ASGHARI-KAMRANI V. UNITED SERVICES AUTOMOBILE ASSOCIATION (Fed. Cir. 2018)
Today the Federal Circuit issued three parallel decisions all stemming from the patent case brought by Asghari-Kamrani. The first two decisions affirm the E.D.Va. judgment-on-the-pleadings. In those cases, the district court held that the patentee (Asghari-Kamrani) failed to state a plausible claim for relief within her complaint. In particular, the court found that all the asserted claims were invalid for lack of eligibility. On appeal, the Federal Circuit AFFIRMED in a R.36 Judgment Without Opinion. [Link].
The third decision is an order of dismissal of a parallel appeal from the PTAB (CBM Review). The PTAB had found all of the claims unpatentable as obvious or anticipated. On appeal, though the Federal Circuit dismissed the appeals as moot — and vacated the USPTO decisions.
These appeals [from the PTAB] (Nos. 2018-1040 and 2018-1041) are dismissed as moot, and the decisions of the U.S. Patent and Trademark Office’s Patent Trial and Appeal Board are vacated in view of our affirmance of the U.S. District Court for the Eastern District of Virginia’s judgment of patent ineligibility in Asghari-Kamrani v. United Services Automobile Ass’n, Appeal Nos. 2016-2415, 2017-2101, and 2017-2191, and the parties’ agreement at oral argument that affirmance of the district court’s ineligibility decision has the effect of invalidating all claims of U.S. Patent No. 8,266,432.
I need to think through this further, but for some reason, the automatic vacatur of the PTAB decisions does not sit well with me.
= = = = =
Asghari-Kamrani’s claims are directed to a system for authenticating a user — using a first central computer to general a temporary dynamic code and a second central computer to validate the code when submitted.
25. An apparatus for authenticating a user during an electronic transaction with an external-entity, the apparatus comprising:
a first central-entity computer adapted to: generate a dynamic code for the user in response to a request during the electronic transaction, wherein the dynamic code is valid for a predefined time and becomes invalid after being used; and provide said dynamic code to the user during the electronic transaction; [and]
a second central-entity computer adapted to validate a digital identity in response to an authentication request from the external-entity, which authentication request includes a user specific information and the dynamic code as the digital identity which dynamic code was received by the user during the electronic transaction and was provided to the external entity by the user during the electronic transaction, and to authenticate the user if the digital identity is valid and to provide a result of the authentication of the user to the external entity during the electronic transaction.
The district court noted that the computers wouldn’t be necessary to run this invention (except for the fact that the claims expressly require a computer). In explaining the abstractness of the claims, the district court explained:
The claims are directed to the abstract idea of using a third party and a random, time-sensitive code to confirm the identity of a participant to a transaction. This formulation is admittedly verbose. It is verbose because the patent claims combine two abstract ideas: the use of a third party intermediary to confirm the identity of a participant to a transaction and the use of a temporary code to confirm the identity of a participant to a transaction. It is an obvious combination, and nothing about the combination removes the patent claims from the realm of the abstract.
As to Alice/Mayo step two – the addition of computers do not somehow turn this abstract idea into a patent eligible invention.