The United Services Automobile Association has asked the U.S. Supreme Court to step into the long-running debate over what qualifies as an abstract idea under U.S. patent law, following a Federal Circuit decision that wiped out mobile check deposit patents after juries awarded USAA more than $223 million against PNC Bank.
In a certiorari petition filed Wednesday and docketed Friday, USAA argued that the Federal Circuit has stretched the Supreme Court’s 2014 Alice Corp. v. CLS Bank framework far beyond its intended scope, effectively stripping patent protection from technological processes simply because they are implemented through software.
According to USAA, that approach has transformed the abstract-idea exception into a rule that invalidates nearly any computer-based invention unless it improves the computer itself, rather than the user’s interaction with it.
USAA’s patents covered technology used in mobile check deposit, a feature that allows bank customers to deposit checks using a smartphone camera instead of visiting a branch or using specialized scanning equipment. The company said the innovation was especially important for military service members banking from remote or overseas locations.
USAA sued PNC in the Eastern District of Texas, leading to two jury trials in 2022. One jury awarded $218.5 million in damages, while another returned a $4.3 million verdict. District court and magistrate judges rejected PNC’s attempts to invalidate the patents under Section 101 of the Patent Act.
On appeal, however, the Federal Circuit reversed. In a June decision, the appellate court concluded that the asserted claims were directed to the abstract idea of depositing a check using a handheld device and lacked an inventive concept sufficient to make them patent-eligible under Alice.
USAA contends the Federal Circuit misapplied both steps of the Alice test, arguing that remote check deposit is a technological process, not an abstract idea, and that the court improperly discounted factual evidence showing the claims were unconventional at the time of invention.
The petition also criticizes what USAA described as the Federal Circuit’s repeated tendency to resolve patent eligibility by recharacterizing claims at a high level of abstraction, without deference to jury findings or lower court determinations.
USAA urged the justices to clarify that improving a user’s experience through computer-implemented technology does not fall outside the bounds of patent protection. At a minimum, the company asked the Supreme Court to solicit the views of the U.S. solicitor general on the issue.
PNC’s response to the petition is due Feb. 17.
USAA previously asked the Supreme Court to review a related decision involving the Patent Trial and Appeal Board’s invalidation of claims tied to the larger verdict. That petition was denied in October.
The patents at issue include U.S. Patent Nos. 10,402,638; 10,482,432; 10,013,681; and 10,013,605.
