Traxcell Technologies, LLC. v. Google LLC

Filing 75

ORDER by Judge Jacqueline Scott Corley granting in part 31 Motion to Dismiss. (ahm, COURT STAFF) (Filed on 11/17/2022)

Case 3:22-cv-04807-JSC Document 75 Filed 11/17/22 Page 1 of 11

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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TRAXCELL TECHNOLOGIES LLC,

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Case No. 22-cv-04807-JSC

Plaintiff,

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ORDER REGARDING DEFENDANT'S
MOTION TO DISMISS

v.

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Re: Dkt. No. 31

GOOGLE LLC,

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Defendant.

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Traxcell Technologies, LLC sues Google LLC for direct and indirect patent infringement.

United States District Court
Northern District of California

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Now pending before the Court is Google’s motion to dismiss under Federal Rule of Civil

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Procedure 12(b)(6). Having carefully reviewed the parties briefing and having had the benefit of

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oral argument on November 17, 2022, the Court GRANTS Google’s motion to dismiss in part.

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Traxcell has failed to allege facts that plausibly support direct infringement or pre-suit indirect

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infringement or any contributory infringement.
BACKGROUND

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Plaintiff filed this suit against Google for infringement of U.S. Patent No. 10,820,147 (the

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“’147 patent”) in the Western District of Texas. (Dkt. No. 23.) The U.S. Patent and Trademark

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Office issued the ‘147 Patent on October 27, 2020. (Dkt. No. 23-1 at 1.)1 The ‘147 patent is titled

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“Mobile wireless device providing off-line and on-line geographic navigation information.” The

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’147 Patent’s Abstract describes:

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A mobile device, wireless network and their method of operation
provide both on-line (connected) navigation operation, as well as offline navigation from a local database within the mobile device.
Routing according to the navigation system can be controlled by
traffic congestion measurements made by the wireless network that
allow the navigation system to select the optimum route based on
expected trip duration.

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Record citations are to material in the Electronic Case File (“ECF”); pinpoint citations are to the
ECF-generated page numbers at the top of the documents.
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(Id.) In the First Amended Complaint (“FAC”), Traxcell alleges that Google Maps—the

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“Accused System”—violated Claim 1 in the ‘147 patent. (Dkt. No. 23 at 4.) Claim 1 provides:

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Northern District of California

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1. A wireless communications system including:
a first radio-frequency transceiver within a wireless mobile
communications device and an associated first antenna to which the
first radio-frequency transceiver is coupled, wherein the first radiofrequency transceiver is configured for radio-frequency
communication with a wireless communications network;
a first processor within the wireless mobile communications device
coupled to the at least one first radio-frequency transceiver
programmed to receive information indicative of a location of the
wireless mobile communications device and generate an indication of
a location of the wireless mobile communications device with respect
to geographic features according to mapping information stored
within the wireless mobile communications device, and wherein the
first processor determines user navigation information and displays
the user navigation information according to the location of the
wireless mobile communications device with respect to the
geographic features and a destination specified at the wireless mobile
communications device, wherein the first processor further sends the
user navigation information to the network as a number of segments,
wherein at least one other processor outside the network updates the
user navigation information in conformity with traffic congestion
information accessible to the at least one other processor outside the
network by computing a numerical value for the segments
corresponding to the expected time to travel through the segments,
updates the user navigation information in conformity with the
numerical values for the segments, and sends the updated user
navigation information to the wireless mobile communications
device;
at least one second radio-frequency transceiver and an associated at
least one second antenna of the wireless communications network to
which the second radio-frequency transceiver is coupled; and
a second processor coupled to the at least one second radio-frequency
transceiver programmed to acquire the information indicative of a
location of the wireless mobile communications device, wherein the
second processor selectively acquires the information indicative of a
location of the wireless mobile communications device dependent on
the setting of preference flags, wherein the second processor acquires
the information indicative of a location of the wireless mobile
communications device if the preference flags are set to a state that
permits tracking of the wireless mobile communications device, and
wherein the second processor does not acquire the information
indicative of the location of the wireless mobile communications
device if the preference flags are set to a state that prohibits tracking
of the wireless mobile communications device.
(Dkt. No. 23-1 at 163.)
Plaintiff filed the FAC, (Dkt. No. 23), after Google moved to dismiss the initial complaint,
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(Dkt. Nos. 1, 12). Google then filed a motion to dismiss the FAC, and the case was transferred to

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this Court. (Dkt. Nos. 31, 50.) Google’s motion to dismiss the FAC is pending now.
DISCUSSION

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Google moves to dismiss Plaintiff’s claims for direct, indirect, and willful infringement of

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Claim 1 in the ‘147 Patent. The Court discusses each claim in turn.

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I.

United States District Court
Northern District of California

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Direct Infringement
Under 35 U.S.C. § 271(a), a party that “makes, uses, offers to sell, or sells any patented

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invention, within the United States or imports into the United States any patented invention during

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the term of the patent therefor, infringes the patent.” Plaintiff alleges Google “use[s]” Claim 1 of

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the ‘147 patent via the “Google Maps online navigation service and the Google Maps server-side

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or cloud infrastructure.” (Dkt. No. 23 at 4 ¶ 10.) Google objects the FAC fails to plausibly allege

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that Google “uses” Claim 1 because Google neither controls nor benefits from each claim element.

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The Court agrees.

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A.

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The Federal Circuit distinguishes between infringement claims alleging “use” of a

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“system” and claims about “use” of a “process.” See NTP, Inc. v. Research in Motion, Ltd., 418

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F.3d 1282, 1317 (Fed. Cir. 2005). A process is a sequence of actions. Id. A process patent is not

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“used” unless each step is performed in a specified order. Id. at 1318. By contrast, a “system” is

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used “as a whole.” Id. at 1317. In NTP, the Federal Circuit held that “to use” a system means

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both to control the system and obtain a benefit from it. Id. Subsequent cases clarified that “to

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use” a system “a person must control (even if indirectly) and benefit from each claimed

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component.” Intellectual Ventures I LLC v. Motorola Mobility LLC, 870 F.3d 1320, 1329 (Fed.

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Cir. 2017) (citing Centillion Data System, LLC v. Qwest Communications International, Inc. 631

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F.3d 1279, 1283–84 (Fed. Cir. 2011)) (emphasis added).

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The Definition of “Use”

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Control

“Control” can occur even in cases where different parties own or physically possess the

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relevant elements in the system claim. Centillion, 631 F.3d at 1283–84. In Centillion, the claim at

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issue required an end user-maintained “front-end” system and service provider-maintained “back3

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end” system. Id. at 1281. The defendant provided “front-end” software to its customers and

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provided “back-end” data processing services. Id. The customers used the “front-end” software to

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trigger data processing by the defendant’s “back-end” system. Id. The court held that customers

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“used” the entire system because they entered queries into the front-end that caused the back-end

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to perform the processing the claim required. Id. at 1285. It did not matter that a third party

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“physically possessed” the back-end processing, because customers had control via the “ability to

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place the system as a whole into service.” Id. at 1284.
But the defendant in Centillion—who provided back-end services and front-end

United States District Court
Northern District of California

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software—did not “use” the patented invention. Id. at 1286. Merely making the processing

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system does not “put the claimed invention into service, i.e., control the system and obtain a

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benefit from it,” because “[s]upplying the software for the customer to use is not the same as using

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the system.” Id. While the defendant provided software and technical assistance, “it is entirely

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the decision of the customer whether to install and operate this software on its personal computer

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data processing means.” Id. at 1287. Thus, the customer “used” the system and controlled each

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element, but the service provider did not. Id.
2.

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Benefit

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To infringe, a party must also benefit from each element in the system claim. Intellectual

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Ventures, 870 F.3d at 1329. It is insufficient to prove that the infringer benefits from the “system

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as a whole.” Id. Rather, the alleged benefits must be “tangible, not speculative, and tethered to

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the claims.” Grecia v. McDonald’s Corp., 724 F. App'x 942, 947 (Fed. Cir. 2018) (applying

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Intellectual Ventures and holding, in an unpublished opinion, that plaintiff’s benefit allegations

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were insufficient to survive a motion to dismiss).
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In sum, “infringing use of the claimed system under § 271(a) requires the patentee to

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demonstrate that the direct infringer obtained benefit from each and every element of the claimed

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system. In addition, the direct or indirect control required is the ability to place the system as a

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whole into service.” Intellectual Ventures, 870 F.3d at 1329 (cleaned up).

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//
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B.

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Claim 1 includes at least: (1) “a first radio-frequency transceiver” in a device, which is

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“coupled” to an “associated first antenna,” (2) a “first processor” within the device and coupled to

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the “first radio-transceiver” that receives information, generates location and navigation

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information, and sends the user navigation information to a wireless network, (3) at least one

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“other processor outside the network” that updates the user navigation information “in conformity

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with traffic congestion information accessible to the at least one other processor,” and sends that

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information to the device, (4) at least one “second radio-frequency transceiver and an associated at

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least one second antenna of the wireless communications network,” (5) and a “second processor”

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United States District Court
Northern District of California

Application

coupled to the “second radio-frequency transceiver.” (Dkt. No. 23-1 at 163.)
The parties dispute whether the FAC plausibly alleges that Google “uses” the system

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described in Claim 1 via its Google Maps product. To plead system infringement by “use,”

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Plaintiff must plead that Google controls and benefits from each element in Claim 1. Intellectual

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Ventures, 870 F.3d at 1329. Plaintiff failed to do so.

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Plaintiff’s “use” claim fails to allege how Google “controls” each claim element.

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Centillion is precisely on point. There, the Federal Circuit held that “[s]upplying the software for

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the customer to use is not the same as using the system.” Centillion, 631 F.3d at 1286. The same

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is true here. The FAC alleges that Google provides software that a user can configure to practice

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Claim 1. (Dkt. No. 23 at 34, 69, 73.) But, as in Centillion, that is insufficient to state a claim

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against the software provider. See Centillion, 631 F.3d at 1286.

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Plaintiff’s arguments to the contrary are unpersuasive. Plaintiff argues that “Traxcell also

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explicitly pleads evidence that Google Maps controls the wireless communication networks such

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that they provide a result, e.g., location information, for Google Maps to use and for its specific

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benefit.” (Dkt. No. 33 at 7.) But Plaintiff does not cite to a single FAC allegation to support that

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statement.

The FAC does provide one conclusory allegation:

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Defendant derives benefits from claim elements met by third party
wireless communication networks such as Verizon, AT&T, and TMobile (identified by name in the evidence charts above). Those
benefits include performing the specifically identified functions of
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those wireless communication networks (e.g., communicate location
of a wireless mobile communications device). Defendant obtains
those benefits by putting those functionalities into use, i.e. controlling
them, as per the evidence charts mentioned above.

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(Dkt. No. 23 at 109 ¶ 10.) But the evidence charts in the FAC do not explain how Google controls

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each element rather than a user doing so via Google Maps. For example, the FAC explains in

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detail how a user can utilize Google Maps to obtain navigation information. (See, e.g., id. at 59.)

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But there is no allegation that Google Maps operates independent of a user. To the contrary,

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Plaintiff’s claim chart provides screenshots of developer documentation titled: “Requesting User

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Permissi[on],” with the subtext “without these permissions, your application will fail at runtime

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when requesting location updates.” (Id. at 34, 69, 73.) The FAC also cites user instructions that

United States District Court
Northern District of California

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state: “You must enable location services to use Google Maps” to get directions and other

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location-based information. (Id. at 11.) Thus, as in Centillion, it is the customers’ choice to use

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the Google Maps product and enable location services. Centillion, 631 F.3d at 1287. While a

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customer may “use” the system in Claim 1, Plaintiff fails to explain how Google directly infringes

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through “use” of each element in Claim 1.2
Because Plaintiff’s FAC does not plausibly allege Google’s “use” of the patented

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invention, Plaintiff’s claim for “direct” infringement under § 271(a) is dismissed.

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II.

Plaintiff also alleges both contributory and induced infringement. (Dkt. No. 23 at 113

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Indirect Infringement

¶¶ 16, 24.) Contributory infringement requires knowledge. The statute defines the offense as:

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Whoever offers to sell or sells within the United States or imports into
the United States a component of a patented machine, manufacture,
combination or composition, or a material or apparatus for use in
practicing a patented process, constituting a material part of the
invention, knowing the same to be especially made or especially
adapted for use in an infringement of such patent, and not a staple
article or commodity of commerce suitable for substantial
noninfringing use, shall be liable as a contributory infringer.

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Because Plaintiff fails to explain how Google “controls” the elements in Claim 1, the Court need
not address Google’s motion to dismiss based on the “benefit” prong of the system use analysis or
alleged impossibilities in the claim chart.
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35 U.S.C. § 271(c) (emphasis added). Induced infringement, under § 271(b), also requires

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knowing inducement. See Global-Tech Appliances, Inc. v. SEB S.A., 563 U.S. 754, 765 (2011)

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(“[I]nduced infringement under § 271(b) requires knowledge that the induced acts constitute

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patent infringement.”) Thus, both claims require that Google had knowledge of the ‘147 patent.

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A.

Pre-Suit Indirect Infringement

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Plaintiff alleges Google had knowledge of the ‘147 patent as of:

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United States District Court
Northern District of California

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[A]t least the date of the patent’s issuance, or from the issuance of the
‘284 patent, which followed the date that the patent’s underlying
application was cited to Defendants by the U.S. Patent and Trademark
Office during prosecution of one of Defendant’s patent applications,
such that Defendant knew and should have known that it was and
would be inducing infringement.

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(Dkt. No. 23 at 111 ¶¶ 14, 18.) The ’147 patent was issued on October 27, 2020. (Dkt. No. 23-1

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at 1.) The FAC does not provide the issuance date of the ‘284 Patent nor does the FAC plead the

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‘284 Patents’ full patent number. However, the ‘147 Patent does list U.S. Pat. No. 8,977,284 as

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issued on March 10, 2015. (Id. at 100.) Google confirms the ‘284 Patent is U.S. Pat. No.

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8,977,284 and lists the same March 10, 2015, issuance date. (Dkt. No. 35 at 8.)

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These pleadings are insufficient to state claims for contributory or induced infringement.

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Working chronologically, the ‘284 Patent was issued five years prior to the ‘147 Patent. The

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March 10, 2015 issuance could not give notice of the ‘147 Patent because that patent would not

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exist for another five years. To have knowledge of a patent, the patent must exist. See State

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Indus. v. A.O. Smith Corp., 751 F.2d 1226, 1236 (Fed. Cir. 1985) (describing the knowledge

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requirement in the willful infringement context); see also Fluidigm Corp. v. IONpath, Inc., No.

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19-05639 WHA, 2020 WL 408988, at *3 (N.D. Cal. Jan. 24, 2020) (“Defendant could not have

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divined the eventual issuance of the two patents eight-years later.”) (emphasis in original).

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Plaintiff does not explain (in the FAC or in its opposition) when or in what context the U.S. PTO

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cited “the patent’s underlying application to Defendants.” Indeed, that language appears to be

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boilerplate. (See Eastern District of Texas, Case No. 2:17-cv-00718-RWS-RSP, Dkt. No. 1 ¶¶ 13,

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20, 27, 34.) Finally, Plaintiff’s citation to the issuance date of the ‘147 Patent is unavailing.

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Plaintiff pleads “Defendant has known and should have known of the ‘147 patent, by at least the
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date of the patent’s issuance.” (Dkt. No. 1 at 111 ¶ 18.) That statement contains no facts that

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would plausibly support an inference of Google’s actual knowledge. See Nobelbiz, Inc. v.

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Insidesales.com, Inc., No. 6:13-CV-360-MHS, 2014 WL 12378804, at *3 (E.D. Tex. Oct. 14,

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2014) (requiring “actual knowledge, not just constructive knowledge based on issuance and

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publication of a patent.”) (citing Global-Tech, 563 U.S. at 763). Rather, Plaintiff merely offers “a

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formulaic recitation of the elements of a cause of action.” Bell Atl. Corp. v. Twombly, 550 U.S.

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544, 555 (2007). That is insufficient to survive a motion to dismiss under Federal Rule of Civil

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Procedure 12(b)(6). Id.

United States District Court
Northern District of California

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In the briefing, Plaintiff makes an additional argument not detailed in the FAC. (Dkt. No.

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33 at 5.) Plaintiff describes litigation in the Eastern District of Texas involving “a related ‘284

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patent from the same patent family,” in which a Google software engineer “was deposed at length

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concerning the technology at issue in June 2019, more than a year prior to the issuance of the ‘147

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patent-in-suit in October 2020.” (Id. at 11–12.) While this argument cannot serve as the basis for

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a claim because it is wholly absent from the FAC, even if the Court were to consider it, it still

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fails. Google could not have had notice of the ‘147 Patent “more than a year prior” to its
issuance—even if the technology mentioned in that deposition was similar. As the Federal Circuit
has explained in the patent application context:
A “patent pending” notice gives one no knowledge whatsoever. It is
not even a guarantee that an application had been filed. Filing an
application is no guarantee any patent will issue and a very substantial
percentage of applications never result in patents. What the scope of
claims in patents that do issue will be is something totally
unforeseeable.

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State Indus. v. A.O. Smith Corp., 751 F.2d 1226, 1236 (Fed. Cir. 1985). Thus, the FAC fails to

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plausibly allege Google’s actual, pre-suit knowledge and therefore fails to state a claim for indirect

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infringement.

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B.

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In its opposition, Plaintiff contends that even if Google did not have notice prior to this

Post-Suit Indirect Infringement

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action, it has “post-suit” knowledge of the patent based on the original complaint. (Dkt. No. 33 at

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5.) But as a technical matter, the allegation of “post-suit” knowledge does not appear in the FAC.

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At most, Plaintiff alleges that Google “continues” to indirectly infringe via inducement and
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contributory infringement. (Dkt. No. 31 at 110–111 ¶¶ 16, 19.) The FAC never mentions the

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original complaint as a basis for notice. The Court can, however, draw a reasonable inference

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from the word “continues” and the title of the complaint “Plaintiff’s Amended Complaint,” that

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Google did have knowledge when it was served with the original complaint on December 16,

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2021. (Dkt. No. 5.)
Although the Federal Circuit has not provided explicit guidance on the issue,3 most district

United States District Court
Northern District of California

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courts permit induced infringement claims to go forward without pre-suit knowledge of a patent

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and have limited recovery to post-suit conduct. Lyda v. CBS Interactive, Inc., No. 16-CV-06592-

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JSW, 2017 WL 783807, at *3 (N.D. Cal. Mar. 1, 2017) (collecting cases and noting the split in

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authority as to whether post-suit knowledge is sufficient). The majority view bases the adequacy

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of post-suit knowledge on there being no sound reason that a defendant should avoid liability for

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an indirect infringement claim when it continues “to promote infringing uses of their products

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after learning about the patents,” simply “because it happened to learn of the patent in connection

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with a lawsuit.” Rembrandt Soc. Media, LP v. Facebook, Inc., 950 F. Supp. 2d 876, 881 (E.D. Va.

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2013). The minority view argues it preserves judicial economy to require pre-suit knowledge to

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state a claim because that encourages settlement and pre-suit negotiation. Id. Absent further

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guidance form the Federal Circuit, the Court will consider whether Plaintiff’s FAC states a claim

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for post-suit indirect infringement.
1.

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Post-Suit Contributory Infringement

To state a claim for contributory infringement, the complaint must plead (1) knowledge of

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the patent, (2) knowledge of the acts alleged to be infringement, (3) that the accused infringer’s

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component is not suitable for a substantial non-infringing use; and (4) that the accused infringer’s

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component is material to practicing the claimed invention. BillJCo, LLC v. Apple Inc., 583 F.

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Supp. 3d 769, 781–82 (W.D. Tex. 2022); see also Arris Grp., Inc. v. Brit. Telecommunications

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For example, in In re Bill of Lading Transmission and Processing System Patent Litigation, the
Federal Circuit found the plaintiff sufficiently alleged claims for induced infringement. 681 F.3d
1323, 1345-45 (Fed. Cir. 2012). There, the plaintiff partially relied on the complaint to allege the
defendant knew of the patent. Id. But the court did not directly hold a complaint is sufficient to
show a defendant has the requisite knowledge of a patent for purposes of induced infringement.
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PLC, 639 F.3d 1368, 1376 (Fed. Cir. 2011) (applying this test to both system and method claims).

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Assuming Plaintiff adequately pled post-suit knowledge, Plaintiff’s complaint fails to state

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a claim as to the third prong—the lack of a substantial non-infringing use. Plaintiff recites

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“Google Maps application and Google Server are not staple article of commerce because there is

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no substantial non-infringing use of these products and features other than to practice the claimed

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invention.” (Dkt. No. 23 at 112 ¶ 22.) This claim merely parrots the elements of the cause of

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action. Twombly, 550 U.S. at 555. Moreover, as Google notes, the FAC belies this claim and
describes numerous Google Maps functions that operate without a user enabling location services.
(See, e.g., Dkt No. 23 ¶ 10 at 23, 40, 49.) In other words, Google Maps functions as a digital
version of a paper map. But the FAC fails to engage with this prong and instead mimics the
language of the cause of action. At this stage, that is insufficient. Twombly, 550 U.S. at 555.

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United States District Court
Northern District of California

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Post-Suit Induced Infringement

35 U.S.C. § 271(b) provides that “[w]hoever actively induces infringement of a patent
shall be liable as an infringer.” In order “[t]o establish liability under section 271(b), a patent
holder must prove that once the defendants knew of the patent, they actively and knowingly aided
and abetted another’s direct infringement.” DSU Medical Corp. v. JMS Co. Ltd., 471 F.3d 1293,
1305 (Fed. Cir. 2006).

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As to post-suit induced infringement, Plaintiff states a claim. (See Dkt. No. 23 at 110 ¶

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16.) First, as discussed above, post-suit knowledge is sufficient to state a claim for post-suit

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damages. See Rembrandt, 950 F. Supp. 2d at 881. The FAC details numerous instances where

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Google explains to users, via its product documentation, how to engage in the allegedly infringing

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activity—enabling and practicing location services, and route navigation with traffic services.

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(See Dkt. No. 23 at 100.) Thus, Google’s motion is DENIED as to post-suit induced infringement.

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III.

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Willful Infringement
Willful infringement is a question of fact. Bayer Healthcare LLC v. Baxalta Inc., 989 F.3d

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964, 987 (Fed. Cir. 2021) (citing Polara Eng’g Inc. v. Campbell Co., 894 F.3d 1339, 1353 (Fed.

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Cir. 2018)). To establish willfulness, the patentee must show the accused infringer had a specific

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intent to infringe at the time of the challenged conduct. See Halo Elecs., Inc. v. Pulse Elecs., Inc.,

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136 S. Ct. 1923, 1933 (2016). As the Supreme Court stated in Halo, “[t]he sort of conduct
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warranting enhanced damages has been variously described in our cases as willful, wanton,

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malicious, bad-faith, deliberate, consciously wrongful, flagrant, or—indeed—characteristic of a

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pirate.” Id. at 1932. A patentee needs to show by a pre-ponderance of the evidence the facts that

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support a finding of willfulness. Id. at 1934. Thus, Knowledge of the asserted patent and evidence

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of infringement are necessary, but not sufficient, for a finding of willfulness. Id. Rather,

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willfulness requires deliberate or intentional infringement. Id.

United States District Court
Northern District of California

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Plaintiff’s post-suit willful infringement argument can survive as to the induced

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infringement. Willful infringement requires knowledge. Bayer Healthcare, 989 F.3d at 988. As

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noted above, the FAC fails to plausibly allege Google’s pre-suit knowledge of the ‘147 patent.

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Thus, Plaintiff’s willful infringement claim is dismissed as to any pre-suit infringement. Plaintiff

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does, however, plead post-suit knowledge and indirect inducement. Here, Plaintiff pleads that

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Google knew its conduct was infringing but proceeded anyway. (Dkt. No. 23 at 112–113 ¶ 24.)

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Viewing all inferences in favor of Plaintiff at this stage, that allegation could constitute

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“consciously wrongful” behavior. Halo, 136 S. Ct. at 1932. Thus, Google’s motion to dismiss is

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denied as to the willful infringement allegation.
CONCLUSION

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For the reasons stated above, Google’s motion to dismiss is GRANTED as to the direct

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infringement claim, the contributory infringement claim, and the pre-suit induced infringement

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claim. Google’s motion to dismiss is DENIED as to post-suit induced infringement and post-suit

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willful infringement. Plaintiff is granted 20 days leave to amend provided Plaintiff can amend

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consistent with Plaintiff counsel’s obligations under Federal Rule of Civil Procedure 11. The

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Court will hold a further case management conference on January 5, 2023 at 1:30 p.m. via Zoom

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video. An updated joint case management conference statement is due December 22, 2022.

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This Order disposes of Docket No. 31.

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IT IS SO ORDERED.

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Dated: November 17, 2022

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JACQUELINE SCOTT CORLEY
United States District Judge

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