Joff Wild

It’s been three days since the CAFC handed down its decision in McRO Inc DBA Planet Blue v Bandai Namco Games America et al . For hot-shot US patent practitioners that’s plenty of time to give it a deep dive and to work out its implications. One such is Zachary Silbersher, a partner in New York-based firm Kroub Silbersher & Kolmykov.

In the following piece, Silbersher argues that the true significance of the case is not what it says about software patentability, but in the way it may affect how and when courts handle motions to dismiss based on the Supreme Court’s Alice decision. Read with the earlier CAFC judgments in Enfish and Bascom, Silbersher states, Alice motions at the front end of a litigation are set to become significantly less attractive. For patent owners, that is very good news. Here’s what Silbersher has to say:

After nine months, the Federal Circuit has finally issued its much-anticipated decision in McRo Inc v Bandai Namco Games America.  The McRo decision is likely to come to stand as the leading case on the eligibility of a specific class of patents; namely, those that claim the automation of a task previously performed by humans with computer-implemented rules. 

We have all wondered, while watching cartoons, how they make the characters’ mouths and facial expressions match the words spoken.  It seems like a painstaking process and the truth is, it is.  Lip-synchronisation for 3D animated characters has traditionally been done manually.  Computer programs help with the process, so that new images do not have to drawn from scratch, but animators manually make it happen. 

The patents at issue in McRo are directed to taking manual lip-synchronisation and automating it on a computer.  They claim methods “for automatically animating lip synchronization and facial expression of three dimensional characters”.  To do that, the claims recite “rules” to automatically determine what facial expression to use for different phonemes (basically, syllables).  The defendants, video game developers and publishers, argued that the claims don’t say what those rules actually are, but just claim the idea of using rules.  Because the rules are essentially “user-defined”, the defendants argued that dooms the eligibility of these patents.  The district court agreed.

That argument undoubtedly has resonance.  Claiming “rules” for automating a previously manual process, without specifying what those rules are, would theoretically allow certain patents to preempt large fields of endeavour.  Such patents would effectively have a monopoly on a recited result, rather than an inventive means of accomplishing that result.  For instance, a claim directed to “rules” for automating the driving of an automobile would theoretically preempt all solutions to self-driving cars.

Indeed, the Federal Circuit’s opinion generally agrees with the premise that claiming unspecified rules that swallow a whole field of endeavour is not likely to be eligible subject matter for a patent.  The court reversed the district court, however, because it disagreed that the patents do not specify or delimit what the rules are. 

In a single paragraph, buried in the centre of the opinion, the Federal Circuit resolved a critical claim construction dispute regarding whether the claimed “rules” are broad or narrow.  The court sided with McRo in finding that the rules are narrowly claimed and have specific requirements.  That determination, though obscured within the breadth of the opinion, feeds directly into the court’s ultimate decision that the patents are patent-eligible.  That means, this decision does not really stand for the enunciation of a bright-line rule about “rules-based” patents, but is rather a decision limited to its facts. 

Decisions limited to their facts do not typically make a lasting impression.  Yet, McRo may buck that trend.  McRo offered another salient takeaway from its opinion that may be why it will often be cited.  The court suggested that the question of whether a patent preempts a field of endeavour is a question of fact, and is likely to be one that warrants discovery.  That suggestion alone may quickly impact Alice practice.

Alice decisions have periodically remarked that the policy behind precluding patents on an abstract idea or law of nature is because, otherwise, those patents would preempt the use of basic scientific or technological tools.  McRo digs deeper into how district courts should think about preemption in assessing patent eligibility.  In this case, the court asked a specific question: do the patents preempt all rules-based lip synchronisation?  The court found that they did not.  That was primarily due to its construction of the “rules”, which delimited them to specific rules, rather than just all unspecified rules for automatic lip-synchronisation. 

But that begged a further question—does the field of lip-synchronisation for animation use any other rules, other than those claimed in the patent, even if they are narrowly construed?  The important point here is that the court found there was no evidence before it to answer that question.  

Interestingly, it does not appear that either McRo or the defendants thought it necessary to produce evidence on this point.  In fact, the court stated that the only evidence presented to it about the breadth of rules for lip-synchronisation was provided by amicus, rather than the parties.  Instead, the defendants relied only upon the patent’s description itself to show that any rules-based lip-synchronisation must necessarily use the rules claimed in the patents.  But to the court, the description of one set of rules does not necessarily mean that other sets of rules don’t exist. 

The implication here is that an Alice motion that makes the argument, “this patent preempts a field of endeavour” may need to prove that, and that doing so is probably a fact question.  That means discovery and expert opinion is required.  If discovery and expert opinion are required to prevail on an Alice motion, then the utility of the motion at the outset of a case drops dramatically. 

Alice motions have gained prevalence because a defendant can use Alice at the beginning of a case, before discovery, documents, experts and depositions.  All you need is the patent, a lawyer and a brief.  But if Alice necessarily raises fact issues about preemption, and those issues warrant discovery, that relegates Alice to the back of the case, along with infringement and most invalidity arguments.  If Alice must await summary judgment, then its use may dwindle because its predictability of success will have to be weighed against more sure-fire approaches. 

It remains unclear why the court took nine months to issue this decision, especially given that it was not appended by long dissents or concurrences.  As far as precedential decisions go, this is not an especially long one.  Nor does it assume the mantle of a treatise on a particular issue of law.  Overall, this mitigates the likelihood that McRo will be heard en banc, or eventually at the Supreme Court. 

Perhaps the court’s patience in issuing this decision reflects some of the same confusion at applying Alice’s slippery and confounding two-step formula that has confounded judges and practitioners alike in the patent community.  The law, generally, does not demand bright-line rules to work.  Indeed, most doctrines that work do not provide clear binary choices, but instead rely upon factors that nevertheless succeed at pointing in the right direction under a given set of facts, at least most of the time.  Whether Alice’s two-step formula hits that mark remains questionable.  As far as laws go, it doesn’t work that well.  Not because its premise and logic are incorrect, but because faced with any given patent, the predictability of its outcome is low. 

The Supreme Court probably has little appetite to revisit Alice to fix it and make it more workable.  But it may not matter.  Taking Enfish, Bascom and McRo together, the Federal Circuit has slowly chipped away at the premise that an Alice motion probably raises no issues of fact warranting discovery, and can be easily decided on a motion to dismiss.  Decisions like Enfish, Bascom and McRo make it harder for a defendant’s litigation counsel to recommend the expense of filing an early Alice motion.  Rather then waiting around for Alice to be fixed, her popularity may slowly just fade away.