Two Intellectual Ventures Banking Patents Invalidated Under Alice

Case: Intellectual Ventures I LLC et al. v. Capital One Financial Corp. et al.

Issue: Whether two mobile banking patents held by Intellectual Ventures I LLC are too abstract for patent eligibility.

Case Summary: A Maryland federal district court invalidated two mobile banking patents held by Intellectual Ventures I LLC, holding the patents were too abstract under the U.S. Supreme Court’s Alice decision in its patent infringement case against Capital One Financial Corp.

Intellectual Ventures sued Capital One alleging that the bank’s websites use technologies that infringe on its patents. The first disputed patent (’81 Patent) is based on an apparatus that organizes, displays and manipulates data pertaining to business documents, and the second disputed patent (’02 Patent) is based on a mobile interface that locates files and data on another computer. Capital One filed a motion for summary judgment contending that the patents are invalid because they are too abstract.

On May 12, 2015, the special master determined that the patents were valid and recommended that the district court dismiss Capital One’s arguments. The special master found the patents were not abstract because their use of the mobile interface was legitimate to accomplish the inventions.

The district court rejected the special master’s recommendation and invalidated the patents on the basis that they claim abstract ideas under the U.S. Supreme Court’s Alice decision. The court described the patents as lacking an inventive concept to make the abstract ideas patent eligible, similar to the idea of using an index, directory or address book to find information and then going to that location to obtain the information.

Bottom Line: The decision leaves only Capital One’s antitrust counterclaims to be resolved.


About Author