Federal Circuit Finds Improvement to Computer Memory Systems is Patent Eligible, and Not an “Abstract Idea” Under Alice, reversing District Court

Summary

On August 15, 2017, the Federal Circuit issued a decision in Visual Memory LLC v. NVIDIA Corp. that provides a favorable decision applicants and patentees can rely upon in seeking to obtain and defend patent claims directed to computer-implemented inventions. Specifically, the Federal Circuit held that a patent “claim[ing] an improvement to computer memory” is not directed to an abstract idea and is therefore patent-eligible under Alice Corp. Pty Ltd. v. CLS Bank Int’l, ___ U.S. ___, 134 S.Ct 2347 (2014).

The patent at issue provides a memory system with programmable operational characteristics that can be tailored for use with multiple different processors without the accompanying reduction in performance. The claimed technology overcame some of the disadvantages of the prior art memory systems that “lacked versatility because they were designed and optimized based on the specific type of processor selected for use in that system."

Visual Memory sued NVIDIA for infringing its U.S. Patent No. 5,953,740. The U.S. District Court for the District of Delaware granted NVIDIA’s motion to dismiss after ruling that the asserted claims were unpatentable under 35 U.S.C. § 101 as directed to an “abstract idea of categorical data storage.”

Under the Supreme Court’s Alice decision, the Federal Circuit, district courts, and the U.S. Patent and Trademark Office employ a two-step process for assessing whether claims are directed to patent-eligible subject matter under Section 101, namely:

1. “determine whether the claims at issue are directed to one of those patent-ineligible concepts,” such as an abstract idea, and
2. “analyze whether the claim elements, either individually or as an ordered combination, contain an ‘inventive concept’ that ‘transforms the nature of the claim into a patent-eligible application.’”

Beginning its analysis with Alice step one, the Court noted that it “must articulate with specificity what the claims are directed to… and ask whether the claims are directed to improvement to computer functionality versus being directed to an abstract idea.” The Court then referenced two recent cases, Enfish, LLC v. Microsoft Corp., 822 F.3d 1327 (Fed. Cir. 2016), and Thales Visionix Inc. v. United States, 850 F.3d 1343 (Fed. Cir. 2017), and determined that the ‘740 patent’s claims demonstrate that they are directed to “an improved computer memory system, not to the abstract idea of categorical data storage” in which a computer is used merely as a tool.

In assessing the ‘740 patent claims, the Court recognized that the ‘740 patent’s teachings “obviate the need to design a separate memory system for each type of processor...