On April 9, 2012, the U.S. Court of Appeals for the Federal Circuit upheld the U.S. District Court for the Western District of Pennsylvania’s decision to invalidate patent claims asserted by Noah Systems, Inc. (“Noah”) against Intuit, Inc. (“Intuit”), because the claims were indefinite.  At the center of this case was U.S. Patent No. 5,875,435 (“Patent ’435”), which discloses an automated accounting system including a financial accounting computer, a financial transaction computer, a communications means, and an access means.  The District Court specifically considered the validity of the “access means” limitation.

In order to properly claim a means-plus-function limitation, an applicant’s specification needs to describe a corresponding structure that performs the function.  Failure to include such a structure renders the claim indefinite.  With respect to computer-implemented systems specifically, means-plus-function claims are indefinite unless the specification discloses an algorithm to perform the function.  The District Court found that Patent ‘435 did not disclose an algorithm to perform the function or functions associated with the “access means” limitation.  The appeal to the Federal Circuit Court centered on this issue.

Noah argued “that the structure used to perform the function associated with the ‘access means’ limitation ‘includes an algorithm by which a passcode is issued to a user or agent, the passcode is entered by a user or agent, and the passcode is validated, and equivalents thereof.’”  Intuit countered that Patent ‘435 did not contain any algorithm and must, therefore, be deemed indefinite.  On this issue, the
Federal Circuit agreed with Noah.

The Federal Circuit Court found that Patent ‘435 did include an algorithm.  The Court, however, determined Noah’s asserted claims contained not one, but two functions, namely: (1) providing access to a file; and (2) once access is provided, enabling the performance of delineated operations.  The Court stated, “Any algorithm must, therefore, address both aspects of this functional language.”  The Court indicated that, while the specification described an algorithm enabling the first function, the specification did not provide an algorithm enabling the second function.  The Court concluded, “Accordingly, where a disclosed algorithm supports some, but not all, of the functions associated with a means-plus-function limitation, we treat the specification as if no algorithm has been described at all. . . Because the ‘435 Patent’s specification discloses an algorithm for performing only one of the functions associated with the ‘access means’ limitation, the limitation is indefinite.  All of the asserted claims . . . are, therefore, invalid as indefinite.”

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