Mortgage Grader, Inc. v. First Choice Loan Services Inc.

United States Court of Appeals
for the Federal Circuit
______________________

MORTGAGE GRADER, INC.,
Plaintiff-Appellant

v.

FIRST CHOICE LOAN SERVICES INC., NYLX, INC.,
Defendants-Appellees
______________________

2015-1415
______________________

Appeal from the United States District Court for the
Central District of California in No. 8:13-cv-00043-AG-
AN, Judge Andrew J. Guilford.
______________________

Decided: January 20, 2015
______________________

CRAIG R. KAUFMAN, TechKnowledge Law Group LLP,
Redwood City, CA, argued for plaintiff-appellant. Also
represented by MICHAEL CHAOCHA TING.

REBECCA JEAN STEMPIEN COYLE, Levy & Grandinetti,
Washington, DC, argued for defendants-appellees. Also
represented by PAUL GRANDINETTI.
______________________
2 MORTGAGE GRADER, INC. v. FIRST CHOICE LOAN SERVICES

Before O’MALLEY and TARANTO, Circuit Judges, and
STARK, Chief District Judge. *
STARK, Chief District Judge.
This case involves patent claims directed to systems
and methods for assisting borrowers to obtain loans.
Plaintiff-Appellant Mortgage Grader, Inc. (“Mortgage
Grader”) appeals two decisions of the district court. First,
Mortgage Grader appeals the district court’s denial of its
motion to strike Defendants-Appellees First Choice Loan
Services, Inc. and NYLX, Inc.’s (“Appellees”) patent-
ineligibility defense. Appellees raised patent ineligibility
as a defense in their answer, then dropped it in their
initial invalidity contentions, only to add it back in their
final invalidity contentions. See Mortgage Grader, Inc. v.
Costco Wholesale Corp., 2014 WL 10763261, at *6 (C.D.
Cal. Oct. 27, 2014) (“Mortgage Grader I”). Second, Mort-
gage Grader appeals the district court’s grant of Appel-
lees’ motion for summary judgment that the asserted
claims are patent-ineligible. See Mortgage Grader, Inc. v.
Costco Wholesale Corp., 89 F. Supp. 3d 1055, 1065 (C.D.
Cal. 2015) (“Mortgage Grader II”). Mortgage Grader
contends that the district court improperly resolved
factual disputes against it and erred in its application of
35 U.S.C. § 101 (“§ 101”).
For the reasons set forth below, we affirm.
BACKGROUND
The patents-in-suit, U.S. Patent Nos. 7,366,694 (“’694
patent”) and 7,680,728 (“’728 patent”), relate to “financial
transactions including a method for a borrower to evalu-
ate and/or obtain financing, e.g., a loan.” ’694 patent

* The Honorable Leonard P. Stark, Chief District
Judge, United States District Court for the District of
Delaware, sitting by designation.
MORTGAGE GRADER, INC. v. FIRST CHOICE LOAN SERVICES 3

col. 1, ll. 19–21; ’728 patent col. 1, ll. 17–19. The ’694
patent is a continuation-in-part of the ’728 patent. 1
Mortgage Grader asserts claims 1, 2, and 19 of the ’694
patent and claim 6 of the ’728 patent.
Claim 1 of the ’694 patent is representative:
A computer-implemented system for enabling bor-
rowers to anonymously shop for loan packages of-
fered by a plurality of lenders, the system
comprising:
a database that stores loan package data
specifying loan packages for home loans
offered by the lenders, the loan package
data specifying, for each of the loan pack-
ages, at least a loan type, an interest rate,
and a required borrower credit grading;
and
a computer system that provides:
a first interface that allows the lenders to
securely upload at least some of the loan
package data for their respective loan
packages to the database over a computer
network; and
a second interface that prompts a borrow-
er to enter personal loan evaluation in-
formation, and invokes, on a computer, a
borrower grading module which uses at
least the entered personal loan evaluation
information to calculate a credit grading
for the borrower, said credit grading being

1 The ’694 patent’s specification contains the entire-
ty of the ’728 patent’s specification and adds to it further
embodiments disclosed in Figures 3 and 4 and described
in accompanying text.
4 MORTGAGE GRADER, INC. v. FIRST CHOICE LOAN SERVICES

distinct from a credit score of the borrow-
er, and being based on underwriting crite-
ria used by at least some of said lenders;
wherein the second interface provides
functionality for the borrower to search
the database to identify a set of loan pack-
ages for which the borrower qualifies
based on the credit grading, and to com-
pare the loan packages within the set, in-
cluding loan type and interest rate, while
remaining anonymous to each of the lend-
ers and without having to post a request
to any of the lenders, said second interface
configured to display to the borrower an
indication of a total cost of each loan
package in the set, said total cost includ-
ing costs of closing services not provided
by corresponding lenders.
Claim 2 of the ’694 patent depends from claim 1, add-
ing only that “the second interface comprises a set of web
pages of a web site.” Independent claim 19 recites a
“computer-implemented method” comprising certain
steps. Claim 6 of the ’728 patent recites a “method of
assisting a borrower in obtaining a loan” comprising
certain steps.
In January 2013, Mortgage Grader sued Costco
Wholesale Corporation (“Costco”) for infringement of the
patents-in-suit. 2 On May 23, 2013, Mortgage Grader
amended its complaint to add Appellees as defendants.
After the parties stipulated to extend the time for Appel-
lees to respond to the amended complaint, Appellees filed
their answer on October 14, 2013. In it, they asserted as

2 The parties stipulated to the dismissal of Costco
in January 2015.
MORTGAGE GRADER, INC. v. FIRST CHOICE LOAN SERVICES 5

affirmative defenses and counterclaims that both the ’694
and ’728 patents failed to claim patent-eligible subject
matter.
In the meantime, on August 30, 2013, Judge Andrew
J. Guilford of the Central District of California, who
presided over the proceedings below, ordered that his
recently issued Standing Patent Rules (“S.P.R.s”) would
apply to this case. Judge Guilford developed his S.P.R.s
“based largely on information obtained from over 100
patent practitioners and professors, a review of all the
other local patent rules, and a review of related litera-
ture.” J.A. 64. The S.P.R.s are intended “to reduce trans-
action costs and increase procedural predictability,” while
also being as “outcome neutral and as concise as possible.”
Id.
Pertinent to this appeal is the S.P.R.s’ requirement
that a party opposing a claim of patent infringement must
serve invalidity contentions. A party’s initial invalidity
contentions are due after the court conducts a scheduling
conference—a conference which is held after the party
asserting infringement produces documents and discloses
its asserted claims and infringement contentions. Pursu-
ant to S.P.R. 2.5, the initial invalidity contentions must
include, inter alia, “[a]ny grounds of invalidity based on
35 U.S.C. § 101 . . . of any of the asserted claims.” J.A. 67.
Consistent with S.P.R. 2.5, on December 20, 2013, Appel-
lees served invalidity contentions, which included the
statement: “Defendants do not present any grounds of
invalidity based on 35 U.S.C. § 101 . . . of any of the
asserted claims at this time. The final claim construction
may require such an assertion of invalidity.” J.A. 332–33.
The S.P.R.s impose further obligations that are trig-
gered by the district court’s issuance of an order constru-
ing claim terms. In particular, the party alleging
infringement must serve final infringement contentions
and expert reports regarding issues on which it bears the
6 MORTGAGE GRADER, INC. v. FIRST CHOICE LOAN SERVICES

burden of proof. Thereafter, a party opposing a claim of
patent infringement must serve its final invalidity con-
tentions and expert reports regarding issues on which it
bears the burden of proof. In particular, S.P.R. 4.2.2
requires service of:
A statement [by the party] that its S.P.R. 2.5 con-
tentions are its Final Invalidity Contentions, or in
the alternative, Final Invalidity Contentions that
amend its S.P.R. 2.5 contentions. A party serving
Final Invalidity Contentions that amend its prior
contentions shall also provide a redline against its
prior contentions and a statement of reasons for
each amendment. Amendments are subject to a
good cause standard but do not require prior
Court approval where they are made due to a
claim construction by the Court different from
that proposed by the party seeking amendment, or
recent discovery of material prior art that was not
discovered, despite diligent efforts, before the ser-
vice of the [initial] Invalidity Contentions.
J.A. 71 (emphasis added).
Here, the district court issued its claim construction
order on April 18, 2014, and then agreed to the parties’
request to extend certain deadlines. Appellees timely
served their final invalidity contentions on August 15,
2014. In their final contentions, Appellees stated:
The Defendants informed the Plaintiff’s counsel of
the intention to challenge the validity of the ’694
and ’728 patents under Alice Corp. Pty., Ltd. v.
CLS Bank International et al., 134 S. Ct. 2347,
2014 U.S. LEXIS 4303 (2014). The use of the
Elite Agents formal application, which was reject-
ed in part under 35 U.S.C. § 101, and the newspa-
per Mortgage Rate Charts are expected to be the
MORTGAGE GRADER, INC. v. FIRST CHOICE LOAN SERVICES 7

primary basis for this challenge.[ 3] The good
cause for this revision to this statement of Final
Invalidity Contentions is caused by the Supreme
Court’s decision issuing after the Defendant[s’] In-
itial Invalidity Contentions.
J.A. 151.
Mortgage Grader moved to strike Appellees’ § 101 de-
fense, arguing that Appellees had not shown good cause
for injecting the defense back into the case after dropping
it in their initial invalidity contentions. Appellees re-
sponded that the Supreme Court’s decision in Alice, which
was issued on June 19, 2014, constituted good cause for
the amendment. The district court agreed with Appellees
and denied Mortgage Grader’s motion. Mortgage Grader
I, 2014 WL 10763261, at *7.
Thereafter, Appellees filed a motion for summary
judgment that the asserted claims are patent-ineligible
under § 101. Both sides filed expert reports in support of
their § 101 positions. In analyzing the motion, the district
court applied the two-part test for patent eligibility set
forth in Mayo Collaborative Services v. Prometheus La-
boratories, Inc., 132 S. Ct. 1289, 1297 (2012), as clarified
by Alice. The court concluded that all of the asserted
claims are directed to the abstract idea of “anonymous
loan shopping” and that they include no “inventive con-
cept.” Mortgage Grader II, 89 F. Supp. 3d at 1063–65.
Accordingly, the court entered summary judgment for
Appellees, as Mortgage Grader could not prove that
Appellees infringed any valid patent claim.
Mortgage Grader filed a timely appeal. We have ju-
risdiction under 28 U.S.C. § 1295(a)(1).

3 The prior art references cited in this sentence
were disclosed elsewhere in Defendants’ final invalidity
contentions.
8 MORTGAGE GRADER, INC. v. FIRST CHOICE LOAN SERVICES

DISCUSSION
Mortgage Grader asks us to reverse the district
court’s grant of summary judgment for Appellees and
remand this case for further proceedings. Specifically,
Mortgage Grader contends that the district court should
have granted its motion to strike, thereby precluding
Appellees from proceeding with their § 101 defense.
Mortgage Grader also insists that the district court erred
in granting summary judgment by improperly resolving
factual disputes and then misapplying the Mayo/Alice test
for patent eligibility. We address each of these issues in
turn.
I
Judge Guilford’s Standing Patent Rules are similar to
the Patent Local Rules adopted by the Northern District
of California and many other districts. Like Patent Local
Rules, the S.P.R.s “are essentially a series of case man-
agement orders that fall within a district court’s broad
power to control its docket and enforce its order.” Kera-
nos, LLC v. Silicon Storage Tech., Inc., 797 F.3d 1025,
1035 (Fed. Cir. 2015). District courts have inherent
power to manage their own docket, see, e.g., Ryan v.
Gonzales, 133 S. Ct. 696, 708 (2013); Ethicon, Inc. v.
Quigg, 849 F.2d 1422, 1426 (Fed. Cir. 1988), and are
authorized to “consider and take appropriate action” to
facilitate the “just, speedy, and inexpensive disposition” of
all matters before them. Fed. R. Civ. P. 16; see also Fed.
R. Civ. P. 1. Judge Guilford’s creation and adoption of his
S.P.R.s fall squarely within this broad authority.
Since the S.P.R.s are “unique to patent cases and have
a close relationship to enforcement of substantive patent
law, we proceed to review their validity and interpreta-
tion under Federal Circuit law.” O2 Micro Int’l Ltd. v.
Monolithic Power Sys., Inc., 467 F.3d 1355, 1364–65 (Fed.
Cir. 2006). “[T]his court defers to the district court when
interpreting and enforcing local rules so as not to frus-
MORTGAGE GRADER, INC. v. FIRST CHOICE LOAN SERVICES 9

trate local attempts to manage patent cases according to
prescribed guidelines.” Genentech, Inc. v. Amgen, Inc.,
289 F.3d 761, 774 (Fed. Cir. 2002). In particular, a “dis-
trict court’s application of its local rules is reviewed under
the standard of abuse of discretion.” Keranos, 797 F.3d at
1035.
In reviewing a district court’s exercise of discre-
tion, this court determines whether (1) the deci-
sion was clearly unreasonable, arbitrary, or
fanciful; (2) the decision was based on an errone-
ous conclusion of law; (3) the court’s findings were
clearly erroneous; or (4) the record contains no ev-
idence upon which the court rationally could have
based its decision.
Genentech, 289 F.3d at 774 (internal quotation marks
omitted).
S.P.R. 4.2.2 requires “good cause” for amendments to
invalidity contentions submitted as final invalidity con-
tentions (other than amendments based on claim con-
struction or recent discovery of material prior art). J.A.
71. 4 In this context, a prerequisite to good cause is a
showing of diligence. See O2 Micro, 467 F.3d at 1366.
The party seeking to amend its contentions bears the
burden of proving it acted with diligence. See id.

4 As the S.P.R.s expressly contemplate amendment
of initial invalidity contentions upon a showing of good
cause, Mortgage Grader’s argument that Appellees
“waived” their § 101 defense by not including it in their
initial invalidity contentions is meritless. (See Appel-
lant’s Br. 20.) Moreover, as we have stated, “refusing to
allow any amendment to contentions based on new infor-
mation developed in discovery could be contrary to the
spirit of the Federal Rules.” O2 Micro, 467 F.3d at 1366.
10 MORTGAGE GRADER, INC. v. FIRST CHOICE LOAN SERVICES

In applying S.P.R. 4.2.2, the district court found that
generally a party cannot claim diligence when it includes
a defense in its answer, fails to include the defense in
initial invalidity contentions, and many months later
adds the defense to its final contentions. See Mortgage
Grader I, 2014 WL 10763261, at *6. While the court
acknowledged that “an argument can be made that Alice
is only a modest advance,” it concluded that “Alice did
provide significant additional clarity on the effect, or lack
of effect, of requiring the use of a computer in the claims.”
Id. at *7. Ultimately, the court concluded that, “[i]n
short, Alice represents a big enough change to justify
including a new § 101 argument in Defendants’ Final
Invalidity Contentions.” Id.
Mortgage Grader argues that the district court abused
its discretion by failing to strike Appellees’ § 101 defense
from their final invalidity contentions. Mortgage Grader’s
primary basis for this argument is its claim that the
Supreme Court’s decision in Alice neither created a new
defense nor changed the law. On these grounds, Mort-
gage Grader claims the decision in Alice cannot be a basis
for finding good cause to amend invalidity contentions.
We find no abuse of discretion in the court’s ruling.
In Alice, the Supreme Court held that “merely requir-
ing generic computer implementation fails to transform
[an] abstract idea into a patent-eligible invention.” 134 S.
Ct. at 2352. We recognized the significance of Alice in
buySAFE, Inc. v. Google, Inc., 765 F.3d 1350, 1354–55
(Fed. Cir. 2014), in which we stated that Alice “made clear
that a claim directed to an abstract idea does not move
into § 101 eligibility territory by merely requiring generic
computer implementation” (internal quotation marks
omitted).
The impact of Alice is also illustrated by our decision
in Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709 (Fed.
Cir. 2014) (“Ultramercial III”). Ultramercial had sued
MORTGAGE GRADER, INC. v. FIRST CHOICE LOAN SERVICES 11

WildTangent for infringement of U.S. Patent No.
7,346,545, a patent directed to allowing consumers to
view copyrighted media products on the Internet at no
cost in exchange for viewing an advertisement. See id. at
712. When the case was first before us, in 2011, we
reversed the district court’s grant of WildTangent’s Rule
12(b)(6) motion to dismiss, holding that “as a practical
application of the general concept of advertising as cur-
rency and an improvement to prior art technology, the
claimed invention is not so manifestly abstract as to
override the statutory language of § 101.” Ultramercial,
LLC v. Hulu, LLC, 657 F.3d 1323, 1330 (Fed. Cir. 2011)
(“Ultramercial I”) (internal quotation marks omitted).
The Supreme Court granted WildTangent’s petition for
certiorari, vacated our order, and remanded for further
consideration in light of Mayo. Ultramercial III, 772 F.3d
at 713. On remand, we again reversed the district court,
holding yet again that the claims were patent-eligible.
Ultramercial v. Hulu, 722 F.3d 1335, 1354 (Fed. Cir.
2013) (“Ultramercial II”). Once more, the Supreme Court
granted WildTangent’s petition for certiorari, vacated our
order, and remanded, this time for further consideration
in light of Alice. Id. On this further remand, with the
“added benefit of the Supreme Court’s reasoning in Alice,”
we affirmed the district court and found the claims to be
not patent-eligible. Id. Our conclusion was expressly
based on Alice’s holding that “adding a computer to oth-
erwise conventional steps does not make an invention
patent-eligible.” Id. at 713, 716–17.
Ultramercial III demonstrates that a § 101 defense
previously lacking in merit may be meritorious after
Alice. This scenario is most likely to occur with respect to
patent claims that involve implementations of economic
arrangements using generic computer technology, as the
claims do here. For example, the asserted claims of the
’694 patent require use of a “computer system” or “com-
puter network” for facilitating anonymous loan shopping,
12 MORTGAGE GRADER, INC. v. FIRST CHOICE LOAN SERVICES

and the asserted claim of the ’728 patent requires “pro-
grammatically generating” and uses a “network” for
shopping for loans. In this context, it was not an abuse of
discretion to allow Appellees to inject a § 101 defense into
the case after Alice.
Mortgage Grader’s arguments to the contrary are un-
persuasive. First, Mortgage Grader points to this Court’s
statement in a non-precedential opinion, Smartflash LLC
v. Apple Inc., 621 Fed. App’x 995, 1002 (Fed. Cir. 2015),
that “Alice did not create a new § 101 defense, but rather
clarified § 101 jurisprudence.” As we have just explained,
even an “old” § 101 defense may enjoy renewed vigor in
light of Alice. More importantly, our statement in Smart-
flash was in an entirely different context: review of denial
of a motion to stay pending Covered Business Method
review, where the alleged infringer waited until four
months after Alice was decided (by which time a jury trial
had been completed) and argued that “the stage of litiga-
tion facing the court is irrelevant to its right to a stay.”
Id. We found no abuse of discretion in the trial court’s
decision to deny a stay in such circumstances. Here, we
conclude similarly that the court did not abuse its discre-
tion in finding that Appellees acted diligently by adding
the § 101 defense just two months after Alice came down,
satisfying the “good cause” standard imposed by S.P.R.
4.2.2. The standard of review employed in both Smart-
flash and here cannot be removed from the results
reached in each case—in neither instance did the district
court abuse the broad discretion afforded it.
Next, Mortgage Grader argues we should reverse the
district court for failing to consider whether Mortgage
Grader would be prejudiced by adding Appellees’ § 101
defense back into the case. Mortgage Grader concedes
that it failed to present arguments related to prejudice to
the district court; thus, its contention here is waived. See
Triton Tech of Tex., LLC v. Nintendo of Am., Inc., 753
F.3d 1375, 1379–80 (Fed. Cir. 2014). In any event, S.P.R.
MORTGAGE GRADER, INC. v. FIRST CHOICE LOAN SERVICES 13

4.2.2 does not reference prejudice—unlike S.P.R. 4.3,
relating to amendment or supplementation of expert
reports, which “are presumptively prejudicial,” J.A. 71,
and unlike several Patent Local Rules in the Northern
District of California, see, e.g., Apple, Inc. v. Samsung
Elecs. Co., 2014 WL 1322028, at *2 (N.D. Cal. Mar. 28,
2014) (discussing Patent Local Rule 3-6 related to amend-
ing contentions). 5 The district court did not abuse its
discretion by failing to consider prejudice when it applied
a rule that does not require consideration of prejudice.
Additionally, Mortgage Grader has done nothing to per-
suade us that it was unfairly prejudiced by Appellees’
amendment, as it has identified nothing (e.g., discovery,
claim construction) it would have done differently if it had
been given more time to respond to the § 101 defense. At
the time Appellees amended their final invalidity conten-
tions, “(1) expert depositions had not yet occurred, (2)
Mortgage Grader had its full length of time to prepare
rebuttal expert reports, and (3) there was still approxi-
mately a month and a half until the close of discovery.”
J.A. 894. Mortgage Grader had adequate time to develop
its response to the § 101 defense.
Thus, the district court did not abuse its discretion.
We affirm the denial of Mortgage Grader’s motion to
strike.

5 Mortgage Grader cites O2 Micro as support for a
requirement to consider prejudice to the patentee before
permitting amendment of invalidity contentions. Howev-
er, O2 Micro—which involved the Northern District of
California’s Patent Local Rules, not the S.P.R.s—
expressly stated that it was not considering “the question
of prejudice,” as the amending party there had failed to
act with diligence. 467 F.3d at 1368.
14 MORTGAGE GRADER, INC. v. FIRST CHOICE LOAN SERVICES

II
Having concluded that it was proper for the district
court to allow Appellees to proceed with their § 101 de-
fense, we must next determine whether the district court
properly granted summary judgment that the patents-in-
suit are not patent-eligible. We review a grant of sum-
mary judgment under the law of the regional circuit.
Landmark Screens, LLC v. Morgan, Lewis, & Bockius,
LLP, 676 F.3d 1354, 1361 (Fed. Cir. 2012). “The Ninth
Circuit reviews the district court’s grant of summary
judgment de novo.” Ultimax Cement Mfg. Corp. v. CTS
Cement Mfg. Corp., 587 F.3d 1339, 1355 (Fed. Cir. 2009)
(citing Universal Health Servs., Inc. v. Thompson, 363
F.3d 1013, 1019 (9th Cir. 2004)). “We must determine,
viewing the evidence in the light most favorable to the
nonmoving party, whether there are any genuine issues of
material fact and whether the district court correctly
applied the relevant substantive law.” Universal Health,
363 F.3d at 1019.
A
Under § 101, “[w]hoever invents or discovers any new
and useful process, machine, manufacture, or composition
of matter, or any new and useful improvement thereof,
may obtain a patent therefor, subject to the conditions
and requirements of this title.” There are three excep-
tions to § 101’s broad patent-eligibility principles: “laws of
nature, physical phenomena, and abstract ideas.” Dia-
mond v. Chakrabarty, 447 U.S. 303, 309 (1980). In Mayo,
the Supreme Court set out a two-step “framework for
distinguishing patents that claim laws of nature, natural
phenomena, and abstract ideas from those that claim
patent-eligible applications of those concepts.” Alice, 134
S. Ct. at 2355. First, courts must determine if the claims
at issue are directed to a patent-ineligible concept. See id.
If not, the inquiry ends, as the claims are patent-eligible.
But if so, the next step is to look for an “‘inventive con-
MORTGAGE GRADER, INC. v. FIRST CHOICE LOAN SERVICES 15

cept’—i.e., an element or combination of elements that is
sufficient to ensure that the patent in practice amounts to
significantly more than a patent upon the [ineligible
concept] itself.” Id. (internal quotation marks omitted).
The district court carefully and correctly applied this
two-step framework to the patents-in-suit. 6 Regarding
step 1, we agree with the district court that the asserted
claims are directed to the abstract idea of “anonymous
loan shopping.” Mortgage Grader II, 89 F. Supp. 3d at
1063. The claim limitations, analyzed individually and
“as a whole,” Alice, 134 S. Ct. at 2359, recite nothing more
than the collection of information to generate a “credit
grading” and to facilitate anonymous loan shopping. As
the district court explained, the claims specify that “the
borrower is anonymous to the lender until the borrower
has been informed of the cost of the loan based on the
borrower’s credit grading, and the borrower then chooses
to expose its identity to a lender.” Mortgage Grader II, 89
F. Supp. 3d at 1063. The series of steps covered by the
asserted claims—borrower applies for a loan, a third
party calculates the borrower’s credit grading, lenders
provide loan pricing information to the third party based
on the borrower’s credit grading, and only thereafter (at
the election of the borrower) the borrower discloses its
identity to a lender—could all be performed by humans
without a computer. Cf. CyberSource Corp. v. Retail

6 Although there was neither an agreement by the
parties nor a finding by the district court that any one of
the asserted claims is representative for purposes of the
§ 101 analysis, there is also no contention that the claims
differ in any manner that is material to the patent-
eligibility inquiry. We have no need to address the four
asserted claims individually. See generally Alice, 134 S.
Ct. at 2359-60 (finding 208 claims to be patent-ineligible
based on analysis of one representative claim).
16 MORTGAGE GRADER, INC. v. FIRST CHOICE LOAN SERVICES

Decisions, Inc., 654 F.3d 1366, 1373 (Fed. Cir. 2011)
(“[C]omputational methods which can be performed
entirely in the human mind are the types of methods that
embody the ‘basic tools of scientific and technological
work’ that are free to all men and reserved exclusively to
none.”) (quoting Gottschalk v. Benson, 409 U.S. 63, 67
(1972)).
Because the claims are directed to an abstract idea,
the claims must include an “inventive concept” in order to
be patent-eligible. No such inventive concept is present
here. Instead, the claims “add” only generic computer
components such as an “interface,” “network,” and “data-
base.” These generic computer components do not satisfy
the inventive concept requirement. See Intellectual
Ventures I LLC v. Capital One Bank (USA), 792 F.3d
1363, 1370 (Fed. Cir. 2015) (“[T]he interactive interface
limitation is a generic computer element.”); buySAFE, 765
F.3d at 1355 (sending information over network is “not
even arguably inventive”); Accenture Global Servs. GmbH
v. Guidewire Software, Inc., 728 F.3d 1336, 1344 (Fed.
Cir. 2013) (database components did not make claims
patent-eligible). “[A]fter Alice, there can remain no doubt:
recitation of generic computer limitations does not make
an otherwise ineligible claim patent-eligible. The bare
fact that a computer exists in the physical rather than
purely conceptual realm is beside the point.” DDR Hold-
ings, LLC v. Hotels.com, L.P., 773 F.3d 1245, 1256 (Fed.
Cir. 2014) (internal citations and quotation marks omit-
ted).
Nothing in the asserted claims “purport[s] to improve
the functioning of the computer itself” or “effect an im-
provement in any other technology or technical field.”
Alice, 134 S. Ct. at 2359. Nor do the claims solve a prob-
lem unique to the Internet. See DDR Holdings, 773 F.3d
at 1257. In addition, the claims are not adequately tied to
“a particular machine or apparatus.” Bilski v. Kappos,
561 U.S. 593, 601 (2010). Because the asserted claims are
MORTGAGE GRADER, INC. v. FIRST CHOICE LOAN SERVICES 17

directed to an abstract idea and nothing in the claims
adds an inventive concept, the claims are not patent-
eligible under § 101.
B
Mortgage Grader contends that the district court im-
properly resolved material factual disputes in connection
with granting Appellees’ summary judgment motion. We
do not agree.
“Summary judgment is appropriate only if there is no
genuine issue of material fact and the movant is entitled
to judgment as a matter of law.” O2 Micro, 467 F.3d at
1369 (citing Fed. R. Civ. P. 56(c); Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 250 (1986)). However, the
“mere existence of some alleged factual dispute between
the parties will not defeat an otherwise properly support-
ed motion for summary judgment.” Anderson, 477 U.S. at
247–48. Instead, “summary judgment will not lie if the
dispute about a material fact is ‘genuine,’ that is, if the
evidence is such that a reasonable jury could return a
verdict for the nonmoving party.” Id. at 248.
The § 101 inquiry “may contain underlying factual is-
sues.” Accenture, 728 F.3d at 1341 (emphasis added); see
also Arrhythmia Research Tech., Inc. v. Corazonix Corp.,
958 F.2d 1053, 1055–56 (Fed. Cir. 1992) (“Whether a
claim is directed to statutory subject matter is a question
of law. Although determination of this question may
require findings of underlying facts specific to the particu-
lar subject matter and its mode of claiming, in this case
there were no disputed facts material to the issue.”). But
it is also possible, as numerous cases have recognized,
that a § 101 analysis may sometimes be undertaken
without resolving fact issues. See, e.g., Accenture, 728
F.3d at 1346. In such circumstances, the § 101 inquiry
may appropriately be resolved on a motion for summary
judgment.
18 MORTGAGE GRADER, INC. v. FIRST CHOICE LOAN SERVICES

It is true that Appellees and Mortgage Grader sub-
mitted expert declarations, and the district court
acknowledged these materials were in the record. See
Mortgage Grader II, 89 F. Supp. 3d at 1063. But the court
did not rely on them in its § 101 analysis. Instead, in
making its patent-eligibility determination, the district
court looked only to the claims and specifications of the
patents-in-suit. See id. at 1061–65. The mere existence
in the record of dueling expert testimony does not neces-
sarily raise a genuine issue of material fact. See, e.g., K-
TEC, Inc. v. Vita-Mix Corp., 696 F.3d 1364, 1374–76 (Fed.
Cir. 2012) (affirming grant of summary judgment that
design patent was not analogous art, despite contrary
opinion in expert report); Minkin v. Gibbons, P.C., 680
F.3d 1341, 1351–52 (Fed. Cir. 2012) (indicating that
summary judgment of invalidity may be available not-
withstanding expert report supporting validity).
Appellees’ experts simply provided non-material his-
torical information about how people obtained mortgages
in the period before the Internet. This added little if
anything to the ’694 patent’s specification, which observed
that “[t]here are newspaper or Internet referral sites
which publish interest rates for one or more lenders.”
’694 patent col. 1, ll. 38–39. Indeed, as Mortgage Grader’s
expert stated, neither of Appellees’ experts “reference[d]
the asserted claims, but instead merely explain[ed] the
existence of mortgage rate tables published in newspapers
during the 1980s and 1990s.” J.A. 1470.
Mortgage Grader’s expert, Jeffrey Lebowitz, opined
that the patents-in-suit solved the problem of information
asymmetry between borrowers and lenders, which had
previously permitted lenders to “steer” borrowers to
predatory loans. But that assertion about problem solv-
ing does not by its terms identify claimed process steps.
In any event, the claims do not actually contain a “con-
flict-free requirement.” See Mortgage Grader II, 89 F.
Supp. 3d at 1063. Instead, the claims expressly encom-
MORTGAGE GRADER, INC. v. FIRST CHOICE LOAN SERVICES 19

pass so-called “independent” third-parties who, in addi-
tion to determining a borrower’s credit grading, may be
“full time employee[s] of an entity providing the desired
financial services” and may “receive[] a percentage com-
mission from an affiliated company based on the loans
funded through the program.” ’694 patent col. 10, l. 51 –
col. 11, l. 5; ’728 patent col. 9, ll. 41–61. Plainly, conflicts-
of-interest and predatory lending are still possible when
practicing the claims. Mr. Lebowitz’s other opinion is
that the patents-in-suit require use of a computer. But
given the intrinsic evidence, and Alice’s clarification that
use of a generic computer to implement a “fundamental
economic practice” cannot provide an inventive concept
sufficient to save claims from patent ineligibility, 134 S.
Ct. at 2356–57, this opinion does not create a genuine
dispute of material fact.
In sum, no reasonable factfinder could find based on
the expert reports that the asserted claims are directed to
patent-eligible subject matter.
CONCLUSION
For the foregoing reasons, the district court did not
abuse its discretion in denying Mortgage Grader’s motion
to strike Appellees’ § 101 defense. Nor did the district
court err in granting summary judgment to Appellees on
that defense. Instead, the district court correctly deter-
mined that the asserted claims are directed to patent-
ineligible subject matter.
AFFIRMED
No costs.