Much of the discussion about the Federal Circuit’s precedential opinion in Yu et al. v. Apple, Inc. et al. has focused on the perceived confusion and dysfunction of U.S. patent law that invalidates a claim directed to an “improved digital camera” as a patent-ineligible “abstract idea.” After delving into the underlying record, this author posits that the Federal Circuit’s opinion has more to do with the manner in which the patent was asserted in the complaint and the resulting Fed. R. Civ. P.. 12(b)(6) motion practice than the nature of the patented invention. This opinion does, however, serve as a reminder to patent prosecutors to be careful when drafting claims having broad functionality because the § 101 inquiry does not depend solely on what is recited in preamble.
The District Court Action – How Did We Get Here?
Yu and Zhang (collectively “Yu”) sued Apple, Inc. in the Northern District of California for infringement of U.S. 6,611,289 (’289 Patent) entitled “Digital cameras using multiple sensors with multiple lenses.” The ‘289 Patent has 31 claims encompassing dual-lens embodiments (claims 1-5) and four-lens embodiments (claims 6-31) of an “improved digital camera” (or a “method claims for generating color images of high quality in a digital camera” (claims 26-31)).
In the complaint, Yu accused the improved zoom and portrait mode offered in certain dual-lens smart phones of infringing the dual-lens embodiments of independent claim 1 and dependent claims 2 and 4. Yu also asserted that the claimed “improved digital camera [was] not limited to performing any particular type of image enhancement” and that “virtually all dual-lens cameras on the market today use the techniques claimed in the ‘289 Patent.”
In response, Apple filed a motion to dismiss under Fed. R. Civ. P. 12(b)(6) arguing that the three asserted claims were not patentable under 35 U.S.C. § 101 because they were directed to the abstract idea of ”creating an image using one image to enhance another image.”
The district court agreed with Apple that these three asserted claims were directed to an abstract idea. Using independent claim 1 as the representative claim, the Court found that the recited limitations – two image sensors and lenses, analog to digital converting circuity, image memory, and digital image processor – were defined only in terms of their function as “’conventional technology’ of a digital camera… being used in conventional ways.” The district court also singled out the “digital image processor” limitation noting that that the “plain language” of its recited function was drawn to the “abstract idea of taking two pictures and using those pictures to enhance each other in some way” and did “not require any special hardware or software” (in other words, the “enhanc[ing]” was not limited to any particular type or process of image enhancement). The district court also declared Judicial Notice stating: “Since the earliest years of the photographic medium, those having skill in the art have used multiple exposures, or the combining of multiple images, to enhance images,” citing to a webpage from the Getty Museum discussing a photograph, The Breaking Wave, from the 19th Century artist Gustave Le Gray. The district court concluded that “[s]uch a ‘fundamental and long prevalent’ practice is a quintessential abstract idea” and that “merely adding computer components to well-known practice does not make invention non-abstract” (citing Affinity Labs of Tex. v. DIRECTV, LLC, 838 F.3d 1253, 1258 (Fed. Cir. 2016)).
The district court dismissed the complaint but gave Yu an opportunity to filed an amended complaint. Yu did so, adding eight new paragraphs to the original complaint and re-asserting the exact same three claims. None of the other 31 claims of the ‘289 Patent were added to the FAC.
Apple again moved to dismiss under Rule 12(b)(6) arguing that the eight new paragraphs did not refute the conclusion that the three asserted claims were directed to the abstract idea of taking two pictures and using a digital processor to enhance the first digital image in some way by the second digital image. In opposing this motion, Yu did not dispute that claim 1 was the representative claim or suggest another approach for the two asserted dependent claims. Nor did Yu identify any material claim construction disagreements. Yu also did not dispute the district court’s judicial finding the “combining of multiple images, to enhance images” had been used in photographs since the 19th Century.
The district court dismissed the amended complaint, stating that the “whole point of [claim 1] is to provide two digital images so that a generic “digital image processor” can enhance one with the other. That is an abstract idea.” The district court found the amended complaint’s allegations concerning inventiveness (including those in the new eight paragraphs) were “wholly divorced from the claims or the specification.” While “Yu [was] perfectly free to try to establish a material issue of fact that might forestall a motion to dismiss, but he cannot simply declare that such disputes exist without any support in the record, or make them up out of whole cloth in a motion brief.” Yu appealed.
The Federal Circuit Opinion – Determining Patent Eligibility Does Not “Depend Simply on the Draftsman’s Art.”
In a 2-1 decision, the Federal Circuit affirmed the district court’s granting of Apple’s motion to dismiss. It found no error in the court’s conclusion that the three asserted claims were invalid under 35 U.S.C. § 101 under the two-step Mayo/Alice framework.
Mayo/Alice Step 1 – whether a patent claim is directed to an unpatentable law of nature, natural phenomenon, or abstract idea
The Federal Circuit began its inquiry under Mayo/Alice Step 1 by looking at the language of claim 1 and the ’289 specification, and asking “what [does] the patent assert to be the focus of the claimed advance over the prior art?”
The Federal Circuit agreed with the district court’s determination that representative claim 1 of the ‘289 Patent was “directed to the abstract idea of taking two pictures (which may be at different exposures) and using one picture to enhance the other in some way,” comparing it to the precedent established in TLI Communications (823 F.3d 607). As explained by the Federal Circuit, asserted claim 1 was “’directed to a result or effect that itself is the abstract idea and merely invoke[d] generic processes and machinery’ rather than ‘a specific means or method that improves the relevant technology.’” This abstract idea was articulated in the last clause of claim 1 by using a generic processor (i.e., “digital image processor”) to “produc[e] a resultant digital image from said first digital image enhanced by said second digital image” without reciting any specifics on how to implement the desired “enhance[ment].” In addition to the ’289 Patent defining the components/elements recited in claim 1 “only in terms of their functions,” the complaint also did not “allege anything other than a generic environment of image sensors and lenses for the invention.”
While the Federal Circuit recognized that claim 1 was “couched as an improved machine“ by its preamble (an “improved digital camera”), the Federal Circuit specifically invoked the Supreme Court’s admonishment in Alice cautioning that the Alice/Mayo step 1 analysis does not end simply by reciting a statutorily eligible preamble (e.g., process, machine, manufacture, or composition of matter). Rather, citing Parker v. Flook, the Federal Circuit noted that the Mayo/Alice step 1 inquiry must also “delve into whether generic components are recited to implement a non-eligible concept or function” in order to insure that the eligibility determination did not “depend simply on the draftsman’s art.”
In addition to generic “digital image processor” recited in claim 1, the Federal Circuit agreed with the district court that all of the other components in claim 1 were simply conventional digital camera components recited in a manner intended merely to effectuate the resulting “enhanced” image—i.e., two image sensors, two lenses, an analog-to-digital converting circuitry, an image memory, and a digital image processor. Moreover, as presented in the asserted claims, these conventional components performed only their basic functions at a high degree of generality (e.g., “said first image sensor producing a first image,” “said second image sensor producing a second image,” “an analog-to-digital converting circuitry [for] digitizing… images,” “an image memory… for storing said first digital image and said second digital image”). Thus, the whole point of the other components of claim 1 was to produce two digital images so that a generic “digital image processor” can enhance one with the other. To the Federal Circuit, that was an abstract idea.
To further buttress its conclusion, the Federal Circuit specifically noted that Yu had already conceded this issue by admitting in its motion briefing to the district court that “[i]t is true that the individual digital camera components recited in the claims are themselves generic and conventional.” The Federal Circuit also noted that neither party disputed the use of asserted claim 1 as the representative claim and that Yu did not separately argue the eligibility of either dependent claims 2 or 4. The Federal Circuit further noted that Yu did not challenge the district court’s use of judicial notice to find that combining of multiple images to enhance images had been known and used in the photographic medium for years.
Mayo/Alice Step 2 – whether the claim nonetheless includes an inventive concept sufficient to transform the nature of the claim’ into a patent-eligible application
The Federal Circuit also agreed with the district court’s conclusion under May/Alice Step 2 that asserted claim 1 “[did] not include an inventive concept sufficient to transform the claimed abstract idea into a patent-eligible invention.” It found that, because the elements of claim 1 were recited at “a high level of generality,” they “merely invoke well-understood, routine, conventional components to apply the abstract.” In other words, “the recited physical components behave[d] exactly as expected according to their ordinary use.”
The Federal Circuit pointedly dismissed Yu’s arguments under Mayo/Alice Step 2. For example, the Federal Circuit rejected Yu’s argument that the “unconventional nature of the claimed digital camera architecture” was demonstrated by the fact that the asserted claims “were allowed over multiple prior art references” by pointing out that novelty was a distinct inquiry from eligibility. Moreover, novelty itself was insufficient to confer eligibility. The Federal Circuit also rejected Yu’s argument that the “claimed hardware configuration was vital to performing the claimed image enhancement” and made the claimed combination of limitations “unconventional.” The Federal Circuit pointed out that Yu’s conclusion of eligibility did not follow from the premise, because the argument that “conventional computer equipment can be ‘vital’” to an abstract advancement does change the abstract idea into an eligible advancement.
In summary, the Federal Circuit explained: “[t]he main problem that [Yu] cannot overcome is that claim 1 — as opposed to something purportedly described in the specification — is missing an inventive concept.”
Rule 12(b)(6) Motions to Dismiss Standards for 101
The Federal Circuit criticized Yu’s arguments that the district court erred by improperly failing to follow the requisite standards for Rule 12(b)(6) motions to dismiss. Yu had argued that the district court erred in making certain adverse findings of fact and failing to accept certain allegations made in the complaint as true. Specially, according to Yu, the district court (1) should not have considered the undisputed fact that the practice of using multiple pictures to enhance each other was well-known for over a century; (2) should not have ruled on the “highly complex” technology at issue without first hearing expert testimony; and (3) improperly disregarded Yu’s allegations of patent eligibility.
The Federal Circuit countered that its precedent well-supported the district court’s recognition at the pleadings stage of the century-old practice of using multiple pictures to enhance each other, calling it a pertinent “fundamental . . . concept and technological development. In addition, it noted that patent eligibility can be determined at the Rule 12(b)(6) stage without the aid of expert testimony. It was not error for the district court to do so here. Lastly, it noted that, “[i]n ruling on a 12(b)(6) motion, a court need not accept as true allegations that contradict matters properly subject to judicial notice or by exhibit, such as the claims and the patent specification.”
Judge Newman’s Dissent
Judge Newman issued a dissent strongly critical to the panel’s decision. According to Judge Newman, the majority’s analysis under 101 was not supported by the “Alice two-step analysis.” To Judge Newman, patentable subject matter is “any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof.” To consider an “improved digital camera” to be “an abstract idea because the camera’s components were well-known and conventional and perform only their basic functions … is not the realm of Section 101 eligibility.” To Judge Newman, such an inquiry should fall under Section 102 and “[t]he question…of whether a particular invention is novel is ‘wholly apart from whether the invention falls into a category of statutory subject matter.’”
According to Judge Newman, the “’abstract idea’ concept with respect to patent-eligibility is founded in the distinction between general principle and specific application.” The Patent Act implements this distinction separately: “Determination of patentability of a new device is not a matter of eligibility under Section 101, but of compliance with all the statutory provisions.” “Section 101 ineligibility does not arise simply because a device embodies minor and predictable differences from the prior art, as the majority holds.” “The question of whether a particular invention is novel is wholly apart from whether the invention falls into a category of statutory subject matter.”
Interestingly, Judge Newman’s dissent makes no mention of the check against preemption articulated in Alice, which prevents “eviscerating the rule that laws of nature, natural phenomena, and abstract ideas are not patentable” and makes Section 101 eligibility “depend simply on the [drafter’s] art.”
Based on the record of litigation, Yu v. Apple is as much, if not more, a consequence of the “all-or-nothing” litigation strategy taken by Yu than an expansion of the Mayo/Alice eligibility test.
By limiting the complaint to the broadest claims of the asserted patent, the plaintiff increased its risk of a Section 101 eligibility challenge, especially as a significant facet of the claimed invention was implemented by a generic processor. When confronted with an early 101 eligibility challenge in a Rule 12(b)(6) motion, the plaintiff did not assert additional claims that might have afforded better arguments than the asserted claims or raise any issues of claim construction. Litigators would do well in view of Yu v. Apple to include dependent claims that are less susceptible to a 101 challenge in their complaints.
Yu v. Apple also serves as a reminder that the Federal Circuit and district courts are following the admonition from Alice to check claims for issues of preemption, and ensure that a clever claim drafter has not used artifice to claim a broad, abstract idea. Patent prosecutors should use claim language having only generic results with caution, and be sure to include dependent claims with limitations that more definitely describe what is encompassed by more broadly recited functionality.