Before Prost, Moore, and Wallach. Appeal from the Northern District of Florida.
Summary: When a state entity sues for patent infringement, it waives sovereign immunity as to all defenses, including subject matter eligibility under Section 101.
The University of Florida Research Foundation (“UFRF”) sued General Electric (“GE”) for patent infringement. GE asserted the claims were directed towards ineligible subject matter under Section 101. UFRF argued that it had not waived sovereign immunity and that the claims were patent eligible under Section 101. The district court ruled for GE on both issues. UFRF appealed to the Federal Circuit.
The Federal Circuit held that suing for patent infringement waived sovereign immunity for any relevant defenses and counterclaims. The only issue was whether a Section 101 challenge is a defense to patent infringement. UFRF argued that Section 282(b) sets forth all defenses to patent infringement and does not include a Section 101 challenge. The Federal Circuit has previously held otherwise, but UFRF argued that the Supreme Court’s holding in SCA Hygiene effectively overruled those cases. The Federal Circuit disagreed because SCA Hygiene concerned laches and did not affect a Section 101 defense. Regardless, both the Federal Circuit and the Supreme Court have long entertained Section 101 challenges as a defense to patent infringement. Thus, UFRF waived sovereign immunity as to the Section 101 challenge by suing for patent infringement.
On the merits, the court determined that the claims were directed to an abstract idea of “collecting, analyzing, manipulating, and displaying data.” The court characterized the patent as “a quintessential ‘do it on a computer’ patent” that acknowledged each of the claimed steps had previously been performed manually. The court also determined the claims did no more than “simply instruct the practitioner to implement the abstract idea . . . on a generic computer.” Thus, the Federal Circuit held the claims ineligible under Section 101.
