Monday, November 23, 2015

In-Store Discount Patents Not Invalid Under 35 U.S.C. § 101 Prior to Claim Construction

The magistrate judge recommended denying without prejudice defendants' motion for judgment on the pleadings that plaintiff's in-store discount patents were invalid for lack of patentable subject matter because defendants did not establish, prior to claim construction, that the claims were directed toward an abstract idea. "Defendants ask the Court to invalidate the asserted claims on the basis that they are directed to the abstract idea of 'offering, tracking, and processing discounts'—a concept Defendants contend is a longstanding commercial practice. . . . [A] review of the asserted claims does not clearly show that they 'recite[] an abstraction—an idea, having no particular concrete or tangible form.' The discount vehicle claims, for example, include physical structures such as a discount vehicle with information identifying products and their associated discounts, and a select code that can be selectively deactivated as to certain discounts, while remaining active for future use as to others. The data processing system claims recite . . . a data processor connected to memory that is capable of selectively deactivating the select code for redeemed discounts, while leaving the select code active for unused discounts. The presence of these structures counsels away from summarily concluding that the asserted claims are directed to an abstract idea. Consequently, it is impossible to make a final determination before claim construction that the claims are simply 'a drafting effort designed to monopolize [an] abstract idea,' rather than a patent-eligible application of the idea."

Advanced Marketing Systems, LLC v. CVS Pharmacy, Inc., 6-15-cv-00134 (TXED November 19, 2015, Order) (Mitchell, M.J.)

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