12 Patents Related to Automobile Transactions Found Ineligible Under Section 101 | Insights – Holland & Knight | Candle Made Easy

Sidekick Technology has 12 patents generally covering systems, methods and apparatus for providing automotive market information and conducting or facilitating automotive transactions.

In reviewing the 12 patents in suit, the U.S. District Court for the District of New Jersey found that, broadly speaking, they “describe errors and inefficiencies in typical automotive transactions, caused primarily by a lack of available information…Automotive transactions are routinely plagued by uncertainty, incompleteness.” Information and distrust…”

The patents in suit allegedly solve these inefficiencies by “creating a platform through which consumers, dealers, and manufacturers can input, access, or filter through a range of available automotive market data and use that data to complete automotive transactions.” The system is designed to efficiently match consumers with dealers, manufacturers, or other automotive sellers.

Below is a representative figure from one of the 12 patents:

Vroom brought a declaratory judgment against Sidekick and filed a Rule 12(c) request for assessment of the pleadings, arguing that each of Sidekick’s relevant patents addressed Section 101 non-allowable subject matter.

Representative Claims

The court first addressed which claim or claims are representative of the 405 claims in all 12 patents. The Court noted that it can treat claims as representative even if the parties do not consent to such treatment: “However, what is less established is the appropriate framework for resolving disputes as to which claims are actually representative.”

After hearing the parties’ arguments and examining all 12 patents, the court settled on a claim that “contains the key elements and limitations argued by the parties for and against entitlement, including, for example, the use of geolocation data and Directions”. and “the additional element of storing automotive market data”, together with “with minor exceptions, which neither party has proposed, concerns authorization analysis.” The representative claim is included at the end of this post.

Alice Step 1

As a first step, the court examined the wording of the claims to determine what the patent claims as the focus of the claimed advance over the prior art, with the critical question being “whether the claims focus on a particular means or process that improves the relevant technology, or are instead directed to a result or effect that is itself the abstract idea, and merely invoke generic processes and machines. The court noted that investigation in the context of software innovation “often revolves around whether the claims focus on specific alleged improvements in computing capabilities or instead on a process or system that qualifies [as] an abstract idea for which computers are merely used as tools.”

Here the court found that the patents address the abstract idea of ​​collecting and using automobile market and user data to facilitate automobile transactions.

The representative claim “says no more than the manner of collecting and storing information that courts routinely deem abstract Alice Step one” and the remaining claim elements “describe a computerized method for performing the basic steps in an automobile transaction”.

Specifically, the court noted that the representative complaint listed the following process:

  1. A consumer requests information about a particular car that includes the consumer’s geolocation information
  2. an automobile manufacturer reviews real-time market data for the requested automobile, including inventory data from multiple dealers, to determine if the automobile can be provided to the consumer
  3. based on the manufacturer’s response to the consumer’s request, a dealership in an area near the consumer makes an inventory-less bid to sell the requested automobile
  4. the consumer receives the bid, which includes at least pricing and delivery options and directions to the dealer making the bid, and then selects a bid indicating an intent to purchase the automobile

Briefly, the court found that the representative claim “merely combines abstract concepts and practices to describe the longstanding and fundamental practice of seeking and using available market information to complete automobile transactions.” In addition, the court noted that the representative claim “does not focus on or describe a specific technological improvement… [and] The specification makes it clear that the problem the patents in suit are intended to address is neither data collection nor data storage… Rather, the specification identifies the problem as one of incomplete information.”

Finally, the inclusion of real-time market data, geolocation information, optical character recognition, or directions did not save the patents in suit. While these limitations may ensure that the patents at issue do not pre-empt the entire field of automotive transactions, the court noted that “a narrowly limited claim directed to an abstract idea is not necessarily patentable, however, since a right of first refusal will be a signal.” may not be patentable subject matter, lack of full right of first refusal does not establish patent entitlement.”

Alice step 2

The court found in the second step that the representative claim does not sufficiently reflect an inventive concept, even if the claim offers advantages over the prior art. “The court may assume that the claimed techniques are groundbreaking, innovative or even brilliant, but that is not sufficient for eligibility.”

The defendant argued that the patents in suit are “new and innovative” processes that offer “a synergetic and optimal resource”. However, the court found these statements to be conclusive, and instead the representative claim contained “no new process, technique, or method for implementing the claimed features or limitations.”

The court concluded that these were “ordinary data storage and processing functions of a computer without any description or explanation of any specific or unconventional development or implementation thereof”.

Accordingly, the court granted Vroom’s motion to rule on the briefs and held that all claims of the 12 patents are unpatentable under Section 101.

* * *

The representative claim is:

Method comprising:

Storing on a computer-readable medium automotive market data representative of recent automotive market characteristics, including at least pricing data and inventory data, the automotive market data comprising information received from at least one manufacturer, a plurality of dealers, and a plurality of consumers, wherein at least one part of the automotive market data is updated in real time;

receiving a first response request regarding a first automobile manufactured by a first manufacturer via a consumer interface, the first request being made by a consumer located at a first location and including geolocation information of the consumer;

Executing instructions by at least one processing device to:

determine current inventory data of the first automobile, wherein the current inventory data of the first automobile includes a plurality of dealer inventories from a plurality of dealers, each respective dealer of the plurality of dealers having a respective dealer inventory, and wherein the current inventory data indicates that a first dealer of the plurality of dealers does not currently have the first automobile in a first inventory of the first dealer;

providing first automobile market data including the current inventory data of the first automobile to the first manufacturer based on the first request via a manufacturer interface, the first automobile market data being based on real-time automobile market data;

based on the market data of the first automobile including the current inventory data of the first automobile via the manufacturer interface at least one confirmation indicating that the first automobile can be provided to the consumer or one confirmation indicating that the first automobile can be provided, be provided to the consumer to generate and an offer indicating that the first automobile may be provided to the consumer;

determine that the consumer is located at the first location using the geolocation information;

based on the first location, create a merchant area in the market that is proximate to the first location;

determine that the first merchant is at a second location within the merchant area at the market;

providing a first manufacturer response via the consumer interface, the first manufacturer response including verification indicating that the first automobile can be provided to the consumer and/or confirmation indicating that the first automobile can be provided to the consumer, and /or includes offer indicating that the first automobile may be provided to the consumer;

request from the first dealer, via a dealer interface, an inventory-less offer to sell the first automobile based on the first manufacturer response;

receive from the first dealer located at the second location and performing a non-stock bidding, the non-stock bidding to provide the first automobile that is at least one of yet-to-be-manufactured and in inventory of another entity;

generate driving instructions from the first location to the second location; and provide the inventoryless bid and the directions to the consumer interface, the inventoryless bid including at least a price and a delivery option; and

receiving a consumer selection of the inventory-less offering including a first delivery option specifying a pickup location at the first dealer, the consumer selection indicating a consumer intent to purchase the first automobile.

The case is Vroom Inc. v Sidekick Tech., LLCNo. 221CV06737WJMJSA, 2022 WL 2314892 (DNJ June 28, 2022)

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