Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_19-cv-01994/USCOURTS-cand-3_19-cv-01994-0/pdf.json

Nature of Suit Code: 830
Nature of Suit: Patent
Cause of Action: 35:271 Patent Infringement

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Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SMART AUTHENTICATION IP, LLC,

Plaintiff,

v.

ELECTRONIC ARTS INC.,

Defendant.

Case No. 19-cv-01994-SI 

ORDER GRANTING DEFENDANT’S

MOTION TO DISMISS

Re: Dkt. No. 21

Before the Court is a motion to dismiss brought by defendant Electronic Arts Inc. (“EA”), 

which seeks a finding that U.S. Patent No. 8,082,213 (the “‘213 patent”) is invalid and patentineligible under 35 U.S.C. § 101. Dkt. No. 21 (Motion to Dismiss). This matter came on for hearing 

on August 9, 2019. Having read the papers and heard the parties’ arguments the Court hereby 

GRANTS defendant’s motion, finding the ‘213 patent invalid under § 101 and dismisses the 

complaint with prejudice. 

BACKGROUND

On December 20, 2011, the ‘213 patent, entitled “Method and System for Personalized 

Online Security,” was duly and lawfully issued by the U.S. Patent and Trademark Office. Compl. 

¶ 7. Plaintiff, Smart Authentication, is the assignee and owner of the right, title and interest in and 

to the ‘213 patent. Compl. ¶ 8. The inventions of the ‘213 patent generally relate to methods and 

systems for multi-factor authentication of users over multiple communications media. Compl. ¶ 9.

The ‘213’s patent abstract states: 

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Various embodiments of the present invention provide strong authentication of users 

on behalf of commercial entities and other parties to electronic transactions. In these 

embodiments of the present invention, a user interacts with an authentication service 

provider [“ASP”] to establish policies for subsequent authentication of the user. 

Thus, in these embodiments of the present invention, a user controls the level and 

complexity of authentication processes carried out by the authentication service 

provider on behalf of both the user and commercial entities and other entities seeking 

to authenticate the user in the course of conducting electronic transactions, electronic 

dialogues, and other interactions for which user authentication is needed. The 

policies specified by a user may include specification of variable-factor 

authentication, in which the user, during the course of an authentication, provides 

both secret information as well as evidence of control of a tangible object. 

Dkt. No. 25-2 at 16 (‘213 Patent).

1

 Figure 3 of the ‘213 patent provides a helpful illustration of 

one of the patent’s potential uses. Specifically, it models an interaction between a user, an ASP 

client, and an ASP. Id. at 5. 

 

1 For ease of reference, page citations to docket entries will refer to the ECF assigned page 

number in the upper right hand corner of each page. 

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The ‘213 patent contemplates a user trying to login to the user’s account on a website, for 

example. In order to strengthen the security of the user’s login credentials and protect the user’s 

information, the user could be prompted to select an alternative form of authorization confirmation. 

The user could select to confirm her authorization via a secondary medium, including, but not 

limited to, a text message on her cell phone or an email. The secondary authenticating medium

would occur outside the purview of the initial login credentials. This second form of authentication 

confirms the user’s identity.

Prior to filing the instant action, Smart Authentication was engaged in proceedings before 

the Patent Trial and Appeal Board. Claim 11 emerged as the sole remaining claim following an 

inter partes review (IPR). Dkt. No. 21 at 10, Footnote 2 (Motion to Dismiss); see also Dkt. Nos. 

25-3 and 25-4 (Decision on Appeal and Final Written Decision, respectively, attached to the Shekhar 

Vyas Declaration in Support of Opposition). Claim 11 is dependent upon claims 1, 9, and 10 (all of 

which were invalidated in the IPR). The relevant claims read:

1. A user-authentication service implemented as routines that execute one or more 

computer systems interconnected by two or more communications media with both 

an authentication-service client, and a user, the user-authentication service 

comprising:

the one or more computer systems;

stored user-authentication policies specified by the user;

stored user information;

account interface routines that implement an account interface by which the user 

specifies, modifies, adds, and deletes user-authentication policies; and 

authentication-interface routines that implement an authentication interface by 

which, following initiation of a transaction by the user with the authentication service 

client, the authentication-service client submits an authentication request, through 

the first communications medium or through a second communications medium, to 

authenticate the user, the authentication interface routines employing a variablefactor authentication, when specified to do so by stored user-authentication policies, 

to authenticate the user on behalf of the authentication-service client during which 

the user communicates with the user-authentication service through a third 

communications medium different from the first and second communications media 

and a user device different from that employed by the user to initiate the transaction 

with the authentication-service client.

9. The user-authentication service of claim 1 wherein a user-authentication policy 

specifies one or more of: constraints and parameters associated with userCase 3:19-cv-01994-SI Document 40 Filed 09/11/19 Page 3 of 15
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authentication processes carried out by the user-authentication service on behalf of 

one or more, specified authentication-service clients.

10. The user-authentication service of claim 9 wherein constraints include one or 

more of: 

geographical constraints;

time-of-day constraints;

date constraints;

communications -medium-related constraints;

user-authentication service actions; and

event constraints.

11. The user-authentication service of claim 10 wherein user-authentication service 

actions include one or more of: 

halting authorization service after detecting a specified event; 

employing particular types of user-authentication procedures; and 

providing alerts upon detecting specified events.

Dkt. No. 25-2 at 16-17 (‘213 Patent). 

Plaintiff’s complaint, filed in April 2019, alleges a single cause of action for direct 

infringement against defendant EA. Specifically, plaintiff alleges: 

Without license or authorization and in violation of 35 U.S.C. § 271(a), Defendant is 

liable for infringement of claim 11 of the ‘213 patent by making, using, importing, 

offering for sale, selling and/or hosting a method for authenticating a user that 

requires two-factor authentication, including, but not limited to Login Verification, 

because each and every element is met either literally or equivalently.

Compl. ¶ 16.

LEGAL STANDARD

I. Motion to Dismiss

Under Federal Rule of Civil Procedure 12(b)(6), a district court must dismiss a complaint if 

it fails to state a claim upon which relief can be granted. To survive a Rule 12(b)(6) motion to 

dismiss, the plaintiff must allege “enough facts to state a claim to relief that is plausible on its face.”

Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). This “facial plausibility” standard requires 

the plaintiff to allege facts that add up to “more than a sheer possibility that a defendant has acted 

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unlawfully.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). While courts do not require “heightened 

fact pleading of specifics,” a plaintiff must allege facts sufficient to “raise a right to relief above the 

speculative level.” Twombly, 550 U.S. at 555, 570.

To state a claim for patent infringement, “a patentee need only plead facts sufficient to place 

the alleged infringer on notice. This requirement ensures that the accused infringer has sufficient 

knowledge of the facts alleged to enable it to answer the complaint and defend itself.”

Phonometrics, Inc. v. Hospitality Franchise Sys., Inc., 203 F.3d 790, 794 (Fed. Cir. 2000). The 

Federal Circuit has “repeatedly recognized that in many cases it is possible and proper to determine 

patent eligibility under 35 U.S.C. § 101 on a Rule 12(b)(6) motion.” Genetic Techs. Ltd. v. Merial 

L.L.C., 818 F.3d 1369, 1373 (Fed. Cir. 2016).

II. Subject Matter Eligibility Under § 101

Under 35 U.S.C. § 101, the scope of patentable subject matter encompasses “any new and 

useful process, machine, manufacture, or composition of matter, or any new and useful improvement 

thereof.” Bilski v. Kappos, 561 U.S. 593, 601 (2010) (quoting 35 U.S.C. § 101). Section 101 

“contains an important implicit exception: Laws of nature, natural phenomena, and abstract ideas 

are not patentable.” Alice Corp. v. CLS Bank Int'l, 573 U.S. 208, 216 (2014) (quoting Ass'n for 

Molecular Pathology v. Myriad Genetics, Inc., 569 U.S. 576, 589 (2013)). They are not patenteligible because “they are the basic tools of scientific and technological work,” which are “free to 

all men and reserved exclusively to none.” Mayo Collaborative Servs. v. Prometheus Labs., Inc., 

566 U.S. 66, 71 (2012) (citations omitted). The United States Supreme Court has explained that 

allowing patents for such purported inventions “might tend to impede innovation more than it would 

tend to promote it[,]” thereby thwarting the primary objective of patent laws. Id.

Alice provides the relevant analytical 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, 573 U.S. at 217. First, the court must determine whether the claims at 

issue are directed to one of the patent-ineligible concepts. Id. Second, if the claims are directed to 

a patent-ineligible concept, such as an abstract idea, the court must “consider the elements of each 

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claim both individually and as an ordered combination to determine whether the additional elements 

transform the nature of the claim into a patent-eligible application.” Id. (citation and quotation 

marks omitted). Step two is often described “as a search for an 'inventive concept[.]’” Id. at 217-

18. “When viewing claim elements individually, the court must remember that recitation of 

conventional, routine, or well-understood activity will not save an abstract claim.” California Inst. 

of Tech. v. Hughes Commc'ns, Inc., 59 F. Supp. 3d 974, 980 (citing Alice, 573 U.S. at 223).

However, “[w]hen viewing claim elements as an ordered combination, the court should not ignore 

the presence of any element, even if the element, viewed separately, is abstract.” Id. “If the ordered 

combination of elements constitutes conventional activity, the claim is not patentable, but courts 

should remember that a series of conventional elements may together form an unconventional, 

patentable combination.” Id.

The Federal Circuit has recently held that “[w]hether something is well-understood, routine, 

and conventional to a skilled artisan at the time of the patent is a factual determination.” Berkheimer 

v. HP Inc., 881 F.3d 1360, 1369 (Fed. Cir. 2018). However, the Berkheimer court also clarified that 

“[n]othing in this decision should be viewed as casting doubt on the propriety of those cases”

resolving § 101 inquiries on motions to dismiss or summary judgment, where there is no genuine 

dispute over the underlying material facts. Id. “When there is no genuine issue of material fact 

regarding whether the claim element or claimed combination is well-understood, routine, 

conventional to a skilled artisan in the relevant field, this issue can be decided . . . as a matter of 

law.” Id. “To the extent that the Court must resolve underlying questions of fact related to 

eligibility, they must be proven by clear and convincing evidence.” Broadband iTV, Inc. v. Oceanic 

Time Warner Cable, LLC, 135 F. Supp. 3d 1175, 1188 (D. Haw. 2015), aff'd sub nom. Broadband 

iTV, Inc. v. Hawaiian Telcom, Inc., 669 F. App’x 555 (Fed. Cir. 2016) (citations omitted).

DISCUSSION

EA requests the Court dismiss this action, arguing that claim 11, the only claim that survived 

the ‘213 patent IPR proceeding, claims patent-ineligible subject matter. Specifically, EA argues 

claim 11 of the ‘213 patent is directed to an abstract idea that lacks an inventive concept. 

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Plaintiff opposes defendant’s motion on three grounds, namely: (1) unresolved issues of 

claim construction and underlying factual disputes preclude summary disposition; (2) claim 11 of 

the ‘213 patent is not abstract because “[i]t is directed to a computer-centric problem of reliable 

authentication of remote users involved in electronic transactions to improve network security,” and 

solves problems associated with the prior art; and (3) claim 11 “reflects an inventive concept, as it 

provides a specific technological way to improve network security by reliably authenticating remote 

users involved in electronic transactions,” and discloses “a specific, inventive combination of 

elements to address known problems in prior art authentication systems.” Dkt. No. 25 at 5

(Opposition) ( bolding in original). 

The parties’ arguments are discussed in turn below. 

I. No Issues of Fact Preclude Summary Determination of Eligibility

Plaintiff argues the following issues of fact preclude summary determination: (1) paragraphs 

9-12 of the complaint (Dkt. No. 25 at 11 (Opposition)); (2) the ‘213 patent’s specification, 

explaining the shortcomings of prior authentication systems and how the alleged non-conventional 

arrangement of the claimed invention solves these problems (Dkt. No. 25 at 10 (Opposition)); and 

(3) claim construction (Id.). During the August 9, 2019 oral argument, when asked what, if any,

factual disputes existed precluding summary determination of eligibility, plaintiff again cited 

paragraphs 9-12 of the complaint and stated claim construction would create issues of fact. 

Transcript of August 9, 2019 Hearing at 8:16-25. The Court disagrees. 

First, paragraphs 9-12 of the complaint merely summarize the ‘213 patent’s functionality, 

stating in total: 

9. The inventions of the ‘213 patent generally relate to methods and systems for 

multi-factor authentication of users over multiple communications mediums.

10. The ‘213 patent discloses an Authentication Service Provider (“ASP”), which “is 

generally implemented above a software and hardware platform or platforms . . . that 

include operating systems, lower-level applications, and computer-server hardware." 

Ex. A at col. 4, ll. 13-16. “In many embodiments, the ASP . . . is a software 

implemented service that runs on one or more computer systems interconnected by 

various communications media with both ASP clients and users.” Id. at col. 2, ll. 47-

50. In certain embodiments, the “ASP may interact with the user via two different 

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communications media, such as a combination of the Internet and a cell phone.” Id. 

at col. 3, ll. 23-25.

11. In another example of disclosed embodiments, “[t]he [] third interface 208 allows 

the ASP to interface with user devices through alternative communications media, 

such as a cell phone, fax machine, telephone, or other communications devices. The 

third interface 208 allows the ASP to interface with virtually any network enabled 

resource through an appropriate medium, including both physical devices such as a 

cell phone, fax machine, telephone, or other communications devices, and also soft 

devices, such as an instant messaging account, or an email account.” Id. at col. 3, ll. 

37-46.

12. As one example of the asserted claim, the ‘213 patent recites a novel method

of providing a user-authentication policy that specifies constraints associated with 

user authentication processes carried out by the user authentication service. The 

constraints include different user-authentication service actions, such as 1) halting 

authorization service after detecting a specified event; 2) employing particular types 

of user-authentication procedures; or 3) providing alerts upon detecting specified 

events. (bolding added)

The closest any language in paragraphs 9-12 comes to raising an issue of fact is the bolded language 

in paragraph 12 above. But this is not enough. Although the Court must take the allegations in a 

well-pleaded complaint as true at this stage, the Court is not required to accept as true “allegations 

that are merely conclusory, unwarranted deductions of fact, or unreasonable inferences.” In re 

Gilead Scis. Sec. Litig., 536 F.3d 1049, 1055 (9th Cir. 2008); see also Uniloc USA Inc. v. LG Elecs. 

USA Inc., 379 F. Supp. 3d 974, 986-87 (N.D. Cal. 2019) (finding § 101 issues properly addressed 

in Rule 12 motion to dismiss where “[p]laintiffs’ second amended complaint features nothing but 

conclusions by, for instance, calling the ‘049 Patent ‘novel and inventive.’”). 

For the same reason, the patent’s specification—explaining shortcomings of prior 

authentication systems and alleging that the non-conventional arrangement of the claimed invention 

solves these problems—does not raise an issue of fact. In Cisco Sys. v. Uniloc USA, Inc., 386 F. 

Supp. 3d 1185, 1192 (N.D. Cal. 2019), this Court rejected a nearly identical argument, and it does 

so again here.

Finally, plaintiff’s claim construction argument also fails. Although the Federal Circuit has 

stated “that it will ordinarily be desirable—and often necessary—to resolve claim construction 

disputes prior to a § 101 analysis, for the determination of patent eligibility requires a full 

understanding of the basic character of the claimed subject matter[,]” it has also stated that “claim 

construction is not an inviolable prerequisite to a validity determination under § 101.” Bancorp 

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Servs., L.L.C. v. Sun Life Assur. Co. of Canada (U.S.), 687 F.3d 1266, 1273-74 (Fed. Cir. 2012). In 

any event, looking to the proposed terms and proposed construction in plaintiff’s brief (see Dkt. No. 

25 at 10 (Opposition)), the Court finds that construction of these terms would not aid or alter the 

Court’s determination today regarding the subject matter eligibility of the ‘213 patent.2

The Court finds that in the circumstances of this case it is appropriate to resolve the question 

of patent eligibility under § 101 on a Rule 12(b)(6) motion to dismiss. 

 

II. Step 1: Abstraction

The Supreme Court has not articulated a definitive rule to determine what constitutes an 

“abstract idea” sufficient to satisfy the first step of the Mayo/Alice inquiry. Rather, both the Federal 

Circuit and the Supreme Court have compared the claims at issue to claims already found to be 

directed to an abstract idea in previous cases. Alice, 527 U.S.. at 221 (“[The Court] need not labor 

to delimit the precise contours of the ‘abstract ideas’ category in this case. It is enough to recognize 

that there is no meaningful distinction between the concept of risk hedging in Bilski and the concept 

of intermediated settlement at issue here.”); see also Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 

1334-1335 (Fed. Cir. May 12, 2016). Fundamental economic and conventional business practices 

are often found to be abstract ideas, even if performed on a computer. See, e.g., OIP Techs., Inc. v. 

Amazon.com, Inc., 788 F.3d 1359, 1362 (Fed. Cir. 2015). Furthermore, a new application or 

computer-implemented function that simply utilizes a computer generally as a tool to conduct a 

known or obvious process will likely be considered abstract, whereas an application or computerimplemented function that improves the capability of the system, will overcome or avoid 

abstraction. Trading Techs. Int’l, Inc. v. CQG, Inc., 675 F. App’x 1001, 1005 (Fed. Cir. 2017).

For the action at bar, there are several cases directly on point to guide the analysis of the 

‘213 patent’s eligibility under § 101. First, in Asghari-Kamrani v. United Servs. Auto. Ass’n, No. 

 

2

 For purposes of the motion to dismiss, defendant accepted plaintiff’s proposed claim 

constructions as correct. Dkt. No. 26 at 18 (Reply Brief). Defendant points out, and the Court 

agrees, that plaintiff’s claim constructions do not transform claim 11 into patentable subject matter. 

Id. 

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2:15cv478, 2016 U.S. Dist. LEXIS 87065, at *3 (E.D. Va. July 5, 2016), affirmed by the Federal 

circuit,3the district court found a patent invalid where the patent was generally described as an 

“invention relat[ing] to a system and method provided by a Central-Entity for centralized 

identification and authentication of users and their transactions to increase security in e-commerce.” 

The ‘213 patent—described by plaintiff as generally relating to “methods and systems for multifactor authentication of users over multiple communications mediums”—is very similar. Compl. 

¶ 9. The representative claim in the Asghari case stated: 

A method for authenticating a user during an electronic transaction between the user 

and an external-entity, the method comprising:

receiving electronically a request for a dynamic code for the user by a computer 

associated with a central-entity during the transaction between the user and the 

external-entity;

generating by the central-entity during the transaction a dynamic code for the user in 

response to the request, wherein the dynamic code is valid for a predefined time and 

becomes invalid after being used;

providing by the computer associated with the central-entity said generated dynamic 

code to the user during the transaction;

receiving electronically by the central-entity a request for authenticating the user 

from a computer associated with the external-entity based on a user-specific 

information and the dynamic code as a digital identity included in the request which 

said dynamic code was received by the user during the transaction and was provided 

to the external-entity by the user during the transaction; and

authenticating by the central-entity the user and providing a result of the 

authenticating to the external-entity during the transaction if the digital identity is 

valid.

Id. at 5-6. With respect to the first Alice step, the court in Asghari ultimately concluded 

[a]ll of the claims in the ‘432 patent require the use of a computer. ... However, 

despite the electronic setting and purportedly Internet specific problem addressed, 

the patent claims are directed to a common method for solving an old problem. The 

claims are directed to the abstract idea of using a third party and a random, timesensitive code to confirm the identity of a participant to a transaction. This 

formulation is admittedly verbose. It is verbose because the patent claims combine 

two abstract ideas: the use of a third party intermediary to confirm the identity of a 

participant to a transaction and the use of a temporary code to confirm the identity 

of a participant to a transaction. It is an obvious combination, and nothing about the 

combination removes the patent claims from the realm of the abstract.

Id. at 11 (emphasis added). The Asghari court’s reasoning is relevant to the case at bar. The ‘213 

 

3 The procedural history of this case is summarized at 737 Fed.Appx. 539 (2018).

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patent is highly similar to the abstract ideas emphasized in the quote above. The Asghari court 

distinguished the patent there from patents that were not found to be abstract because the other 

patents “were directed to an improvement in computer technology.” Id. at 14. Here, there is no 

evidence that the ‘213 patent improves computer technology by making it faster, cheaper, or more 

efficient.

The second case particularly on point is Strikeforce Techs., Inc. v. SecureAuth Corp., No. 

LA CV17-04314 JAK (SKx), 2017 U.S. Dist. LEXIS 222516, at *4 (C.D. Cal. Dec. 1, 2017), aff’d, 

753 F. App’x 914 (Fed. Cir. 2019). In that case, the patents in dispute were directed 

to multichannel security systems and methods for authenticating a user seeking to 

gain access to a secure network. Such networks include those used for online 

banking, social networking and business activities. This field of technology is related 

to “out-of-band” authentication, or “two-factor” or “multi-factor” authentication.

Id. (citations omitted). Again, this case involved highly similar subject matter to the ‘213 patent. 

The plaintiff in Strikeforce made the same argument Smart Authentication makes here: that the 

patent in question addressed a technology-specific problem by providing a technology-specific 

solution. Dkt. No. 25 at 9 (Opposition) (“Thus, claim 11 provides a solution that is necessarily 

rooted in computer technology to overcome a problem specific to electronic communications.”); 

Strikeforce Techs., Inc., 2017 U.S. Dist. LEXIS 222516, at *9 (“Plaintiff argues that the Asserted 

Claims address a technology-specific problem by providing a technology-specific solution.”). This 

Court reaches the same conclusion as the court in Strikeforce: plaintiff has simply applied “familiar 

processes in the context of the use of computers that are connected to the internet.” Strikeforce 

Techs., Inc., 2017 U.S. Dist. LEXIS 222516, at *17. The ‘213 patent, like those in both Asghari

and Strikeforce, is abstract.

The third analogous case is Prism Technologies LLC v. T-Mobile USA, Inc., 696 Fed. Appx. 

1014 (Fed. Cir. 2017). Generally, the patent there related to “systems and methods [controlling] access 

to protected computer resources by authenticating identity data, i.e., unique identifying information of 

computer components.” Id. at 1016. The Federal Circuit found Prism’s patent abstract, and because it 

was directed to the abstract process of “(1) receiving identity data from a device with a request for access 

to resources; (2) confirming the authenticity of the identity data associated with that device; (3) 

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determining whether the device identified is authorized to access the resources requested; and (4) if 

authorized, permitting access to the requested resources.” Id. at 117. While Smart Authentication’s 

patent involves authentication using two electronic media, and Prism’s used different servers, the 

underlying principle is the same. 

The ‘213 patent lacks specificity and amounts to generalized steps using generic computer 

functionality. The patent describes a functional system and method that is not special in its 

composition or unique in terms of its result. There are no technical details; rather, the ‘213 patent 

offers a “myriad of software implementation choices” and a “wide variety” of communication 

channels to implement claim 11. Dkt. No. 25-2 at 16 (‘213 Patent). The patent does not state how 

it should be implemented. To the contrary, the ‘213 patent’s specification states:

[T]he ASP can be implemented in an almost limitless number of different ways, 

using different control structures, data structures, hardware and software platforms, 

modular organizations, protocols, and any of various other myriad software 

implementation choices and parameters .... ASPs may run on single server 

computers, on multi-processor systems, or on distributed computer systems. 

Multiple, geographically dispersed ASPs may be employed to efficiently handle 

ASP-client-transaction requests received through any of a wide variety of different 

types of communications media. 

Id. Thus, the ‘213 patent recites a method for authenticating a user in more than one way over 

multiple electronic mediums but does not provide any “unconventional, patentable combination,”

such that straightforward steps to be done on a computer are transformed into something nonabstract. California Inst. of Tech. v. Hughes Commc'ns, Inc., 59 F. Supp. 3d at 980.

Because the ‘213 patent is directed to the abstract idea of verifying the identify of a user in 

more than one way over multiple communications mediums, the Court must proceed to Step 2 of 

the Alice inquiry. 

III. Step 2: Inventive Concept

At step two of the Alice framework, the court considers the elements of each claim and asks, 

“what else is there in the claims before us?” Alice, 573 U.S. at 217. The Supreme Court describes 

this process as searching for an “‘inventive concept’—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 

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upon the [ineligible concept] itself.’” Id. at 217-18. For an abstract idea involving a computer to 

be patent-eligible, “the claim ha[s] to supply a ‘new and useful’ application of the idea.” Id. at 222 

(quoting Gottschalk v. Benson, 409 U.S. 63, 67 (1972)); see also Diamond v. Diehr, 450 U.S. 175, 

177 (1981) (validating a claim employing a mathematical equation used in a larger process designed 

to solve a technological problem in the molding of rubber products). An inventive concept occurs 

when the claims are “more than a drafting effort designed to monopolize the [abstract idea]” and 

“claims may be read to ‘improve[ ] an existing technological process.’” Bascom Glob. Internet 

Servs., Inc. v. AT&T Mobility LLC, 827 F.3d 1341, 1351 (Fed. Cir. 2016) (quoting Alice, 573 U.S. 

at 221-23). The court’s task at step two “is to ‘determine whether the claims do significantly more 

than simply describe [the] abstract method’ and thus transform the abstract idea into patentable 

subject matter.” Affinity Labs of Tex. v. DIRECTV, LLC, 838 F.3d 1253, 1262 (Fed. Cir. 2016) 

(citation omitted).

In its briefing and during the August 9, 2019 hearing, plaintiff argued its inventive concept 

is “the arrangement of the claimed combination in order to have multiple devices and multiple 

communications media in order to reliably authenticate remote users of electronic transactions.” 

Dkt. No. 25 at 16 (Opposition); August 9, 2019 Trial Transcript 15:8-13. Thus, the purported 

inventive concept simply restates the abstract idea the patent is directed to: verifying the identify of 

a user in more than one way over multiple communications media. What is needed to pass muster 

at step two of Alice is something “significantly more” than a description of the abstract idea itself, 

as the Federal Circuit explained in Affinity Labs. 838 F.3d at 1262. That case involved a patent with 

two independent claims “directed to streaming regional broadcast signals to cellular telephones 

located outside the region served by the regional broadcaster.” Id. at 1255. After finding the claims 

were directed to an abstract idea at step one, the court went on to find no inventive concept at step 

two. The court explained, “The claim simply recites the use of generic features of cellular 

telephones, such as a storage medium and a graphical user interface, as well as routine functions, 

such as transmitting and receiving signals, to implement the underlying idea.” Id. at 1262. Using 

well-known computer technology to authenticate a user – even using multiple electronic media to 

do so – amounts to functional use of familiar technology and is not inventive. 

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Plaintiff makes three overarching arguments with respect to the ‘213 patent’s inventiveness: 

(1) plaintiff argues that defendant’s “‘generic computer functionality’ test” fails because the ‘213 

patent’s specific combination of multiple user devices and communications media allegedly 

“transforms” the claim into a patent eligible application; (2) the ‘213 patent is inventive because it 

addresses the problem of “eavesdropping in communications networks”; and (3) claim 1, upon 

which claim 11 depends, “recites significant structural elements” that, according to plaintiff, amount 

to an inventive concept. Dkt. No. 25 at 16-18 (Opposition). The Court disagrees. 

First, the combination articulated in the patent is not transformative – especially because it 

can be applied in a “limitless number of different ways.” Dkt. No. 25-2 at 16 (‘213 Patent). Second,

while the ‘213 patent very well may address a problem unaddressed by prior art, that alone does not 

make the patent inventive. See Market Track, LLC v. Efficient Collaborative Retail Mktg., LLC,

No. 14 C 4957, 2015 U.S. Dist. LEXIS 75916, *23-25 (citing Parker v. Flook, 437 U.S. at 595 n.18 

(“When evaluating inventiveness, ‘[t]he mere fact that a patent asserts that it represents an 

improvement on prior art does not, of course, suffice. And ‘improvement,’ standing alone, is not in 

any event the sine qua non of patentability ... improvements must be the product of an inventive 

concept.’”)). 

Third, plaintiff’s structural elements argument fails – indeed, it is made half heartedly by 

simply listing/quoting various portions of claim 1 and 11 without stating why or how these structural 

elements amount to an inventive concept. Dkt. No. 25-2 at 16-17 (‘213 Patent). All the structural 

elements listed (computer systems, interface routines, user devices, etc.) were well-known and 

common place at the time the patent issued, and none provides a meaningful limitation. Alice, 527 

U.S. at 226 (“As a result, none of the hardware recited by the system claims offers a meaningful 

limitation beyond generally linking the use of the method to a particular technological environment, 

that is, implementation via computers.”) (internal quotation omitted). Plaintiff argues that the 

structural elements “even if determined to be ‘conventional,’ provide an ordered combination that 

is significantly more technical than” defendant argues. Dkt. No. 25 at 17 (Opposition). Again, this 

does not establish inventiveness, which seeks uniqueness and transformation, of which there is none 

here.

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Plaintiff submitted Cellspin Soft Inc. v. Fitbit, Inc., No. 2018-1817 (Fed. Cir. June 25, 2019) 

as supplemental authority, in support of its inventiveness argument. In Cellspin, the Federal Circuit 

affirmed the district court’s finding of the patent’s abstraction, but reversed the district court on step 

2, finding the patent at issue was in fact inventive. However, Cellspin does not advance plaintiff’s 

case in the action at bar. In that case, Cellspin argued its patent was inventive because it 

contemplated a less bulky and less expensive apparatus in terms of hardware – making it cheaper to 

build – and was also less expensive for the user. Cellspin Soft Inc. v. Fitbit, Inc., No. 2018-1817 

(Fed. Cir. June 25, 2019) at 18. Cellspin is also distinguished from the facts at bar because the 

ordered combination of elements was found to be inventive due to the combination fundamentally 

improving functionality. Smart Authentication has made no such showing here. 

The Court finds no inventive concept such that the ‘213 patent, despite being directed to an 

abstract idea, is transformed into patentable subject matter. Accordingly, the Court concludes that 

claim 11 of the ‘213 patent is invalid under § 101.

CONCLUSION

For the foregoing reasons and for good cause shown, the Court hereby GRANTS EA’s

motion to dismiss with prejudice.

IT IS SO ORDERED.

Dated: September 11, 2019

______________________________________

SUSAN ILLSTON

United States District Judge

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