Fed. Circuit Upholds CosmoKey Authentication Patent Asserted Against Duo

• Published date: 01 November 2021
• Subject Matter: Intellectual Property, Litigation, Mediation & Arbitration, Food, Drugs, Healthcare, Life Sciences, Patent, Trials & Appeals & Compensation, Biotechnology & Nanotechnology
• Law Firm: Volpe Koenig
• Author: Mr Nicholas M. Tinari

It takes two to tango, and if you are like many of us still working remotely, you may use a two-step identification method for accessing a secure network, such as the Duo Security two-part authentication dance to log onto your remote platform. Well, you might be dancing to something different one day now that the Federal Circuit has upheld validity of a patent owned by Duo competitor CosmoKey. In CosmoKey Solutions, GMBH & Co. KG. v. Duo Security, LLC (Fed. Cir, Oct. 3, 2021), the appeals court reversed a Delaware District Court ruling that CosmoKey's authentication patent U.S. 9,246,903 was invalid as ineligible subject matter under 35 U.S.C. ' 101.

The decision came as Duo moved for a Rule 12(c) Motion for Judgment on the Pleadings to hold the '903 patent invalid under 35 U.S.C. ' 101, after it was sued by CosmoKey for infringement of the subject patent. The District Court granted Duo's motion in June of 2020. Under the Supreme Court's Alice rubric, if a claim is directed to an abstract idea (Step one test), then it must teach, what many see as an ineffable, "something more" than the abstract idea itself. (Step two test). Alice Corp. v CLS Bank Int'l, 573 U.S. 208 (2014). The District Court found that CosmoKey's claims were directed to an abstract idea and had nothing more than "well-understood and routine, conventional activities previously known in the authentication field." As a reminder, the first part of the Alice test is to determine whether the claims are directed to an abstract idea, a law of nature or a natural phenomenon (i.e., a judicial exception). If the claims are directed to a judicial exception, the second part of the Alice test is to determine whether the claim recites additional elements that amount to significantly more than the judicial exception.

Now, if you are not a fan of that two-step Alice test, you may be thinking that it sounds at times like a 35 U.S.C. '103 obviousness analysis- not a patentable subject matter question. Certainly not Rule 12(c) dismissal fodder. Here's claim 1 of the relevant patent. See what you think.

A method of authenticating a user to a transaction at a terminal, comprising the steps of:

• transmitting a user identification from the terminal to a transaction partner via a first communication channel,
• providing an authentication step in which an authentication device uses a second communication channel for checking an authentication function that is implemented in a mobile device of the user,
• as a...