Eligibility and Off the Shelf

Spireon v. Procon Analytics (Supreme Court 2022)

Another new petition for certiorari has re-asked the American Axle questions:

  1. What is the appropriate standard for determining whether a patent claim is “directed to” a patent-ineligible concept…?
  2. Is patent eligibility (at each step of the Court’s two-step framework) a question of law for the court based on the scope of the claims or a question of fact for the jury based on the state of the art at the time of the patent?

[Petition] Spireon is the maker of LoJack and has millions of vehicle tracking systems in operation.  Procon provides similar services as well.

Spireon’s U.S. Patent No. 10,089,598 is directed to a method of managing vehicle inventory at an auto dealership using a “location device” (such as a GPS receiver or other positioning system designed to be attached to the vehicle).  Claim 1 includes the following steps:

  1. In the Server DB: Associate the location device with the dealer’s group of ‘available location devices’;
  2. Communicatively couple the device with a vehicle;
  3. Once coupled, transmit a connection notice that includes a vehicle identifier and location device identifier;
  4. In the server DB: Associate the location device with the vehicle and remove it from the list of ‘available location devices’; and
  5. Receive current location from the location devices. [Full text of Claim 1 is below]

In the case, Procon filed a declaratory judgment action. The district court dismissed the case on the pleadings — finding the claims directed to an abstract idea.  The Federal Circuit then affirmed without opinion.

= = =

Off the Shelf: The patent specification indicated that “the location device may be an off-the-shelf tracking device for a vehicle, for example for use by an end user, for user-based insurance, for fleet management, for managing driver behavior, and/or the like.”  The district court relied upon this statement to conclude that the location device did not include any inventive concept.  In its petition, the patentee argues (I think correctly) that the “off-the-shelf” statement should be interpreted as contemplating the invented device being sold in retail stores, not that it could already be found on retail stores pre-invention.

= = =

1. A method for managing a vehicle inventory for a dealer implemented by a computer having a processor and a memory, the method comprising:

while a location device is not communicatively coupled with a vehicle, associating the location device with a dealer’s group of available location devices in the memory, wherein the dealer’s group of available location devices comprises location devices owned by the dealer that are not coupled with any vehicle;

communicatively coupling the location device with a vehicle;

in response to the location device becoming communicatively coupled with the vehicle, the location device transmitting a connection notice over a network, the connection notice comprising a vehicle identifier and a location device identifier;

receiving, by the computer, the connection notice from the location device over the network;

in response to the connection notice received by the computer, the processor: associating the location device identifier with the vehicle identifier in the memory; and disassociating the location device from the dealer’s group of available location devices in the memory; and

receiving, by the computer, current location information from the location device.

2. A method for managing a vehicle inventory according to claim 1, wherein the vehicle identifier comprises a VIN of the vehicle and the location device identifier comprises a location device serial number.

= = = =

40 thoughts on “Eligibility and Off the Shelf

  1. 9

    On the other side of the pond the EPO is just as eager as the USPTO to look at enablement. The EPO’s unofficial policy is that raising enablement issues (art 83 EPC) are be left to third parties, which can be done in opposition proceedings or by submitting observations under article 115 EPC. A recent decision of an EPO Board of Appeal T 0161/18 is to be mentioned, however, as the BOA raised the enablement issue sua sponte in addition to confirming the first-level rejection for obviousness. The decision related to an AI case in which according to the BOA the application failed to provide sufficient disclosure of the training dataset to be used. This might lead to enhanced review of enablement in IT cases and calls for specific attention from practitioners when drafting applications.

    It is also noteworthy that the recent reform of French patent law (« PACTE ») while extending the scope of examination by the French IP Office to include obviousness, did not go so far as to include enablement. However, the issue can be raised in the opposition proceedings created by the PACTE reform.

    As to the justification for an enablement requirement in addition to the definiteness/written description requirement, there are valid arguments.
    First, the lack of enabling disclosure may relate to items which are not explicitly recited in the claims.
    Second, the enablement requirement is an effective tool to fight speculative patents devoid of enabling disclosure. The award of exclusive rights to inventions is justified by the public policy objective of disseminating information to the public, this objective is frustrated when patents devoid of useful information are granted.

  2. 8

    1) “off the shelf” has one, and only one meaning, as described by Mikey at 1.1.1

    One need not me a member of the sooper dooper guild of patent priests to tease out the meaning viz a legal fiction of PHOSITA. There is an idiom that alludes to retail sales of a component – “shrink wrapped” – which would never have the same engineering meaning.

    2) Another easy one for my scheme. Is it a method? Yes. Does the method’s useful result only arise from some item of information? Yes. Is the useful result realized by human consumption of the information? No. This method is used by a database service to allocate dispositions of tracking devices in a collection. The method should pass 101.

    But there should be a procedural step to define the invention and take a first pass at obviousness /written description prior to millions of dollars worth of experts and discovery. Alice could be a useful, compact test if conducted like the Markman procedure, with technology briefing and adversarial motions that can extend beyond the patent and the complaint. Yes, this “invention” is so obvious that its painful to look at. KSR called that common sense.

    101 has been stretched to the 11th dimension to avoid the use of common sense.

    1. 7.1

      Hits a paywall.

      Can you summarize?

      1. 7.1.1

        “One key for accessing the system is the job title of Supervisory Patent Examiner (SPE). In 2020, the USPTO had at least 120 people who weren’t SPEs designated online as SPEs on its employee locator. All SPEs must be an examiner on a patent, but an examination of patent office records shows that these people have never done so, Hoyle said. In all, over 100 of these people are federal contractors, he added.”

        They’re just bsing because some contractors (likely the guys that do our STIC work or guys that do some IT work for us etc.) supposedly were mistakenly put in a computer system mistakenly as a SPE and “had access” to sensitive info. Which is probably true, though it probably wasn’t done inappropriately.

        “According to Burke, the USPTO has designated non-SPEs as SPEs for a long time.”

        This is correct, and I’ve noticed it. I think it’s for some oddball purpose tho.

        “Labeling people who aren’t SPEs as SPES also creates problems when inventors, patent attorneys, and patent agents call the patent office for help, ”

        This is true that such could happen with the employee locator and is a reason to get it cleaned up.

        “At one point, Burke was listed as an SPE, although she was a quality assurance specialist.”

        Spe’s or directors seem to be put in as the same thing also sometimes.

        They get further into some inside baseball legalities etc, and there likely is some truth that it should be cleaned up, but it isn’t that big of a deal, whomever those contractors etc. are that need access will still be getting access I promise you.

        1. 7.1.1.1

          Thanks 6 – sounds more like a technicality (albeit perhaps an important one along the lines of Arthrex)

      2. 7.1.2

        The idea that a contractor can be called a SPE, and as an applicant you would not know you are dealing with a contract employee instead of a federally protected worker because they are both carrying the officially positioned title SPE. Ergo, the applicant thinks their application is being examined by a federally (and union) protected SPE, but the converse might be true, your application is being examined by an at will contractor, whom does not have federal employment protection.
        And you don’t know – the article is silent – how that contractor SPE is being compensated – per disposal? per allowance? per dismissal?

        1. 7.1.2.1

          iwt,

          To play the Devil’s Advocate, your musing is moot – after all, the Office is bound by 37 CFR 1.2’s “The action of the Patent and Trademark Office will be based exclusively on the written record in the Office” … eh?

        2. 7.1.2.2

          “The idea that a contractor can be called a SPE, and as an applicant you would not know you are dealing with a contract employee instead of a federally protected worker because they are both carrying the officially positioned title SPE. Ergo, the applicant thinks their application is being examined by a federally (and union) protected SPE, but the converse might be true, your application is being examined by an at will contractor, whom does not have federal employment protection.
          And you don’t know – the article is silent – how that contractor SPE is being compensated – per disposal? per allowance? per dismissal?”

          Literally none of this is correct. Or even what the article is about. The article is about some contractors getting a title spe solely in a computer system for computer administrative purposes. Not for examination purposes or irl in any form or fashion. That is, they’re not actually called a spe by anyone. They just have (SPE) in front of their name in a computer system so that they can make changes therein etc. and do the trainings we pay them to do. Although yes, they probably do have access to view unpublished apps (if they know the number they’re looking for which is a complete crp shoot), as they have access to pe2e/edan, I presume that the necessary paperwork was done to clear them and swear them to secrecy. They cannot take any office examination action thereupon as they are not a spe or an examiner.

          “the applicant thinks their application is being examined by a federally (and union) protected SPE”

          A. spe’s are not covered by a union (only primary examiner’s and below are, spe’s lose union coverage when joining mgmt officially tho irl I think they basically get advocated for by POPA just to keep the agency running probably but that isn’t official), and B. nobody should think their application is being examined by a SPE, very very few apps get examined by a SPE (less than .0001% I would guess).

          “ut the converse might be true, your application is being examined by an at will contractor, ”

          That never happens and that isn’t what the article is alleging happens. The post on PO confused you as to the content of the article.

  3. 6

    Off the Shelf: The patent specification indicated that “the location device may be an off-the-shelf tracking device for a vehicle, for example for use by an end user, for user-based insurance, for fleet management, for managing driver behavior, and/or the like.” The district court relied upon this statement to conclude that the location device did not include any inventive concept. In its petition, the patentee argues (I think correctly) that the “off-the-shelf” statement should be interpreted as contemplating the invented device being sold in retail stores, not that it could already be found on retail stores pre-invention.

    First, a component being “off-the-shelf” is not particularly relevant. This is from FN8 of DDR Holdings:
    On a fundamental level, the creation of new compositions and products based on combining elements from different sources has long been a basis for patentable inventions. See, e.g., Parks v. Booth, 102 U.S. 96, 102 (1880) (“Modern inventions very often consist merely of a new combination of old elements or devices, where nothing is or can be claimed except the new combination.”); KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398, 418–19 (2007) (“[I]nventions in most, if not all, instances rely upon building blocks long since uncovered, and claimed discoveries almost of necessity will be combinations of what, in some sense, is already known.”).

    The following is from BASCOM:
    We agree with the district court that the limitations of the claims, taken individually, recite generic computer, network and Internet components, none of which is inventive by itself. BASCOM does not assert that it invented local computers, ISP servers, networks, network accounts, or filtering. Nor does the specification describe those elements as inventive. … The inventive concept inquiry requires more than recognizing that each claim element, by itself, was known in the art. As is the case here, an inventive concept can be found in the non-conventional and non-generic arrangement of known, conventional pieces.

    Without having read the petition or the court’s decisions, its plain (to me) that the Court erred based upon the caselaw stated above. There is a difference between disclosing that certain individual components are off-the-shelf (e.g., the location device) and a finding that the entire hardware system was off-the-shelf. Moreover, even if all of the individual elements were off-the-shelf items, this does not established that the combination, as a whole, was an “off-the-shelf” item.

    1. 6.1

      Correct. “Off the shelf” should come into play — if at all — only in the 102 / 103 analysis.

      ‘cept, that is, when your best friend is . . . Alice.

      (the petition is excellent)

      1. 6.1.1

        The undefined “significantly more” of the Justice-written law begs to differ.

      2. 6.1.2

        “Off the shelf” should come into play — if at all — only in the 102 / 103 analysis.
        “[V]irtually all [inventions] are combinations of old elements.” In re Rouffet, 149 F.3d 1350, 47 USPQ2d 1453 (Fed. Cir. 1998) (quoting Environmental Designs, Ltd. v. Union Oil, 713 F.2d 693, 218 USPQ 865 (Fed. Cir. 1993)).

  4. 5

    — I disagree … “off-the-shelf” clearly indicates something generic and/or pre-existing. To argue not only that this could refer to something novel/inventive in the application, but to go so far as saying that the phrase simply contemplates that someday, this novel tracker might be placed on a shelf somewhere, and thus will need to be taken off said shelf in order to be used, is ridiculous, IMHO.

    1. 5.1

      Exactly. This is what patent attorneys say when they want to be lazy or are unfamiliar with how something works.

  5. 4

    Maybe (just maybe) we should point out that “directed to” is really merely a euphemism for “Gist”…

    On top of that, the immediate case being a claim clearly in statutory process category, the court should be reminded (and yes this echoes Mark’s comment below) — with emphasis:

    35 U.S.C. 100(b): The term “process” means process, art or method, and includes a new use of a known process, machine, manufacture, composition of matter, or material.

    1. 4.1

      Yes; that.

  6. 3

    I maintain that, while a mess, our 101 law springs from an overly formalistic approach to invalidity on obviousness. Like in Europe, if we could combine obvious abstract concepts with known devices we’d be in a better position than all of these stretching-to-fit opinions on what is obviously not patentable, but which nonetheless passes muster under the separate statutory grounds. Using a GPS to track a fleet is so obvious as to be painful to look at, but it’s concrete enough, as far as that goes. It’s just not, or shouldn’t ever have been, deserving of a patent.

    1. 3.1

      101 law springs from an overly formalistic approach to invalidity on obviousness.

      You mean – that which Congress expressly rebuked the pre-1952 Supreme Court upon?

    2. 3.2

      Using a GPS to track a fleet is so obvious as to be painful to look at, but it’s concrete enough, as far as that goes. It’s just not, or shouldn’t ever have been, deserving of a patent.
      What I find sad is the proclivity of both judges and attorneys to abstract an invention down to 7 words or so (e.g., “Using a GPS to track a fleet”) when that abstraction is NOT what was invented.

      Claim 1 of the ‘598 Patent is 179 words long. While Mr. Stroud is correct in stating that using a GPS to track a fleet (presumably at the time the ‘598 Patent was filed) was obvious, this alone is not being claimed.

      BTW — USP 5,922,040 (issued on July 13, 1999) and titled “Method and apparatus for fleet management” described tracking vehicles using GPS. I suspect one could find earlier disclosures but I liked the Title.

      All too often, anti-patent advocates (such as Mr. Stroud) and judges abstract away the details of what is being claimed. It is easier to declare that an invention is obvious and/or directed to patent eligible subject matter when the details are ignored.

      1. 3.2.1

        What I find sad is the proclivity of both judges and attorneys to abstract an invention down to 7 words or so (e.g., “Using a GPS to track a fleet”) when that abstraction is NOT what was invented.

        +1

      2. 3.2.2

        Minor correction, but the proper term is Gisting down to seven words.

        After the Gist, comes the Abstract.

        It’s all a part of the double edge sword presented by the Supreme Court: Gist and Abstract.

        (I can see why this needs a reminder though, as the Courts have shied away from using that terminology — no doubt that this is due to some of the clerks having recognized how the Gist/Abstract lingo so mirrors the pre-1952 Court and its own (then) use of dozens of variants of the “Gist” term)

      3. 3.2.3

        “It is easier to declare that an invention is obvious and/or directed to patent eligible subject matter when the details are ignored.”

        But it’s easiest to declare your interlocuter’s error when they haven’t provided a formal obviousness argument in an informal setting.

        The best part of such argument is that you don’t have to express any support for the dreck while getting an inflated sense of superiority!

        1. 3.2.3.1

          Meh, if the (101) dreck were not advance in the first place, then no matter how informal a comment be, the “inflated” would need not be presented.

          And yet, the “inflated” most always DOES need to be presented.

          (You are aiming at the wrong Dreck, Ben)

        2. 3.2.3.2

          But it’s easiest to declare your interlocuter’s error when they haven’t provided a formal obviousness argument in an informal setting.
          This is a blog chock full of patent professionals that are talking about serious issues. This isn’t a blog discussing the latest release of Pokemon cards. If you are going to present a sloppy conclusion of law as part of a criticism, don’t be surprised when someone calls you out on it. It takes about 90 seconds of scanning the claims to realize that what is being claimed is not “Using a GPS to track a fleet.”

          The best part of such argument is that you don’t have to express any support for the dreck while getting an inflated sense of superiority!
          Your anti-patent bent just shining through. You being you I guess. My commentary was directed to how Mr. Stroud’s characterized the claimed invention — similar to how I’ve seen many judges characterize inventions. My commentary has nothing to do with the actual invention at hand. It was issued by the US Patent Office, so I assume that some kind of examination was performed. Should I naturally assume that this examination was poorly performed?

          Regardless, I care little about this individual invention. Whether this invention is, in fact, patentable makes little difference to me. However, what I do care about is how the anti-patent crowd likes to over-generalize inventions when it suits their purpose. IMHO, it is intellectually dishonest.

          Your comment to me has nothing to do with the law. You just want me to knock me down a peg or two. This is because you cannot actually address the issue I raised on its merits. Rather, you are left with attacking me instead. You being you I guess.

          1. 3.2.3.2.1

            I’m enjoying this little Motte and Bailey you’ve got here. “I just want the claims to be characterized correctly” right now, and then later “if you haven’t established a prima facie case for obviousness in this informal setting, you shouldn’t say the claim is obvious and I am right to declare you wrong without providing any counterpoint.” Well done.

            1. 3.2.3.2.1.1

              Motte and Bailey…..

              Someone has tuned into the Dr. Lindsay show.

            2. 3.2.3.2.1.2

              Except it is more than a bit of a strawman for you to insert the Motte here, as NO ONE has indicated that they would argue as you set up.

  7. 2

    The concept here seems to be that ‘unbound’ location devices can be manufactured and distributed to dealerships, and then remotely bound to new vehicles on-site without the need for manual intervention by the manufacturer. In that sense, perhaps it is true that the location devices are themselves ‘off the shelf’.

    I would be surprised if this is not obvious (or anticipated), assuming the appropriate prior art can be identified. It seems closely analogous with the kinds of processes used to install new set top boxes and broadband routers, amongst other things. It’s not far off what happens when a roaming SIM first identities itself on a new cellular network.

    But it’s not abstract.

    It’s time the courts stopped using 101 as a ‘shortcut’ to avoid the additional work involved in 102 or 103.

    1. 2.1

      +1

    2. 2.2

      “It’s time the courts stopped using 101 as a ‘shortcut’ to avoid the additional work involved in 102 or 103.”

      Big +1.

    3. 2.3

      I don’t see how you can “+1” both comment-2 and comment-3.2. Mark’s just engaging in a lighter form of the abstracting that WT decries; he didn’t engage with every limitation and show where the prior art teaches it, so his opinion is invalid.

      1. 2.3.1

        Mention for this to be indented under comment-2.1. Oh well.

  8. 1

    “the patentee argues (I think correctly) that the “off-the-shelf” statement should be interpreted as contemplating the invented device being sold in retail stores, not that it could already be found on retail stores pre-invention”

    That interpretation does not seem reasonable to me.

    From the specification:
    In an exemplary embodiment, a location device may be an off-the-shelf tracking device for a vehicle

    Using “off the shelf” in “an X may be an off the shelf Y” to indicate that X could potentially be available off the shelf is highly non-standard and nothing else in the specification suggests that this was the intended meaning.

    1. 1.1

      Well Ben, I too would appreciate an explication from the good professor.

      1. 1.1.1

        As an engineer I can tell you with 100% certainty it means it already exists. It has nothing to do with retail. It has to do with an engineer figuratively going to the shelf of parts at the lab and grabbing a pre-existing part that needs no fabrication to build what he’s working on. I’ve been using this phrase my whole life and my colleagues have too. I can tell you Dennis is wrong on this one. I’m not a hater-troll.

        1. 1.1.1.1

          I’ll give a real life example. We were designing a system that would recognize the presence of an object. The design was a fluid-filled bladder in a certain geometric configuration connected to a sensor that would detect the displacement of the fluid. Rather than design and fabricate a special sensor, we used a sensor that another division in our company was already producing tens of thousands of a year. We used an “off the shelf” pressure sensor because, among other things, the design was proven and stable, able to be mass produced, and was cheap. This was not a “retail” part by the way. It was being used in another system and was “off the shelf”.

        2. 1.1.1.2

          Mikey,

          I would pause and remind you that “as an engineer” is not the necessary way to read a legal document (that is what a patent is).

          1. 1.1.1.2.1

            A patent must be read with the eyes of someone of ordinary skill in the art. Presuming Mikey meets that qualification, “as an engineer” is precisely the necessary way to read a legal document.

            1. 1.1.1.2.1.1

              No — reading a legal document from the vantage of a Legal Fiction does NOT mean read the patent as an engineering document.

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