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Federal Circuit Panel Affirms Dismissal Under 35 U.S.C. § 101 of All Infringement Claims Against Fandango LLC

May 2, 2018

On May 1, 2018, the Federal Circuit affirmed Judge Louise W. Flanagan’s (E.D.N.C.) order granting Rothwell Figg client Fandango LLC’s motion to dismiss all infringement claims brought by plaintiff Robert Mankes for lack of patent eligible subject matter. The Federal Circuit panel, composed of Judges Taranto, Wallach, and Stoll, heard oral arguments in this case on April 30, 2018, and affirmed without opinion under Rule 36 the following day.

Mankes accused Fandango of infringing U.S. Patent No. 6,477,503 (“the ’503 patent”), which describes a method for allowing a local site and a remote site to each sell or reserve inventory, with the local server controlling and managing the inventory. Mankes’ primary argument on appeal was that the claims of the ‘503 patent were directed to a new method of inventory management that had not been previously done, and Fandango had not shown that computers doing this new method were routine and conventional at the time of invention in 1999. Fandango explained to the Federal Circuit that in the ‘503 patent itself, in the briefing, and at oral argument, Mankes conceded that the claimed invention did not improve computer technology and used only generic computer components. Fandango successfully argued that Mankes’ invention was purely a non-technical solution to a business problem that was then implemented on a generic computer. The invention was one, in fact, that could be done with a phone and pencil—a fact Mankes also conceded at the oral argument. The Federal Circuit agreed with Judge Flanagan and Fandango, issuing its decision affirming the District Court’s dismissal less than a day following oral argument. As a result of this affirmance, Fandango successfully achieved a complete victory against Mankes in this five-year-old case, which never advanced beyond the motion to dismiss stage.

Rothwell Figg has represented Fandango since the case began in October 2013, when Mankes first accused Fandango of infringing the ‘503 patent. In 2015, Judge Flanagan granted Fandango’s motion for judgment on the pleadings on the issue of joint infringement and Mankes’ failure to adequately plead infringement or inducement of infringement. Mankes appealed that decision to the Federal Circuit in 2015, and in light of changes in the law of induced infringement reflected in the en banc Limelight Networks v. Akamai Techs. Federal Circuit decision, the Federal Circuit in April 2016 vacated Judge Flanagan’s grant of judgment on the pleadings to Fandango.

On remand, Judge Flanagan directed Mankes to file an amended complaint. In response to the amended complaint, Fandango filed a motion to dismiss for failure to state a claim on the grounds that the claims of the ‘503 were patent ineligible under 35 U.S.C. § 101. Fandango argued that the claims were directed to a method for managing inventory using general purpose computer components, and that there was no inventive concept to save the claims under Alice step two. The District Court granted Fandango’s motion to dismiss in February 2017, and Mankes appealed again to the Federal Circuit.

Fandango was represented in this case by Rothwell Figg attorneys Steven Lieberman, Sharon L. Davis, Nechama E. Potasnick, and Michael H. Jones.

Read more in IP Law360’s write-up of the victory, which can be found here.