TRUSTEES OF COLUMBIA UNIVERSITY v. GEN DIGITAL INC.
Authored by: Jeremy J. Gustrowsky
The Federal Circuit vacated a $185 million jury verdict in favor of Columbia University against Gen Digital Inc. (the company behind Norton antivirus software), finding that Columbia’s patents for detecting malicious software are directed to an abstract idea. The case involved U.S. Patent Nos. 8,601,322 and 8,074,115, which describe methods for spotting suspicious computer program behavior by running programs in an “emulator” and comparing what the program does against a model of what it is expected to do. The model is built by combining data gathered from multiple computers, allowing the system to learn normal behavior faster. Columbia accused Norton’s SONAR/BASH antivirus feature of infringing several claims of these patents.
The central question on appeal was whether the patent claims were eligible for patent protection under the two-step framework from the Supreme Court’s Alice decision. At step one, the court asks whether the claims are directed to an abstract idea. The district court had said no, reasoning that the patents improved virus scanning through “unique models” and “efficiency.” The Federal Circuit disagreed, finding that the claims boil down to the abstract concept of comparing data against a model (built using multiple computers) to spot anomalies. The court noted that Columbia itself conceded that both emulators and the “divide-and-conquer” approach of splitting work among multiple computers were conventional. Columbia tried to point to other improvements described in the patent specification (like selective emulation, diversified models, and distributed sensors), but the court found none of these features were actually required by the claim language. Because eligibility depends on what is claimed, not everything disclosed in the specification, these arguments fell short.
Despite finding the claims abstract at step one, the Federal Circuit did not end the case there. It sent the case back to the district court to decide step two: whether the claims contain an “inventive concept” that transforms them into something patent-eligible. Specifically, the court identified a factual dispute over whether the claimed “model of function calls” was conventional technology or something new. Because the case was still at the pleading stage (the district court had struck the eligibility defense before trial), the court said this factual question should be resolved by the district court first.
The court also addressed several other issues that could matter if the patents survive the eligibility challenge on remand. It upheld the district court’s construction of the term “emulator,” agreeing that the patent does not require simulation of a virtual computer system. Norton had argued its products could not infringe because SONAR/BASH does not simulate a computer, but the court found that the patent’s language and specification support a broader meaning. The court also upheld the jury’s finding of willful infringement, noting evidence that Norton knew about Columbia’s research and patent applications years before suit was filed and failed to investigate potential infringement when developing SONAR/BASH.
On damages, the Federal Circuit reversed the portion of the verdict based on Norton’s foreign sales (roughly $94 million of the total). Relying on the Supreme Court’s reasoning in Microsoft Corp. v. AT&T Corp., the court held that software is not a tangible, infringing product until it is installed or encoded on a computer. Because copies of Norton’s software sold to foreign customers were only created on computers located outside the United States, those copies were not “made in” or “distributed from” the United States. The court also vacated the district court’s award of enhanced damages (which had multiplied the verdict by 2.6) and attorneys’ fees. Those awards had relied in part on a contempt finding against Norton’s former law firm, which the Federal Circuit reversed in a companion case. On remand, the district court will need to reconsider enhancement without that inference and must also account for the closeness of the case, including Norton’s reasonable (if ultimately unsuccessful) legal defenses.