MAZ Encryption Technologies: The Proper Way to Decide a Rule 12(c) Motion for Ineligible Subject Matter
Given the volume of district court decisions regarding Section 101, I typically don't find ones that stand out enough to warrant discussion. But last week's decision by Judge Stark in MAZ Encryption Technologies LLC v. Blackberry Corporation is an exception. The opinion demonstrates a rigorous application of the requirements of a Rule 12(c) motion for judgment on the pleadings, as well as an integrated approach to the Mayo test. The opinion is noteworthy as well because Judge Stark is no pushover on Section 101: Before MAZ he granted six of nine Section 101 motions (including two 12(b) motions) invalidating over a dozen patents. Judge Stark also wrote the opinion invalidating the patents in the Federal Circuit's Mortgage Grader case.
MAZ's invention solved the problem of integrating encryption into electronic document management system (EDMS). The summary of invention of MAZ's patent provides an overview:
In the encryption method, after a user issues a “close,” “save” or “save as” command for a document, the command is translated into an event, and a crypto module traps the event. The crypto module then obtains an encryption key value and encrypts the document using the encryption key value. With the document encrypted, the crypto module passes control to an electronic document management system which executes the “close,” “save” or “save as” command.
In MAZ, Judge Stark follows the methodologies set out in Enfish and McRo, focusing in step one of the Mayo test on the improvement provided by the invention. Stark correctly states that on a motion to dismiss the court cannot consider any evidence other than the pleadings and the patent (and public records such as the file history). And, for purposes of the motion, the court has to accept as true any statements made in the patent specification, not arguments by counsel.
However, on the record properly before the Court on Defendant's Motion - which is a motion for judgment on the pleadings - the Court must take the specification's statements about the purported invention to be true. The Court is not free to accept Defendant's contrary attorney argument that claim 31 is directed to a "conventional" way of transparent encryption.
Thus, Judge Stark looks to the patent specification’s discussion of how the invention is an improvement over the prior art, in particular language identifying the problems in art, again accepting these statements as true.
The patent's specification describes problems associated with "typical" prior art encryption systems, such as incompatibility with EDMS systems and general difficulty of use. (See '681 patent at 3:54-4:9)
This approach follows Enfish which likewise relied on the specification’s disparagement of the prior art. Here is relevant text from the MAZ patent:
The biggest obstacle to adoption of any type of encryption system has been ease of use. Typical encryption systems are very cumbersome. They require a user to interrupt their normal work flow, save their clear text document, activate the separate encryption software, and save the cipher text document under a different name. Where the subject document is ordinary e-mail contents, the process is especially cumbersome, because the clear text must first be created in a separate application, then encrypted, then attached to the e-mail message.
A major concern in computing today is “total cost of ownership,” or TCO. TCO recognizes that while a program might be inexpensive (or even free in the case of PGP for non-commercial use), there are significant costs in using the software. This includes the cost of installation, training, lost productivity during use and from bugs, and maintenance.
Even where one of the typical encryption systems might satisfy a user's TCO needs, they may not even be an available option. For example, typical EDMSes are self-contained and are not compatible with typical encryption systems.
Judge Stark relied on these statements to find that the claims were directed to an encryption method that enabled encryption within an EDMS, without disrupting the user's workflow thus solving a technological problem.
Next, Judge Stark rejects the five different "abstract ideas" alleged by the defendants: "Regardless of whether Defendant's five articulations are viewed as different or the same, they each run afoul of the Federal Circuit's guidance in Enfish that courts should not "oversimplify" key inventive concepts or "downplay" an invention's benefits in conducting a step-1 analysis."
To determine whether the claim is directed to an abstract, Judge Stark then turns to the specific claim limitations and pays particular attention to the limitations that were added to overcome the prior art. The claim before the court was claim 31, which had been amended during re-examination to add the following two limitations relative to the original claim, as shown here:
31. A method of encrypting an electronic document which is open in an application program running in a general purpose computer, the general purpose computer including a display, a user input device, a crypto module and a processor, the method comprising:
providing plural documents having respective names providing a first table having the names of encrypted documents for each of the names of encrypted documents in the first table, key names associated with the encryption key values for the encrypted documents
(a) from within the application program running in the general purpose computer, a user issuing one of a "close," "save" or "save as" command for the document using the user input device;
(b) automatically translating the command into an event;
(d) the crypto module automatically trapping the event;
(d) the crypto module determining if the document should be encrypted using the first table, and if so then automatically obtaining an encryption key value by retrieving a key name associated with a name of the selected document from the first table and retrieving the encryption key value associated with the key name from a second table, the second table having at least one encryption key value and at least one key name respectively associated with one of the encryption key values
(e) the crypto module automatically encrypting the document using the encryption key value;
(f) the crypto module automatically passing control to an electronic document management system; and
(g) the electronic document management system executing the issued "close," "save" or "save as" command; whereby the electronic document is automatically encrypted.
Judge Stark's analysis:
Whether at step one or step two of the Alice test, in determining the patentability of a method, a court must look to the claims as an ordered combination, without ignoring the requirements of the individual steps." McRo, 2016 WL 4896481, at *7 (emphasis added). Significant "individual steps" in claim 31 were added during reexamination, including the above-described use of tabular association of documents with "key names" and "key names" with "key values.'' (See D.I. 77 at 13-14) (summarizing exchange between applicant and examiner regarding "key name <-> document association" limitation added to overcome obviousness rejection) These limitations were added to distinguish the claimed invention from the "key directory association" found in the prior art and are evidence that claim 31 is "directed to a specific improvement to the way computers operate" rather than an abstract idea. Enfish, 822 F .3d at 1336. Defendant's broad articulations of abstract ideas do not capture what claim 31 is "directed to" because they do not take into account the two separate tables used to distinguish claim 31 over the prior art. (emphasis added)
Judge Stark is not holding that the claim is eligible merely because it was found non-obvious. Rather, he is holding that in deciding what the claim is directed to, it is necessary to consider the elements which distinguish the invention from the prior art because these are the elements that define the improvement when the claim is considered as a whole. To be clear, this is not Flook's point of novelty approach: Judge Stark is not looking for the inventive concept here, he is looking for an identifiable improvement as stated by the language of the claims. This approach is exactly correct and should be followed by other courts and patent examiners.
Judge Stark also rejects the defendant's argument that the claim is directed to an abstract idea because that there is a human analogue for the claims, "the storage and utilization of filenames, key names, and key values recited in the patent claims is no different substantively than how an old hotel would store and keep track of the keys to its patrons' rooms." The court's response to this argument:
Defendant's analogy is unpersuasive. It fails to capture the key inventive aspect touted in the '681 patent: handling encryption operations without requiring user input, that is, "transparently." ('681 patent at 7:58-62)8 In Defendant's analogy, the hotel clerk manually performs each operation.
and
In addition, the entire exercise of comparing the invention in claim 31 to a human- executable series of steps is relatively unhelpful in this particular case, because the specification of the '681 patent so clearly identifies the claimed invention as "improv[ing] an existing technological process ." Alice, 134 S. Ct. at 2358. Specifically, claim 31 is directed to a specific way of transparently encrypting data without the need for user input, eliminating interruption and inefficiency -as well as human action - in a technology process. Hence, claim 31 is distinguishable from claims that have been found to have human-executable analogues.
It is important to note that the technical improvement in MAZ's invention was not a better encryption algorithm that was faster or more efficient or otherwise "improved" the objective performance of the computer. Rather, the improvement that Alice acknowledges is to "improve the functioning of the computer itself" or, as phrased by the Federal Circuit in Enfish, "whether the claims are directed to an improvement to computer functionality." Functionality is broader than simply an objective performance metric such as improved speed, less memory or other factors. We see this in McRo where the invention made it easier to for animators to lip sync their characters to the dialogue. Similarly in MAZ, the improvement was in usability, making it easier for users to encrypt documents without leaving their workflow within the EDMS. Indeed, given that MAZ's method worked by intercepting requests to the EMDS close or save documents ("the crypto module automatically trapping the event"), and then encrypting them on the fly, it necessarily slowed down the computer: users had to wait well the application encrypted the document (and wait again for the document to be decrypted each time it was opened). If you use a document management system that does on-the-fly encryption and decryption of documents, then you have experienced this issue. But the tradeoff for reduced objective performance was improved ease of use and better overall security. In short, a problem in usability of a computer is a technological problem, and solutions that improve usability are technological solutions.
Finally, Judge Stark relies on a preemption analysis in step one, and again ties this to the specific amendments to claim 31 that overcame the prior art. Judge Stark notes the amended claims do not preempt other ways of achieving the solution.
The specific implementation in claim 31 raises fewer preemption concerns than the broader, original claims of the '681 patent which were rejected during reexamination.
Significantly, Judge Stark treats preemption as a question of fact that requires evidence, relying on McRo:
Defendant has not produced any evidence to support any preemption concerns. Consequently, the preemption consideration confirms the Court's conclusion at step 1 that claim 31 is not directed to an abstract idea. See [McRo]. ("There has been no showing that any rules-based lip-synchronization process must use rules with the specifically claimed characteristics .").
I think Judge Stark's approach is a model for how the district courts should handle Rule 12(c) (and by extension, Rule 12(b)(6)) motions both on a procedural and substantive level. Rather than employing empty formalisms and strained analogies, the court focuses on what is claimed, the nature of the improvement and whether the claim actually preempts the purported abstract idea. This approach should likewise be followed by examiners at the USPTO.
For patent prosecutors, MAZ, along with DDR, Enfish and McRo, suggests the value of discussing in the patent application specific problems in the prior art and linking aspects of the claimed invention to their solutions. The general trend over the past several years has been to say less in the background and summary of invention. That is still good advice, and these cases do not contradict that view, as the underlying patents provided very short and concise statements of the prior art problem, not lengthy expositions. Prosecutors that draft only a trivial background and little or no summary of the invention may end up removing an important basis for establishing eligibility and defeating an early dispositive motion. If the motivation for this approach is the risk that the background and summary will narrow the scope of the claims, I would say better a slightly narrowed patent than none at all.