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Federal Circuit Highlights Claim Construction in Patent Eligibility Analysis

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Authors: Bradley T. Lennie, Sean Gloth and Gwendolyn Tawresey

Federal Circuit Highlights Claim Construction in Patent Eligibility Analysis

The case demonstrates that the eligibility analysis is highly fact-specific and dependent on properly construed claims.

In McRO, Inc. v. Bandai Namco Games America Inc., a panel of the U.S. Court of Appeals for the Federal Circuit reversed a district court ruling that found patents directed to a rule-based approach for lip synchronization in animation were unpatentable subject matter under 35 U.S.C. § 101. Relying on claim construction of key terms, the panel rejected the accused infringers’ arguments that the claims broadly preempt the use of rules in automating speech animation. Instead, the panel found that the claims were properly limited to improving the state of the art using a particular type of rules and were not directed to ineligible subject matter. Ultimately, McRO advances the jurisprudence on patent eligibility by providing concrete analysis to the vague test announced in Alice Corp. v. CLS Bank International, 134 S. Ct. 2347 (2014). At the very least, the decision highlights the importance of claim construction in the eligibility analysis and may make it more difficult for defendants to obtain preliminary rulings on patent-ineligible subject matter before a court construes the claims.


In Alice, the Supreme Court established a two-part test to determine whether a patent is valid under 35 U.S.C. § 101: (1) whether the claims at issue are directed to a patent-ineligible concept, such as an abstract idea, and (2) if so, whether an “inventive concept” exists that transforms the nature of the claim into a patent-eligible application. 134 S. Ct. at 2235. Significantly, neither the Supreme Court nor the Federal Circuit have yet adopted a definition for an “abstract idea.” Since Alice, the Federal Circuit and the district courts have struggled to apply this amorphous, fact-specific standard. In general, the test has seemed to favor defendants, leaving a graveyard of invalidated patents in Alice’s wake; so much so that § 101 challenges are becoming a rote defense among those accused of patent infringement. Patents directed to business methods, computer software and computer-implemented methods have suffered disproportionately, whereas patents that are directed to tangible devices and the like have been less susceptible.

Indeed, prior to the McRO decision, only two Federal Circuit decisions had found that asserted computer and software patents were not directed to abstract ideas under Alice: DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245 (Fed. Cir. 2014) and Enfish, LLC v. Microsoft Corp., 822 F.3d 1327 (Fed. Cir. 2016). In DDR Holdings, the court noted that, while claims “directed to nothing more than the performance of an abstract business practice on the Internet or using a conventional computer” are ineligible under § 101, the claims at issue in that case were not directed to an abstract idea because they were “necessarily rooted in computer technology in order to overcome a problem specifically arising in the realm of computer networks.” 773 F.3d at 1256-57. Similarly in Enfish, the court noted:

We do not read Alice to broadly hold that all improvements in computer-related technology are inherently abstract and, therefore, must be considered at step two. Indeed, some improvements in computer-related technology when appropriately claimed are undoubtedly not abstract, such as a chip architecture, an LED display, and the like. Nor do we think that claims directed to software, as opposed to hardware, are inherently abstract and therefore only properly analyzed at the second step of the Alice analysis.

822 F.3d at 1335.

McRO Case

In McRO, the court further clarified Alice and its application to computer- and software-related patents. The McRO patents are directed to a rules-based approach to automatically synchronize the mouth positions of animated characters to pre-recorded speech. McRO, No. 15-1080, slip op. at 5-6 (Fed. Cir. Sept. 13, 2016). Traditionally, artists animate speech by establishing positional vertices on an animated mouth in the “neutral” position and then “weighting” these vertices until the mouth position corresponds to the posture of a human mouth making a discrete sound, called a “phoneme.” Id. The target mouth position for a given phoneme is referred to as a “morph target.” Id. A computer program would then interpolate to connect the morph target frames together to produce continuous speech. Id. at 7-8. Prior to the inventions described in McRO’s patents, lip synchronization required an animator to use her judgment to adjust the transition between morph targets at certain “keyframes” to ensure that the animated speech looked natural. Id. at 7-9. McRO’s patents aim to automate this task by implementing a rule-based approach that automatically generates keyframes, thereby eliminating the need to manually adjust morph weights at specific keyframes. Id.

McRO filed infringement actions in the U.S. District Court for the Central District of California, alleging infringement by Bandai Namco Games America Inc. and more than a dozen other defendants (collectively, Bandai). Bandai moved for judgment on the pleadings, arguing that McRO’s claims were directed to ineligible subject matter under 35 U.S.C. § 101. The district court granted Bandai’s motion, holding that the patents were directed to patent-ineligible subject matter and therefore invalid.

The district court concluded that the claims were not limited to specific rules, but rather claimed the abstract idea of using any rules to generate keyframes, thereby preempting the field of lip synchronization using a rules-based approach. McRO, slip op. at 7-9. The district court’s ineligibility analysis focused on the single claim element it determined to be the point of novelty over the prior art, namely using morph weight set representations coupled to rules to generate keyframes. Id. at 14. Ignoring the limitations already found in the prior art and broadly construing the claims to allow for the use of any rules-based approach to automated lip synchronization, the district court concluded that the claims merely state the application of an abstract idea — the use of rules to generate keyframes.

On appeal, McRO argued that its patents were not directed to an abstract idea and, thus, survived the first step of the Alice analysis. McRO further argued that, even if the patents were directed to an abstract idea, the patents claimed specific types of rules and thus did not preempt the field of using rules in speech animation. Id. In particular, McRO urged that its patents described rules that define output morph weight set stream as a function of phoneme sequence and time of said phoneme sequence. Id. at 15-16. McRO asserted that the genus form of the claims was proper because the nature of animation makes it impossible to define one specific set of rules for animating speech, as different characters with different speech patterns would require different rules (e.g., a swamp monster’s speech would differ from a tight-lipped cat). Id. at 16. Therefore, McRO argued, the patents’ claims to speech automation rule types were patent eligible. Id.

Bandai countered that the McRO patents merely automated a preexisting process (adjusting keyframes) on a general purpose computer and were therefore directed to patent-ineligible subject matter. Id. at 16. Further, Bandai argued that the patents did not create a tangible product and produced only a stream of morph weight sets used in the synchronization process. Id. According to Bandai, the processes claimed merely used mathematical algorithms to manipulate existing information and, therefore, claim an abstract idea. Id. Bandai, like the district court, also argued that the patents’ claims were not limited to particular rules for adjusting keyframes and alleged that the claims instead attempted to capture a fundamental truth about how the human mouth looks while speaking certain sounds, thereby preempting all possible rules-based lip synchronization methods. Id. at 17.

Federal Circuit’s Opinion

The Federal Circuit rejected Bandai’s arguments and reversed the district court’s decision of ineligibility. Id. at 18. The panel took issue with the district court’s analysis to the extent it “‘oversimplif[ied] the claims’ by looking at them generally and failing to account for the specific requirements of the claims.” Id. at 21 (quoting TLI Comm’cns LLC Patent Litig., 823 F.3d 607, 611 (Fed. Cir. 2016); citing Diamond v. Diehr, 450 U.S. 175, 189 n. 12 (1981)). The panel relied on the district court’s claim construction opinion to hold that McRO’s claims define the particular types of rules to be used in automating the speech animation. Id. at 21. In particular, the panel found concrete limits on the scope of the claims to the extent they require rules that (1) evaluate sub-sequences consisting of multiple sequential phonemes and (2) define a morph weight set stream as a function of phoneme sequence and times associated with said phoneme sequence. Id.

Even though the rules were claimed in a genus format — instead of listing particular rules to be applied in specific situations — the panel found that the claims did not improperly preempt a broad field of endeavor. Properly construed, the claims at issue merely covered a relatively narrow improvement over the prior art rather than broadly monopolizing all types of rules-based approaches to automated lip synchronization for animation .

The court relied on differences between the prior art process performed by animators and the process claimed by the invention in concluding that the claims were not directed to an abstract idea. Id. at 24. Specifically, whereas an animator would subjectively change keyframes at certain points in time, the claimed invention uses fixed mathematical rules to evaluate keyframe sub-sequences. Id. The Federal Circuit also cited to briefs from amici curiae that explain the complex interaction between vocalization and facial expression and that identify other relationships that exist beside those required by the asserted claims. Id. at 26. Accordingly, the court concluded that McRO’s claims directed to a particular rules-based synchronization approach were sufficiently narrow to avoid preemption concerns. Id. at 24-25. Throughout its analysis, the Federal Circuit repeatedly recognized the need to analyze the claims “as a whole” in an apparent implicit rejection of the district court’s approach of focusing only on the novel aspects of the claims in the in eligibility analysis. Id. at 20, 21, 27.

In McRO, the Federal Circuit anchored its patent eligibility determination in its construction of the asserted claims. This appears to be a recognition by the panel that the Alice inquiry is claim-specific, highlighting the importance of claim construction to the ultimate issue of patentability. Practically speaking, this underscores the difficulty of addressing the eligibility issue before claim construction occurs. Additionally, the decision is noteworthy for its apparent requirement that the claims be analyzed as a whole in the eligibility analysis. Still, while the McRO decision provides additional clarification for applying the Alice standard, the case also demonstrates that the eligibility analysis is highly fact-specific and dependent on properly construed claims.

The material in this publication was created as of the date set forth above and is based on laws, court decisions, administrative rulings and congressional materials that existed at that time, and should not be construed as legal advice or legal opinions on specific facts. The information in this publication is not intended to create, and the transmission and receipt of it does not constitute, a lawyer-client relationship.