Appeals from the United States District Court for the
District of Minnesota in No. 0:13-cv-02637-SRN-BRT, Judge
Susan Richard Nelson.
James Gilbertson, Greene Espel, PLLP, Minneapolis, MN, argued
for plaintiff-cross-appellant. Also represented by Sybil
Louise Dunlop, David Wallace-Jackson.
Thomas Vitt, Jones Day, Minneapolis, MN, argued for
defendants-appellants. Also represented by Gregory A.
Castanias, Washington, DC; Peter McCreery Lancaster, Timothy
J. Droske, Ben Desmond Kappelman, Dorsey & Whitney LLP,
Chen, Hughes, and Stoll, Circuit Judges.
Bancorp and its affiliate Elavon, Inc. (collectively, U.S.
Bank) appeal orders in the United States District Court for
the District of Minnesota (1) denying U.S. Bank's motion
for summary judgment that claims 1-5 of U.S. Patent No. 8,
311, 945 ('945 patent), assigned to Solutran, Inc.
(Solutran), are invalid under 35 U.S.C. § 101 for
failing to recite patent-eligible subject matter and (2)
granting Solutran's motion for summary judgment that
Solutran's products infringe claims 1-5 of the '945
patent. Solutran cross-appeals, arguing that the district
court abused its discretion when it denied Solutran the
ability to amend its complaint to include a claim for willful
infringement after the deadline set out in the scheduling
we agree with U.S. Bank that claims 1-5 of Solutran's
patent are invalid under § 101, we reverse.
'945 patent, issued in 2012, describes a system and
method for processing paper checks. '945 patent. The
patent explains that in the past, the payee would transport
the check to his or her own bank to be read and processed,
then the payee's bank would transport the check to the
payor's bank, where it also would be read and processed.
Id. at col. 1, ll. 30-39. At this point, the
payor's bank would debit the payor's account and
transfer the money to the payee's bank, which would
credit the payee's account. Id. at col. 1, ll.
Background section of the '945 patent explains that the
digital age ushered in a faster approach to processing
checks, where the transaction information-e.g.,
amount of the transaction, routing and account number- on the
check is turned into a digital file at the merchant's
point of sale (POS) terminal. Id. at col. 1, l. 51 -
col. 2, l. 8, col. 4, ll. 51-58 (at the point of purchase,
"the merchant keys, or applies amount captured at POS,
into the terminal the amount of the purchase" and
"passes the check through a MICR (magnetic ink character
recognition) reader to capture the consumer's account
number, routing number of the financial institution holding
the account, and the check number"). The digital check
information is sent electronically over the Internet or other
network, id. at col. 1, ll. 54- 61, and the funds
are then transferred electronically from one account to
another. Id. at col. 2, ll. 5-8. By converting the
check information into digital form, it no longer was always
necessary to physically move the paper check from one entity
to another to debit or credit the accounts. Id. at
col. 2, ll. 1-5. But retaining the checks was still useful
for, among other things, verifying accuracy of the
transaction data entered into the digital file. Id.
at col. 2, ll. 11-15. It was well-known that merchants could
optionally capture a digital image of the check at the point
of purchase. Id. at col. 2, ll. 61-63, col. 4, ll.
58-59, FIG. 1; see also id. at col. 2, ll. 30-31
("The original check can be scanned and its digital
image stored for later use . . . .").
patent also discloses a method proposed by the National
Automated Clearing House Association (NACHA) for "back
office conversion" where merchants scan their checks in
a back office, typically at the end of the day, id.
at col. 2, l. 65 - col. 3, l. 1, "instead of at the
purchase terminal," id. at col. 5, ll. 2-4,
FIG. 2. A scanner captures an image of the check, and MICR
data from the check is stored with the image. Id. at
col. 3, ll. 1-2. An image file containing this information
can be transferred to a bank or third-party payment
processor. Id. at col. 3, ll. 2-4.
patent describes its invention as a system and method of
electronically processing checks in which (1) "data from
the checks is captured at the point of purchase," (2)
"this data is used to promptly process a deposit to the
merchant's account," (3) the paper checks are moved
elsewhere "for scanning and image capture," and (4)
"the image of the check is matched up to the data
file." Id. at col. 3, ll. 16-46. The proffered
benefits include "improved funds availability" for
merchants and allegedly "reliev[ing merchants] of the
task, cost, and risk of scanning and destroying the paper
checks themselves, relying instead on a secure, high-volume
scanning operation to obtain digital images of the
checks." Id. at col. 3, ll. 46-62. Solutran
explains that its method allows merchants to get their
accounts credited sooner, without having to wait for the
check scanning step.
court treated claim 1 as representative, which the parties do