Research Corp. v. Microsoft Corp.

The Federal Circuit issued an opinion in Research Corp. v. Microsoft on Wednesday, December 8, ruling on issues of patentable subject matter and filing dates.

The asserted claims involved image halftoning methods as well as computers and computer-related devices related to digital image halftoning. On summary judgment, the U.S. District Court for the District of Arizona ruled that the patents’ subject matter was not patentable and that certain claims of two of the patents at issue were not entitled to claim the benefit of earlier-filed applications.

Regarding the patentability of the subject matter under 35 U.S.C. § 101, the Federal Circuit first found that the subject matter was “a process” and therefore that the subject matter was patentable under § 101 unless it was disqualified as an abstract idea. Deciding this case in the wake of Bilski v. Kappos, 130 S.Ct. 3218 (2010), the Federal Circuit did not provide a specific definition for the term “abstract,” but stated that abstractness “should exhibit itself so manifestly as to override the broad statutory categories of eligible subject matter and the statutory context that directs primary attention on the patentability criteria of the rest of the Patent Act.” The Federal Circuit found that the patents claimed “functional and palpable applications” in computer technology and that some of the claims required various computer-related equipment and devices. On these bases, the Federal Circuit found the subject matter non-abstract and patentable, reversing the ruling on that issue at the district court.

The Federal Circuit then addressed the effective filing date issue regarding certain asserted claims in two of the patents at issue. According to the district court, these claims could not claim the benefit of either of two applications, respectively filed in 1990 and 1991. The Federal Circuit initially found that the district court correctly first placed a burden on defendant Microsoft to produce invalidating prior art and second placed a burden on Research Corp. to prove priority to earlier disclosure. The Federal Circuit then looked to the scope of the later-filed claims to see whether they received support from the earlier applications’ written descriptions. The court found that one asserted patent’s claims did not receive such support, affirming the district court, but that the other asserted patent’s claims did receive such support, reversing the district court.

This opinion first provides some Federal Circuit interpretation of the Supreme Court’s Bilski decision. The court seems to find the range of non-abstract, patentable subject matter to be wide, a view that may bolster the strength of business method patents. The rulings here could also impact patents in other fields, especially with respect to method claims.

The Federal Circuit opinion further emphasizes that after a patent challenger produces prior art, the patent holder bears the burden of establishing any alleged priority to earlier-filed disclosure. Thus, patent applicants should be aware of possible earlier disclosures for which their patents could claim an earlier filing date. If a patent claim could possibly be ruled not novel or obvious unless it can claim the priority of an earlier filing date, the owner of that patent should be ready to prove why the earlier filing date applies when asserting the patent against any infringers.