from the United States District Court for the Northern
District of Texas in No. 3:16-cv-02689-K, Judge Ed Kinkeade.
Katherine Vidal, Winston & Strawn LLP, Menlo Park, CA,
argued for plaintiff-appellee. Also represented by Michael A.
Bittner, Thomas M. Melsheimer, Dallas, TX; Tyler Johannes,
Chicago, IL; Steffen Nathanael Johnson, Washington, DC; John
D. Vandenberg, Klar-quist Sparkman, LLP, Portland, OR.
E. Key, DiMuroGinsberg PC - DGKeyIP Group, Tysons Corner, VA,
argued for defendant-appellant. Also represented by Teresa
Marie Summers; Jay P. Kesan, McLean, VA.
Lourie, O'Malley, and Taranto, Circuit Judges.
Taranto, Circuit Judge.
LLC's U.S. Patent No. 6, 349, 291 describes and claims
systems and methods for performing certain statistical
analyses of investment information. We addressed this patent
in In re Varma, 816 F.3d 1352 (Fed. Cir. 2016),
where we construed key claim terms and partly reversed and
partly vacated the Patent Trial and Appeal Board's
cancellations of various claims in two reexamination
proceedings involving issues of anticipation and obviousness
under 35 U.S.C. §§ 102 and 103. The present appeal
involves a declaratory judgment action filed in 2016 by SAP
America, Inc., which alleges, among other things, that the
claims of the '291 patent are invalid because their
subject matter is ineligible for patenting under 35 U.S.C.
§ 101. When SAP moved for a judgment on the pleadings on
that ground, the district court granted the motion, holding
all claims ineligible under § 101 and hence invalid.
SAP Am., Inc. v. In-vestPic, LLC, 260 F.Supp.3d 705,
718-19 (N.D. Tex. 2017).
affirm. We may assume that the techniques claimed are
"[g]roundbreaking, innovative, or even brilliant, "
but that is not enough for eligibility. Ass'n for
Molecular Pathology v. Myriad Genetics, Inc., 569 U.S.
576, 591 (2013); accord buySAFE, Inc. v. Google,
Inc., 765 F.3d 1350, 1352 (Fed. Cir. 2014). Nor is it
enough for subject-matter eligibility that claimed techniques
be novel and nonobvious in light of prior art, passing muster
under 35 U.S.C. §§ 102 and 103. See Mayo
Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S.
66, 89-90 (2012); Synopsys, Inc. v. Mentor Graphics
Corp., 839 F.3d 1138, 1151 (Fed. Cir. 2016) ("[A]
claim for a new abstract idea is still an abstract
idea. The search for a § 101 inventive concept is thus
distinct from demonstrating § 102 novelty.");
Intellectual Ventures I LLC v. Symantec Corp., 838
F.3d 1307, 1315 (Fed. Cir. 2016) (same for obviousness)
(Symantec). The claims here are ineligible because
their innovation is an innovation in ineligible subject
matter. Their subject is nothing but a series of mathematical
calculations based on selected information and the
presentation of the results of those calculations (in the
plot of a probability distribution function). No matter how
much of an advance in the finance field the claims recite,
the advance lies entirely in the realm of abstract ideas,
with no plausibly alleged innovation in the non-abstract
application realm. An advance of that nature is ineligible
aspects of existing practices declared to be in need of
improvement, the '291 patent states that
"conventional financial information sites" on the
World Wide Web "perform rudimentary statistical
functions" that "are not useful to investors in
forecasting the behavior of financial markets because they
rely upon assumptions that the underlying probability
distribution function ('PDF') for the financial data
follows a normal or Gaussian distribution." '291
patent, col. 1, lines 24-36. That assumption, the patent
says, "is generally false": "the PDF for
financial market data is heavy tailed (i.e., the histograms
of financial market data typically involve many outliers
containing important information), " rather than
symmetric like a normal distribution. Id., col. 1,
lines 36- 37, 41-44. Moreover, "statistical measures
such as the standard deviation provide no meaningful insight
into the distribution of financial data." Id.,
col. 1, lines 44-46. As a result, the patent asserts,
conventional "analyses understate the true risk and
overstate [the] potential rewards for an investment or
trading strategy." Id., col. 1, lines 53-54.
remedy those deficiencies, the patent proposes a technique
that "utilizes resampled statistical methods for the
analysis of financial data, " which do not assume a
normal probability distribution. Id., col. 1, line
65 through col. 2, line 3. One such method is a bootstrap
method, which estimates the distribution of data in a pool (a
sample space) by repeated sampling of the data in the pool.
Id., col. 10, lines 20-38. A sample space in a
bootstrap method can be defined by selecting a specific
investment or a particular period of time. Id., col.
12, lines 62-66. Data samples are drawn from the sample space
"with replacement": samples are drawn from the
sample space and then returned to the pool before the next
sample is drawn. Id., col. 10, lines 60-62, col. 11,
lines 18-20. The patent also describes using a "bias
parameter" to "specif[y] the degree of randomness
in the resampling process." Id., col. 11, lines
55-58. In order to "perform a resampled statistical
analysis, " a client "may specify a number of
parameters including an investment or investments (e.g., a
portfolio) to be analyzed, a financial function, a sample
size, a period, a type of plot and a bias parameter, which
controls the randomness of the resampling process."
Id., col. 2, lines 50-56.
1, 11, and 22 are the remaining independent claims of the
'291 patent. Claims 1 and 11 are method claims. Claim 1
reads as follows:
1. A method for calculating, analyzing and displaying
investment data comprising the steps of:
(a) selecting a sample space, wherein the sample space
includes at least one investment data sample;
(b) generating a distribution function using a re-sampled
statistical method and a bias parameter, wherein the bias
parameter determines a degree of randomness in a resampling
(c) generating a plot of the distribution function.
Id., col. 16, lines 35-43. Claim 11 states the