Adobe Gets E-Signature Patent Claims Erased as Ineligible at CAFC

The U.S. Court of Appeals for the Federal Circuit (CAFC) on Wednesday, July 3, affirmed a district court’s holding that a patent for e-signature technology was ineligible under Section 101. The district court found the patent claims were directed to a longstanding business practice under Alice step one, and were therefore abstract, and that they contained no inventive step at Alice step two. Judge Prost authored the CAFC opinion.

U.S. Patent No. 8,065,527 is owned by Esignature Software, LLC and titled, “System and Method for Embedding a Written Signature into a Secure Electronic Document.”  Adobe, Inc. moved for judgment on the pleadings that the claims were ineligible under Section 101 and Esignature opposed. Following oral arguments, the U.S. District Court for the Northern District of California found, in evaluating the claims under Alice step one, that Esignature itself acknowledged that “signatures have been used for centuries to notarize and authenticate documents,” and that ultimately the claims “simply recite that existing business practice with the benefit of generic computing technology.”

In its discussion on appeal, the CAFC dismissed Esignature’s arguments that the claims are not abstract “because secure electronic documents were not digitally signed as claimed before the ’527 patent, the district court’s articulation was not a longstanding business practice, and therefore not an abstract idea.” The Federal Circuit’s opinion explained:

“Esignature’s argument misunderstands both the district court’s analysis and governing case law. The district court did not conclude that applying digital signatures in an electronic document was, itself, a longstanding business practice. Nor did it need to. Instead, it concluded that applying signatures in designated places on documents was a longstanding business practice—and that claim 1, due to its purely functional and generic implementation, amounts to little more than saying: do that on a computer.”

The CAFC also added in a footnote that, to the extent Esignature was attempting to argue the claim should be eligible because no one had ever applied a signature digitally to an electronic document before, “novelty alone ‘does not avoid the problem of abstractness.’”

As to step two, Esignature argued that the district court failed to consider “inventive aspects” in some of the dependent claims, including “facilitating remote signatures (claims 18 and 19), capturing a signature at the time a transaction occurs (claim 10), and saving the embedded signature in a secure electronic document (claim 9).” But the CAFC said that since Esignature failed to raise those arguments before the district court, and agreed that claim 1 was representative, they were forfeited.

Finally, Esignature argued that the district court should have construed certain claim terms before holding the claims ineligible, but the CAFC dubbed this argument “unpersuasive” absent any explanation as to how it might benefit from a particular construction under Alice.

Image Source: Deposit Photos
Author: toppercussion
Image ID: 550059548