<i>Versata v. SAP </i>: Definitions Are Now the Name of the Game

Versata Development Group v. SAP America was a closely watched case since it was the first appeal to the Federal Circuit of a Covered Business Methods (CBM) review by the Patent Trials and Appeal Board (PTAB) under Section 18 of the America Invents Act (AIA). See, 2014-1194, 2015 U.S. App. LEXIS 11802 (Fed. Cir. July 9, 2015). The court decided several important questions, including: 1) whether it could review PTAB's determination that Versata's patent was eligible for CBM review; 2) what is the meaning of “covered business method patent,” including whether USPTO's definitions of a “financial product or service” and “technological invention” were correct; 3) what is the appropriate standard for claim construction, broadest reasonable interpretation or one correct construction; and 4) an evaluation of the merits. Briefly, the court decided:

• The court can review PTAB final decisions, even when they touch upon the same legal issues that lead to the institution decision (which the Federal Circuit does not have authority to review), including whether a patent qualifies as a covered business method patent;
• The USPTO's definitions of covered business method patent are acceptable;
• PTAB can use broadest reasonable claim construction; and
• Versata's patent was for a financial service, not a technological invention, and was an ineligible abstract idea.

This article addresses the court's reasoning regarding the definitions of a covered business method patent, and how that reasoning is at odds with norms of statutory construction, technological innovation, and claim drafting.