Epic Systems Invalidation of Troll Patent on Abstract Idea Affirmed by Federal Circuit

MILWAUKEE, Wis. — On April 12, 2017, the Federal Circuit affirmed a win for Epic Systems Corporation against the appellant, Preservation Wellness Technologies, LLC, a non-practicing entity. The appellate court panel, consisting of Judges Dyk, Moore, and Reyna, affirmed by per curium order the district court’s grant of Epic’s motion to dismiss a patent infringement suit last May, because the asserted patent was directed to unpatentable subject matter.

Preservation Wellness originally asserted U.S. Patent No. 7,640,271 against Epic, along with three other defendants, in the Eastern District of Texas. Epic and another defendant filed motions to dismiss the complaint on the grounds that the claims of the ’271 Patent are directed to subject matter that is ineligible for patenting under 35 U.S.C. § 101 in light of the Supreme Court’s decision in Alice Corporation v. CLS Bank International. Federal Circuit Judge William Bryson, sitting by designation in the Eastern District of Texas, granted the motions to dismiss on May 10, 2016, dismissing all claims against the defendants.

Preservation Wellness appealed the district court decision to the Federal Circuit, seeking review of whether the district court misapplied the procedural standard and test set forth in Alice, and erred in concluding that the claims of the ’271 Patent are drawn to abstract ideas and do not satisfy the inventive concept requirement.

Following oral argument on April 7, 2016, the Federal Circuit affirmed the district court’s finding that the asserted patent was “clearly drawn to an abstract idea”—securely managing medical records and providing patients and physicians with different levels of access to those records. The court also rejected Preservation Wellness’ reliance on a “two-way firewall” claim element as an “inventive concept.”  Accordingly, the Federal Circuit affirmed that the asserted patent is invalid for claiming subject matter that is not eligible for patenting.

Epic develops healthcare software for use in community hospitals, clinics, medical centers, and patient homes. In addition to providing electronic health record systems to healthcare providers, Epic has designed web portals for patients to view, enter, and manage their personal health information.

Epic was represented by Quarles & Brady’s Anthony Tomaselli, Kristin Graham Noel, Martha Jahn Snyder, Louis Klapp.

The case is Preservation Wellness Technologies LLC v. Allscripts Healthcare Solutions, et al., case number 16-2193, in the United States Court of Appeals for the Federal Circuit.