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Federal Circuit Affirms Patent Directed to Targeted Ads is Ineligible
July 11th, 2024
Contributor: Pramod Chintalapoodi
The Federal Circuit has affirmed summary judgment that patent claims for targeting ads based on a user’s internet search results are patent-ineligible subject matter under 35 U.S.C. § 101.
The case is Chewy, Inc. v. International Business Machines Corporation.
As the court explains,
IBM owns the ’849 and ’443 patents, which generally relate to improvements in web-based advertising. The ’849 patent discloses improved methods for presenting advertisements to a user of an interactive service….. In the prior art, advertisements would be downloaded at the same time as applications….. This conventional method diminished service response time as it required application traffic to compete with advertising traffic for network communication services. …The claimed methods minimize advertising traffic’s interference with the retrieval and presentation of application data by, inter alia, “storing and managing” advertising at the user reception system before it is requested by the user. …The advertising may be “individualized to the respective users based on characterizations of the respective users as defined by the interaction history with the service and such other information as user demographics and locale.”
Claim 1 of the ‘849 recites:
A method for presenting advertising obtained from a computer network… c. selectively storing advertising objects at a store established at the reception system.
(Emphasis added by court.)
Chewy, Inc. sued IBM, seeking a declaratory judgment of noninfringement of several IBM patents, including the ’849 and ’443 patents.
IBM then filed counterclaims alleging Chewy’s website and mobile applications infringed the IBM patents.
The district court granted Chewy’s motion for summary judgment of noninfringement of certain claims of the ’849 patent. The district court also granted Chewy’s motion for summary judgment that certain claims of the ’443 patent were ineligible under § 101.
IBM appealed both rulings.
The Federal Circuit noted that
The district court granted summary judgment of noninfringement of [certain claims of the ‘849 patent] because no reasonable factfinder could find Chewy’s website or mobile applications perform the selectively storing limitation recited in the claims.
In other words, said the Federal Circuit, the advertising objects must be “pre-fetched.” IBM argued that the proper construction doesn’t require prefetching, but the Federal Circuit agreed with the district court, noting that
In the “Summary of Invention” section, the ’849 patent provides: [T]he method for presenting advertising in accordance with this invention achieves the above-noted and other objects by featuring steps for presenting advertising concurrently with service applications at the user reception system; i.e., terminal. . . . in accordance with the method, the user reception system at which the advertising is presented includes [a] facility for storing and managing the advertising so that it can be pre-fetched from the network and staged at the reception system in anticipation of being called for presentation.
(Emphasis added by court.)
The written description also includes the phrase, “This is accomplished by using the aforementioned pre-fetching mechanism.”
The district court construed “selectively storing advertising objects at a store established at the reception system” as “retrieving advertising objects and storing at a store established at the reception system in anticipation of display concurrently with the applications.”
The Federal Circuit agreed that selectively storing advertising objects requires pre-fetching and therefore affirmed the district court’s construction of the selectively storing limitation.
As for the issue of patent eligibility, the court’s analysis applied the US Supreme Court’s two-step Alice framework. (Alice Corp. v. CLS Bank Int’l, 573 U.S. 208, 217 (2014).)
In step one, a court must determine whether the claims are “directed to a patent-ineligible concept,” such as an abstract idea or a law of nature.
Here, said the court, the “district court held at Alice step one the asserted claims are directed to the abstract idea of identifying advertisements based on search results.”
IBM argued that
the claims are instead directed to a patent-eligible improvement in online advertising: obtaining search results from a user’s search query and using those search results to identify targeted advertisements.
The Federal Circuit disagreed with IBM and agreed with the district court, saying,
The claims broadly recite correlating advertisements with search results using a generic process. For example, claim 13 recites a method of associating advertisements with search results by identifying at least one search result item from a user’s Internet search, searching for and identifying an associated advertisement in an information repository that matches the search result item, and correlating the search result item and associated advertisement using an off-line batch process. … Similarly, claim 15 recites a method for providing related advertisements by matching the search results to related advertisements, providing a graphical user interface (GUI) for each search result, and searching, retrieving, and displaying related advertisements for each search result when selected by a user on the GUI. … We have held claims to targeted advertising were directed to an abstract idea at Alice step one…
The court said, “Correlating advertisements with search results is a type of targeted advertising and is thus abstract.”
According to IBM, its method of identifying advertisements based on search results rather than search queries improved the specificity and relevancy of online advertisements.
But the Federal Circuit was not convinced:
the ’443 patent claims are not directed to any challenges unique to computer networks or specific improvements to the functionality of the computer itself. The claims merely recite the concept of identifying advertisements based on search results without any specificity as to how this is accomplished. Even accepting that the claimed invention improves the specificity and relevancy of online advertisements, this “is at most an improvement to the abstract concept of targeted advertising wherein a computer is merely used as a tool.”
Similarly, at Alice step 2, the Federal Circuit agreed with the district court that the claims failed to recite an inventive concept.
For example, said the court,
Using a generic database to store the information used in correlating advertisements with search results is not an inventive concept.
The court thus affirmed part of the district court’s summary judgment ruling.