Split Federal Circuit Vacates Section 101 Decision So District Court Can Resolve Claim Construction Dispute

December 9, 2019

In MyMail, Ltd. v. OoVoo, LLC, IAC Search & Media, Inc., 934 F.3d 1373 (Fed. Cir. August 16, 2019), a split Federal Circuit panel held that the district court erred by declining to resolve the parties’ claim construction dispute before deciding patent subject matter eligibility under Section 101

The patents-in-suit relate to “modifying a toolbar” displayed on an Internet-connected device.  The lengthy claims require updating “toolbar data” in accordance with “toolbar update data” received from the Internet, and displaying the “toolbar” as defined by the “updated toolbar data.”  

MyMail had directed the district court to a construction from another case involving the patents-in-suit (MyMail, Ltd. v. Yahoo! Inc., No. 2:16-cv-01000 (E.D. Tex. 2017)) where the court construed the claim term “toolbar” to mean a “button bar that can be dynamically changed or updated via a Pinger process or a MOT script.”  According to MyMail, this construction confirmed that its claims are directed to a particular technological process for improving an exclusively computer-oriented device, which would have rendered the claims patent-eligible.  The defendants, by contrast, contended that MyMail’s construction would have had no impact on claim scope and, by extension, on a Section 101 analysis. 

The district court performed a Section 101 analysis of the claims and found them invalid based on post-Alice precedents holding that the analysis, transmission, and display of information are, in themselves, abstract ideas and therefore patent ineligible.  But the district court did not resolve the parties’ claim construction dispute over the meaning of “toolbar.”  MyMail appealed because it believed that the district court should have construed “toolbar” before granting ooVoo’s and IAC’s motions for judgment on the pleadings.  

A two-judge majority of the Federal Circuit panel held that the district court’s failure to address the parties’ claim construction dispute was error under Aatrix Software, Inc. v. Green Shades Software, Inc., 882 F.3d 1121, 1125 (Fed. Cir. 2018).  The MyMail majority vacated the district court’s Section 101 decision, and instructed the district court to resolve the claim construction dispute (and then the eligibility issue) on remand.  MyMail, 934 F.3d at 1380-81.  The majority also explained why it declined to opine on the parties’ claim construction dispute.  The majority stated that it was “generally hesitant to construe patent claims in the first instance on appeal,” and noted that its “hesitancy is intended to avoid conflating de novo review with an independent analysis.”  Id.   

The MyMail majority relied heavily on the Federal Circuit’s 2018 decision in Aatrix.  As in MyMail, the Federal Circuit in Aatrix vacated a district court’s dismissal of a case under Section 101.  Aatrix, 882 F.3d at 1130.  The patentee in Aatrix had submitted a proposed amended complaint that alleged factual details with respect to how the claimed invention was directed to improvements in computer processing speed and memory efficiency, and how the invention overcame problems in the prior art.  The Federal Circuit held that the district court erred when it refused to allow the patentee to file its amended complaint.  Id. at 1126-28. 

Of particular importance to the MyMail majority, the Federal Circuit in Aatrix also held that there would be “a need for claim construction” on remand “after the amended complaint is filed” in district court.  Id. at 1128-29.  Specifically, the patentee in Aatrix contended that, as properly construed, the claimed “data file” represented an “inventive concept” under Alice step 2.  The Federal Circuit pointed to several passages from the specification that, according to the patentee, demonstrated the supposed “inventive concept.”  The defendant, on the other hand, argued that the disputed claim limitation reflected nothing more than “a routine and conventional use of a computer,” although the court noted that the defendant pointed to nothing in the specification that described the relevant feature as conventional.  Id.  The Federal Circuit instructed the district court to “resolve, as necessary, [these] claim construction issues.”  Id. at 1130.      

Both Aatrix and MyMail state that if the parties raise a claim construction dispute at the motion to dismiss stage, “the district court must either adopt the non-moving party’s constructions or resolve the dispute to whatever extent is needed to conduct the § 101 analysis.”  MyMail, 934 F.3d at 1379 (citing Aatrix, 882 F.3d at 1125 (“If there are claim construction disputes at the Rule 12(b)(6) stage, we have held that either the court must proceed by adopting the non-moving party’s constructions … or the court must resolve the disputes to whatever extent is needed to conduct the § 101 analysis , which may well be less than a full, formal claim construction.”)).  It is nevertheless possible to read MyMail as extending the holding from Aatrix. 

Aatrix discussed a specific claim limitation and explained, in some detail, how it might amount to an “inventive concept” that could render the claims patent-eligible.  The Aatrix panel’s attempt to analyze the substance of the 101 question on appeal using the non-moving party’s positions, despite the district court’s failure to address the claim construction dispute, suggests that the Federal Circuit might, in an appropriate case, be able to cure the district court’s failure by adopting the non-moving party’s construction and then considering the 101 question using that construction.  Indeed, the dissent in MyMail (by Judge Lourie) thought that MyMail presented just such a case, i.e., one that could have been resolved on appeal by adopting the non-moving party’s (MyMail’s) construction.  

The MyMail majority, by contrast, did not even consider whether, under MyMail’s construction, the “toolbar” claim limitation could transform the claims into eligible subject matter.  Rather, the MyMail majority treated the district court’s failure to address the claim construction dispute as per se fatal to the district court’s grant of a motion to dismiss on 101 grounds.  And it expressly declined to consider the substance of the 101 issue, even under MyMail’s construction, until the district court had done so, noting that subsidiary factual questions might underly such a determination.  MyMail, 934 F.3d at 1380.  Presumably, whether such subsidiary factual questions exist must be considered in the first instance by the district court using an appropriate claim construction

Author: Andrew Noble