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Mitchell Declares ‘Complete Victory’ in Federal Appeals Court Ruling

The U.S. Court of Appeals for the Federal Circuit has affirmed a February 2016 ruling by the U.S. Patent Trial and Appeals Board that invalidated all three patents in Audatex North America’s patent-infringement lawsuit against Mitchell International.

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The U.S. Court of Appeals for the Federal Circuit has affirmed a February 2016 ruling by the U.S. Patent Trial and Appeals Board that invalidated all three patents in Audatex North America’s patent-infringement lawsuit against Mitchell International.

Audatex sued Mitchell in February 2012, alleging that Mitchell’s WorkCenter software violated three Audatex patents.

In the lawsuit, Audatex claimed that it holds patents on systems that process insurance-claims data for collision-damaged vehicles and transmit that data via the Internet. The systems process the data into a valuation report transmitted via the Internet, allowing insurance-claims adjusters to access a vehicle-valuation database more readily, the appeals court explains.

During the proceedings with the Patent Trial and Appeals Board, Mitchell asserted that the Audatex patents use well-known technology to generate valuation reports for damaged cars, and are not directed to improving a computer’s functionality.

In February 2016, the board sided with Mitchell and invalidated all three Audatex patents as abstract under the U.S. Supreme Court’s Alice Corp. decision, in which the high court ruled that abstract ideas implemented using a computer are not patent-eligible. The board also decided that each of the claims in all three Audatex patents were both “anticipated and obvious.”

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Audatex appealed portions of the board’s decision to the U.S. Court of Appeals for the Federal Circuit.

On July 27, the Federal Circuit affirmed the board’s invalidation of all three Audatex patents.

“The proposed claims recite nothing more than the collection of information to generate a valuation report for a damaged vehicle with the aid of well-known technology,” Chief Judge Sharon Prost wrote on behalf of the appeals court. “They embody an abstract idea that merely uses a computer and generic components as tools to collect these data and generate reports.”

Stephanie Kroon, senior vice president, general counsel and secretary at San Diego-based Mitchell, called the Federal Circuit’s opinion “welcome news for Mitchell.”

“We believed from early in the case that Audatex’s claims against Mitchell had no merit and the Federal Circuit has confirmed our position,” Kroon said. “This decision is a complete victory for Mitchell.”

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