[00:00:08] Speaker 04:
correctly?

[00:00:10] Speaker 02:
Yes, Your Honor, you did.

[00:00:11] Speaker 02:
Thank you.

[00:00:11] Speaker 04:
Good morning.

[00:00:13] Speaker 02:
Please proceed.

[00:00:13] Speaker 02:
Good morning, Your Honors, and may it please the Court.

[00:00:17] Speaker 02:
Steve Shortchin on behalf of the appellant, Truveras.

[00:00:21] Speaker 02:
Your Honors, this is an unusual case in which the district court, without the benefit of even a single hearing, dismissed the original complaint, having conducted no claim construction proceedings of any kind,

[00:00:36] Speaker 02:
having rejected the appellant's request for opportunity for leave to amend without making any finding whatsoever that that request was not in good faith or was futile.

[00:00:51] Speaker 02:
And then the district court engaged in a variety of steps and analyses which are both contradictory to the result and, in fact, support reversing remanding this case under both step one and step two of ALIS.

[00:01:04] Speaker 04:
Can I ask you about just what your point about claim construction?

[00:01:07] Speaker 04:
Did you offer up certain claim constructions that are clearly disputed?

[00:01:12] Speaker 04:
And did she reject even considering those?

[00:01:14] Speaker 04:
What left out of this claim?

[00:01:17] Speaker 02:
Your Honor, the Court's opinion in this matter is a bit confused, or confusing at least to me reading it.

[00:01:23] Speaker 02:
And here's why.

[00:01:25] Speaker 04:
Well, I'm just asking what you did.

[00:01:27] Speaker 02:
OK, thank you, Your Honor.

[00:01:29] Speaker 02:
We did not offer constructions to the district court below, although in the opposition to the motion to dismiss, three terms were identified as potentially requiring construction.

[00:01:40] Speaker 02:
And Judge, to your question, I think, one of the things that's interesting here is that the court, for one of the three terms for which the appellant requested construction, and that term is price inflation parameter,

[00:01:55] Speaker 02:
This is what the court wrote in her opinion at appendix page 68.

[00:02:01] Speaker 02:
And I'll be quoting the court.

[00:02:02] Speaker 02:
As for price inflation parameters, admittedly, these could be understood differently depending on the content of the factors employed or the particular equations or algorithms selected.

[00:02:16] Speaker 02:
And then the court concluded that these differences would not change the outcome, because in the court's view, there was a fundamental economic process being claimed here and not statutory subject matter.

[00:02:28] Speaker 02:
Your Honors, when the court, under this court's decisions of both Phillips and O2, says there's one of your initial points, you indicated you didn't get the opportunity to amend.

[00:02:39] Speaker 06:
Did you ever move to amend the complaint, or did you ever provide an amended complaint to the district court?

[00:02:46] Speaker 02:
Your Honor, in the opposition to the motion dismissed, counsel requested leave to amend if the court were inclined to grant the motion to dismiss.

[00:02:55] Speaker 02:
And Your Honor, we will call from the record that there was no hearing on this matter.

[00:02:59] Speaker 02:
The procedural history is very, very brief.

[00:03:01] Speaker 02:
Original complaint.

[00:03:03] Speaker 02:
motion to dismiss, briefing on the motion to dismiss, and then order from the district court.

[00:03:08] Speaker 02:
And respectfully, as we point out, Judge Cunningham, in our reply brief, under the prevailing law of where the Ohio court sits, which is, of course, the Sixth Circuit, it is an abuse of discretion under that court's standards to deny a motion for leave without making any findings whatsoever, none whatsoever on the record,

[00:03:30] Speaker 02:
that the motion to leave was either, or the proposed amendment, I should say, were either futile or not in good faith.

[00:03:38] Speaker 02:
Here, the court made no findings of any kind of the opinion.

[00:03:41] Speaker 02:
It simply dismissed the case on the original complaint despite that request.

[00:03:46] Speaker 06:
And so I think just to follow up on the answer to my question, it sounds like you said you made maybe a sentence in the motion to dismiss papers, the opposition papers, but no separate motion to amend.

[00:03:58] Speaker 06:
Is that accurate statement?

[00:04:00] Speaker 02:
That is correct, because procedurally, there was not an opportunity to do so.

[00:04:04] Speaker 02:
The original complaint was filed.

[00:04:06] Speaker 02:
The motion dismissed were filed.

[00:04:08] Speaker 02:
The briefing on the motion dismissed occurred where the request for a motion to leave was noted to the district court.

[00:04:14] Speaker 02:
Without any hearing, the court granted the motion to dismiss.

[00:04:17] Speaker 04:
What did you allege?

[00:04:18] Speaker 04:
I mean, in this follow-up to Judge Cunningham's point, did you identify new factual allegations?

[00:04:29] Speaker 04:
of the amendment would differentiate the case from what it was before the amendment.

[00:04:35] Speaker 04:
I don't know if it's in the appendix.

[00:04:39] Speaker 02:
Yes, Your Honor.

[00:04:41] Speaker 02:
There's a number of responses to this.

[00:04:44] Speaker 05:
One of the... I don't know if it was in the last sentence, Your Honor, but... Yes, Your Honor.

[00:05:08] Speaker 05:
I don't know that I would characterize it as a throwaway, of course.

[00:05:40] Speaker 06:
Is it Appendix 400 to 401?

[00:05:59] Speaker 02:
Your Honor, that is at least, thank you, Your Honor, Judge Cunningham.

[00:06:01] Speaker 02:
That is at least one location where it occurs.

[00:06:03] Speaker 02:
Therefore, any dismissal should be

[00:06:06] Speaker 05:
I thought there was, when I looked, I only saw one reference at the very end of your motion.

[00:06:12] Speaker 02:
Judge Clevenger, I believe that is correct.

[00:06:13] Speaker 02:
I'm not aware of any other requests by trial counsel.

[00:06:16] Speaker 05:
I think there's been one that said basically if it's a private firm buried at the end of something, it's been treated as non-existent.

[00:06:26] Speaker 02:
Your Honor, I'm not sure to what law you're referring to.

[00:06:29] Speaker 02:
Perhaps the court is referring to the Snap versus Sanderling case.

[00:06:33] Speaker 05:
Bedouin.

[00:06:33] Speaker 05:
Bedouin against Sessions.

[00:06:36] Speaker 02:
Your Honor, I don't know that this is a throwaway, because the original complaint on its face, and it's recognized by the district court, pled improvements to the process and to the structured order of the components as claimed that resulted in algorithmic improvements, the display of uniform and consistent bid results.

[00:06:57] Speaker 05:
I mean, I just thought, I mean, I read the bedroom on it in sessions.

[00:07:00] Speaker 05:
It says, a bearer request in an opposition and a motion dismissed without any indication of particular grounds on which the amendment is sought does not constitute a motion within the contemplation of Rule 15A.

[00:07:12] Speaker 05:
Metamonic accessions, 871 Fed 3rd, 459 at 460.

[00:07:18] Speaker 05:
So when I got that far in my research, I kind of gave up on the argument.

[00:07:23] Speaker 02:
Your honor, I appreciate this.

[00:07:25] Speaker 05:
As you said, there's only one place that I saw a motion to amend, period, in your violence.

[00:07:32] Speaker 05:
And it's this one reference that you're reciting.

[00:07:35] Speaker 02:
Your honor, I would still suggest that the Sixth Circuit has held that when the request is made, the court cannot deny it without making any finding as to good faith or futility.

[00:07:47] Speaker 02:
And so under your honor's hypothetical, the district says that.

[00:07:51] Speaker 02:
In the Sixth Circuit?

[00:07:53] Speaker 02:
Yes, Your Honor.

[00:07:53] Speaker 02:
It's cited in our reply brief.

[00:07:57] Speaker 04:
Well, in your motion, you cited city EOC versus Ohio.

[00:08:01] Speaker 04:
And then you have a parenthetical.

[00:08:04] Speaker 02:
Yes, Your Honor.

[00:08:04] Speaker 02:
Yes, Your Honor.

[00:08:05] Speaker 04:
Your parenthetical, at least, says where a more carefully drafted complaint might stay the claim, they have to give a chance.

[00:08:12] Speaker 04:
But you have it alleged.

[00:08:14] Speaker 04:
You didn't give any basis.

[00:08:16] Speaker 04:
Like, well, if I get to amend this complaint, we can do such and such.

[00:08:21] Speaker 02:
Your Honor, the case that was cited in the reply brief before this court is from the Sixth Circuit is Parchman versus SLM Court, 896 F3rd, 728 at 736.

[00:08:35] Speaker 02:
And here is the quote from the brief, Your Honor.

[00:08:37] Speaker 02:
Under Sixth Circuit precedent such, and this I'm going to quote from the Sixth Circuit,

[00:08:42] Speaker 02:
Such outright refusal to grant the leave without any justifying reason appearing for denial is not an exercise of discretion, but abuse of that discretion and inconsistent with the spirit of the federal rules."

[00:08:56] Speaker 02:
And that's the Parchman case at 736.

[00:08:57] Speaker 02:
Your Honor, with the request lodged, Judge Clevenger, to your point about the Bedouin case, this court made no determination whatsoever.

[00:09:10] Speaker 02:
that the amendment was futile.

[00:09:12] Speaker 02:
It made no findings one way or the other.

[00:09:14] Speaker 02:
Nor did it make any findings that the request wasn't fulsome, Your Honor, or that the crest wasn't ripe under rule.

[00:09:20] Speaker 04:
Well, I'll make a decision about whether it's futile or not when you don't have any information that you've given her with respect to what the amendment will say or do.

[00:09:29] Speaker 04:
You don't need to make a representation here.

[00:09:32] Speaker 04:
that the amendment will do x, y, z, and that's why it wouldn't be futile.

[00:09:36] Speaker 04:
She doesn't have to make a finding about futility when you haven't even made an allegation that it wouldn't be futile.

[00:09:42] Speaker 02:
Well, but on the claims of the patent as issued, Your Honor, and as she apparently took into consideration,

[00:09:49] Speaker 02:
The claims themselves specify that they enable fair comparison and scoring, scaling, and increase the speed and efficiency of the algorithmic analysis and of the presentation to the user of the system.

[00:10:05] Speaker 02:
And that's at appendix 416.

[00:10:07] Speaker 02:
So even on the complaint as alleged,

[00:10:10] Speaker 02:
Dismissal was, with respect to the district court in Ohio, improvident.

[00:10:15] Speaker 02:
One of the things we haven't gotten to, Your Honors, is I'm mindful of my time.

[00:10:18] Speaker 02:
And I appreciate the questions on motions for leave.

[00:10:20] Speaker 02:
I understand the procedural posture of that case, of what that does right for this case.

[00:10:25] Speaker 02:
The district court's own opinion here, I think, instructs that remanding is required.

[00:10:30] Speaker 02:
And here is why.

[00:10:32] Speaker 02:
The district court found that there were improvements that may well be deemed innovation.

[00:10:39] Speaker 02:
That's the quote from Appendix 70.

[00:10:41] Speaker 02:
She also found that there was ingenuity in the following claim language, to quote, render or refashion all PBM, pharmacy benefit management bids, into a uniform scoring framework, which understandably may assist in portraying

[00:10:57] Speaker 06:
I mean, you kind of, in some places, left out important parts of what she was saying, right?

[00:11:13] Speaker 06:
So, on Appendix Page 70, it says

[00:11:16] Speaker 06:
Those may well be deemed innovation as a matter of business acumen or economics.

[00:11:21] Speaker 06:
Like in some of them, in some of your brief, I would see you just put like a period in brackets and I was thinking, well, what else is there?

[00:11:28] Speaker 06:
And there's a little bit more to what she's saying in these places on innovation.

[00:11:31] Speaker 02:
Thank you, Judge Cunningham.

[00:11:33] Speaker 02:
On that particular quote, that's the issue before this court.

[00:11:35] Speaker 02:
That's why that sentence is a list.

[00:11:37] Speaker 02:
The question before this court, as a matter of law and de novo review, is are these claims simply directed to economic or business acumen?

[00:11:45] Speaker 02:
They are not, Your Honor.

[00:11:46] Speaker 02:
That's what we have briefed before the court.

[00:11:48] Speaker 02:
And so what the court found

[00:11:50] Speaker 02:
And I'm on page 70 of the appendix, Your Honor, from the actual opinion.

[00:11:54] Speaker 02:
It is directed to how PBM bids and pricing should be translated and rendered uniform to facilitate wiser, more reliable price comparisons.

[00:12:05] Speaker 02:
Your Honor, that is the reason

[00:12:07] Speaker 02:
If there's innovation in that concept, that is not a matter of business or economic acumen.

[00:12:12] Speaker 02:
The prior sentence is where the court's opinion, I think, diverges from Alice.

[00:12:16] Speaker 02:
Because by finding that there is translation of data that renders it uniform to facilitate wiser and more reliable price comparison in the context of the claim language, the scoring and the generating of the bid results,

[00:12:30] Speaker 02:
That then satisfies step two, because she has found it to be innovative.

[00:12:34] Speaker 02:
There is also, on appendix page 31, Your Honor, which I believe you referred to, Judge Kenningham, that claim one facilitates-

[00:12:45] Speaker 06:
Page 31.

[00:12:46] Speaker 02:
OK.

[00:12:47] Speaker 02:
Thank you.

[00:12:47] Speaker 02:
Sorry, Judge.

[00:12:48] Speaker 02:
I misheard you.

[00:12:49] Speaker 02:
And I'm keeping out my time here.

[00:12:51] Speaker 02:
If you look at appendix 31 in the second full paragraph and the second sentence, the court's finding is that claim one facilitates price normalization by translating disparate bids into some common metric that allows for an apples to apples comparison.

[00:13:10] Speaker 02:
The court later then found that appendix page 56, with respect to the step.

[00:13:16] Speaker 04:
The sentence that follows, the one you just read, says, but that is every bit as much fundamental economic activity and abstract concept as the risk hedging issue in Bilski and Alex.

[00:13:29] Speaker 02:
Your honor, but that's the point of appeal before this court.

[00:13:31] Speaker 02:
Was the district court writing, concluding, having made this finding below, that the claim language, in fact, is purely economic or business acumen?

[00:13:40] Speaker 02:
We respectfully suggest it is not.

[00:13:42] Speaker 02:
And the reason, your honor.

[00:13:44] Speaker 04:
Your time is running out.

[00:13:45] Speaker 04:
So let me just ask you one question.

[00:13:46] Speaker 04:
Yes, your honor.

[00:13:47] Speaker 04:
You've had many years of jurisprudence in 101, a lot of which deal with kind of claims like this.

[00:13:54] Speaker 04:
What are your best cases?

[00:14:01] Speaker 04:
I mean, everybody who wants, you know, but I'm not seeing the parallel between what went down and what went down here and actually what the claims themselves say.

[00:14:12] Speaker 04:
So do you have a case where you found a claim non-abstract that really leads like the claims in your case?

[00:14:20] Speaker 04:
What's the closest one?

[00:14:22] Speaker 02:
Thank you, Your Honor.

[00:14:22] Speaker 02:
Of course, reading claims that are close, difficult exercise at best, right?

[00:14:27] Speaker 02:
I think Enfish is close, and so is Core Wireless.

[00:14:29] Speaker 02:
And here's why in Enfish.

[00:14:30] Speaker 02:
Self-referential databases, we all know the case.

[00:14:34] Speaker 02:
In that case, this court said that much of the advancement made in computer technology consists of improvements of software that

[00:14:41] Speaker 02:
by their very nature may not be defined by particular physical features, but rather by logical structures and processes.

[00:14:48] Speaker 02:
We do not see Bilsky or Alice, or our cases, as exclusion to patenting this large field of technological progress.

[00:14:54] Speaker 02:
And notably, Your Honor, in Enfish, at least as the claims are described in the reported opinion, there was no hardware structure.

[00:15:01] Speaker 02:
There was a database that was claimed.

[00:15:03] Speaker 02:
There was logic that was claimed.

[00:15:05] Speaker 02:
That's Enfish, Your Honor.

[00:15:06] Speaker 02:
I'd also, mindful of my time, encourage the court to look at Core Wireless, which I think is also similar.

[00:15:11] Speaker 02:
That's the improved user interface for displaying items on a smaller screen.

[00:15:17] Speaker 02:
This patent and the district court found this patent allows for the display of information in a uniform way by making apples to apples comparisons through the 15 steps of the method, which did not exist prior.

[00:15:30] Speaker 02:
The court concludes that this is perhaps ingenious and innovative.

[00:15:34] Speaker 02:
And then she says, but it doesn't matter.

[00:15:35] Speaker 02:
Machine transformation tests, it doesn't matter.

[00:15:38] Speaker 02:
That's what's wrong with this opinion, Your Honor, at its core.

[00:15:42] Speaker 02:
Thank you, Your Honors.

[00:16:05] Speaker 00:
Good morning, your honors.

[00:16:07] Speaker 00:
If it pleases the court, I'm Bill Munier on behalf of Appellee Skysale.

[00:16:14] Speaker 00:
I think it makes sense to start with the issues that your honor started with.

[00:16:17] Speaker 00:
So with your permission, I'll do them in order.

[00:16:22] Speaker 00:
The claim construction issue, the complaint that the district court didn't do any claim construction.

[00:16:29] Speaker 00:
Traveras's entire claim construction request, if you can call it that, to the district court was just that there may be claim constructions that may affect

[00:16:40] Speaker 00:
They didn't give any claim constructions.

[00:16:42] Speaker 00:
They didn't give any proposed claim constructions.

[00:16:45] Speaker 00:
And they didn't say how they may affect the 101 analysis.

[00:16:48] Speaker 00:
It was just perhaps there might be something out there.

[00:16:51] Speaker 00:
And that's at appendix 397 through 98, which is part of their brief.

[00:16:57] Speaker 00:
And as we say in our briefs, it was incumbent upon them that if they thought there was a claim construction that could be relevant

[00:17:06] Speaker 00:
to the analysis, they needed to identify that claim construction, that proposed claim construction, and tell the district court how it could affect the analysis.

[00:17:16] Speaker 00:
They did not.

[00:17:18] Speaker 00:
So we cite cases like Sanderling and Cleveland Clinic saying that was upon them.

[00:17:23] Speaker 00:
Since our brief, there's been more cases coming out that say the same thing.

[00:17:28] Speaker 00:
For example, three months after our brief was filed, the Trinity decision, 72-4F.

[00:17:35] Speaker 00:
at 1355, at 1362.

[00:17:39] Speaker 00:
So this was just after our briefs.

[00:17:40] Speaker 00:
It said, quote, a patentee must do more than invoke a generic need for claim construction and discovery.

[00:17:47] Speaker 04:
OK, I think we can allie that issue of claim construction.

[00:17:51] Speaker 04:
All right.

[00:17:51] Speaker 04:
And maybe even allie the question, and then we will complain to my colleagues.

[00:17:56] Speaker 04:
So why don't we get to the heart of the claim?

[00:17:58] Speaker 04:
an interesting and helpful chart, I think, on page 13 and 14 in your brief.

[00:18:03] Speaker 04:
We've reached the limitations of that.

[00:18:05] Speaker 03:
Sure.

[00:18:06] Speaker 04:
But what is your response to NPH or wireless?

[00:18:10] Speaker 04:
Why this case is not similar enough to those cases to get the

[00:18:18] Speaker 00:
The pithy short answer is because the case is not similar to those at all, Your Honor.

[00:18:23] Speaker 00:
This case has to do with an abstract idea that is a series of requesting and collecting information, analyzing information, and then presenting the results of that analysis.

[00:18:37] Speaker 00:
Those are all abstract ideas on their own.

[00:18:40] Speaker 00:
And combined, they're all abstract ideas.

[00:18:42] Speaker 00:
And I think you've got plenty of case law in front of you that confirms that.

[00:18:45] Speaker 00:
That that's almost like the traditional form of an abstract idea.

[00:18:50] Speaker 00:
So that's an abstract idea.

[00:18:52] Speaker 00:
Endfish, core wireless, those weren't about collecting information, presenting information.

[00:18:58] Speaker 00:
Those were actual specific improvements to technology.

[00:19:03] Speaker 00:
not an abstract idea, to technology.

[00:19:06] Speaker 00:
Entfish was an improved computer database.

[00:19:09] Speaker 00:
It wasn't an abstract idea that used a computer to perform that abstract idea.

[00:19:15] Speaker 00:
It was an actual improvement to computers itself.

[00:19:18] Speaker 00:
And all the case law says, in that instance, where, like here, you've got a computer or they're now calling it a software type of claim, if it's an improvement to the computer technology itself or

[00:19:32] Speaker 00:
well, really, or if it's not in computers, just to technology itself, that can take it away from an abstract idea, even if there's an abstract idea baked in.

[00:19:40] Speaker 00:
For example, a mathematical formula by itself would be an abstract idea.

[00:19:45] Speaker 00:
But using that to develop a process for curing rubber

[00:19:53] Speaker 00:
That is technology.

[00:19:56] Speaker 00:
What we've got here is just abstract ideas about the best way to perform this type of reverse auction to pick a drug plan.

[00:20:07] Speaker 00:
The only thing that's added to that abstract idea

[00:20:11] Speaker 00:
is to do those steps, those abstract ideas, those things that you would do as a person in your mind or with a pen or paper, is to do it on a computer.

[00:20:22] Speaker 00:
Get it from a generic remote server.

[00:20:27] Speaker 00:
Get it from a client.

[00:20:28] Speaker 04:
In one of our cases, we talked about this as a long-standing historical practice.

[00:20:33] Speaker 04:
And I think they emphasize one H in their classifying clients.

[00:20:39] Speaker 04:
Classifying each historic drug claim as a particular set of historical drug claims into one or more third party indicated drug classification.

[00:20:47] Speaker 04:
I mean, this is maybe, as the judge said, I don't know if anybody's ever done this before, right?

[00:20:56] Speaker 00:
Well, the quick answer is, in their patent, it actually says that it was known to use these third party standardizations in the background of the patent.

[00:21:09] Speaker 00:
Well, actually, let's put that aside.

[00:21:11] Speaker 00:
Because at the end of the day, it doesn't matter, I guess is what I would say.

[00:21:15] Speaker 00:
Because what they're really arguing is, well, it's an abstract idea, but it's a new and non-obvious abstract idea.

[00:21:23] Speaker 00:
It's a better way.

[00:21:25] Speaker 00:
We've invented a better way of doing reverse auction.

[00:21:28] Speaker 00:
Instead of using the standards that everybody provides with the bids, we're going to use a consistent standard.

[00:21:33] Speaker 00:
We're going to standardize these drug claims using a third party.

[00:21:37] Speaker 00:
That is still an abstract idea.

[00:21:39] Speaker 00:
The fact that they're saying it's a better abstract idea, a new abstract idea, doesn't matter because it's still an abstract idea.

[00:21:46] Speaker 00:
Alice, right?

[00:21:47] Speaker 00:
We all know Alice.

[00:21:48] Speaker 00:
Abstract ideas are not patentable.

[00:21:51] Speaker 00:
The synopsis case that we cite, 89 F3rd, 1138 and 1151, a claim for a new abstract idea is still an abstract idea.

[00:22:02] Speaker 04:
the diamond case in the supreme court american axle from europe from your own court they all say whether something's new or not whether something's non-obvious or not it's not respected concept we cannot figure out that they invented some new computer we could get through step two but on step one is there any way that this could be turned from an abstract idea to a patent eligible subject matter

[00:22:29] Speaker 00:
Well, based on what they say their invention is, I think the answer is no.

[00:22:36] Speaker 00:
Because the problem they identify is not one with technology, not one with computers.

[00:22:41] Speaker 00:
The problem they identify is a problem with an abstract idea itself, how to best perform a reverse auction.

[00:22:49] Speaker 00:
And they say, the problem is,

[00:22:52] Speaker 00:
that when you get a bid, it will have its own standard for a drug claim.

[00:22:57] Speaker 00:
And then another bid will have a difference.

[00:22:59] Speaker 00:
So it's hard to compare apples to apples.

[00:23:02] Speaker 00:
So that's the problem they're dealing with.

[00:23:04] Speaker 00:
That's not a technology problem.

[00:23:05] Speaker 00:
That's not a computer problem.

[00:23:07] Speaker 00:
That's a reverse auction problem.

[00:23:08] Speaker 00:
That's an economic business problem.

[00:23:12] Speaker 00:
And their solution to that was in what they're now saying is a novel or non-obvious

[00:23:21] Speaker 04:
Idea is instead of using the standardization the standards that are given with each bid will use a third party Standardization, so I'm sorry categorization This one's 2020

[00:23:44] Speaker 04:
This patent was issued after most of the cases we've discussed today were already out there.

[00:23:52] Speaker 04:
And my recollection of the discussion of the prosecution history in the briefs is that this was rejected repeatedly.

[00:23:58] Speaker 04:
And then granted, do you know?

[00:24:02] Speaker 04:
I can't remember.

[00:24:03] Speaker 04:
Was there some intervening action or statement by the patent owner that would explain

[00:24:09] Speaker 04:
what the basis for removing the rejection was?

[00:24:12] Speaker 00:
If you recall, that's what the district court tried to find.

[00:24:15] Speaker 00:
Because Truvaris had argued, hey, it was issued.

[00:24:20] Speaker 00:
The five rejections were overcome.

[00:24:23] Speaker 00:
So that must show that there's a good reason for that.

[00:24:27] Speaker 00:
But they never identified the reason in every case.

[00:24:29] Speaker 04:
Well, obviously, every case that we have that involves a one-to-one challenge is based on a patent issue.

[00:24:34] Speaker 00:
Exactly.

[00:24:34] Speaker 04:
That doesn't get you very far.

[00:24:38] Speaker 04:
interesting and telling to me that this is a recently issued patent, which makes me want to think harder about what the issuance process is.

[00:24:47] Speaker 00:
I will say that my recollection is there were amendments, but what they're pointing to now, for example, the use of the third party, disregarding the classifications and the bids and using the third party, that was already in the claims.

[00:25:02] Speaker 00:
the use of that information to actually score the bids, to estimate costs.

[00:25:12] Speaker 00:
That was already in the claims.

[00:25:13] Speaker 00:
So as the district court found, there really doesn't seem to be anything jumping out as to why the rejection was rescinded after five times here.

[00:25:27] Speaker 06:
There was nothing specifically stated in the prosecution history that explained

[00:25:31] Speaker 06:
what was going on in terms of allowing it after the 101 rejection.

[00:25:36] Speaker 00:
My recollection, and the record certainly doesn't have anything about the examiner saying, here's why I've withdrawn.

[00:25:44] Speaker 05:
I didn't see anything in your editor's brief that made a strong argument that the reason why it got through at the end after all these rejections was this, this, this, and this.

[00:25:57] Speaker 00:
Unsurprisingly, I agree with you, Your Honor.

[00:25:59] Speaker 00:
There wasn't anything there about that.

[00:26:01] Speaker 00:
And because there really isn't anything there.

[00:26:03] Speaker 05:
What they've got now is- I mean, the district court's opinion sort of teed it up.

[00:26:06] Speaker 05:
The district court went through, sort of matched up what looked like and the limitations that had been changed.

[00:26:14] Speaker 00:
Sure.

[00:26:14] Speaker 05:
So it didn't seem to make any difference to me.

[00:26:17] Speaker 05:
And I would have thought that it made any difference if it wasn't heard from your adversary.

[00:26:20] Speaker 00:
And we did not.

[00:26:22] Speaker 00:
We did not, Your Honor.

[00:26:23] Speaker 00:
And again, it's what amendments were there are not what they seem to be relying on right now as the, let's say, inventive concept that would somehow transform this list of abstract ideas, these mental steps, into something that was patentable subject matter.

[00:26:42] Speaker 00:
And they really can't point anything because it's just, do these with a computer.

[00:26:47] Speaker 00:
which the case law obviously says is not good enough.

[00:26:49] Speaker 00:
So at the end of the day, where before they argued to the district court, these are all improvements to computer systems.

[00:26:57] Speaker 00:
The reason this is not an abstract idea is because there is an improvement to computer system here.

[00:27:02] Speaker 00:
The reason it's patentable is that it's an improvement to computer system here.

[00:27:05] Speaker 00:
But now, they've dropped that.

[00:27:08] Speaker 00:
And it's just really, if you sift through all the complaints

[00:27:13] Speaker 00:
in their briefs about what the district court looked at or didn't look at, et cetera, et cetera.

[00:27:17] Speaker 00:
What is their actual argument as to why it's patentable?

[00:27:20] Speaker 00:
And it really boils down to because we came up with a good abstract idea.

[00:27:24] Speaker 00:
We came up with a new abstract idea.

[00:27:26] Speaker 00:
We came up with the idea of when we do a reverse auction, we're going to use this information to compare bids and not other information.

[00:27:35] Speaker 06:
So we've been primarily focused on claim one.

[00:27:37] Speaker 06:
Is there any differential information we need to know what respect would be?

[00:27:41] Speaker 06:
other potential claims?

[00:27:42] Speaker 06:
I think claim four is also discussed.

[00:27:44] Speaker 00:
Sure.

[00:27:44] Speaker 00:
I think claim four probably, it makes sense to talk about.

[00:27:47] Speaker 00:
I think that the short answer is no.

[00:27:50] Speaker 00:
As the district court noted, only claim one was actually identified as infringed in the complaint.

[00:27:55] Speaker 00:
And the complaint went through the basis for the infringement analysis.

[00:27:59] Speaker 00:
And it all had to do with the limitations of claim one.

[00:28:03] Speaker 00:
So claim four was not actually specified.

[00:28:07] Speaker 00:
And there was no basis for infringement given in that.

[00:28:10] Speaker 00:
There were, in the opposition to the district court, there were three other claims identified other than one.

[00:28:19] Speaker 00:
Or I shouldn't say identified, mentioned.

[00:28:20] Speaker 00:
There was 11 and 12.

[00:28:22] Speaker 00:
But that was mentioned at, I think, A389 through 90, which is another part of their brief.

[00:28:30] Speaker 00:
But all they said about 11 and 12 was, claim one and 11 and 12 have this limitation.

[00:28:36] Speaker 00:
And it means it's not abstract or it's patentable.

[00:28:39] Speaker 00:
So they didn't have any different arguments about 11 and 12 that didn't also apply to 1.

[00:28:44] Speaker 00:
So everything that we've been talking about 1, if 11 and 12 were asserted, would apply there.

[00:28:51] Speaker 00:
And the district court found that.

[00:28:53] Speaker 00:
At A67 of the appendix, note 23, there's no different analysis because they make the same argument about 11 and 12 that they do for 1.

[00:29:02] Speaker 00:
So that leaves claim 4.

[00:29:04] Speaker 00:
Claim 4 is a dependent claim.

[00:29:06] Speaker 00:
not asserted, and certainly not identified or named, and no basis for giving it.

[00:29:11] Speaker 00:
But they alleged, again, in their opposition, that, quote, claim four adds an inventive concept that is plainly unconventional.

[00:29:20] Speaker 00:
That's a key word they use a lot, unconventional, wherein, this is the claim, wherein a first scoring element is associated with plan costs and a second scoring element is associated with plan terms and definitions.

[00:29:33] Speaker 00:
That's just an abstract idea.

[00:29:34] Speaker 00:
They didn't explain how that's an improvement to computers, how that's an improvement to technology.

[00:29:39] Speaker 00:
At best, that's an improvement to the abstract idea of how are you going to score these bids?

[00:29:45] Speaker 00:
How are you going to assess these bids?

[00:29:47] Speaker 00:
And the district court rightly said, you haven't shown me anything that's actually

[00:29:51] Speaker 00:
the alleged improvement to technology in claim four.

[00:29:54] Speaker 00:
You just say, quote unquote, it's unconventional.

[00:29:57] Speaker 00:
And again, that unconventional word shows up a lot.

[00:29:59] Speaker 00:
An unconventional abstract idea is still an abstract idea.

[00:30:04] Speaker 00:
It's not patentable.

[00:30:05] Speaker 00:
And so the district court went on to say, I don't see anything that saves claim four here either, but I'm not going to find it invalid because it hasn't been asserted.

[00:30:15] Speaker 00:
I think the way the court put it was that

[00:30:19] Speaker 00:
A-71, Appendix 71, Footnote 3 of the opinion.

[00:30:24] Speaker 00:
And this would apply also to the other two claims that were mentioned, 1112.

[00:30:30] Speaker 00:
The court said, this case does not require, and therefore does not allow, the court to issue any advisory opinion on claims other than Claim 1 of the 920, because no other claims were at issue.

[00:30:41] Speaker 00:
No other claims were asserted in the complaint.

[00:30:47] Speaker 04:
OK.

[00:30:47] Speaker 04:
I think you're close to your time now.

[00:30:48] Speaker 00:
Thank you, Your Honor.

[00:30:55] Speaker 01:
minutes of rebuttal time thank you your honor that was more than generous I was only going to ask for 60 seconds but I appreciate that the courtesy

[00:31:16] Speaker 02:
I'll know when an opinion issues, Your Honor.

[00:31:19] Speaker 02:
I want to address a couple of final points that were raised by Appellee's counsel.

[00:31:23] Speaker 02:
There was a question about where one can find in the record the prosecution history and what the changes were between the prior refusals to allow and the allowance.

[00:31:33] Speaker 02:
Your Honors may find that we briefed that in our opening brief, starting at page 10 of that brief.

[00:31:38] Speaker 02:
And it goes on until about beginning at page 13 of that brief.

[00:31:42] Speaker 02:
And in particular, it's referencing the prosecution history, which the court can find in appendices where appendices cites 416.

[00:31:50] Speaker 02:
Well, actually, it starts at 412 and goes through our citations end at 416.

[00:31:59] Speaker 02:
Actually, our citation is in 419 and 420.

[00:32:02] Speaker 02:
And one of the reasons this is important is that the amendment that occurred at the end to Judge Clevenger's question was that the remote database was explained and that why that remote database was a practical improvement over current technology

[00:32:16] Speaker 02:
And I won't read the brief back to you.

[00:32:18] Speaker 02:
The court can find it itself.

[00:32:19] Speaker 02:
But the notion was that by disregarding the PBM-indicated drug classifications and using this remote database to substitute its own third-party classifications and using that historical information, that process of the remote database allowed a more efficient and accurate scoring generation algorithm to be completed.

[00:32:44] Speaker 02:
And I think, Judge Prost, I have 20 seconds.

[00:32:47] Speaker 02:
To your last question, you asked, or to a last point, you asked counsel, how could you amend these claims?

[00:32:52] Speaker 02:
Because they were allowed well after Alice.

[00:32:55] Speaker 02:
The position that the appellee is taking, essentially, is that there is no statutory protection for a process or method claim whatsoever.

[00:33:02] Speaker 02:
Because these claims, as found by the district court, possessed ingenuity, novelty, and prepared and gave an advantage to the patent holder.

[00:33:10] Speaker 02:
She made those express findings.

[00:33:12] Speaker 02:
In this case, if accepting the position of the appellee would result in a bright line rule that a process or a method is simply not patentable, that is not the law of the United States.

[00:33:23] Speaker 04:
Thank you.

[00:33:23] Speaker 04:
I thank both sides.

[00:33:24] Speaker 04:
The case is still in.