A US SOFTWARE PATENT CASE TO REMEMBER

The US decision DDR Holdings, LLC v. Hotels.com, L.P. [1] was the first prominent decision finding a software invention patentable in the US after the Alice decision [2], which has been used to invalidate many US software patents.
If you need to know how to draft a software patent for the US, or need to respond to a patentable subject matter objection, DDR holdings provides good guidance on how to proceed.
The court considered if the internet e-commerce related invention the subject of patent US 7,818,399 was patent eligible subject matter.
The patent is directed to systems and methods of generating a composite webpage that combines certain visual elements of a host website with content of a third party merchant. For example, the generated composite webpage may combine the logo, background colour, and fonts of the merchant website with product information from the merchant. The patent explains that prior art systems allow third-party merchants to lure the host website visitor traffic away from the host website because visitors would be taken to the third-party merchants website when they clicked on the merchants advertisement on the host site. The provided solution to this problem is creating a new webpage that permits a website visitor in a sense to be in two places at the same time on activation of a hyperlink on the host website – such as an advertisement for a third-party merchant – instead of taking the visitor to the merchant’s website. The system generates and directs the visitor to a composite webpage that displays product information from the third-party merchant, but retains the host websites look and feel. Thus, the host website can display a third-party merchants products, but retain its visitor traffic by displaying this product information from within a generated webpage that gives the viewer of the page the impression that she is viewing pages served by the host website.
The representative claim considered by the court for patent eligible subject matter is:
A system useful in an outsource provider serving web pages offering commercial opportunities, the system comprising:
(a)  a computer store containing data, for each of a plurality of first web pages, defining a plurality of visually perceptible elements, which visually perceptible elements correspond to the plurality of first web pages;
                                               i.     wherein each of the first web pages belongs to one of a plurality of web page owners;
                                             ii.     wherein each of the first web pages displays at least one active link associated with a commerce object associated with a buying opportunity of a selected one of a plurality of merchants; and
                                            iii.     wherein the selected merchant, the outsource provider, and the owner of the first web page displaying the associated link are each third parties with respect to one other;
(b)  a computer server at the outsource provider, which computer server is coupled to the computer store and programmed to:
                                               i.     receive from the web browser of a computer user a signal indicating activation of one of the links displayed by one of the first web pages;
                                             ii.     automatically identify as the source page the one of the first web pages on which the link has been activated;
                                            iii.     In response to identification of the source page, automatically retrieve the stored data corresponding to the source page; and
                                            iv.     Using the data retrieve, automatically generate and transmit to the web browser a second web page that displays: (A) information associated with the commerce object associated with the link that has been activated, and (B) the plurality of visually perceptible elements visually corresponding to the source page.
The court applied the two-step Alice analysis. First, given the nature of the invention in this case, it is considered whether the claim is directed to a patent ineligible abstract idea. If so, then the second step is to consider the elements of each claim both individually and as an ordered combination to determine whether the additional elements transform the nature of the claim into a patent eligible application of the abstract idea.
The court noted that although the claims addressed a business challenge related to website visitors, it is a challenge particular to the Internet. The court contrasted the invention to other invalidated patents which had claims that recited various computer hardware elements but were in substance directed to nothing more than the performance of an abstract business practice on the Internet or using a conventional computer.
Instead, the claimed solution was found to be necessarily rooted in computer technology in order to overcome a problem specifically arising in the realm of computer networks. The claims recite an invention that is not merely the routine or conventional use of the Internet. Also, the claims do not attempt to pre-empt every application of the idea of increasing sales by making two webpages look the same. Rather, they recite a specific way to automate the creation of a composite webpage by an outsourced provider.
It should be noted that the law in the area may not be settled.  One of the three judges, considering the matter dissented, arguing that the invention is simply an abstract idea, that is, online merchant sales can be increased if two webpages have the same look and feel, and involves using a generic computer.  If you need to draft or argue for a US software patent application, the applicable lessons from this decision are:
·      frame the invention as being necessarily rooted in computer technology in order to overcome a problem specifically arising in the realm of computer networks.
·      draft claims that recite an invention that is not merely the routine or conventional use of the Internet.
·      do not merely recite the performance of some business practice from the pre- Internet world on a general purpose computer.
[1] DDR Holdings LLC v. Hotels.com,  773 F.3d 1245 (Fed. Cir. 2014)
[2] Alice Corp. v. CLS Bank Int’l, 134 S. Ct. 2347, 2355 (2014).

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