a live case or controversy between petitioners and respondent; and
- Whether, if the case is not moot, the lower court erred in holding that the statutory definition of a patent eligible for covered business method review requires that the claims of the patent expressly include a “financial activity element”—in other words, that the claim have no use outside of financial activity—rather than making covered business method review available for patents that claim “a method or corresponding apparatus for performing data processing or other operations used in the practice, administration, or management of a financial product or service.”
In its list of orders, the Supreme Court has decided the case — agreeing with the first question that the case is moot:
The petition for a writ of certiorari is granted. The judgment is vacated as moot, and the case is remanded to the United States Court of Appeals for the Federal Circuit with instructions to remand the case to the Patent Trial and Appeal Board to vacate the Board’s order. See United States v. Munsingwear, Inc., 340 U. S. 36 (1950). Justice Alito took no part in the consideration or decision of this petition.
The mootness issue here stems from the fact that the challenged Secure Axcess patent claims were also cancelled in a separate IPR proceeding that has been affirmed by the Federal Circuit and the time for petitioning the Supreme Court has passed. Petitioner writes:
The now unreviewable invalidation of those claims, and resulting dismissal of Secure Axcess‘ infringement claims with prejudice moots any live case or controversy between the parties here.
The cited Supreme Court Munsingwear decision comes from mootness-on-appeal. In that case, the court explained its establish practice of vacating judgments on issues that become moot while on appeal or pending decision:
The established practice of the Court in dealing with a civil case from a court in the federal system which has become moot while on its way here or pending our decision on the merits is to reverse or vacate the judgment below and remand with a direction to dismiss.