Federal Circuit Upholds Invalidity of Patent in Case against Warner and CBS

The Federal Circuit Court of Appeals has upheld a trial court’s ruling that invalidated a patent owned by CyberFone Systems LLC on the basis that it covered an abstract concept rather than a patentable invention.

CyberFone owned US Patent No. 8,019, 060, issued in 2011, for a “Telephone/transaction entry device and system for entering transaction data into databases.”  According to the patent abstract,

Transaction data is entered by the user in response to prompts in a template. The template and entered data are accumulated into data transactions which are exploded and sent to an external database servers [sic] for processing and storage. Each database server may explode the data transaction to produce ancillary records which are then stored, and/or forwards the data transaction or some or all of the ancillary records to other database servers for updating other databases associated with those database servers. The database server(s) may also return data streams for use in completing the fields in the data transaction.

Soon after the patent was issued, CyberFone sued 81 defendants for infringement.  The defendants included news and media companies such as Warner Bros., CBS, Yahoo, Twitter, and LinkedIn.

The defendants moved for summary judgment on the grounds that the patent’s claims described only an abstract idea.

The district court judge agreed, saying:

The patent, broken down into its component parts, recites steps by which data is obtained, sorted and stored.  These steps represent nothing more than a disembodied concept of data sorting and storage.

The Circuit Court found that the patent unfairly purported to give CyberFone ownership of a basic idea:

Here, the well-known concept of categorical data storage, i.e., the idea of collecting information in classified form, then separating and transmitting that information according to its classification, is an abstract idea that is not patent-eligible.

Stay up-to-date on the latest Intellectual Property Law news from Sheldon Mak & Anderson.

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