By Blanche E. Schiller

In CyberSource Corporation v. Retail Decisions, Inc., 654 F.3d 1366 (Fed. Cir. 2011), the Court of Appeals for the Federal Circuit held that claims that recite purely mental steps are not patentable subject matter. CyberSource Corporation is the owner of U.S. Patent No. 6,029,154 (the ‘154 patent), which describes the use of Internet address information (such as IP addresses, MAC address and e-mail addresses) to detect credit card fraud. CyberSource appealed to the Court of Appeals for the Federal Circuit from a lower court’s decision granting summary judgment of invalidity of claims 2 and 3 of the ‘€˜154 patent under 35 U.S.C. 101, for failure to recite patentable subject matter. Claim 2 is directed to a computer readable medium containing program instructions for detecting fraud in a credit card transaction, and claim 3 is directed to a process for verifying the validity of credit card transactions over the Internet.

First, claim 3 is discussed, and then, claim 2, since the Court’s decision builds on the evaluation of claim 3. Claim 3, which recites a method for verifying the validity of a credit card transaction over the Internet, includes three steps: (1) obtaining information about other transactions that have utilized an Internet address that is identified with the credit card transaction; (2) constructing a map of credit card numbers based on the other transactions; and (3) utilizing the map to determine if the credit card transaction is valid. The Court of Appeals held that this claim fails to recite patentable subject matter, since the claim recites nothing but mental steps. The Court of Appeals stated: “Such a method that can be performed by human thought alone is merely an abstract idea and is not patent-eligible under §101. Methods which can be performed entirely in the human mind are unpatentable not because there is anything wrong with claiming mental method steps as part of a process containing non-mental steps, but rather because computational methods which can be performed entirely in the human mind are the types of methods that embody the ‘€˜basic tools of scientific and technological work’€™ that are free to all men and reserved exclusively to none.” CyberSource, 654 F.3d at 1373 (citations omitted).

For this reason, claim 3 was held to only describe mental steps. However, what about claim 2, which recites physical objects, a computer readable medium and processors? Is that patentable subject matter? Claim 2 is reproduced below:

A computer readable medium containing program instructions for detecting fraud in a credit card transaction between a consumer and a merchant over the Internet, wherein execution of the program instructions by one or more processors of a computer system causes the one or more processors to carry out the steps of:

(a) obtaining credit card information relating to the transactions from the consumer; and

(b) verifying the credit card information based upon values of plurality of parameters, in combination with information that identifies the consumer, and that may provide an indication whether the credit card transaction is fraudulent,

wherein each value among the plurality of parameters is weighted in the verifying step according to an importance, as determined by the merchant, of that value to the credit card transaction, so as to provide the merchant with a quantifiable indication of whether the credit card transaction is fraudulent,

wherein execution of the program instructions by one or more processors of a computer system causes that one or more processors to carry out the further steps of:

(a) obtaining information about other transactions that have utilized an Internet address that is identified with the credit card transaction;

(b) constructing a map of credit card numbers based upon the other transactions; and

(c) utilizing the map of credit card numbers to determine if the credit card transaction is valid.

As with claim 3, the Court of Appeals held that this claim too was unpatentable subject matter, even though it recites a computer readable medium and one or more processors. “As we stated in Bilski, to impart patent-eligibility to an otherwise unpatentable process under the theory that the process is linked to a machine, the use of the machine must impose meaningful limits on the claims scope. In other words, the machine must play a significant part in permitting the claimed method to be performed. Here, the incidental use of a computer to perform the mental process of claim 3 does not impose a sufficiently meaningful limit on the claim’s scope. As such, the ‘computer readable medium’€™ limitation of claim 2 does not make the otherwise unpatentable method patent-eligible under §101.”€ CyberSource, 654 F.3d at 1375 (internal quotes and citations omitted).

Thus, although claim 2 recites a computer readable medium and one or more processors, it was deemed insufficient for patentability. Because the underlying method could be performed entirely by the human mind, the recitation of a computer readable medium and processors does not overcome that deficiency. Therefore, are computer readable media claims and such other claims patentable? Yes, but the challenge remains to craft these claims such that they recite patentable subject matter under this decision. Clearly, based on the decision, the claims, regardless of their form, are to recite inventions that are more than mental processes. If a processor or machine is used, it should be recited in the claims, such that the use of the processor or machine “must impose meaningful limits on the claims’€™ scope.”€ CyberSource, 654 F.3d at 1375.