Cyberfone v. CNN: Mere Use of a Telephone and Mere Collection and Organization of Data Insufficient to Shift from Ineligible Abstract Idea to Eligible Subject Matter

Category: 101 
By: Eric Paul Smith, Contributor   
TitleCyberfone Systems, LLC v. CNN Interactive Group, Inc., Nos. 2012-1673, -1674 (Fed. Cir. Feb. 26, 2014) (non-precedential).
IssueWhether the United States District Court for the District of Delaware properly "found that the subject matter of [U.S. Patent No. 8,019,060] was nothing more than a disembodied concept of data sorting and storage and granted summary judgment of invalidity under [35 U.S.C. ]§ 101[ (2012)]." Cyberfone at *5 (citations and internal quotation marks omitted).
Holding"We agree with the district court that the '060 patent claims ineligible subject matter--an abstract idea--and that the patent is invalid under § 101." Id. at *10.
Procedural History"The district court held that the ['060] patent claims ineligible matter and is invalid under . . . § 101 . . . ." Cyberfone appeals. Cyberfone at *4.


Legal Reasoning (Dyk, Wallach, Lourie)
Representative Claim at Issue1. A method, comprising:

obtaining data transaction information entered on a telephone from a single transmission from said telephone;

forming a plurality of different exploded data transactions for the single transmission, said plurality of different exploded data transaction[s] indicative of a single data transaction, each of said exploded data transactions having different data that is intended for a different destination that is included as part of the exploded data transactions, and each of said exploded data transactions formed based on said data transaction information from said single transmission, so that different data from the single data transmission is separated and sent to different destinations; and

sending said different exploded data transactions over a channel to said different destinations, all based on said data transaction information entered in said single transmission.

Cyberfone at *4-5.
Eligibility of Abstract Ideas
Legal Standard"The Supreme Court has established that section 101 impliedly bars patents on laws of nature, natural phenomena, and abstract ideas. The Court has explained that [a] principle, in the abstract, is a fundamental truth; an original cause; a motive; these cannot be patented, as no one can claim in either of them an exclusive right." Cyberfone at *6 (alteration in original) (citations and internal quotation marks omitted). However, "[f]inding the abstract idea itself to be ineligible subject matter is not the end of the inquiry. The second step in the § 101 analysis requires determining whether additional substantive limitations . . . narrow, confine, or otherwise tie down the claim so that, in practical terms, it does not cover the full abstract idea itself." Id. at *8 (citations and internal quotation marks omitted).
The Claims at Issue Claim an Abstract Idea"[U]sing categories to organize, store, and transmit information is well-established. Here, the well-known concept of categorical data storage, i.e., the idea of collecting information in classified form, then separating and transmitting that information according to its classification, is an abstract idea that is not patent-eligible." Id. at *7. Furthermore, "[a]lthough methods that can be performed in the human mind alone are not eligible for patent protection the category of patent-ineligible abstract ideas is not limited to methods that can be performed in the human mind." Id. at *8 (citations and internal quotation marks omitted).
Additional Substantve Limitations Fail to Sufficiently Narrow the Claim[1] "Cyberfone asserts that the method of claim 1 requires a 'telephone,' and that it is a specific machine that plays an integral role in the method. But the specification explains that '[w]hen in telephone mode, the telephone operates in a conventional manner.' '060 patent col. 2 ll. 63–65. The telephone can only obtain data 'in the transaction entry mode, [when] menus are used to navigate the user to forms which facilitate the entry of data.' ’060 patent col. 1 ll. 34–35. Thus, the telephone does not obtain data when it is functioning as a telephone, only when in an unclaimed mode of operation." Id. at *9-10 (alterations in original).

[2] "Cyberfone next argues that the claims are sufficiently limited by the transformation that results from 'exploding' data transactions, i.e., sending information, in whole or in part, gathered from one source to different destinations. We have held that the mere collection and organization of data . . . is insufficient to meet the transformation prong of the test. Here, the exploding step effects no meaningful transformation because it merely makes the originally-gathered information accessible to different destinations without changing the content or its classification. Nor does the particular configuration of steps—obtaining, separating, and then sending information—confer patentability. As in Mayo, the ordered combination adds nothing because it follows from the underlying idea of categorical information storage." Id. at *10 (citations and internal quotation marks omitted).
"We agree with the district court that the '060 patent claims ineligible subject matter—an abstract idea—and that the patent is invalid under § 101." Cyberfone at *10.
 Image Attribution Statement: US Post Office, “Telephone Centennial Issue 1976-13c,” available as a public domain image  being a work prepared by an officer or employee of the United States Government as part of that person’s official duties, http://en.wikipedia.org/wiki/File:Telephone_Centennial_Issue_1976-13c.jpg (last visited March 10, 2014) (image modified).
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