Bozeman Financial LLC v. Federal Reserve Bank, No. 19-1018 (Fed. Cir. 2020)
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The Patent Trial and Appeal Board conducted covered business method (CBM) review and found all of the claims of Bozeman’s patents, directed to methods for authorizing and clearing financial transactions to detect and prevent fraud, ineligible under 35 U.S.C. 101.1. Bozeman challenged the Board’s authority to decide the petitions, arguing that the Federal Reserve Banks are not “persons” under the America Invents Act (AIA).
The Federal Circuit affirmed, holding that the Banks are “persons” who may petition for post-issuance review under the AIA. While the Supreme Court has held that federal agencies are not “persons” able to seek post-issuance review of a patent under the AIA, the Banks are distinct from the government for purposes of the AIA. They are operating members of the nation’s Federal Reserve System, which is a federal agency, but they are not government-owned and are operationally distinct from the federal government. The claims at issue are directed to the abstract idea of “collecting and analyzing information for financial transaction fraud or error detection” and do not contain an inventive concept sufficient to “transform the nature of the claims into patent-eligible applications of an abstract idea.”
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