Court Opinion

ID: 9916175
Source: CourtListenerOpinion
Date Created: 2024-01-09 16:01:30.535179+00
Date Added: 2024-06-11T13:24:20.683184
License: Public Domain

Case: 22-1861   Document: 53     Page: 1   Filed: 01/09/2024

        NOTE: This disposition is nonprecedential.

   United States Court of Appeals
       for the Federal Circuit
                 ______________________

      INTERNATIONAL BUSINESS MACHINES
               CORPORATION,
               Plaintiff-Appellant

                            v.

        ZILLOW GROUP, INC., ZILLOW, INC.,
               Defendants-Appellees
              ______________________

                       2022-1861
                 ______________________

    Appeal from the United States District Court for the
 Western District of Washington in No. 2:20-cv-01130-TSZ,
 Senior Judge Thomas S. Zilly.
                  ______________________

                Decided: January 9, 2024
                 ______________________

    GOUTAM PATNAIK, Desmarais LLP, Washington, DC,
 argued for plaintiff-appellant. Also represented by JOHN
 M. DESMARAIS, KARIM ZEDDAM OUSSAYEF, WILLIAM N. YAU,
 New York, NY.

    STEVEN M. SEIGEL, Susman Godfrey LLP, Seattle, WA,
 argued for defendants-appellees. Also represented by IAN
 B. CROSBY, KATHERINE MARIE PEASLEE, DANIEL J. SHIH;
 SHAWN DANIEL BLACKBURN, Houston, TX.
Case: 22-1861     Document: 53     Page: 2    Filed: 01/09/2024

 2                                   IBM v. ZILLOW GROUP, INC.

                   ______________________

     Before PROST, HUGHES, and STOLL, Circuit Judges.
 Opinion for the court filed by Circuit Judge HUGHES.
     Concurring-in-part, dissenting-in-part opinion filed by
 Circuit Judge STOLL.
 HUGHES, Circuit Judge.
     International Business Machines Corp. (IBM) appeals
 a decision from the Western District of Washington con-
 cluding that all patent claims asserted against Zillow
 Group, Inc. are directed to ineligible subject matter under
 35 U.S.C. § 101. Because we agree that all asserted claims
 are ineligible and the pleadings thus fail to state a claim
 upon which relief can be granted, we affirm the district
 court’s grant of Zillow’s motion to dismiss under Federal
 Rule of Civil Procedure 12(b)(6).
                               I
                               A
      At issue in this appeal are two patents that IBM owns,
 U.S. Patent Nos. 6,778,193 and 6,785,676. The ’193 patent
 is directed to a “graphical user interface for a customer self
 service system that performs resource search and selec-
 tion.” ’193 patent at Abstract. The claimed invention seeks
 to enhance how search results are displayed to a user by
 offering three “visual workspaces” that streamline how us-
 ers input search information. A user begins by entering
 their search query into a “Context Selection Workspace.”
 ’193 patent at 4:61–64. Next, a user can further specify the
 details of their search in a “Detail Specification Work-
 space.” ’193 patent at 4:65–67. Finally, a user can view the
 results of their search in a “Results Display Workspace.”
 ’193 patent at 5:1–2. Representative claim 1 is as follows:
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 IBM v. ZILLOW GROUP, INC.                                   3

 1. A graphical user interface for a customer self service sys-
 tem that performs resource search and selection compris-
 ing:
       a first visual workspace comprising entry field ena-
       bling entry of a query for a resource and, one or more
       selectable graphical user context elements, each ele-
       ment representing a context associated with the cur-
       rent user state and having context attributes and
       attribute values associated therewith;
       a second visual workspace for visualizing the set of
       resources that the customer self service system has
       determined to match the user’s query, said system
       indicating a degree of fit of said determined re-
       sources with said query;
       a third visual workspace for enabling said user to se-
       lect and modify context attribute values to enable in-
       creased specificity and accuracy of a query’s search
       parameters, said third visual workspace further en-
       abling said user to specify resource selection param-
       eters and relevant resource evaluation criteria
       utilized by a search mechanism in said system, said
       degree of fit indication based on said user’s context,
       and said associated resource selection parameters
       and relevant resource evaluation criteria; and, a
       mechanism enabling said user to navigate among
       said first, second and third visual workspaces to
       thereby identify and improve selection logic and re-
       sponse sets fitted to said query.
     The ’676 patent is also directed to improving how
 search results are displayed to users. ’676 patent at Ab-
 stract. Specifically, the ’676 patent discloses a method of
 “annotating resource results obtained in a customer self
 service system that performs resource search and selec-
 tion.” ’676 patent at 3:6–8. Representative claim 14 lays out
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 4                                  IBM v. ZILLOW GROUP, INC.

 a four-step process for annotating and presenting search
 results:
 14. A method for annotating resource results obtained in a
 customer self service system that performs resource search
 and selection, said method comprising the steps of:
       a) receiving a resource response set of results ob-
       tained in response to a current user query;
       b) receiving a user context vector associated with
       said current user query, said user context vector
       comprising data associating an interaction state
       with said user and including context that is a func-
       tion of the user;
       c) applying an ordering and annotation function for
       mapping the user context vector with the resource
       response set to generate an annotated response set
       having one or more annotations; and,
        d) controlling the presentation of the resource re-
       sponse set to the user according to said annotations,
       wherein the ordering and annotation function is ex-
       ecuted interactively at the time of each user query.
                              B
     IBM sued Zillow in the Western District of Washington
 for allegedly infringing five patents. The claims related to
 two of the patents were dismissed. For the remaining three
 patents, Zillow filed a motion to dismiss under Rule
 12(b)(6), arguing that all asserted claims are ineligible un-
 der 35 U.S.C. § 101. Only two of those patents, the ’676 pa-
 tent and the ’193 patent, are appealed here.
      For the ’676 patent, the district court found that the
 asserted claims of the ’676 patent were “aimed at offering
 a user ‘the most beneficial and meaningful way’ to view the
 results of a query . . . and not at advancing computer capa-
 bilities per se.” J.A. 29 (quoting ’676 patent at Abstract).
 The district court noted that the claims only recite four
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 IBM v. ZILLOW GROUP, INC.                                    5

 steps for improving search results: “(i) receiving a set of re-
 sults; (ii) receiving a vector of data associated with the
 user; (iii) mapping the vector against the set of results to
 generate an annotated set of results; and (iv) presenting
 the annotated set of results to the user in a manner con-
 sistent with the annotations, which are produced upon
 each user query.” J.A. 31. Based on these steps, the district
 court noted that the processes could “be performed with a
 pen and paper, albeit not with the speed of a computer, and
 they are focused on the intangible of information,” and fur-
 ther that the claims were merely “result[s]-oriented.” J.A.
 31. The district court found the asserted claims of the ’676
 patent ineligible under § 101.
      Turning to the ’193 patent, the district court took a sim-
 ilar approach and held that the two representative claims,
 claims 1 and 8, were ineligible. The district court found
 that the claims were directed to the abstract idea of “more
 precisely tailoring the outcome of a query by guiding users
 (via icons, pull-down menus, dialogue boxes, and the like)
 to make choices about specific context variables, rather
 than requiring them to formulate and enter detailed search
 criteria.” J.A. 20 (footnote omitted). Although IBM argued
 that user context icons, separate workstations, and itera-
 tive navigation were inventive concepts, the district court
 did not find IBM’s inventive concepts to be anything more
 than what was well-understood, routine, or conventional at
 the time of the invention. Instead, the district court found
 that these benefits “do[] not, however, concern the com-
 puter’s or graphical user interface’s capability or function-
 ality; [they] relate[] merely to the user’s experience and
 satisfaction with the search process and results.” J.A. 22.
 The district court similarly found the asserted claims of the
 ’193 patent ineligible under § 101.
    IBM now appeals. We have jurisdiction under 28
 U.S.C. § 1295(a)(1).
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 6                                     IBM v. ZILLOW GROUP, INC.

                                II
                                A
      We review the grant of a Rule 12 motion under the law
 of the regional circuit. Cellspin Soft, Inc. v. Fitbit, Inc., 927
 F.3d 1306, 1314 (Fed. Cir. 2019). The Ninth Circuit reviews
 motions granted under Rule 12(b)(6) de novo. Id. (citing
 Chavez v. United States, 683 F.3d 1102, 1108 (9th Cir.
 2012)). Under this standard, we “determine whether the
 facts alleged in the complaint, taken as true, entitle the
 plaintiff to a legal remedy.” Id. (internal quotation mark
 and citation omitted). We review a district court’s determi-
 nation of patent eligibility under § 101 de novo, though the
 inquiry may contain underlying issues of fact. Cooperative
 Ent., Inc. v. Kollective Tech., Inc., 50 F.4th 127, 130 (Fed.
 Cir. 2022) (citing Berkheimer v. HP Inc., 881 F.3d 1360,
 1365 (Fed. Cir. 2018)).
                                B
      The Supreme Court has laid out a two-step framework
 for evaluating patent eligibility in Alice Corp. v. CLS Bank
 International, 573 U.S. 208 (2014) and Mayo Collaborative
 Services v. Prometheus Laboratories, Inc., 566 U.S. 66
 (2012). At step one, we determine whether a patent claim
 is directed to an unpatentable law of nature, natural phe-
 nomena, or abstract idea. Alice, 573 U.S. at 218. “In cases
 involving software innovations, [the step one] inquiry often
 turns on whether the claims focus on specific asserted im-
 provements in computer capabilities or instead on a pro-
 cess or system that qualifies [as] an abstract idea for which
 computers are invoked merely as a tool.” TecSec, Inc. v.
 Adobe Inc., 978 F.3d 1278, 1293 (Fed. Cir. 2020) (citation
 omitted). Furthermore, “improving a user’s experience
 while using a computer application is not, without more,
 sufficient to render the claims” patent-eligible at step one.
 Customedia Techs., LLC v. Dish Network Corp., 951 F.3d
 1359, 1365 (Fed. Cir. 2020); see also IBM Corp. v. Zillow
 Group, Inc., 50 F.4th 1371, 1377 (Fed. Cir. 2022) (quoting
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 IBM v. ZILLOW GROUP, INC.                                   7

 and applying TecSec, 978 F.3d at 1293 and Customedia,
 951 F.3d at 1365). “In applying step two of the Alice analy-
 sis, we ‘determine whether the claims do significantly more
 than simply describe [the] abstract method’ and thus trans-
 form the abstract idea into patentable subject matter.” In-
 tell. Ventures I LLC v. Cap. One Fin. Corp., 850 F.3d 1332,
 1341 (Fed. Cir. 2017) (quoting Ultramercial, Inc. v. Hulu,
 LLC, 772 F.3d 709, 715 (Fed. Cir. 2014)). We evaluate
 whether the claims disclose “additional features . . . that
 constitute an inventive concept” and are “more than well-
 understood, routine, conventional activity.” Id. (cleaned
 up).
                              III
     For both patents, IBM argues that the district court
 erred in granting Zillow’s motion to dismiss because IBM’s
 complaint and inventor declaration, at a minimum, allege
 enough to survive the pleading stage. For the ’676 patent,
 IBM also argues that the district court erred by failing to
 resolve a claim construction dispute over the term “user
 context vector.” We address each argument in turn.
                               A
     We begin with the ’193 patent. IBM argues that the
 district court erred at Alice step one by “overgeneralizing
 the ’193 patent to an abstract idea based on inaccurate
 analogies to manual pen-and-paper methods.” Appellant’s
 Br. 44. In the alternative, IBM argues that judgment on
 Zillow’s motion to dismiss is precluded at step two because
 its allegations of inventiveness, at a minimum, clear the
 pleading threshold. Id. at 56. We disagree with both argu-
 ments.
       The district court concluded that the claims of the ’193
 patent “possess the following indicia of abstractness: (i) de-
 scribing processes that can be performed with a pen and
 paper; (ii) using claim language that is result-oriented; and
 (iii) focusing on an intangible, namely information.” J.A.
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 8                                   IBM v. ZILLOW GROUP, INC.

 18. The district court also concluded that the ’193 patent
 “merely mimics what humans do to search for information,
 with the added feature of conducting the entire exercise on
 a computer.” J.A. 18.
     We agree. The claims of the ’193 patent do nothing
 more than improve a user’s experience while using a com-
 puter application and are precisely the types of claims that
 we have held are abstract at step one in cases such as Cus-
 tomedia and IBM. Here, IBM fails to explain how the
 claims do anything more than “[i]dentify[], analyz[e], and
 present[] certain data to a user,” which we explained in
 IBM is “not an improvement specific to computing.” IBM,
 50 F.4th at 1378. The claims here do not disclose any tech-
 nical improvement to how computer applications are used.
 We agree with the district court’s characterization of the
 ’193 patent and thus conclude that, at Alice step one, the
 ’193 patent is directed to a patent-ineligible abstract idea.
     The ’193 patent fares no better at Alice step two. We
 agree with the district court that IBM’s allegations of in-
 ventiveness “do[] not . . . concern the computer’s or graph-
 ical user interface’s capability or functionality, [but]
 relate[] merely to the user’s experience and satisfaction
 with the search process and results.” J.A. 22.
     Pointing to our recent decision in Weisner v. Google
 LLC, 51 F.4th 1073 (Fed. Cir. 2022), IBM argues that the
 district court failed to “accept IBM’s well-pleaded factual
 allegations as true and construe all reasonable inferences
 in favor of IBM” at the Rule 12 stage. ECF No. 50 at 2 (Ci-
 tation of Supplemental Authority for Appellant IBM). In
 Weisner, we held that allegations of inventiveness for pa-
 tents directed to a “specific technique for using physical lo-
 cation history data to improve computerized search
 results” satisfied the pleading requirement under Rule 12.
 51 F.4th at 1086. We also noted that the specification for
 those patents included a “specific implementation” of
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 IBM v. ZILLOW GROUP, INC.                                   9

 improving search results, rather than a simple conceptual
 description of an improvement. Id.
     Even so, we have repeatedly held that “the district
 court need not accept a patent owner’s conclusory allega-
 tions of inventiveness.” IBM, 50 F.4th at 1379. And even
 where claims, faced with a § 101 challenge, have survived
 the pleading stage, we have cautioned that generic allega-
 tions of inventiveness are insufficient. Cellspin, 927 F.3d
 at 1317 (“[W]e do not . . . say that any allegation about in-
 ventiveness, wholly divorced from the claims or the speci-
 fication, defeats a motion to dismiss.”). Here, the
 allegations of inventiveness are not tied to the claims or the
 specification, and thus cases such as Weisner are distin-
 guishable. For example, the inventor declaration accompa-
 nying IBM’s first amended complaint explains that “one of
 the key innovative aspects of the invention of the ’193 pa-
 tent was not just the multiple visual workspaces alone, but
 how these various visual workspaces build upon each other
 and interact with each other,” as well as “the use of one
 visual workspace to affect the others in a closed-loop feed-
 back system.” J.A. 1184. But neither the claims nor the
 specification include any such information, and these por-
 tions of the declaration do not cite the patent at all. Simply
 including allegations of inventiveness in a complaint, de-
 tached from what is claimed or discussed in the patent,
 does not ensure that the complaint will survive the plead-
 ing stage.
     Accordingly, we affirm the district court’s decision
 holding that the ’193 patent is directed to ineligible subject
 matter under § 101 and granting Zillow’s motion to dismiss
 as to the ’193 patent.
                               B
                               1
    We next consider the claims of the ’676 patent, begin-
 ning with Alice step one. The district court concluded that
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 10                                 IBM v. ZILLOW GROUP, INC.

 the claims failed at step one because they are directed to
 the abstract ideas of “showing users the correlations be-
 tween their search parameters and the search results” and
 “tailoring the presentation of search results based on users’
 perusal of prior search results.” J.A. 31. Citing the ab-
 stract, the district court found that “the ’676 patent is
 aimed at offering a user ‘the most beneficial and meaning-
 ful way’ to view the results of a query . . . and not at ad-
 vancing computer capabilities per se.” J.A. 29. The district
 court also found that “[t]he claim language is entirely re-
 sult-oriented, specifying what data enters and leaves the
 proverbial ‘black box,’ but revealing nothing about the in-
 ner workings of the box itself.” J.A. 31.
     We agree with the district court that the claims are di-
 rected to an abstract idea. As with the ’193 patent, the
 claims are directed to improving a user’s experience when
 viewing search results but do not contain any specific
 mechanism for doing so. For example, representative claim
 14 uses results-oriented language, such as “receiving a re-
 source response set of results,” “receiving a user context
 vector,” “mapping the user context vector,” and “controlling
 the presentation of the resource response set,” without any
 explanation for how these steps are carried out. Thus, we
 agree with the district court that the claims of the ’676 pa-
 tent are directed to the abstract idea of displaying and or-
 ganizing information.
      And at Alice step two, we once more agree with the dis-
 trict court that IBM failed to plausibly allege any inventive
 concept that would render the abstract claims patent-eligi-
 ble. The district court found that the ’676 patent contained
 no “specific, discrete implementation of the abstract ideas
 of applying an ordering and annotation function, mapping
 the user context vector with the resource response set, or
 generating an annotated response set.” J.A. 33 (internal
 quotation marks omitted).
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 IBM v. ZILLOW GROUP, INC.                                 11

     Merely alleging inventiveness without tying those alle-
 gations to the patent is insufficient to survive a Rule 12
 motion. As with the ’193 patent, the portions of the inven-
 tor declaration discussing the inventive aspects of the ’676
 patent do not cite to the patent and contain discussions
 that go beyond what is claimed or described in the patent
 document. For example, the declaration states that the
 “user context vector would populate the data structure
 with a wide variety of contextual information specific to a
 particular user through a back-and-forth interaction be-
 tween the user and the computer system as the user inter-
 acts with the customer self-service system.” J.A. 1181. But
 none of this is in the specification or the claims. These are
 the same types of conclusory allegations, unsupported by
 the patent itself, that we have repeatedly found insufficient
 to survive the pleading stage.
                              2
      Separately, IBM alleges that the district court erred by
 failing to consider a supposed claim construction dispute
 regarding the term “user context vector.” Appellant’s Br.
 27–28. IBM argues that the district court should construe
 “user context vector” as “an n-dimensional vector derived
 from the combination of user context and previous interac-
 tion with the system.” Appellant’s Br. 29. However, IBM’s
 argument requires a claim construction dispute in the first
 place, and we find none in the record.
     As Zillow explained, it “embraced” IBM’s construction
 of “user context vector” during the motion to dismiss pro-
 ceeding. Appellee’s Br. 19. Specifically, Zillow’s reply to
 IBM’s opposition brief adopted IBM’s construction, and Zil-
 low did not propose an alternate construction. Id. at 19–20
 (“IBM’s own construction of ‘user context vector’ as ‘an n-
 dimensional vector’ acknowledges that a ‘vector’ is a con-
 ventional data structure—namely, a certain quantity (n) of
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 12                                   IBM v. ZILLOW GROUP, INC.

 data slots each containing a number.”). Thus, there was no
 claim construction dispute for the district court to resolve. 1
     Accordingly, we affirm the district court’s decision
 holding that the ’676 patent claimed ineligible subject mat-
 ter under § 101, and properly granted Zillow’s motion to
 dismiss as to the ’676 patent.
                               IV
     We have considered the rest of IBM’s arguments and
 find them unpersuasive. Therefore, we conclude that the
 district court properly found the asserted claims of the ’193
 patent and ’676 patent ineligible under § 101, and we af-
 firm the district court’s grant of Zillow’s motion to dismiss
 as to both patents.
                         AFFIRMED

      1   The dissent contends that we do not “meaningfully
 address IBM’s proposed construction of ‘user context vec-
 tor.’” Dissent at 2. As explained above, because Zillow’s
 briefing to the district court adopted IBM’s proposed con-
 struction, there was nothing for the district court to ad-
 dress. Even assuming for the sake of argument that the
 district court erred by not explicitly adopting IBM’s pro-
 posed construction, any error would be harmless. While
 IBM’s proposed construction of “user context vector” might
 “add a degree of particularity to the claims” by explaining
 what type of data is contained in the vector, “the underly-
 ing concept embodied by the limitations merely encom-
 passes the abstract idea itself of organizing, displaying,
 and manipulating data of particular documents,” and
 therefore, the claims are not patent eligible. See Cap. One,
 850 F.3d at 1341.
Case: 22-1861    Document: 53      Page: 13   Filed: 01/09/2024

         NOTE: This disposition is nonprecedential.

    United States Court of Appeals
        for the Federal Circuit
                   ______________________

       INTERNATIONAL BUSINESS MACHINES
                CORPORATION,
                Plaintiff-Appellant

                              v.

         ZILLOW GROUP, INC., ZILLOW, INC.,
                Defendants-Appellees
               ______________________

                         2022-1861
                   ______________________

    Appeal from the United States District Court for the
 Western District of Washington in No. 2:20-cv-01130-TSZ,
 Senior Judge Thomas S. Zilly.
                  ______________________

 STOLL, Circuit Judge, concurring-in-part, dissenting-in-
 part.
      I respectfully dissent-in-part. Like the majority, I
 would affirm the district court’s holding of ineligibility of
 the claims of the ’193 patent. But I would vacate the dis-
 trict court’s holding of ineligibility of the claims of the
 ’676 patent. The ’676 patent claims are directed to a
 method for annotating computer search results, including
 mapping a user context vector on the search results to gen-
 erate an ordered list of search results based on character-
 istics relating to the user and the user’s prior interaction
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 2                                   IBM v. ZILLOW GROUP, INC.

 with prior search results. According to IBM, the method
 improves the relevance of search results based on the user’s
 interactions with prior search results. The specification ex-
 plains that “[o]ver time, the system will improve in its abil-
 ity to serve individual needs and evolve to an ability to
 suggest preferred answers to groups of users.” ’676 patent
 col. 19 ll. 21–23. The majority views the claims as having
 a different scope. But the majority, like the district court,
 does not meaningfully address IBM’s proposed construc-
 tion of “user context vector.” In opposing Zillow’s motion to
 dismiss under Rule 12(b)(6), IBM asserted that the term
 “user context vector,” which is recited in each independent
 claim, should be construed as “an n-dimensional vector de-
 rived from the combination of user context and previous in-
 teraction with the system.” J.A. 4063. Contrary to the
 majority’s suggestion, Zillow’s reply brief in support of its
 motion to dismiss only addressed part of IBM’s proposed
 construction and did not address the implications of such
 construction in the § 101 analysis. Our caselaw holds that
 the district court must either resolve the claim construction
 dispute to the extent necessary or adopt the non-movant’s
 claim construction when analyzing § 101 eligibility in the
 context of a motion to dismiss under Rule 12(b)(6). See
 Aatrix Software, Inc. v. Green Shades Software, Inc.,
 882 F.3d 1121, 1125 (Fed. Cir. 2018). The district court
 erred by not analyzing or adopting IBM’s proposed con-
 struction. Moreover, the court’s error was prejudicial be-
 cause IBM has demonstrated that its claims plausibly
 recite an inventive concept under its proposed construc-
 tion. Accordingly, I dissent-in-part.