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6 October 2021Patents

Fed Circ affirms CosmoKey authentication patent

The US Court of Appeals for the Federal Circuit has affirmed the eligibility of a patent directed to user authentication, in a decision delivered on Monday, October 4.

At the centre of the dispute is German company CosmoKey’s US patent number 9,246,903 (the ‘903 patent), titled ‘Authentication Method’ and filed in 2012. The patent covers an authentication method described in Monday’s judgment as being low in complexity but highly secure.

In September 2018, CosmoKey filed a lawsuit against security platform Duo Security at the US District Court for the District of Delaware, accusing the company—which is owned by US technology conglomerate Cisco Systems—of infringing the ‘903 patent.

In response, Duo Security alleged that all claims of the ‘903 patent are ineligible as they are directed to the abstract idea of authentication.

The US District Court for the District of Delaware sided with Duo Security in 2020. “Verification of identity to permit access to transactions” is not an inventive concept, according to the district court.

However, on appeal, the Federal Circuit disagreed.

Alice test

The Federal Circuit said the claims of the ‘903 patent are patent-eligible under the second step of the test set out by Alice v CLS Bank in 2014.

The Alice test first asks whether the patent is directed to a patent-ineligible concept, such as an abstract idea. If so, the second step of the test asks whether the claimed elements transform the invention into something which is patent-eligible.

If the answer to the first part is affirmative, then the claims are patentable. If the answers to both parts are affirmative, then the claims are patentable. However, if the answer to the first part is affirmative but the answer to the second part is not, then the claims are not patentable.

On Monday, the Federal Circuit held that the ‘903 patent satisfies the second stage of the Alice test and so the claims are patentable.

“The ’903 patent claims and specification recite a specific improvement to authentication that increases security, prevents unauthorised access by a third party, is easily implemented, and can advantageously be carried out with mobile devices of low complexity,” the Federal Circuit said.

Reyna challenges reasoning

Although the decision was unanimous, Circuit Judge Jimmie Reyna did not agree with the majority’s reasoning.

Reyna said that the majority, which comprised Circuit Judge Kathleen O’Malley and Circuit Judge Kara Stoll, “skips” the first stage of the Alice test and instead relies entirely on the second which, in his view, is “extraordinary and contrary to Supreme Court precedent”.

With regards to the first stage of the Alice test, the majority said that they need not answer this question because the claims of the ‘903 patent satisfy the second stage.

However, having asked the first question in the Alice test and answered it in the affirmative, Reyna did proceed to agree with the majority that the second stage is also satisfied.

After finding the claims of CosmoKey’s ‘903 patent to be patent-eligible, the Federal Circuit reversed the decision of the district court.

This is not the only time that the Alice test has come to the rescue recently; in August, computer hardware company IBM saved two of its patents by relying on the test set out by Alice.

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