Federal Circuit Report

PHILIP EKLEM
Reichman Jorgensen Lehman & Feldberg LLP

THIS ARTICLE DISCUSSES THE FEDERAL CIRCUIT’S recent opinion in CloudofChange, LLC v. NCR Corp., ___ F.4th ___, 2024 WL 5150627 (Fed. Cir. Dec. 18, 2024) ("Opinion"), and its impact on the test for direct infringement under 35 U.S.C. § 271(a) based on the "use" of a system claim.

THE DISTRICT COURT’S DETERMINATION OF DIRECT INFRINGEMENT LIABILITY

CloudofChange sued NCR in the Western District of Texas for infringing its patents covering a web-based point-of-sale-builder system, which is something "that a non-expert business operator can use to assemble a point of sale (‘POS’) system for managing their business operations." Opinion at 1.¹ The illustrative claim describes a system that requires components belonging to two different entities: a "vendor" and a "subscriber." Id. at 1-2. As the Federal Circuit summarized, "[t]he claims require the vendor’s remote servers to host the web server software while subscribers possess the POS terminals that access the web server software." Id. at 2. The claims also require "an internet connection from [the] point of sale terminals to [the] web server." Id.