Skip to content

Federal Circuit Rules that Moving Software to the Cloud Alone Is Obvious

IP Update Background Decorative Image

On May 5, 2020, the Federal Circuit ruled that claims directed to software executed on a server are obvious in view of prior art that taught performing the same method on a local device. Uber Technologies, Inc. v. X One, Inc., No. 2019-1163, slip op. (Fed. Cir. May 5, 2020). The Court applied the holding of KSR to hold that such modifications are obvious “predictable variations” of the prior art that are not patentable.

In Uber Technologies, the challenged patent claimed a computer-implemented method for plotting user location data on a map on a server, and then transmitting the map to a terminal device. The inter partes review petition claimed that these were obvious over a first reference that taught generating a map with user data locations on the client-side (Okubo), in combination with another reference that taught generating a map with plotted locations on the server-side (Konshi). The Patent Trial and Appeal Board held that the asserted combination did not render the claims obvious because the combination would require “impermissible hindsight” and that the proposed modification to Okubo to allow server-side rendering would be a “wholesale” modification.

The Federal Circuit disagreed. The evidence before the board demonstrated that there were only two possible places where the plotting could occur – server-side and client-side – and that both were known in the art. Therefore, substituting one for the other would have led to a “predictable variation.” The only difference between server-side plotting and terminal-side plotting amounts to a design choice between whether to plot locations before transmitting location information (server-side plotting) or after transmitting location information (client-side plotting). Accordingly, the Court ruled that “A person of ordinary skill would therefore have two predictable choices for when to perform plotting, providing them with a simple design choice as to whether to plot server-side or terminal-side. [ ] Because a person of ordinary skill ‘has good reasons to pursue the known options within his or her technical grasp,’ § 103 bars the patentability of such obvious variations.” Uber Techs. at 11.

What This Means For You

The Federal Circuit’s decision in Uber Technologies means that patents that rely on server or cloud-based implementations of methods that are the same or similar to existing technologies may not be patentable, or if issued, may be invalid. For patent applicants, the Court’s holding suggests that patent applications on cloud technologies describe how the claimed invention overcomes challenges unique to the cloud environment. For patent litigants, this holding suggests that prior art may be read to invalidate patents even if the location that the method is implemented differs from the challenged claims.

This information is provided by Vinson & Elkins LLP for educational and informational purposes only and is not intended, nor should it be construed, as legal advice.