Picture this: back in 2018, Berkheimer v. HP drops like a mic from the Federal Circuit, whispering sweet nothings to patent lawyers. ‘Hey,’ it says, ‘those Section 101 questions? Factual disputes, folks—juries and trials incoming, no more summary judgment slaughter.’ Patent owners everywhere popped champagne. Remote deposit capture patents? Safe. Financial tech innovations? Bulletproof.
Then September 12 hits. Eastern District of Texas. PPS Data v. Jack Henry. Jury verdict form lands, and boom—first post-Berkheimer Section 101 invalidity call. Claims 1-6 and 9 of U.S. Patent No. 7,216,106? Toast. Routine. Conventional. As of April 28, 2000. Noninfringement too, on six products. The air? Let out.
What Everyone Expected from Berkheimer—and Why It Backfired
Patent pros dreamed big. Alice/Mayo had been a meat grinder, shredding software claims on 12(b)(6) motions before breakfast. Berkheimer promised friction—factual inquiries at step 2B about ‘well-understood, routine, conventional’ activities. Summary judgment? Tougher. Motions to dismiss? Near impossible. Judge Gilstrap even cited it this March, batting away a judgment on the pleadings for another patent in the case.
But here’s the twist nobody scripted. Survive summary judgment? Sure. Trial? Jury sees the claims—computer-readable media for remote check deposits, no physical routing needed—and yawns. ‘Did Jack Henry prove by clear and convincing evidence that… the Asserted Claims… ONLY involve activities that were well-understood, routine, and conventional as of April 28, 2000?’ Verdict: Yes. All claims down.
Jay Heidrick, Jack Henry’s lead counsel at Polsinelli, nailed it post-trial.
“One of the challenges that we faced as parties and with the court is that there’s not a lot out there as far as what other courts have done with jury instructions on the Section 101 issue.”
Heidrick kept it laser-focused: noninfringement theme, plus invalidity punch. No objections to the court’s verdict form wording. Compelling facts, right story—jury eats it up.
Short version? Berkheimer bought time, not immortality.
Why Does This Verdict Crush Patent Owner Dreams?
Look, remote deposit capture was hot in 2000—scanning checks from your couch, ditching the bank run. Revolutionary then? Jury said nah. Just computers doing what computers did: processing data, transmitting images. No inventive spark. Gilstrap let it past summary judgment, citing Berkheimer’s factual hurdles. But juries? They’re not swayed by appellate nuance.
And that quote from the original coverage stings for owners:
“[F]or counsel representing patent owners, PPS Data might temper any previous enthusiasm for Berkheimer, as attorneys now face the difficulty of not only presenting the technical elements of an invention to a jury but also of the proper meaning of ‘routine’ and ‘conventional’—terms which aren’t very well defined for the purposes of determining patent validity.”
Undefined terms. Juries decoding ‘routine’? Good luck. Heidrick again: “If you have compelling facts and the right story to tell, you can be successful on a Section 101 challenge with the jury.” Translation: defendants, sharpen those pitchforks.
This isn’t hype deflation—it’s reality check. Patent owners survived early motions, hit trial, and watched laypeople dismantle eligibility with prior art exhibits and expert demos. PPS Data? No response to inquiries. Ouch.
Now, my hot take—the unique angle you’re not reading elsewhere. This echoes the 1990s software patent explosion, pre-Alice. Remember CyberSource or State Street? Banks and fintech flooded with ‘business method’ claims on every click. Dot-com fever birthed junk patents, clogged courts, stifled real progress. PPS Data? Vintage 2000, smelling like that era’s overreach. Today’s lesson: Berkheimer cleared the brush, but juries will burn the deadwood. For AI—a true platform shift, like electricity remaking factories—this verdict torches weak claims, forcing inventors to claim the inventive concept, not the obvious implementation. AI patents on neural nets processing data remotely? They’ll face the same jury glare. Prediction: by 2025, we’ll see 20% more Section 101 trial wins for defendants, accelerating genuine AI breakthroughs over me-too filings.
Is This the Death Knell for Software Patents?
Not quite. But damn close for the lazy ones. Heidrick credits focus; imagine defendants everywhere copying that playbook. Patent owners? You’ll need demos, not declarations. Experts explaining why your widget wasn’t ‘conventional’ in 2000 (or 2020 for AI filings). Juries aren’t PTAB—they’re everyday folks, skeptical of tech magic.
PPS Data’s patent: filed 2000, covers media for remote financial deposits. Sounds innovative—until you stack it against prior scanners, networks, databases. Routine stack. Conventional glue. Alice step one: abstract idea (processing deposits). Step two: no more.
Broader ripple? Fintech, sure. But AI litigators, listen up. Your generative models ‘trained on data’? Juries might call that routine tomorrow. The enthusiasm for Berkheimer? Waning fast.
Think bigger. AI isn’t incremental code—it’s the new OS for reality. Weak patents like this clog the innovation pipe, just as buggy whips slowed cars. This verdict? A wrench turning the valve wide open. Wonder at that: juries, unwitting heroes, clearing space for tomorrow’s leaps.
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Frequently Asked Questions
What was the first jury verdict on Section 101 after Berkheimer?
PPS Data v. Jack Henry, September 12, Eastern District of Texas—jury found claims routine/conventional, invalid under 101.
Does Berkheimer protect patents from jury invalidity?
No—it makes early dismissals harder, but juries can still kill claims at trial with clear evidence.
What are implications for AI patents under Section 101?
Expect tougher jury scrutiny; focus on truly inventive steps beyond routine data processing.
