Source: http://docketreport.blogspot.com/2016/06/
Timestamp: 2019-04-23 04:37:51+00:00

Document:
In a final written decision, the Board found the challenged claims of a electronic inventory tracking patent to be unpatentable under 35 U.S.C. § 101 and that the claims were directed to the abstract idea of inventory management. "[T]he challenged claims are directed to the abstract idea of inventory management that takes advantage of certain data and information that is collected, stored, evaluated, and used, and provides access to information based on assigned permissions and roles. The recited databases, software, computer, and assigned permissions or roles perform their normal functions, as used in their ordinary capacity. We are not persuaded 'the plain focus' of the challenged claims here 'is on an improvement to computer functionality itself, not on economic or other tasks for which a computer is used in its ordinary capacity.' Thus, we determine that challenged claims 67 and 70– 76 are directed to an abstract idea, and the first step in the Alice/Mayo test is met for those claims."
In the decision granting inter partes review, the Board rejected the patent owner's arguments that institution should be denied for failure to identify all real parties-in-interest. "The mere fact that members provide payment to [the petitioner] for a subscription to [the petitioner's] services is insufficient to show that these members are funding this particular inter partes review. The evidence does not show an obligation on [the petitioner's] part to file inter partes review proceedings on behalf of any member in return for payment, nor does it show that [the petitioner's] members have any control over when and how [the petitioner] spends the revenue received from its members. Instead, the evidence shows that [the petitioner] makes all decisions regarding any inter partes review proceeding without input from its members, and that [the petitioner] alone bears all costs of any such proceeding."
The newly assigned district judge sua sponte moved to reconsider the previous district judge's summary judgment ruling that plaintiffs' marketing analysis patents were invalid for lack of patentable subject matter under 35 U.S.C. § 101. "This Court has reviewed the [prior] patent decision and believes that it is in the interests of justice to reconsider that ruling. The Court believes that the district court may have misapprehended the patents; this Court has not reached a final resolution as to whether that requires reversal. . . . This Court does not believe additional briefing is necessary to such reconsideration but will nonetheless allow the parties to be heard on the substance of vacatur (the Court does not need briefing on the subject of its discretionary authority to sua sponte revisit prior decisions in a pending case)."
Following a consent judgment, the court granted defendants' motion for attorney fees under 35 U.S.C. § 285 in the first phase of the parties' litigation and rejected plaintiff's argument that an award of fees was premature. "Defendants’ position is more faithful to proper interpretation of Rule 54 and 35 U.S.C. § 285, and reflects the superior policy position with regard to shifting attorney’s fees in a complex, protracted patent case. . . . Phase I was a complete victory for the Defendants, and it concluded with a judgment . . . of noninfringement as to four patents. . . . [I]n complex patent litigation, determinations of prevailing party status during each 'phase' of litigation may be the only practical way to achieve the purposes inherent to making an exceptional case determination under 35 U.S.C. § 285. . . . Importantly, making a § 285 determination at the conclusion of a phase of litigation will, ideally, have the salutary effect of curbing exceptional conduct in future phases. In the absence of a rule permitting exceptional case determinations at the conclusion of a 'phase' of a case, a litigant with many patents and an exceptionally weak substantive litigating position could continually delay the conclusion of a case, thus frustrating the ability of the Court to enter a 35 U.S.C. § 285 determination and impose meaningful sanctions."
The court denied defendant's motion for judgment as a matter of law that it did not willfully infringe plaintiff's capacitor patent and rejected defendant's argument that the jury finding of willful infringement was void under a recent Federal Circuit decision. "In [Halo Elecs., Inc. v. Pulse Elecs., Inc., No. 14-1513, 579 U.S. __ (June 13, 2016)], the Supreme Court rejected the Federal Circuit’s two-part test from Seagate for determining when a district court may award enhanced damages as inconsistent with § 284. The Supreme Court explained that § 284 commits the award of enhanced damages to the discretion of the district court. . . . In the present case . . . [t]he jury . . . found by clear and convincing evidence that [defendant's] infringement of the [patent-in-suit] was willful. . . . [Defendant] is correct that in Halo, the Supreme Court held that the ultimate decision of whether to award enhanced damages and in what amount is committed to the sound discretion of the trial court. But there is no language in Halo holding that a finding as to whether the infringement was willful must be made by the Court. . . . [T]he Court properly permitted the jury to issue a finding as to whether [defendant's] infringement was willful and the jury’s finding as to this issue is not void."
On May 11, 2016, President Obama signed into law a bill that amends the federal criminal code to create a private civil cause of action for trade secret misappropriation.
Under the new law, called the Defend Trade Secrets Act of 2016 (DTSA) a trade secret owner may file a civil action in a U.S. district court seeking relief for trade secret misappropriation related to a product or service in interstate or foreign commerce. The bill establishes remedies including injunctive relief, compensatory damages, and attorney's fees, and sets a three-year statute of limitation from the date of discovery of the misappropriation.
As of this writing, new DTSA claims have been filed in at least 15 federal cases. Docket Navigator is expanding its coverage to include several new practice areas, including DTSA. Unfortunately, PACER’s case classification categories do not yet include DTSA claims, so identifying cases asserting those claims presents a challenge. The process will be significantly improved once PACER creates a Nature of Suit flag for DTSA cases.
As we discover additional DTSA cases, they will be added to the list in real time. Docket Navigator subscribers can create an alert on the link above to be notified of new DTSA cases. In addition, subscribers may click on an individual case to be notified when new documents are filed in that case.
If you are aware of a DTSA case that does not appear in the list above, please contact us with the information.
The court granted defendants' motion to dismiss because the asserted claims of plaintiff’s digital color selection patent encompassed unpatentable subject matter and found that the claims were directed toward a mathematical algorithm. "[The patent-in-suit] is directed to a method of selecting a color for a portion of a digital image by calculating and comparing various vectors within a specific region of space, known as a 'steradian.' . . . [Defendants] contend that the steps of claim 1 only explain how to calculate two vectors, calculate a steradian region, determine whether those vectors are located in that steradian region, compare the length of the vectors and then use that information to derive color information for the two vectors. . . . Plaintiff goes to great lengths to argue that '[s]pace is not abstract,' but is instead 'a region, and real object, we all exist in.' Plaintiff relies on the contentions that space 'exists literally' and that the computer calculations in claim 1 'bring[ ] a particular steradian . . . into existence' to support his assertion that claim 1 is directed to 'Real Objects' rather than to an abstract idea. The critical flaw with this argument, however, is that the [patent-in-suit] does not claim 'space.' Instead, it claims methods of calculating a region of space and comparing various calculations to choose a pixel color."
The court denied defendants' motion to stay pending inter partes review and found that the undue prejudice to plaintiff resulting from defendants' delay in filing their petitions weighed against a stay. "Defendants did not file their IPRs expeditiously and are most likely seeking a stay to gain a tactical advantage over [plaintiff]. . . . Defendants filed three IPR petitions on . . . the last day of the '1 year' period under which Defendants were permitted to file IPRs. Defendants offer no reason for filing their IPRs on the last day. As [plaintiff] points out, Defendants identified relevant prior art at least six months before they filed their IPRs, when they served their infringement contentions . . . . Indeed, this case presents a good example of why filing IPRs near the end of the one-year period tends to prejudice the non-moving party. . . . [S]taying the case will delay a resolution on the merits and require [plaintiff] to warehouse discovery results that it diligently worked with third-parties for months to collect."
The court granted defendant's motion for judgment on the pleadings that the asserted claims of plaintiff’s attention management patent encompassed unpatentable subject matter and found that the claims were directed toward an abstract idea. "[Plaintiff] argues that the claims are 'directed to the operation of an attention manager system,' which, as construed by the Federal Circuit, is a not an abstract idea but rather a 'multi-tiered, networked architecture of computers that communicates in a predefined manner to facilitate the automatic provision of information from multiple content providers to an interested user in a non-invasive manner.'. . . [T]he asserted claims are directed to the abstract idea of providing information to a person without interfering with the person’s primary activity. This basic and longstanding practice can be found in, for example, a television station’s use of a breaking news ticker across the bottom of the screen. The text-only news ticker provides information to viewers without interfering with the primary activity: the main story then being reported by the on-screen news anchor. Similarly, a lawyer’s legal assistant may provide her with messages or mail in a manner that does not interfere with her primary activity: participating in a conference call. This could be accomplished at a certain time (delivering the message between telephone calls) or in a certain location (placing the message in the corner of her desk)."
Following a jury verdict of willful infringement and a damages award of $1.5 million, the court awarded plaintiff an additional $1 million in enhanced damages because defendant's copying, lack of a good faith belief of no liability, litigation conduct, size/financial condition, lack of closeness of the case, and lack of remedial action favored an award of enhanced damages. "The fact that [defendant] partnered with [a nonparty] and directed them to develop the software portion of the infringing [systems] does not preclude a finding that [defendant] copied [plaintiff's] technology. An infringer can copy another person’s patented invention even though the infringer directs another to build the copy. . . . A belief that individual components of a patented system are not themselves patentable is not a good faith belief of noninfringement or invalidity. . . . [Defendant] was provided with highly confidential information regarding [plaintiff's] system and the evidence shows that [defendant] knew [plaintiff's] system was patented — yet there is no evidence that [defendant] made an investigation into the scope of [plaintiff's] patent rights, made any attempt to design around the patent, or had a good faith belief of noninfringement. . . . [T]his was not a close case and given the reasonable relief [plaintiff] requested, it could have been resolved in a more efficient manner. . . . [Defendant] is an international company of about 1,100 employees. . . . A trebled damage award of $4,623,999 would represent less than one percent of [defendant's] annual revenue, or approximately nine percent of the revenue of the relevant business division. . . . As previously detailed throughout this Order, [defendant's] noninfringement defenses were not strong. . . . [Defendant argues] that it took remedial action by removing the [infringing] hardware from its . . . vehicles following the Court’s preliminary injunction. [Defendant] confuses compliance with the preliminary injunction with remedial action."
The court denied in part defendant's request for attorney fees under 35 U.S.C. § 285 because the forum rate rule applied. "[Defendant] argues that the exception to the forum rate rule applies because the case required the special expertise of its out-of-state counsel. . . . [Defendant] does not indicate that Delaware counsel were unwilling to litigate the case. . . . [Defendant] has not presented specific evidence that patent cases involving vehicles, as opposed to other types of technologies, require specialized expertise. Further, I accept [defendant's] representation that its [out-of-state] counsel were able to achieve certain efficiencies by virtue of representing [defendant] in the patent litigation pending concurrently with this case and in other cases. Still, that the [out-of-state] attorneys had prior experience litigating cases in which [defendant's] vehicles were at issue does not prove that no local attorneys had the expertise necessary to litigate the case."
The court granted defendant's motion to stay pending inter partes review and rejected plaintiff's argument that the Supreme Court's pending review of a case supported plaintiff's argument of a lack of potential simplification of issues. "Plaintiff responds that IPR may not simplify the issues of the case because the PTAB’s 'broadest reasonable interpretation' standard for claim construction is currently under review by the United State Supreme Court in Cuozzo Speed Technologies, LLC v. Lee, U.S. No. 15-446, and that the PTAB’s decision in Defendant’s IPR turned on the BRI standard of claim construction. Plaintiff therefore argues that a stay should not be granted because the IPR decision may not simplify the issues for trial if the BRI claim construction standard is incompatible with a patent’s presumption of validity. The Court agrees with Defendant, however, that it would be improper to suspend the application of current law based on speculation as to the Supreme Court’s decision in Cuozzo."
The court granted defendant's motion to dismiss because the asserted claims of plaintiff’s telehealth patent encompassed unpatentable subject matter and found that the claims were directed toward an abstract idea. "[Plaintiff's] claims are directed to a patent-ineligible abstract idea: setting up consultations between patients and available healthcare providers. . . . [Plaintiff] contends that because the concept of tracking the instant availability of doctors is not found in the pre-internet era, it is not in the category of long-standing, fundamental economic practices that generally constitute abstract ideas. . . . The claims nevertheless embody the abstract idea of connecting a patient with an available doctor. The claims involve a method of 'organizing human activity,' and they constitute an 'idea, having no particular concrete or tangible form.' The preemption concerns raised by [plaintiff] underscore this point. Allowing [plaintiff] to patent the idea of using a computer to connect a patient with an available doctor would effectively grant a monopoly over an abstract idea."
Following claim construction, the court granted defendant's motion for summary judgment that it did not infringe plaintiff's secure bootstrap architecture patent either literally or under the doctrine of equivalents. "This action concerns the manner in which [defendant's] iPhone, iPad, and iPod Touch devices boot up. . . . [The patent-in-suit] describes techniques for booting a computer system in a secure manner. . . . [Defendant] contends that because the accused products require human intervention to recover, they cannot infringe the asserted claims. [Plaintiff] responds that [defendant's] products do recover automatically once the user has plugged the device into a computer and affirmatively initiated the recovery process and because the devices enter 'recovery mode' automatically (although, again, they cannot recover without human interaction). [Plaintiff's] argument seeks a second bite at claim construction by trying to ignore the automatic limitation. . . . Tellingly, no claim element reads on these instances of human interaction. . . . [Defendant's] recovery procedure that required human intervention could be equivalent to automatic recovery even though the former failed to address all of the problems solved by the latter, that would vitiate the automatic limitation present in the properly construed claims. Plainly, the inventors did not view these as equivalent when they expressly described previous efforts that required human interaction as 'inferior to the present invention.'"
The court granted defendant's motion for judgment on the pleadings that the asserted claims of plaintiff’s computer memory testing patents encompassed unpatentable subject matter and found that the claims were directed toward an abstract idea. "[E]ach of the asserted claims, at its heart, is directed to the use of a simulator to determine whether a memory test violates a set of rules. . . . Although Plaintiff contends that 'the [a]sserted [c]laims improve the functioning of the computer itself,' that conclusion does not follow from the specification of the [patents] or the asserted claims. The [patents] are directed to methods of verifying and optimizing memory tests, not to improving the computer or software components used to carry out those methods. . . . [T]he primary improvement cited by Plaintiff — the efficient generation of memory tests for modern, complex memory devices — is not reflected in the limitations of the asserted claims. . . . [T]he asserted claims’ reflection of generic, and conventional, computerization of processes previously performed by humans without computers confirms the Court’s conclusion that the asserted claims are directed to patent-ineligible abstract ideas."
The court denied defendant's motion to dismiss on the ground that plaintiff’s dental laser patent encompassed unpatentable subject matter because the claims were not directed to a law of nature. "[Defendant] fails to indicate what portion of the patent claims appear to claim for itself a particular equation or law of nature. This is not an example of simply stating 'apply it' after reciting a law of nature. The patent does not, in fact, recite a law of nature. [Defendant's] characterization of what constitutes a law of nature or a natural phenomena for purposes of the [Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 134 S. Ct. 2347 (2014)] step one analysis is precisely what the Alice Court warned would 'swallow all of patent law' when the analysis goes too far. . . . The claims are not directed to the use of the electromagnetic spectrum, or the qualities of light broadly, but are specifically directed to a method and system of using laser beams of ultrashort duration. . . . The discovery that the material-removing properties of ultrashort pulsed lasers have beneficial effects is 'not nature’s handiwork' but rather the work of the inventor of the subject matter here."
Although the court found that the case was exceptional under 35 U.S.C. § 285, it awarded plaintiff $0 in attorney fees because plaintiff failed to provide sufficient documentation of its claimed fees. "Despite three separate opportunities in its motion for attorneys’ fees, reply, and sur-surreply, [plaintiff] has not documented the work counsel performed in a manner that would allow the court to make its lodestar calculations. Instead, [plaintiff] basically asks the court to take its word for it in terms of what constitutes a reasonable amount of fees and costs. Although the court continues to believe this case was 'exceptional' within the meaning of 35 U.S.C. § 285, [plaintiff] has not met its burden. . . . Further, [plaintiff's] offer to allow in camera review is not sufficient. Opposing counsel has the right to challenge the basis for a fee award, and the court is entitled to opposing counsel’s views. . . . [Plaintiff] argues that it is precluded from producing invoices with descriptions of the work performed because such descriptions are protected by attorney-client privilege. . . . Not only does the case law not support its argument, but [plaintiff] filed motions to seal its motion, reply, and sur-surreply, which should have tempered any privilege concerns."
The court denied plaintiff's motion for judgment on the pleadings that defendant's electronic message delivery patents encompassed unpatentable subject matter because the claims did not lack an inventive concept. "[Plaintiff] argues that the patents-in-suit simply duplicate a pre-internet business practice on the internet because the patents-in-suit allegedly acknowledge that their solution is directed at the same problem that exists with regular mail, namely proof of delivery. The patents-in-suit, however, address more than that. More importantly, the patents-in-suit aim to solve a technical problem of electronic messages, which because of their form, present unique challenges for establishing proof of receipt and delivery. The patents-in-suit thus use an intermediate server between the sender and receiver of an electronic message to address the problem of providing reliable proof of the content and delivery of electronic messages, without requiring the cooperation of the recipient and without requiring special email software. The patents-in-suit’s technical solution thus satisfies step two of the analysis under [Alice Corp. Pty. v. CLS Bank Int’l, 134 S. Ct. 2347 (2014)]."
The court sua sponte sanctioned defendant for failing to adequately respond to plaintiff's document requests. "Rather than conduct a complete search of all corporate files, defendant and counsel for defendant have instead taken a piecemeal approach to discovery, reviewing only the files of select corporate employees. This approach is contrary to the Federal Rules of Civil Procedure and to repeated orders of this court. . . . Although plaintiff has not expressly requested an award of attorney’s fees, defendant’s repeated failure to comply with this court’s orders warrants sanctions and an award of fees. . . . The court already has ordered defendant to pay the reasonable attorney’s fees of plaintiff associated with two recent discovery motions. It is evident, however, that defendant’s extended delay in responding to discovery requests has caused plaintiff to incur attorney’s fees and expenses well beyond those associated with the two recent motions."
The court granted defendant's motion to dismiss because the asserted claims of plaintiff’s video game updating patent encompassed unpatentable subject matter and found that the claims were directed toward an abstract idea. "The claims recite a simple internet-based method of updating the software of sports video games. This is an abstract idea — updating software in sports video games — and it is performed on a conventional computer, server, and network. . . . [T]he Patent claims do nothing more than recite the performance of a long-established business practice — re-writing software to produce an updated version — using a general purpose computer and the internet. . . . The fact that the Patent is limited to the specific field of use of sports video games, or that it is performed over the internet, makes no difference."
In a final written decision, the Board found claims of a patent directed to a data security system unpatentable under 35 U.S.C. § 101. "[W]e are persuaded by Petitioner that the claims are directed to the abstract idea of determining whether access to data should be granted based on whether one or more rules are satisfied. . . .The databases and access rules recited in claims 1 and 8 perform their normal functions and achieve expected results. The protection of data in a database at the data element level still comports with the abstract idea of determining whether access to data should be granted based on whether one or more rules are satisfied. . . . We are also mindful of recent admonishments by the Federal Circuit that the first step of our analysis should not be pro forma when the claims are directed to improvements in software. See Enfish, LLC v. Microsoft Corp., No. 2015-1244 , 2016 WL 2756255, at *4 (Fed. Cir. May 12, 2016) . . . We are not persuaded, however, that the instant claims are directed to a specific improvement to the way computers operate."
The court granted defendant's motion to dismiss because the asserted claims of plaintiff’s computer memory hierarchy patent encompassed unpatentable subject matter and found that the claims were directed toward an abstract idea. "[T]he claims are directed to the abstract idea of categorical data storage. Humans have categorized data for many years. . . . This is an 'undisputably well-known' practice that 'humans have always performed.' . . . Courts have routinely found that similar claims are directed to abstract ideas. . . . Plaintiff relies on the Federal Circuit's recent decision in [Enfish, LLC v. Microsoft Corp., (Fed. Cir. May 12, 2016)] for the proposition that claims which 'improve the functioning of a computer itself' are patent eligible. . . . [H]owever, the question of whether a given claim 'improve[s] the way a computer [works]' is not, by itself, determinative. . . . [Enfish] described the central question as 'whether the focus of the claims is on the specific asserted improvement in computer capabilities (i.e., the self-referential table for a computer database) or, instead, on a process that qualifies as an 'abstract idea' for which computers are invoked merely as a tool.' . . . Enfish is thus best understood as a case which cautions against oversimplification during step one of Mayo/Alice, rather than a case which exempts from § 101 scrutiny all patents which purport to improve the functioning of a computer. . . . Here, there is no analog to the 'specific type of data structure' that was found sufficiently un-abstract in Enfish. Although the claims 'touch on what is asserted to be an improvement to . . . computer capabilities,' they are not 'directed to a 'specific' or 'concrete' improvement in the way software operates,' but instead are 'directed to . . . the mere idea of' categorical data storage."
In a final written decision, the Board found claims of a patent directed to a portable data storage device unpatentable under 35 U.S.C. § 101. "Petitioner argues that claims 13 and 14 are directed to the abstract idea of 'licensing/regulating access to copyrighted content.' Although [patent owner] does not concede, in its brief, that claims 13 and 14 are directed to an abstract idea, it does not persuasively explain how the challenged claims escape being classified as abstract. We are persuaded that claims 13 and 14 are drawn to an abstract idea. Specifically, claims 13 and 14 are directed to performing the fundamental economic practice of conditioning and controlling access to content based on payment. . . . Although the specification refers to data piracy on the Internet, claims 13 and 14 are not limited to the Internet. . . .The underlying concept of claims 13 and 14, particularly when viewed in light of the ’720 patent specification, is conditioning and controlling access to content based upon payment. This is a fundamental economic practice long in existence in commerce. We are, thus, persuaded, based on the ’720 patent specification and the claim language, that each of claims 13 and 14 is directed to an abstract idea."

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