U.S. Patent to Consumer Marketing, Based on Avatar Choices, Survives § 101 Challenge

On March 22, 2016, the U.S. District Court for the District of Delaware issued a Memorandum Opinion in a case captioned Treehouse Avatar LLC v. Valve Corp., in which software patent claims survived a patent eligibility challenge.

Treehouse Avatar sued Valve Corp. for infringement of U.S. Patent No. 8,180,858.  Valve Corp filed a Motion to Dismiss alleging that the asserted claims did not satisfy 35 U.S.C. § 101 as being directed to an abstract idea.

The '858 patent, titled "Method and System for Presenting Data Over A Network Based On Network User Choices and Collecting Real-Time Data Related To Said Choices," was filed on November 30, 2010 and issued on May 15, 2012.  The invention increases network site loyalty by presenting to network users audio data and visual image data that is indicative of the individuality of the network user (by allowing a user to create an avatar), and also collects market research data in real-time.  The method presents data to a network user based on choices made by the user while the user is within a character-enabled network site.  For instance, a user may select a "character" or avatar and then select "character attributes", such as clothing using the interface shown in Figure 9, which is reproduced below.

As to the market research capabilities, the site program/data of a character-enabled site may be designed to provide a means of capturing data related to the identity, tastes, preferences and opinions of site users.  For example, if a selected character is female or appears to be of a certain age, these attributes are likely indicative of the user.

Claim 1 recites:

A method of collecting data from an information network in response to user choices of a plurality of users made while accessing said information network and navigating character-enabled (CE) network sites on said information network, said method comprising:
    storing a plurality of character data in a database accessible by said CE network site;
    storing a plurality of character attribute data in said database;
    linking the character attribute data with one or more of the character data;
    presenting to a user interface, one or more character data defining one or more characters for selection by the user;
    upon selection of a character by the user, presenting in real time to the user interface, the selected character along with at least one of the character-attribute data linked to the selected character for selection by the user;
    upon selection of a character attribute by the user, presenting in real time to the user interface, the selected character including the selected character attribute; and
    tallying the number of times the selected character attribute has been selected by a plurality of users.

Patent-Eligible Subject Matter?

The District Court followed the Supreme Court's framework for distinguishing patents that claim laws of nature, natural phenomena, and abstract ideas from those that claim patent-eligible applications of those concepts.  First, it is determined whether the claims at issue are directed to one of those patent-ineligible concepts.  If so, then it is determined what else is there in the claims before us to determine whether the additional elements transform the nature of the claim into a patent-eligible application.

The District Court noted that because computer software comprises a set of instructions, the first step of Alice is, for the most part, a given; i.e., computer-implemented patents generally involve abstract ideas.  The more difficult part of the analysis is subsumed in the second step of determining whether the claims "merely recite the performance of some business practice known from the pre-Internet world along with the requirement to perform it on the Internet," or whether the claims are directed to "a problem specifically arising in the realm of computer technology" and the claimed solution specifies how computer technology should be manipulated to overcome the problem.

The District Court offered comments, echoed by many practitioners today, that the evolution of § 101 jurisprudence has gone from the complete rejection of patentability for computer programs to the almost complete acceptance of such, to the current (apparent) requirements that the patent claims in suit (1) disclose a problem "necessarily rooted in computer technology," and (2) claim a solution that (a) not only departs from the "routine and conventional" use of the technology, but (b) is sufficiently specific so as to negate the risk of pre-emption.  In other words, even though most of the patent claims now being challenged under § 101 would have survived such challenges if mounted at the time of issuance, these claims are now in jeopardy under the heightened specificity required by the Federal Circuit post-Alice.

The District Court further highlighted that it is less than clear how a § 101 inquiry that is focused through the lens of specificity can be harmonized with the roles given to other aspects of the patent law (such as enablement under § 112 and non-obviousness under § 103).

The District Court concluded a rant on § 101 jurisprudence by stating that at their broadest, the various decisions of the Federal Circuit would likely ring the death-knell for patent protection of computer-implemented inventions.  The District Court settled on DDR as a benchmark; i.e., the claims (informed by the specification) must describe a problem and solution rooted in computer technology, and the solution must be (1) specific enough to preclude the risk of pre-emption, and (2) innovative enough to "override the routine and conventional" use of the computer.

The defendant attempted to summarize the claims of the patent as the abstract concept of allowing a customer or potential customer to customize a character by selecting character attributes and then to keep a tally of character/attributes that have been selected.  Defendant then analogized this concept to a "human" counterpart, namely participating in a mall focus group, wherein a person presents choices of brands or products to potential customers and tallies the choices.

The District Court rejected such a characterization because it does not embody the Internet centric concept of the claims.  Because the claims are directed to users selecting and modifying customizable characters (avatars) in real time on character-enabled (CE) sites, as well as storing and retrieving such characters within an information network, the human analogy is not representative of the claims as a whole which describe more than the pre-Internet business concept of "tallying" choices applied in a computer setting.  The District Court found that the claims are more like those in DDR, to wit, "necessarily rooted in computer technology in order to overcome a problem specifically arising in the realm of computer networks."

The District Court also found that the claims satisfy step two of the Alice analysis because they provide a specific series of steps used to customize a character to users' choices in real time.  For example, claim 1 seeks to collect data in response to users' choices made on CE sites by having character data and character attribute data in a database; linking the character attribute data with character data; having a user select a character and character attribute data; updating the selections in real time; and tallying the selected character attributes.  The District Court concluded that the claims are innovative, and do not represent the routine and conventional use of a computer.  Thus, the defendant's motion to dismiss was denied because the claims were found to satisfy 35 U.S.C. § 101.

Whether claims satisfy § 101 is becoming a very subjective analysis.  How the claims at issue here are not "a conventional use of a computer" is hard to see considering that the method includes storing data, linking data, presenting data to a user, and tallying data.  Certainly, such functions are basic and routine computer functions.  The District Court's analysis lacks any factual determinations for what in the claims is actually "innovative", and rather simply makes the statement that the claim limitations are innovative.  Such a subjective analysis is problematic.

The District Court here, as well as many other district courts, emphasized the Federal Circuit's decision in DDR and placed great weight on whether the challenged claims are necessarily rooted in computer technology, and recite steps in detail for how to overcome a problem arising in computer networks.  This seems to be a safe way to hedge bets for the chances that the Federal Circuit would reverse the District Court on appeal.

Treehouse Avatar LLC v. Valve Corp. (D.C. Del. 2016)
Memorandum Opinion by District Judge Sue L Robinson