Tuesday, August 30, 2011

Patent Case - non-patentable subject matter

Cybersource v Retail Decisions was decided on 16 August 2011. It decided that a certain Internet process was not patentable subject matter.

CyberSource is the owner by assignment of a patent, which recites a “method and system for detecting fraud in a credit card transaction between [a] consumer and a merchant over the Internet.” Claim 3 of the patent recites a process for verifying the validity of credit card transactions over the Internet.

"We are not persuaded by the appellant’s argument that the claimed method is tied to a particular machine because it “would not be necessary or possible without the Internet.” Appellant’s Br. 42. Regardless of whether “the Internet” can be viewed as a machine, it is clear that the Internet cannot perform the fraud detection steps of the claimed method. Moreover, while claim 3 describes a method of analyzing data regarding Internet credit card transactions, nothing in claim 3 requires an infringer to use the Internet to obtain that data (as opposed to obtain- ing the data from a pre-compiled database). The Internet is merely described as the source of the data. We have held that mere “[data-gathering] step[s] cannot make an otherwise nonstatutory claim statutory.”