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Freight Tracking Startup FourKites Wins Patent Lawsuit

November 16, 2015

12:30 pm

In the tech industry, patent infringement lawsuits are not uncommon. Most of these are due to so-called patent trolls who buy patents and then sue other companies who try to patent similar innovations, hoping for a settlement. However, some of them are legitimate lawsuits that are worth fighting.

A recent case happened with Chicago, IL-based logistics startup FourKites. They were recently sued for patent infringement by Macropoint, a competitor in the freight tracking space. However, FourKites argued that it could not have possibly infringed on any Macropoint patents because the claims of the patents themselves were invalid. According to FourKites defense, the subject-matter of the patents was known prior to the filing date of the patents and the patents were not directed to patent eligible subject-matter.

Thanks to a  recent Supreme Court ruling in the case of Alice Corp. v. CLS Bank Int’ , patents are not valid if they claim an abstract idea and do not include an inventive concept. In the Alice case, the patents were held to be invalid because the claims were drawn to an abstract idea, and implementing those claims on a computer was not enough to transform that idea into patentable subject matter.

“This is a significant victory not only for FourKites, but also for the entire transportation industry. Real-time freight tracking is the core of transportation,” said Mathew Elenjickal, FourKites’ CEO, in a statement. “We believe that the industry is best served when we compete based on the merits of our products in an open marketplace in boardrooms rather than with attorneys in courtrooms.”

A federal judge of theU.S. District Court in Cleveland dismissed the Macropoint lawsuit and thus closed the case.

Judge Gaughan ruled: “Upon review, the Court finds that the patents-in-suit are directed to the abstract idea of tracking freight.” The Court continued: “Although the patents-in-suit do not entirely foreclose all tracking of freight, the steps in the claimed invention do involve ‘well-understood, routine, conventional activity.’ Thus, ‘upholding the patents would risk disproportionately tying up the use of the underlying’ conventional steps. Accordingly, [MacroPoint’s] argument is not well-taken.”

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Kristin is an aspiring entrepreneur who is enthusiastically navigating her way through the DC startup space. She has an unending passion for learning and is never satisfied with the status quo. During the day she is an ops, biz dev, and marketing maven for Fission Strategy

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