Papst Licensing GmbH & Co. KG v. Xilinx Inc.

Filing 99

ORDER by Judge Lucy H. Koh granting (81) Motion for Judgment on the Pleadings in case 5:16-cv-00926-LHK; granting (88) Motion for Judgment on the Pleadings in case 5:16-cv-00925-LHK. (lhklc4, COURT STAFF) (Filed on 6/9/2016)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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SAN JOSE DIVISION

United States District Court
Northern District of California

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PAPST LICENSING GMBH & CO. KG,
Plaintiff,

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XILINX INC,
Defendant.

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Re: Dkt. No. 88 (Case No. 16-CV-00925);
Dkt. No. 81 (Case No. 16-CV-00926)

PAPST LICENSING GMBH & CO. KG,

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ORDER GRANTING MOTION FOR
JUDGMENT ON THE PLEADINGS

v.

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Case No. 16-CV-00925-LHK
Case No. 16-CV-00926-LHK

Plaintiff,
v.
ALTERA CORPORATION,
Defendant.

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Plaintiff Papst Licensing GmbH & Co. KG (“Papst” or “Plaintiff”) filed patent

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infringement suits against Xilinx, Inc. (“Xilinx”) and Altera Corporation (“Altera”) (collectively,

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“Defendants”). Plaintiff alleges that Defendants infringe claims of U.S. Patent Nos. 6,574,759 and

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6,704,891. On May 11, 2016, Defendants filed identical Motions for Judgment on the Pleadings,
contending that the asserted claims of Papst’s patents are invalid for failure to claim patent-eligible
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Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

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subject matter under 35 U.S.C. § 101. On May 25, 2016, Papst filed an opposition. On May 30,

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2016, Defendants filed a reply. See ECF Nos. 88 (“Motion”), 92 (“Opposition”), 94 (“Reply”)

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(Case No. 16-CV-00925-LHK); ECF Nos. 81, 82, 84 (Case No. 16-CV-00926-LHK).1
Having considered the parties’ submissions, the record, and the relevant law, the Court

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GRANTS Defendants’ Motion for the reasons set forth below.

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I.

BACKGROUND
A. Factual Background

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1. The Parties

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Plaintiff Papst is a German patent licensing company with its principal place of business in
St. Georgen, Germany. No. 16-CV-00925-LHK, ECF No. 1 ¶¶ 1, 6. Papst is the assignee of the

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United States District Court
Northern District of California

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two patents at issue in the instant case, which Papst acquired through Papst’s predecessor-in-

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interest, Rambus, Inc. Id. ¶¶ 7, 13, 19. Defendant Xilinx is a Delaware corporation that supplies

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programmable logic devices and software. Id. ¶¶ 2, 13–15. Defendant Altera is also a Delaware

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corporation that supplies programmable logic devices and software. No. 15-CV-00926-LHK,

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ECF No. 1 ¶¶ 2, 13–15.2

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2. The Asserted Patents

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At issue are U.S. Patent Nos. 6,574,759 (the “ ’759 patent”) and 6,704,891 (the “ ’891

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patent”) (collectively, the “Papst Patents”). Each of the Papst Patents is entitled “Method for

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Verifying and Improving Run-Time of a Memory Test.”3 The ’891 patent resulted from a

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continuation of the same patent application that led to the ’759 patent, meaning that the two

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Because the parties’ motions for judgment on the pleadings in the two cases are substantively
identical, for simplicity, references to the Motion, Opposition, and Reply are to ECF Nos. 88, 92,
and 94, respectively, in Case No. 16-CV-00925-LHK.
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Though not relevant for purposes of the Motion, Altera states that it is now a wholly owned
subsidiary of third-party counterclaimant Intel Corporation. No. 15-CV-00926-LHK, ECF No. 54
(Answer) ¶ 2. Intel has asserted breach-of-contract counterclaims against Papst stemming from an
alleged covenant not to sue Intel and its affiliates concerning the Papst Patents. Id. ¶¶ 38–66.
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The ’759 and ’891 patents are attached to the Complaints filed in each case as Exhibits A and B,
respectively. See No. 16-CV-00925-LHK, ECF Nos. 1-1, 1-2; No. 16-CV-00926-LHK, ECF Nos.
1-1, 1-2.
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patents share nearly identical specifications.4 For simplicity, the Court’s citations to the text and

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figures of the Papst Patents refer to the ’759 patent specification.
The Papst Patents relate generally to the field of testing computer memory devices, and

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more specifically, to methods for creating and verifying sets of instructions or operations used to

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test memory devices. See ’759 Patent, at abstract (“A method of generating and verifying a

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memory test is disclosed.”). According to the Papst Patents, improvements in the size and

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capacity of integrated circuit memory devices have “revolutionized computer systems,

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telecommunications equipment and consumer electronics.” ’759 patent, col. 1:11–12. Such

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memory devices, however, “must be reliable.” Id., col. 1:15–16. “Accordingly, memory devices

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have been tested since their first manufacture. Very early in the history of memory device testing,

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United States District Court
Northern District of California

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specialized equipment and automated test routines were developed to improve testing efficiency.”

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Id., col. 1:16–21.
As described by the Papst Patents, “[i]n creating a [memory] test, a test writer must define

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a sequence of operations which store and retrieve data to/from the memory device in accordance

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with certain ‘operating constraints’” or rules imposed by the capabilities of the particular memory

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being tested. Id., col. 1:58–61. These operating constraints or rules may be “timing-based,”

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meaning that a minimum amount of time must elapse between certain memory operations, or

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“state-based,” meaning that certain operations must occur in a particular order. See id., col. 1:63–

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2:1; col. 2:63–3:17.
While early memory devices were “simple and characterized by relatively few

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constraints,” contemporary memory devices have “increased in complexity” and “have an

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increased number of operating constraints which must be obeyed during a sequence of memory

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system operations.” Id., col. 2:2–6; col. 2:9–11.
The Papst Patents note several disadvantages of the conventional methods for creating

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See Monsanto Co. v. Scruggs, 459 F.3d 1328, 1337 (Fed. Cir. 2006) (“The patents are
continuations or divisionals of a common parent application and therefore necessarily have almost
identical specifications.”); see also Opp. at 2 n.1 (noting that Papst Patents share substantially the
same specification).
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memory tests by hand. Specifically, the Papst Patents note that “[m]emory device test writers

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currently generate test protocols without benefit of a tool which provides feedback as to whether

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or not a test step or test routine violates one or more memory device constraints.” Id., col. 2:23–

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verifying compliance with actual memory device constraints.” Id., col. 3:15–17. As a result,

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“when a memory device fails a test,” it is unclear whether “the memory device is truly broken, or

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whether the test has been improperly constructed” by failing to comply with all required timing-

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based and state-based rules governing use of the memory. Id., col. 2:29–31.

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According to the Papst Patents, one way in which this problem was addressed in the
“conventional process of test generation” was by using a “known-good” memory device “to test

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Northern District of California

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the test” in a “trial-and-error” fashion. Id., col. 2:55–57; col. 2:37; see also id., at Fig. 1

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(describing prior art process). Identifying an appropriate reference device, however, was

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sometimes done by running another kind of test to “attempt to identify known-good memory

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devices.” Id., col. 3:26. This could lead to a “chicken and egg” problem, since “known-good

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memory devices can not be identified until a valid set of tests have been run.” Id., col. 3:19–24.

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The Papst Patents purport to overcome this problem with a “simulator . . . using a

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parameter list covering all relevant constraints” to model the memory device to be tested. Id., col.

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3:58–60. The simulator “is event-driven and directly models the behavior of one or more memory

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devices or modules on a communications channel” using a “parameter file . . . that describes the

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architectural and timing characteristics of the memory device or module being simulated.” Id.,

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col. 5:7–12. The “parameter file” of rules is provided by the test writer. Id. A “time-ordered

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sequence” of operations, i.e., the test, “is passed through the simulator to verify that it adheres to

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the operating constraints” of the memory device for which the test is intended. Id., col. 3:60–63.

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If the test violates any of the rules required by the memory device specification, “error messages

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may offer suggested fixes, such as timing adjustments required to place the sequence of operations

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in compliance with the constraints.” Id., col. 3:64–67. In addition, the Papst Patents disclose the

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use of a “packer” to minimize the length of time a particular test will take to run “in relation to the

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given constraints” of the memory device. Id., col. 4:1–4.
Figure 2 of the ’759 patent is instructive as to the general sequence of steps taught by the
claimed process:

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At step 10, a test writer creates a test for a particular memory device. ’759 patent, col. 7:41–49.
The test is then passed through the simulator modeling the operational constraints of the memory
device at step 12. Id., col. 7:49–55. If the test fails, error messages are generated at step 14, the
test writer alters the test accordingly at step 15, and the process is repeated until errors no longer
remain. Id., col. 7:56–60. Once the test is verified, it may be run through the packer at step 17,
which “may dictate alteration of the test . . . to minimize the run-time of the sequence of
operations.” Id., col. 7:61–67.
The Papst Patents describe the implementation of the preferred embodiment of the
simulator and packer as follows:
As presently preferred, the simulator is written in a high level
language like ‘C’ on a UNIX based platform. A standard tool set or
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Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
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threads package, such as the CSIM17 software library offered by
Mesquite Software™, may be used to write the simulator. The
simulator may be written to test memory devices on an individual
basis, in groups (such as modules), and/or to test a . . .fully
populated channel with memory modules. The packer function is
presently implemented as a ‘Perl script,’ a well known UNIX
programming language.

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’759 patent, col. 6:55–65; see also id., col. 5:5–34 (describing use of simulator); col. 5:59–6:52

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(describing use of packer).
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3. The Asserted Claims
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Plaintiff asserts claims 1, 4, 5 and 14 of the ’759 patent and claims 1 and 2 of the ’891

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patent against both Xilinx and Altera. Mot. at 4–5; Opp. at 4. Plaintiff additionally asserts claims
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United States District Court
Northern District of California

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5 and 6 of the ’891 patent against Xilinx alone. Id. The Court refers to these claims collectively
as the “asserted claims.” All of the asserted claims are method claims. With minor differences,
the asserted clams of the two patents are similar in nature.5 The text of the asserted claims of the
’759 patent is as follows:

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1. A method of generating a test for a memory having defined operating constraints, the
method comprising:
developing a set of operations defining the test, where the set of operations is
ordered in time;
passing the set of operations through a simulator capable of determining whether
the set of operations violates any one of the operating constraints; and
upon determining that the set of operations violates any one of the operating
constraints, outputting an error message, wherein the error message comprises an
adjustment to the set of operations which will resolve the operating constraint
violation.

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4. A method of generating a test for a memory having defined operating constraints, the
method comprising:
developing a set of operations defining the test, where the set of operations is
ordered in time;
passing the set of operations through a simulator capable of determining whether
the set of operations violates any one of the operating constraints; and
upon determining that the set of operations violates any one of the operating
constraints, outputting an error message, wherein the error message identifies a
violated time-based constraint.

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As discussed further below, Claim 14 of the ’759 patent differs in that it includes a limitation
directed to “packer” functionality, which is not present in the remaining claims.
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Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

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5. The method of claim 4, wherein the error message further identifies a timing
adjustment to the set of operations which will resolve the time-based constraint
violation.
14. A method of generating and verifying a test for a memory having defined operating
constraints, the method comprising:
defining one or more commands, wherein each one of the commands comprises a
group of operations;
forming a time ordered sequence of commands defining the test;
verifying the test by passing the time ordered sequence of commands through a
simulator capable of determining whether the time order [sic] sequence of
commands violates any one of the operating constraints;
passing the verified test through a packer to minimize run time of the test in
relation to the operating constraints.
The text of the asserted claims of the ’891 patent is as follows:
1. A method of simulating the behavior of a memory device, the method comprising:
defining a set of operating constraints based on the characteristics of the memory
device;
providing a set of memory device operations, wherein the set of memory device
operations is ordered in time;
passing the set of operations through a simulator capable of determining whether
the set of memory device operation [sic] violates any one of the operating
constraints; and
outputting an error message upon determining that the set of operations violates
any one of the operating constraints.
2. The method of claim 1, wherein the error message comprises an adjustment to the set of
operations which will resolve the operation constraint violation.
5. The method of claim 1, wherein the error message identifies a violated time-based
constraint.
6. The method of claim 5, wherein the error message further identifies a timing adjustment
to the set of operations which will resolve the time-based constraint violation.
B. Procedural History

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1. Altera

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On October 28, 2014, Altera filed a declaratory judgment action against Papst in this

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district, and sought a declaration that the Papst Patents were neither valid nor infringed. Altera

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Corp. v. Papst Licensing GmbH & Co. KG, No. 14-CV-04794-LHK, ECF No. 1 (N.D. Cal. Oct.

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28, 2014). On February 6, 2015, Papst moved to dismiss Altera’s California case for lack of

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personal jurisdiction, or, in the alternative, to transfer the case to the United States District Court

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for the District of Delaware. See id., ECF No. 18. On February 20, 2015, Altera filed an

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opposition. Id., ECF Nos. 28, 45. On April 22, 2015, Papst filed a reply. Id., ECF No. 51.

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Meanwhile, on February 17, 2015, Papst filed an action against Altera in the District of

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Delaware, alleging that Altera infringed the Papst Patents. Papst Licensing GmbH & Co. KG v.

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Altera Corp., No. 15-CV-00162-LPS, ECF No. 1 (D. Del. Feb. 17, 2015). On March 31, 2015,

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Altera filed a motion seeking to transfer the Delaware case to the Northern District of California,

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or alternatively to dismiss or stay the case under the first-to-file rule in view of the case previously

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filed by Altera against Papst in California. Id., ECF Nos. 11–12. Papst filed an opposition on

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April 17, 2015. Id., ECF No. 16. Altera filed a reply on April 27, 2015. Id., ECF No. 18.
2. Xilinx

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United States District Court
Northern District of California

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On November 7, 2014, Papst sued Xilinx in the United States District Court for the District

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of Delaware for alleged infringement of the Papst Patents. Papst Licensing GmbH & Co. KG v.

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Xilinx, Inc., No. 14-CV-01376-LPS, ECF No. 1 (D. Del. Nov. 7, 2014). On February 2, 2015,

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Xilinx moved to transfer the Delaware case against Xilinx to the Northern District of California.

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Id., ECF Nos. 13–14. Papst filed an opposition on February 20, 2015. Id., ECF No. 18. Xilinx

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filed a reply on March 2, 2015. Id., ECF No. 22.

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On November 7, 2014, the same day that Papst sued Xilinx in Delaware, Xilinx filed a

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declaratory judgment action against Papst in the Northern District of California. Xilinx, Inc. v.

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Papst Licensing GmbH & Co. KG, No. 14-CV-04963-LHK, ECF No. 1 (N.D. Cal. Nov. 7, 2014).

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In the California case, Xilinx sought a declaration that the Papst Patents were neither valid nor

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infringed. See id. On February 6, 2015, Papst moved to dismiss Xilinx’s California case for lack

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of personal jurisdiction, or, in the alternative, to transfer the case to the District of Delaware. See

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id., ECF No. 18. Xilinx took discovery on Papst’s motion to dismiss the California case, and

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thereafter filed an opposition on April 15, 2015. Id., ECF No. 52. On April 22, 2015, Papst filed

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a reply. Id., ECF No. 56.

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3. Rulings on Motions to Dismiss and Transfer

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On February 23, 2015, both California cases were reassigned to the undersigned judge. As

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Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

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a result, by late February 2015, two cases between Defendants and Papst regarding the Papst

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Patents were pending before this Court, while two additional cases between Defendants and Papst

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regarding the Papst Patents were simultaneously pending in the District of Delaware.

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On July 9, 2015, this Court granted Papst’s motions to dismiss the California cases for lack

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of personal jurisdiction over Papst, ending the California cases. No. 14-CV-4963-LHK, ECF No.

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62; No. 14-CV-4794-LHK, ECF No. 57. Both Altera and Xilinx appealed to the United States

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Court of Appeals for the Federal Circuit. See Appeal Nos. 2015-1914, 2015-1919. On June 9,

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2016, the Federal Circuit granted Altera’s unopposed motion to dismiss its appeal as moot. See

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No. 14-CV-4794-LHK, ECF No. 69 (Federal Circuit order). Xilinx’s appeal remains pending.

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United States District Court
Northern District of California

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See Appeal No. 15-1919.
On September 1, 2015, a Magistrate Judge in Delaware issued a combined Memorandum

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Order that granted both Xilinx’s and Altera’s motions to transfer the Delaware cases to the

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Northern District of California. No. 14-CV-01376-LPS, ECF No. 49; No. 15-CV-00162-LPS,

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ECF No. 41. Papst filed objections, which a District Judge orally overruled on February 23, 2016.

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No. 14-CV-01376-LPS, ECF No. 54; No. 15-CV-00162-LPS, ECF No. 48. On February 24,

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2016, the cases were transferred to the Northern District of California and docketed as the instant

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cases, Nos. 16-CV-00925 and 16-CV-00926.

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On March 22, 2016, this Court issued an order relating the two cases transferred from

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Delaware to the two dismissed California cases involving Defendants and Papst. See No. 14-CV-

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00925, ECF No. 66. The two cases transferred from Delaware were accordingly reassigned to the

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undersigned judge that same day.

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On May 11, 2016, Defendants filed their substantively identical Motions for Judgment on

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the Pleadings. On May 25, 2016, Plaintiff filed an opposition. On May 30, 2016, Defendants

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filed a reply. See ECF Nos. 88, 92, 94 (Case No. 16-CV-00925); ECF Nos. 81, 82, 84 (Case No.

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16-CV-00926).

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II.

LEGAL STANDARD
A. Motion for Judgment on the Pleadings Under Fed. R. Civ. P. 12(c)

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“After the pleadings are closed—but early enough not to delay trial—a party may move for
judgment on the pleadings.” Fed. R. Civ. P. 12(c). “Judgment on the pleadings is properly

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granted when, accepting all factual allegations in the complaint as true, there is no issue of
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material fact in dispute, and the moving party is entitled to judgment as a matter of law.” Chavez

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v. United States, 683 F.3d 1102, 1108 (9th Cir. 2012) (quotation marks and alteration omitted).
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Like a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), a motion under Rule
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12(c) challenges the legal sufficiency of the claims asserted in the complaint. See id. Indeed, a
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Northern District of California

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Rule 12(c) motion is “functionally identical” to a Rule 12(b)(6) motion, and courts apply the
“same standard.” Dworkin v. Hustler Magazine Inc., 867 F.2d 1188, 1192 (9th Cir. 1989)
(explaining that the “principal difference” between Rule 12(b)(6) and Rule 12(c) “is the tim[ing]
of filing”); see also United States ex rel. Cafasso v. Gen. Dynamics C4 Sys., 637 F.3d 1047, 1054

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n.4 (9th Cir. 2011).
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Judgment on the pleadings should thus be entered when a complaint does not plead
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“enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly,
550 U.S. 544, 570 (2007). “A claim has facial plausibility when the plaintiff pleads factual

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content that allows the court to draw the reasonable inference that the defendant is liable for the
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misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). “The plausibility standard is

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not akin to a probability requirement, but it asks for more than a sheer possibility that a defendant
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has acted unlawfully.” Id. (quotation marks omitted). For purposes of ruling on a Rule 12(c)
motion, the Court “accept[s] factual allegations in the complaint as true and construe[s] the
pleadings in the light most favorable to the nonmoving party.” Manzarek v. St. Paul Fire &

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Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008).
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The Court, however, need not accept as true allegations contradicted by judicially
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noticeable facts, see Shwarz v. United States, 234 F.3d 428, 435 (9th Cir. 2000), and it “may look
beyond the plaintiff’s complaint to matters of public record” without converting the Rule 12(c)

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motion into a motion for summary judgment, Shaw v. Hahn, 56 F.3d 1128, 1129 n.1 (9th Cir.

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1995). Nor must the Court “assume the truth of legal conclusions merely because they are cast in

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the form of factual allegations.” Fayer v. Vaughn, 649 F.3d 1061, 1064 (9th Cir. 2011) (per

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curiam) (quotation marks omitted). Mere “conclusory allegations of law and unwarranted

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inferences are insufficient” to defeat a motion for judgment on the pleadings. Adams v. Johnson,

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355 F.3d 1179, 1183 (9th Cir. 2004).

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B. Patent Validity Challenges Under 35 U.S.C. § 101

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1. Availability of Judgment on the Pleadings

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Defendants’ Motion asserts that the Papst Patents fail to claim patent-eligible subject
matter under 35 U.S.C. § 101 in light of the U.S. Supreme Court’s decision in Alice Corporation

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United States District Court
Northern District of California

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Pty. Ltd. v. CLS Bank International, 134 S. Ct. 2347 (2014). Whether a claim recites patent-

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eligible subject matter under Section 101 is a question of law. In re Roslin Inst. (Edinburgh), 750

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F.3d 1333, 1335 (Fed. Cir. 2014) (“Section 101 patent eligibility is a question of law[.]”);

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Dealertrack, Inc. v. Huber, 674 F.3d 1315, 1333 (Fed. Cir. 2012) (same). Accordingly, a district

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court may resolve the issue of patent eligibility under Section 101 by way of a motion for

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judgment on the pleadings. See, e.g., buySAFE, Inc. v. Google, Inc., 765 F.3d 1350, 1351 (Fed.

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Cir. 2014) (affirming determination of ineligibility made on motion for judgment on the

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pleadings); see also Content Extraction & Transmission LLC v. Wells Fargo Bank, Nat. Ass’n,

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776 F.3d 1343, 1345 (Fed. Cir. 2014) (affirming determination of ineligibility made on 12(b)(6)

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motion); Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 713 (Fed. Cir. 2014) (same).

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Although claim construction is often desirable, and may sometimes be necessary, to

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resolve whether a patent claim is directed to patent-eligible subject matter, the Federal Circuit has

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explained that “claim construction is not an inviolable prerequisite to a validity determination

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under § 101.” Bancorp Servs., L.L.C. v Sun Life Assur. Co. of Canada (U.S.), 687 F.3d 1266,

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1273–1274 (Fed. Cir. 2013). Where the court has a “full understanding of the basic character of

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the claimed subject matter,” the question of patent eligibility may properly be resolved on the

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pleadings. Content Extraction, 776 F.3d at 1349; see also Cardpool, Inc. v. Plastic Jungle, Inc.,

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No. 12-CV-04182-WHA, 2013 WL 245026, at *4 (N.D. Cal. Jan. 22, 2013) (same), aff’d, 817

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F.3d 1316 (Fed. Cir. 2016).

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2. Burden of Proof

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Before proceeding to the merits of Defendants’ Motion, the Court addresses Plaintiff’s

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contention concerning the appropriate burden of proof to be applied.
“Under § 282 of the Patent Act of 1952, a patent shall be presumed valid and the burden of

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establishing invalidity of a patent or any claim thereof shall rest on the party asserting such

8

invalidity.” Microsoft Corp. v. i4i Ltd. P’ship, 564 U.S. 91, 95 (2011) (citing 35 U.S.C. § 282)

9

(quotation marks and alterations omitted).

10

Plaintiff states without elaboration that Defendants must establish a lack of patent-eligible

United States District Court
Northern District of California

11

subject matter by clear and convincing evidence—a heightened evidentiary standard applied in

12

evaluating challenges to patent validity—rather than by a preponderance of the evidence. Opp. at

13

4:26, 15:18. In that regard, Plaintiff cites to Ultramercial, Inc. v. Hulu, LLC, 722 F.3d 1335,

14

1338–39 (Fed. Cir. 2013), for the proposition that the clear and convincing evidence standard

15

applies. Opp. at 4. However, the Ultramercial decision relied upon by Plaintiff lacks precedential

16

effect, as the U.S. Supreme Court vacated the judgment in the case “for further consideration in

17

light of Alice.” WildTangent, Inc. v. Ultramercial, LLC, 134 S. Ct. 2870 (2014). On remand, the

18

Federal Circuit reversed its prior decision and held, without mention of the clear and convincing

19

evidence standard, that the claims at issue were not directed to patent-eligible subject matter. See

20

Ultramercial, 772 F.3d at 711–12, 714–717.

21

No post-Alice decision of the U.S. Supreme Court or the Federal Circuit appears to directly

22

address whether the clear and convincing evidence standard applies when evaluating a lack of

23

patent-eligible subject matter on the pleadings. There is a split of authority amongst district courts

24

as to the appropriate standard to be applied. Several courts have concluded that a heightened

25

burden of proof makes little sense in the context of a motion to dismiss or motion for judgment on

26

the pleadings, and therefore declined to apply the clear and convincing evidence standard. See,

27

e.g., TNS Media Res., LLC v. Tivo Res. & Analytics, Inc., No. 11-CV-4039-SAS, 2016 WL

28

12
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1

817447, at *10 (S.D.N.Y. Feb. 22, 2016) (“Because no evidence outside the pleadings is

2

considered in deciding a motion to dismiss or a motion for judgment on the pleadings, it makes

3

little sense to apply a clear and convincing evidence standard—a burden of proof—to such

4

motions.”) (quotation marks and emphasis omitted); Protegrity USA, Inc. v. Netskope, Inc., No.

5

15-CV-02515-YGR, 2015 WL 6126599, at *4 (N.D. Cal. Oct. 19, 2015) (same). Other courts

6

have applied the clear and convincing evidence standard to Section 101 challenges either without

7

discussion, or because that standard is applied by the Federal Circuit in the context of other

8

challenges to validity. See OpenTV, Inc. v. Apple Inc., No. 15-CV-02008-EJD, 2016 WL 344845,

9

at *3 (N.D. Cal. Jan. 28, 2016) (noting split of authority and collecting cases); Affinity Labs of
Tex., LLC v. DirecTV, LLC, 109 F. Supp. 3d 916, 932 & n.6 (W.D. Tex. 2015) (same); c.f. Bascom

11
United States District Court
Northern District of California

10

Res., LLC v. LinkedIn, Inc., 77 F. Supp. 3d 940, 945 (N.D. Cal. 2015) (holding that “an alleged

12

infringer asserting an invalidity defense pursuant to § 101 bears the burden of proving invalidity

13

by clear and convincing evidence” in summary judgment context).

14

However, the Court need not resolve this dispute in connection with the instant Motion.

15

For the reasons set forth below, regardless of which standard applies, the Court concludes that

16

Defendants have established that the asserted claims of the Papst Patents currently at issue are

17

directed to patent-ineligible subject matter.

18

C. Substantive Legal Standards Applicable Under 35 U.S.C. § 101

19

Defendants contend that the asserted claims of the Papst Patents are directed to

20

unpatentable abstract ideas, and fail to “recite an inventive concept sufficient to transform the

21

unpatentable abstract idea of using a simulator to verify a memory test into a patentable

22

application of that idea.” Mot. at 1. Defendants therefore argue that judgment on the pleadings is

23

appropriate because [t]he asserted claims are . . . invalid under 35 U.S.C. § 101.” Id. Because of

24

the rapid evolution of the law concerning patent-eligible subject matter under Section 101 in

25

recent years, the Court first discusses the legal framework applicable to Defendants’ Motion. The

26

Court then turns to the application of that framework to the Papst Patents.

27
28

13
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1
2
3
4
5
6
7
8
9
10

United States District Court
Northern District of California

11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28

1. Patent-Eligible Subject Matter Under 35 U.S.C. § 101
Section 101 of Title 35 of the United States Code “defines the subject matter that may be
patented under the Patent Act.” Bilski v. Kappos, 561 U.S. 593, 601 (2010). Under Section 101,
the scope of patentable subject matter encompasses “any new and useful process, machine,
manufacture, or composition of matter, or any new and useful improvement thereof.” Id. (quoting
35 U.S.C. § 101). These categories are broad, but they are not limitless. Section 101 “contains an
important implicit exception: Laws of nature, natural phenomena, and abstract ideas are not
patentable.” Alice, 134 S. Ct. at 2354 (quotation marks omitted). These three exceptions are not
patent-eligible because “they are the basic tools of scientific and technological work,” which are
“free to all men and reserved exclusively to none.” Mayo Collaborative Servs. v. Prometheus
Labs., Inc., 132 S. Ct. 1289, 1293 (2012) (quotation marks omitted). The U.S. Supreme Court has
explained that allowing patent claims for such purported inventions would “tend to impede
innovation more than it would tend to promote it,” thereby thwarting the primary object of the
patent laws. Id. at 1293. However, the U.S. Supreme Court has also cautioned that “[a]t some
level, all inventions embody, use, reflect, rest upon, or apply laws of nature, natural phenomena, or
abstract ideas.” Alice, 134 S. Ct. at 2354 (quotation marks and alterations omitted). Accordingly,
courts must “tread carefully in construing this exclusionary principle lest it swallow all of patent
law.” Id.
In Alice, the leading case on patent-eligible subject matter under Section 101, the U.S.
Supreme Court refined the “framework for distinguishing patents that claim laws of nature,
natural phenomena, and abstract ideas from those that claim patent-eligible applications of those
concepts” originally set forth in Mayo, 132 S. Ct. at 1296–97. This analysis, generally known as
the “Alice” framework, proceeds in two steps as follows:
First, we determine whether the claims at issue are directed to one of
those patent-ineligible concepts. If so, we then ask, “[w]hat else is
there in the claims before us?” To answer that question, we consider
the elements of each claim both individually and “as an ordered
combination” to determine whether the additional elements
“transform the nature of the claim” into a patent-eligible application.
We have described step two of this analysis as a search for an
“‘inventive concept’”—i.e., an element or combination of elements
14
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1

that is “sufficient to ensure that the patent in practice amounts to
significantly more than a patent upon the [ineligible concept] itself.”

2

Alice, 134 S. Ct. at 2355. (citations omitted; alterations in original); see also In re TLI Commc’ns

3

Patent Litig., No. 2015-1372 (lead), --- F.3d ----, 2016 WL 2865693, at *2 (Fed. Cir. May 17,

4

2016) (describing “the now familiar two-part test described by the U.S. Supreme Court in Alice”).

5

The Court discusses the contours of analysis under the two steps of the Alice framework below.

6

2. Alice Step One — Identification of Claims Directed to an Abstract Idea

7

Neither the U.S. Supreme Court nor the Federal Circuit has set forth a bright line test

8

separating abstract ideas from concepts that are sufficiently concrete so as to require no further

9

inquiry under the first step of the Alice framework. See, e.g., Alice, 134 S. Ct. at 2357 (noting that
“[the U.S. Supreme Court] need not labor to delimit the precise contours of the ‘abstract ideas’

11
United States District Court
Northern District of California

10

category in this case”); DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245, 1256 (Fed. Cir.

12

2014) (observing that the U.S. Supreme Court did not “delimit the precise contours of the ‘abstract

13

ideas’ category in Alice”) (quotation marks omitted). As a result, in evaluating whether particular

14

claims are directed to patent-ineligible abstract ideas, courts have generally begun by

15

“compar[ing] claims at issue to those claims already found to be directed to an abstract idea in

16

previous cases.” Enfish, LLC v. Microsoft Corp., No. 2015-1244, --- F.3d ----, 2016 WL 2756255,

17

at *4 (Fed. Cir. May 12, 2016).

18

Two of the U.S. Supreme Court’s leading cases concerning the “abstract idea” exception

19

involved claims held to be abstract because they were drawn to longstanding, fundamental

20

economic practices. See Alice, 134 S. Ct. at 2356 (claims “drawn to the concept of intermediated

21

settlement, i.e., the use of a third party to mitigate settlement risk” were directed to an

22

unpatentable abstract idea); Bilski, 561 U.S. at 611–12 (claims drawn to “the basic concept of

23

hedging, or protecting against risk” were directed to an unpatentable abstract idea because

24

“[h]edging is a fundamental economic practice long prevalent in our system of commerce and

25

taught in any introductory finance class.”) (quotation marks omitted). Although courts have thus

26

had little difficultly concluding that claims drawn to the simple automation of fundamental

27
28

15
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1

economic practices similar to those at issue in Bilski and Alice are abstract6, the determination of

2

whether other types of computer-implemented claims are abstract has proven more troublesome.

3

See, e.g., Internet Patents Corp. v. Active Network, Inc., 790 F.3d 1343, 1345 (Fed. Cir. 2015)

4

(“[P]recision has been elusive in defining an all-purpose boundary between the abstract and the

5

concrete[.]”).
As a result, in addition to comparing claims to prior U.S. Supreme Court and Federal

6

Circuit precedents, courts considering computer-implemented inventions have taken varied

8

approaches to determining whether particular claims are directed to an abstract idea. For example,

9

courts have considered whether the claims purport to “improve the functioning of the computer

10

itself,” Alice, 134 S. Ct. at 2359, which may suggest that the claims are not abstract, or instead

11
United States District Court
Northern District of California

7

whether “computers are invoked merely as a tool” to carry out an abstract process. Enfish, 2016

12

WL 2756255 at *5; see also id. at *4 (noting that “some improvements in computer-related

13

technology when appropriately claimed are undoubtedly not abstract, such as a chip architecture,

14

an LED display, and the like. Nor do we think that claims directed to software, as opposed to

15

hardware, are inherently abstract[.]”).
Similarly, the Federal Circuit has considered whether claims are directed to “a problem

16
17

that does not arise in the ‘brick and mortar context’” but rather is “particular to the Internet” as an

18

indicator that a claim is not drawn to a patent-ineligible abstract idea. DDR Holdings, 773 F.3d at

19

1257–58 (holding that claims were not abstract where the “the claims recite an invention that is

20

not merely the routine or conventional use of the Internet” but instead solve a specific problem by

21

departing from “the routine, conventional functioning of Internet hyperlink protocol”).

22
23
24
25
26

6

See, e.g., buySAFE, 765 F.3d at 1355 (creating a transaction performance guaranty for a
commercial transaction on computer networks such as the Internet); Accenture Global Servs.,
GmbH v. Guidewire Soft., Inc., 728 F.3d 1336, 1338 (Fed. Cir. 2013) (generating rule-based tasks
for processing an insurance claim); Bancorp Servs., 687 F.3d at 1278 (managing a stable value
protected life insurance policy); Dealertrack, 674 F.3d at 1333 (processing loan information
through a clearinghouse); see also Cyberfone Sys., LLC v. CNN Interactive Grp., Inc., 558 F.
App’x 988, 991 (Fed. Cir. 2014) (non-prec.) (collecting cases).

27
28

16
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

Another helpful tool used by courts in the abstract idea inquiry is consideration of whether

1

the claims are, in essence, directed to a mental process or a process that could be done with pen

3

and paper. See CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d 1366, 1372 (Fed. Cir. 2011)

4

(claim for verifying the validity of a credit card transaction over the Internet was invalid because

5

the “steps can be performed in the human mind, or by a human using a pen and paper”); see also,

6

e.g., Mortgage Grader, Inc. v. First Choice Loan Servs. Inc., 811 F.3d 1314, 1324 (Fed. Cir. 2016)

7

(claims for computer-implemented system to enable borrowers to anonymously shop for loan

8

packages were abstract where “[t]he series of steps covered by the asserted claims . . . could all be

9

performed by humans without a computer”); Intellectual Ventures I LLC v. Symantec Corp., 100

10

F. Supp. 3d 371, 383 (D. Del. 2015) (“Another helpful way of assessing whether the claims of the

11
United States District Court
Northern District of California

2

patent are directed to an abstract idea is to consider if all of the steps of the claim could be

12

performed by human beings in a non-computerized ‘brick and mortar’ context.”) (citing buySafe,

13

765 F.3d at 1353).7
Regardless of the particular analysis that is best suited to the specific facts at issue in a

14
15

case, however, the Federal Circuit has emphasized that “a substantial class of claims are not

16

directed to a patent-ineligible concept,” and thus “the first step of the [Alice] inquiry is a

17

meaningful one.” Enfish, 2016 WL 2756255 at *4 (emphasis in original). The court’s task is thus

18

not to determine whether claims merely involve an abstract idea at some level, see id., but rather to

19

examine the claims “in their entirety to ascertain whether their character as a whole is directed to

20

excluded subject matter.” Internet Patents Corp., 790 F.3d at 1346.
3. Alice Step Two — Evaluation of Abstract Claims for a Limiting Inventive
Concept

21
22

A claim drawn to an abstract idea is not necessarily invalid if the claim’s limitations—

23
24
25
26
27
28

7

One court has noted that, like all tools of analysis, the “pencil and paper” analogy must not be
unthinkingly applied. See California Inst. of Tech. v. Hughes Commc’ns Inc., 59 F. Supp. 3d 974,
995 (C.D. Cal. 2014) (viewing pencil-and-paper test as a “stand-in for another concern: that
humans engaged in the same activity long before the invention of computers,” and concluding that
test was unhelpful where “error correction codes were not conventional activity that humans
engaged in before computers”).
17
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1

considered individually or as an ordered combination—serve to “transform the claims into a

2

patent-eligible application.” Content Extraction, 776 F.3d at 1348. Thus, the second step of the

3

Alice analysis (the search for an “inventive concept”) asks whether the claim contains an element

4

or combination of elements that ensures that the patent in practice amounts to significantly more

5

than a patent upon the abstract idea itself. Alice, 134 S. Ct. at 2355.

6

The U.S. Supreme Court has made clear that a transformation of an abstract idea to a

7

patent-eligible application of the idea requires more than simply reciting the idea followed by

8

“apply it.” Id. at 2357 (quoting Mayo, 132 S. Ct. at 1294). In that regard, the Federal Circuit has

9

repeatedly held that “[f]or the role of a computer in a computer-implemented invention to be
deemed meaningful in the context of this analysis, it must involve more than the performance of

11
United States District Court
Northern District of California

10

‘well-understood, routine, [and] conventional activities previously known to the industry.’”

12

Content Extraction, 776 F.3d at 1347–48 (quoting Alice, 134 S. Ct. at 2359) (alterations in

13

original); see also Mortgage Grader, 811 F.3d at 1324–25 (holding that “generic computer

14

components such as an ‘interface,’ ‘network,’ and ‘database’ . . . do not satisfy the inventive

15

concept requirement.”); Bancorp Servs., 687 F.3d at 1278 (“To salvage an otherwise patent-

16

ineligible process, a computer must be integral to the claimed invention, facilitating the process in

17

a way that a person making calculations or computations could not.”). Similarly, “[i]t is well-

18

settled that mere recitation of concrete, tangible components is insufficient to confer patent

19

eligibility to an otherwise abstract idea” where those components simply perform their “well-

20

understood, routine, conventional” functions. In re TLI Commc’ns., 2016 WL 2865693, at *5

21

(limitations of “telephone unit,” “server,” “image analysis unit,” and “control unit” insufficient to

22

adequately narrow abstract idea of “classifying and storing digital images in an organized manner”

23

under step two of the Alice framework) (quotation marks omitted).

24

In addition, the U.S. Supreme Court explained in Bilski that “limiting an abstract idea

25

to one field of use or adding token postsolution components [does] not make the concept

26

patentable.” 561 U.S. at 612 (citing Parker v. Flook, 437 U.S. 584 (1978)); see also Alice, 134

27

S.Ct. at 2358 (same). The Federal Circuit has similarly stated that attempts “to limit the use of

28

18
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1

the abstract idea to a particular technological environment” are insufficient to render an abstract

2

idea patent eligible. Ultramercial, 772 F.3d at 716 (quotation marks omitted); see also Intellectual

3

Ventures I LLC v. Capital One Bank (USA), 792 F.3d 1363, 1366 (Fed. Cir. 2015) (“An abstract

4

idea does not become nonabstract by limiting the invention to a particular field of use or

5

technological environment, such as the Internet.”).
Finally, in considering whether a claim contains an inventive element, courts often apply

6
7

the so-called “machine-or-transformation” test, which asks whether a process is (1) “tied to a

8

particular machine or apparatus,” or (2) “transforms a particular article into a different state or

9

thing.” Ultramercial, 772 F.3d at 716. Although the “machine-or-transformation test is not the
sole test governing § 101 analyses, that test can provide a ‘useful clue’ in the second step of

11
United States District Court
Northern District of California

10

the Alice framework.” Id. at 716 (citations omitted); Bancorp Servs., 867 F.3d at 1279 (discerning

12

“no fault” in district court’s consideration of machine-or-transformation test).

13

III.

14

DISCUSSION
The question presented by Defendants’ Motion is whether the asserted claims fall within

15

the patent-ineligible “abstract ideas” exception to Section 101. To answer this question, the Court

16

turns to the application of the Alice framework described above to the asserted claims of the Papst

17

Patents.

18

A. Alice Step One — Whether the Asserted Claims Are Directed to an Abstract Idea

19

The Court “must first determine whether the claims at issue are directed to [an abstract

20

idea].” Alice, 134 S. Ct. at 2355. Defendants contend that “[t]he Papst Patents are directed to the

21

abstract idea of verifying a test for a memory device.” Mot. at 1; see also id. at 8 (arguing that

22

“the ‘gist’ of the Papst Patents is to use a generic ‘simulator’ to verify whether a memory test will

23

violate any of the operating constraints of the memory device to be tested.”). Defendants argue

24

that “two things are critical in assessing whether the Papst Patent claims recite an unpatentable

25

abstract idea”: first, that the “functions recited in the asserted claims—all of which are methods—

26

can be performed by a human test writer either mentally or with a pencil and paper”; and second,

27

that the asserted claims “do not recite any specific algorithm or implementation details of the

28

19
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1
2

claimed ‘simulator’ or ‘packer’—and neither does the specification.” Id. at 8–9.
Plaintiff responds that the claims are not directed to abstract ideas because the specification

3

demonstrates that the claims “are directed to an improvement of an existing computer technology

4

rather than an abstract idea,” Opp. at 8–9; because the claimed “simulator” and “packer” are

5

specialized computer programs, Opp. 10–12; because “Defendants’ assertion that the functions . . .

6

can be carried out mentally or with a pencil and paper is nonsensical,” Opp. 12–13; and because

7

Defendants’ characterization of the asserted claims is overly general, Opp. 14–15.
The Court begins by examining each asserted claim in its entirety to understand the idea at

9

the “heart” of the claimed invention. Ultramercial, 772 F.3d at 714 (“We first examine the claims

10

because claims are the definition of what a patent is intended to cover”); Accenture Global Servs.,

11
United States District Court
Northern District of California

8

728 F.3d at 1341 (“[T]he court must first identify and define whatever fundamental concept

12

appears wrapped up in the claim.”) (quotation marks omitted). In distilling the purpose of a claim,

13

the Court is careful not to express the claim’s fundamental concept at an unduly “high level of

14

abstraction . . . untethered from the language of the claims,” but rather at a level consonant with

15

the level of generality or abstraction expressed in the claims themselves. Enfish, 2016 WL

16

2756255 at *6; see also Visual Memory LLC, v. Nvidia Corp, No. 15-CV-789-RGA, 2016 WL

17

3041847, at *5 (D. Del. May 27, 2016) (“Put another way, the ‘level of abstraction’ employed by

18

the court in describing the claims must be consonant with the level of abstraction expressed in the

19

claims themselves.”)

20

Here, the Court agrees with Defendants that each of the asserted claims, at its heart, is

21

directed to the use of a simulator to determine whether a memory test violates a set of rules. With

22

minor variations in phrasing, each of the asserted claims requires (1) writing a memory test (e.g.,

23

’759 patent, cl. 1: “developing a set of operations defining the test” wherein the operations are

24

“ordered in time”); (2) using a “simulator” to check if the test violates the rules (“operating

25

constraints”) governing use of the memory (e.g., ’759 patent, cl. 1: “passing the set of operations

26

through a simulator capable of determining whether the set of operations violates any one of the

27

[memory’s] operating constraints”); and (3) notifying the user of any errors found by the simulator

28

20
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1

(e.g., ‘759 patent, cl. 1: “outputting an error message”). The focus of this process is on the use of

2

a simulator, with additional steps describing the input to the simulator (the memory test and a set

3

of rules) and the output of the simulator (error messages if the test does not comply with the rules).

4

Moreover, the specification emphasizes the use of the simulator as a basic feature of the

5

claimed invention. See, e.g., ’759 patent, at abstract (“A simulator is used to verify that the

6

sequence of time-ordered commands complies with a set of operating constraints for the

7

memory.”); id., col. 3:55–63 (emphasizing simulator as “a first general aspect” of the invention).

8

With the exception of Claim 14 of the ’759 patent, discussed further below, the remaining asserted

9

claims are directed to variants of the same basic concept as Claim 1 of the ’759 patent. These
variants consist of minor rephrasing or the addition of minor limitations varying the content of the

11
United States District Court
Northern District of California

10

error message output by the simulator (e.g., ’759 patent, cl. 5, and ’891 patent, cl. 6, which add

12

“wherein the error message further identifies a timing adjustment to the set of operations which

13

will resolve the time-based constraint violation.”).

14

The Federal Circuit has held that a district court need not expressly address each asserted

15

claim where the court concludes particular claims are representative because all the claims are

16

“substantially similar and linked to the same abstract idea.” Content Extraction, 776 F.3d at 1348

17

(quotation marks omitted); see also Mortgage Grader, 811 F.3d at 1324 n.6 (court did not err by

18

discussing only one claim where claims did not “differ in any manner that is material to the patent-

19

eligibility inquiry”). Although Claims 1 and 14 of the ’759 patent are plainly representative of the

20

remaining asserted claims, the Court has also considered each asserted claim individually, and its

21

analysis herein concerning Claims 1 and 14 is equally applicable to each asserted claim.

22

Plaintiff contends that Defendants’ description of the claims (and, by extension, the

23

abstract idea identified by Defendants) is impermissibly generalized, and fails entirely to account

24

for two categories of claim limitations: limitations related to error messages recited in each claim

25

except Claim 14 of the ’759 patent, and the “packer” limitation recited by Claim 14. Opp. at 15.

26
27
28

Plaintiff’s contention is unpersuasive with regard to the error message limitations. The
error message limitations of the asserted claims are secondary to (and dependent upon) the use of
21
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

the simulator itself. See, e.g., ’759 patent, col. 5:26–28 (“If the list of operations violates a

2

constraint, the simulator provides an error message.”). The use of a simulator is thus the dominant

3

concept to which the claims are directed. Moreover, although determining the concept to which a

4

claim is directed at the first step of the Alice framework cannot be “untethered from the language

5

of the claims,” Enfish, 2016 WL 2756255 at *6, it is equally clear that the Court’s formulation of

6

the basic concept reflected by the claim need not expressly recite every limitation of a claim. See,

7

e.g., Ultramercial, 772 F.3d at 715 (describing “the concept embodied by the majority of the

8

limitations” despite presence of other limitations) (emphasis added); Content Extraction, 776 F.3d

9

at 1347 (summarizing concept to which claims were drawn as “1) collecting data, 2) recognizing

10

certain data within the collected data set, and 3) storing that recognized data in a memory” despite

11
United States District Court
Northern District of California

1

presence of other claim limitations); Dealertrack, 674 F.3d at 1333 (reducing multi-step process to

12

“its simplest form [of] three steps” and summarizing concept as “processing information through a

13

clearinghouse” despite presence of additional limitations).

14

With regard to the “packer” functionality of Claim 14, however, Plaintiff’s point is well-

15

taken. Although Claim 14 of the ’759 patent is directed to the same basic concept of using a

16

simulator to determine whether a memory test violates a set of rules, see ’759 patent, cl. 14, it also

17

adds the additional concept of passing the memory test through a “packer” to minimize the time

18

between each test command. Unlike the limitations directed to the content of error messages

19

output by the simulator, the Papst Patents describe the packer as a conceptually separate aspect of

20

the invention used to reduce the amount of time a memory test takes to run. See, e.g., ’759 patent,

21

at abstract (“A packer may thereafter be used to optimize run time of the verified test”); col. 4:1–4;

22

col. 5:59–62 (describing packer as “a second general aspect” of the invention that temporally

23

“packs” the operations making up the memory test “as tightly as possible” given a set of rules).

24

While the other asserted claims are directed to the fundamental concept of using a simulator to

25

determine whether a memory test violates a set of rules, Claim 14 is thus more appropriately

26

characterized as being directed to the concepts of (1) using a simulator to determine whether a

27

memory test violates a set of rules; and (2) using a packer to optimize the memory test.

28

22
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1

Having thus identified the fundamental concepts to which the asserted claims are directed,

2

the question remains whether those concepts are abstract within the meaning of the exception to

3

patentable subject matter set forth by the U.S. Supreme Court. For the reasons set forth below, the

4

Court concludes that each of the asserted claims is directed to a patent-ineligible abstract idea.

5

1. The Asserted Claims of the Papst Patents Are Similar to Claims Previously Held
to Be Directed to Abstract Ideas

6
As noted above, in considering whether a claim is directed to an abstract idea, both the
7

U.S. Supreme Court and the Federal Circuit have “compare[d the] claims at issue to those claims

8
already found to be directed to an abstract idea in previous cases.” Enfish, 2016 WL 2756255 at
9
10

*4. Defendants contend that the Federal Circuit’s relatively recent decision in Vehicle Intelligence
& Safety LLC v. Mercedes-Benz USA, LLC is particularly instructive on these facts. 635 F. App’x

11
United States District Court
Northern District of California

914 (Fed. Cir. 2015) (non-prec.), cert. denied, No. 15-1201, 2016 WL 1171121 (U.S. May 31,
12
2016). The Court agrees.
13
In Vehicle Intelligence, the Federal Circuit affirmed a judgment on the pleadings under
14
Federal Rule of Civil Procedure 12(c), holding that asserted claims of U.S. Patent No. 7,394,392
15
16
17
18
19
20
21

were invalid as covering “only abstract ideas coupled with routine data-gathering steps and
conventional computer activity.” 635 F. App’x at 915. The claims of the patent at issue related to
“methods and systems that screen equipment operators for impairment, selectively test those
operators, and control the equipment if an impairment is detected.” Id. at 916. A representative
method claim was directed to a method “to screen an equipment operator for impairment” and
recited limitations including “screening an equipment operator by one or more expert systems to
detect potential impairment of said equipment operator,” “selectively testing said equipment

22
operator when said screening of said equipment operator detects potential impairment of said
23

equipment operator,” and “controlling operation of said equipment if said selective testing . . .

24
indicates said impairment . . ., wherein said screening . . . includes a time-sharing allocation of at
25
26

least one processor executing at least one expert system.” Id. A representative system claim
recited similar concepts in terms of modules, such as “one or more expert system modules” and “a

27
28

23
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1

screening module to screen and selectively test an equipment operator . . . wherein said screening

2

module utilizes one or more expert system modules.” Id.

3

As is relevant here, the Federal Circuit held that these claims were directed to patent-

4

ineligible abstract ideas. A particular focus of the court’s analysis was the level of generality at

5

which the computerized “expert system” performing the impairment screening and control was

6

claimed, and the equivalent generality with which that expert system was described in the

7

specification. Specifically, the Federal Circuit noted that “critically absent from the entire patent”

8

was an explanation of how the expert system or modules actually carried out the claimed

9

functions. Id. at 918. Although the patent specified the functions that the expert system would
perform (e.g., determining whether or not the equipment operator was impaired), neither the

11
United States District Court
Northern District of California

10

specification nor the claims explained, for example, how “the decision module determines if an

12

operator is impaired . . .; assuming this determination can be made, how the decision module

13

decides which control response to make; and assuming the control response decision can be made,

14

how the ‘expert system’ effectuates the chosen control response.” Id. Rather, the patent “[a]t best

15

. . . answer[ed] the question of how to provide faster, more accurate and reliable impairment

16

testing by simply stating ‘use an expert system.’” Id. As the court concluded, “in the absence of

17

any details about how the ‘expert system’ works, the claims at issue are drawn to a patent-

18

ineligible abstract idea.” Id..

19

The Federal Circuit’s analysis of the claims at issue in Vehicle Intelligence is equally

20

applicable to the asserted claims here. The asserted claims of the Papst Patents replace manual

21

evaluation of a memory test with “a simulator capable of determining whether the set of

22

operations violates any one of the operating constraints” of the memory, ’759 patent, cl. 1, and

23

manual optimization of a memory test with “a packer to minimize run time of the test in relation to

24

the operating constraints,” id., cl. 14. But just as in Vehicle Intelligence, neither the specification

25

nor the claims of the Papst Patents provide any meaningful explanation of how the claimed

26

simulator determines whether operating constraints are violated. Nor do the specification or

27

claims offer any explanation of how the claimed packer optimizes the memory test. Rather, the

28

24
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1

Papst Patents simply describe, in the most general of terms, that the simulator “runs the set of

2

operations against the set of constraints defined by the [memory device] parameter list,”

3

’759 patent, col. 5:25–28, and that the packer operates by “iteratively call[ing] the simulator to

4

produce a version of the time-ordered sequence [of memory test commands] which minimizes the

5

time allocated between different operations,” id. col. 5:62–66; see also id. col. 5:7–9 (explaining

6

that “[t]he simulator is event-driven and directly models the behavior of one or more memory

7

devices,” but offering no further explanation how modeling occurs).
Similarly, the specification states, again in general terms, that the simulator can be “written

8
9

in a high level language like ‘C’ on a UNIX based platform” or with “[a] standard tool set or
threads package, such as the CSIM17 software library[.]” Id. col. 6:56–59. The packer is

11
United States District Court
Northern District of California

10

similarly described in general terms as being implemented “as a ‘Perl script,’ a well known UNIX

12

programming language.” Id. col. 6:64–65. Although the specification thus includes generic

13

descriptions of well-known programming languages that could be used in the abstract to create a

14

simulator or packer, absent from the Papst Patents is any description of any specific algorithm for

15

simulator or packer operation to be implemented with those languages, or other implementation

16

details that might narrow the scope of the abstract idea of creating and using a generic simulator or

17

packer. In essence, the simulator and packer in the asserted claims of the Papst Patents are

18

claimed simply as black boxes defined by a desired function. As in Vehicle Intelligence, the Papst

19

Patents thus answer “the question of how to provide faster, more accurate and reliable [verification

20

of memory tests] by simply stating ‘use [a simulator or packer].’” 635 F. App’x at 918. Without

21

more, the asserted claims are drawn to a patent-ineligible abstract idea.

22

Plaintiff argues that the asserted claims are not directed to abstract ideas because the

23

claimed “simulator” and “packer” refer to “specific, defined, special-purpose software components

24

that achieve functionality different from existing and conventional practices.” Opp. 9–12.8 This

25
26
27
28

8

In connection with this argument, Plaintiff requests without opposition that the Court take
judicial notice of several exhibits attached to the Declaration of Andrew G. DiNovo submitted
with the Opposition. Opp. at 11 n. 2; See No. 16-CV-00925-LHK, ECF No. 93 (“DiNovo
Declaration”). The Court takes judicial notice of the dictionary definition submitted as Exhibit A
25
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1

argument is unpersuasive. First, Plaintiff’s contention that the simulator and packer claimed are

2

something other than generically identified software components performing conventional

3

functions is belied by the complete lack of description in the Papst Patents as to how those

4

components should be implemented. Indeed, the Papst Patents assume that implementation of a

5

generic simulator or packer is within the abilities of one of ordinary skill in the art, and state

6

without elaboration that the simulator or packer can be written in standard programming languages

7

using standard tools. See ’759 patent, col. 6:55–65; cf. Content Extraction, 776 F.3d at 1348

8

(holding that “use of a generic scanner and computer to perform well-understood, routine, and

9

conventional activities commonly used in industry” was insufficient to render claims nonabstract). The concept of a software “packer” or a “simulator” for a memory device, specified at

11
United States District Court
Northern District of California

10

the level of generality present in the asserted claims of the Papst Patents, is thus no different than

12

the other types of generic software components, such as a “database,” that the Federal Circuit has

13

described as “generic computer elements performing generic computer tasks.” Intellectual

14

Ventures I, 792 F.3d at 1368; Mortgage Grader, 811 F.3d at 1324–25 (rejecting claims reciting

15

“generic computer components” including a “database”); Accenture Global Servs., 728 F.3d at

16

1344 (rejecting claims requiring “a combination of computer components including an insurance

17

transaction database, a task library database, a client component, and a server component, which

18

include[d] an event processor, a task engine, and a task assistant”).

19

Second, Plaintiff’s argument closely parallels an argument rejected by the Federal Circuit

20

in Vehicle Intelligence, albeit in the second step of the Alice analysis. There, the patentee argued

21

that “its methods are embedded in ‘specialized existing equipment modules,’ as opposed to

22
23
24
25
26
27
28

to the DiNovo Declaration and the May 6, 2016 Institution Decision of the United States Patent
and Trademark Office’s Patent Trial and Appeal Board (“PTAB”), submitted as Exhibit D to the
DiNovo Declaration, concerning the claims of the ’759 patent in inter partes review No. IPR201600104. However, Exhibits B and C to the DiNovo Declaration appear to be technical materials
printed from Defendants’ websites. Because Plaintiff does not explain (and it is not otherwise
apparent) why such documents may be appropriately judicially noticed, the Court denies
Plaintiff’s request concerning those documents. See ECF No. 93, Ex. B (Altera document); Ex. C
(Xilinx document). Regardless, none of the documents supplied with the DiNovo Declaration
would alter the Court’s conclusions herein.
26
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1

generic computers, which renders them patent-eligible.” 635 F. App’x at 919. As is also the case

2

here, however, the Federal Circuit in Vehicle Intelligence noted that “markedly absent from the . . .

3

patent is any explanation of how the methods at issue can be embedded into these existing

4

modules.” Id. The Federal Circuit further explained that “[m]erely stating that the methods at

5

issue are performed on already existing vehicle equipment”—much as Plaintiff here argues its

6

methods are performed on existing software components—“does not save the disputed claims

7

from abstraction.” Id.

8
9

In addition, Plaintiff relies heavily upon the Federal Circuit’s decisions in Enfish, 2016 WL
2756255, at *4, and DDR Holdings, 773 F.3d at 1248, 1257, to argue that the “[a]sserted [c]laims
here are directed to an improvement of an existing computer technology rather than an abstract

11
United States District Court
Northern District of California

10

idea.” Opp. at 8; see also id. at 6. Plaintiff’s argument is not persuasive, however, because unlike

12

the claims at issue in Enfish and DDR Holdings, the asserted claims of the Papst Patents are not

13

directed to any improvement of the computer or technology itself.

14

In Enfish, the Federal Circuit “clarified that a relevant inquiry at [Alice] step one is ‘to ask

15

whether the claims are directed to improvement to computer functionality versus being directed to

16

an abstract idea.’” In re TLI Commc’ns, 2016 WL 2865693, at *3 (quoting Enfish, 2016 WL

17

2756255, at *4). In Enfish, however, the claims at issue were directed “to a specific improvement

18

to the way computers operate,” in the form of a data structure that used a “self-referential table.”

19

Enfish, 2016 WL 2756255, at *5. Rather than simply automating a process using a computer as a

20

tool, the claims involved “a specific type of data structure designed to improve the way a

21

computer stores and retrieves data in memory.” Id. at *8. The claims were therefore directed to

22

an improvement of the functioning of the computer itself, as opposed to an abstract idea merely

23

performed on a computer. Similarly, the claims at issue in DDR Holdings were directed to an

24

improvement of the functionality of network technology itself. The claims there “specif[ied] how

25

interactions with the Internet are manipulated to yield a desired result—a result that overrides the

26

routine and conventional sequence of events ordinarily triggered by the click of a hyperlink.” 773

27

F.3d at 1258. The claims thereby solved a “particular Internet-centric problem” by means that did

28

27
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1

not recite “the routine or conventional use of the Internet” to carry out a process. Id. at 1259.
In contrast, the asserted claims here bear little resemblance to the claims at issue in Enfish

2
3

and DDR Holdings. Although Plaintiff contends that “the [a]sserted [c]laims improve the

4

functioning of the computer itself,” Opp. at 14, that conclusion does not follow from the

5

specification of the Papst Patents or the asserted claims. The Papst Patents are directed to methods

6

of verifying and optimizing memory tests, not to improving the computer or software components

7

used to carry out those methods. Unlike the improvements to data structures claimed by the

8

patents at issue in Enfish, the Papst Patents do not purport to improve the underlying technology of

9

memory devices or particular techniques of testing memory devices. For example, the Papst
Patents do not purport to improve the design, operation, or functionality of memory devices in any

11
United States District Court
Northern District of California

10

way. Nor do the Papst Patents disclose any improvement to the design or operation of the

12

simulator or packer recited in the asserted claims. Indeed, as noted above, the Papst Patents offer

13

scant detail as to how the simulator and packer should be implemented, let alone details of

14

improvements to those components. The focus of the asserted claims is instead on “a process that

15

qualifies as an ‘abstract idea’ for which computers are invoked merely as a tool”—specifically,

16

using a generically claimed simulator as a tool to determine whether a memory test violates a set

17

of rules, and using a generically claimed packer to optimize the test. Enfish, 2016 WL 2756255, at

18

*5.

19

Plaintiff’s argument that abstractness is defeated because the “claimed methods solve the

20

problems [identified in the specification] or improve memory-device testing” in various ways is

21

similarly unavailing. Opp. at 8–9 (citing Enfish, 2016 WL 2756255, at *6). In Enfish, the Federal

22

Circuit observed that benefits described in the patent’s specification bolstered the court’s

23

conclusion that the claims were directed to an improvement of existing database technology

24

through the use of a “self-referential table.” Enfish, 2016 WL 2756255, at *5. In contrast to the

25

asserted claims in the instant case, however, the Enfish claims were directed to implementations of

26

the self-referential tables or data structures that provided the purported improvement. See id.

27
28

Here, the primary improvement cited by Plaintiff—the efficient generation of memory tests
28
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1

for modern, complex memory devices, see Opp. at 9, 2–3—is not reflected in the limitations of the

2

asserted claims. Nothing in the asserted claims limits the claimed processes to the generation of

3

tests only for modern or complex memory devices, as opposed to simple tests for simple,

4

conventional memory devices. See ’759 patent, col. 2:1–3 (“The operation of early memory

5

devices was simple and characterized by relatively few constraints.”). The specification’s

6

description of the benefits of automation of a process using a computer is thus insufficient to save

7

the asserted claims from abstractness. See Accenture Global Servs., 728 F.3d at 1345 (focusing on

8

the language of the claims and stating that the “level of detail in the specification does not

9

transform a claim reciting only an abstract concept into a patent-eligible system or method”). The
remaining improvements cited by Plaintiff recite general advantages of using a computer to

11
United States District Court
Northern District of California

10

automate a memory-test verification process previously done manually, not improvements over a

12

prior computerized method for simulating or verifying memory tests. See Opp. 8–9. Plaintiff is

13

thus incorrect that the asserted claims are directed to a specific improvement of existing

14

technology, as opposed to unduly preempting an abstract idea.

15

2. The Asserted Claims of the Papst Patents Claim Automation of Mental or Penciland-Paper Processes

16
In addition, Defendants contend that the abstract nature of the asserted claims is confirmed
17

by the fact that “[t]he fundamental concept set out in each of the asserted claims can be—and, at

18
least with early, simply memory devices, often was—carried out by a human test writer either
19

mentally or with the aid of a pencil and paper.” Mot. at 10.

20
Defendants are correct that the steps of the asserted claims reflect activity described by the
21
specification as previously having been carried out by humans, and which are capable of being
22
performed mentally or with pencil and paper. As the Papst Patents describe, human test writers
23
wrote memory tests for early memory devices, and did so in accordance with the constraints of
24

particular memory devices. ’759 patent, col. 2:23–34; see also id., col. 1:58–61 (“In creating a

25
test, a test writer must define a sequence of operations which store and retrieve data to/from the
26

memory device in accordance with certain ‘operating constraints.’”). Defendants also

27
28

29
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

convincingly argue that there is no reason why, at least for simple memory devices, the step of

2

each asserted claim performed by “a simulator capable of determining” whether the memory tests

3

violates any of the constraints of the memory device could not instead be performed mentally or

4

with pencil and paper, simply by comparing the operations of a simple memory test to the rules

5

obtained from a simple memory device data sheet. See, e.g., ’759 patent, col. 2:1–3 (noting that

6

“[t]he operation of early memory devices was simple and characterized by relatively few

7

constraints); id. col. 3:35–37 (acknowledging that memory devices and memory tests have varying

8

levels of complexity). Similarly, the optimization step performed by the “packer” recited by Claim

9

14 of the ’759 patent reflects a process that could be performed mentally or with pencil and paper.

10

See ’759 patent, col. 3:39–40 (acknowledging “a test writer is motivated to write efficient tests”);

11
United States District Court
Northern District of California

1

id. col. 6:10–13 (acknowledging that test writers previously worked to “minimiz[e] the time

12

allocated between operations in the sequence of operations when the test is being written”). An

13

equivalent function to the error messages recited by the asserted claims (other than Claim 14 of the

14

’759 patent) can likewise be performed by a human test writer by noting a violation of a rule by

15

the memory test, or noting the solution to such a violation as a result of the mental steps or pencil-

16

and-paper calculations described above.

17

Plaintiff contends that Defendants’ argument that the “functions recited in the [a]sserted

18

[c]laims can be carried out mentally or with a pencil and paper is nonsensical” for three basic

19

reasons: (1) because the claims “must be implemented on a computer”; (2) because the “packer”

20

of Claim 14 of the ’759 patent operates differently than a human test writer optimizing a test does;

21

and (3) because “an unaided human cannot account for the near-instantaneous speed of memory

22

operations.” Opp. at 12–13. None of these reasons is persuasive.

23

First, Plaintiff’s contention that the functions recited by the claims literally require the use

24

of “software and computers” does not undermine Defendants’ argument. See, e.g., Opp. at 12

25

(arguing that “a human being cannot . . . iteratively call a simulator to optimize” a memory test).

26

Although cases have found that claims directed to “computational methods which can be

27

performed entirely in the human mind” are abstract, CyberSource, 654 F.3d at 1373 (emphasis

28

30
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1

added), the Federal Circuit has also held that claims that literally require the use of a computer, but

2

nevertheless reflect routine automation of activities which “could all be performed by humans

3

without a computer” may be abstract. Mortgage Grader, 811 F.3d at 1324 (claims directed to

4

patent-ineligible abstract idea where steps “could all be performed by humans without a

5

computer” despite literally requiring “[a] computer-implemented system” including “a database,”

6

“a computer system,” “a first interface,” and “a second interface”).

7

Second, Plaintiff’s argument that the packer operates differently than a human test
optimizer is unpersuasive. Opp. at 13 (arguing that “just because the packer shares a common

9

goal with a human test writer does not mean that they reach the goal in the same way”). In this

10

regard, Plaintiff essentially argues that human test writers previously attempted to minimize run

11
United States District Court
Northern District of California

8

time of a memory test while writing the test, while the packer operates after the test is written. Id.

12

However, Plaintiff identifies no reason why a human could not simply optimize a test after it is

13

written, regardless of whether that human would also attempt to minimize the run time of the test

14

when first writing the test. Moreover, Plaintiff’s argument that the operation of the packer should

15

be distinguished from the way humans previously optimized memory tests is particularly

16

unpersuasive given the generality with which the packer element is described, and the absence of

17

any implementation details or claim limitations directed to the specific way in which the claimed

18

packer achieves its goal.

19

Third, and finally, the Federal Circuit has repeatedly and emphatically rejected arguments

20

similar to Plaintiff’s contention that a computerized process is necessary to handle the complexity

21

or speed contemplated by the invention where such complexity is not reflected in the claim

22

limitations. See, e.g., Intellectual Ventures I, 792 F.3d at 1367 (“Nor . . . does claiming the

23

improved speed or efficiency inherent with applying the abstract idea on a computer provide a

24

sufficient inventive concept”); id. at 1370 (“[O]ur precedent is clear that merely adding computer

25

functionality to increase the speed or efficiency of the process does not confer patent eligibility on

26

an otherwise abstract idea.”); OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1363 (Fed.

27

Cir. 2015) (“[R]elying on a computer to perform routine tasks more quickly or more accurately is

28

31
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1

insufficient to render a claim patent eligible.”).
In this respect, Plaintiff’s argument is akin to the argument rejected by the Federal Circuit

2
3

in Planet Bingo, LLC v. VKGS LLC, 576 F. App’x 1005, 1008 (Fed. Cir. 2014) (non-prec). There,

4

the Federal Circuit held the claimed computerized bingo management system was directed to

5

patent-ineligible subject matter, despite the patentee’s argument that “‘in real world use, literally

6

thousands, if not millions of preselected Bingo numbers are handled by the claimed computer

7

program,’ making it impossible for the invention to be carried out manually.” Id. The complexity

8

upon which the patentee relied, however, was not reflected in the actual claims at issue, which

9

required at most “two sets of Bingo Numbers,” a “player,” and “a manager.” Id. That is equally
true in the instant case, where the claims are not limited to complex tests for complex memory

11
United States District Court
Northern District of California

10

devices, or similarly restricted in a manner which somehow might make the “near-instantaneous

12

speed of memory operations” which Plaintiff cites relevant.9 See Opp. at 13. As in Planet Bingo,

13

the use of a computer in the Papst Patents might make a tedious verification process faster and

14

more efficient, but it does not change the fundamental fact that the functions recited could also be

15

performed by humans without a computer. Cf. ’759 patent, col. 3:51–52; col. 6:18–21 (suggesting

16

that invention lifts the “burden” from human test writer by automating manual process previously

17

performed).

18

As noted above, whether a claim reflects routine automation of steps that could be

19

performed by humans mentally or with a pencil and paper is a useful tool in determining whether

20

the claim as a whole is directed to an abstract idea. See, e.g., Mortgage Grader, 811 F.3d at 1324;

21

cf. CyberSource, 654 F.3d at 1373. Here, the asserted claims’ reflection of generic, and

22

conventional, computerization of processes previously performed by humans without computers

23

confirms the Court’s conclusion that the asserted claims are directed to patent-ineligible abstract

24

ideas.

25
26
27
28

9

As Defendants also correctly note, Plaintiff’s argument concerning the speed of modern memory
devices fails for the additional reason that the claims are not directed to memory devices
themselves (which Plaintiff states operate at “near-instantaneous speed”), but rather to generating
and verifying memory tests—activity which need not occur at such speeds. Reply at 6.
32
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

For the reasons stated above, the Court concludes that each of the asserted claims is

1
2

directed to a patent-ineligible abstract idea. See Alice, 134 S. Ct. at 2355.
B. Alice Step Two — Whether the Asserted Claims Contain an “Inventive Concept”
Sufficient to Confer Patent Eligibility

3
4

Having determined that the asserted claims are directed to patent-ineligible abstract ideas,
5
6
7
8

the Court proceeds to the second step of the Alice framework to determine whether the claim’s
limitations—considered individually or as an ordered combination—serve to “transform the
claims into a patent-eligible application.” Content Extraction, 776 F.3d at 1348. Here, the Court
concludes that the asserted claims’ limitations, considered both individually and as a whole,

9
include no such transformation or inventive concept sufficient to ensure that the claims in practice
10
amount to significantly more than a patent upon the abstract idea itself. See Alice, 134 S. Ct. at
11
United States District Court
Northern District of California

2355.
12
When viewed as an ordered combination, the claim limitations of the asserted claims
13
specify steps at a high level of generality using generic software in order to carry out the abstract
14
idea of (1) using a simulator to determine whether a memory test violates a set of rules and (2)
15
using a packer to optimize that test. The U.S. Supreme Court in Alice explained that these types of
16

claim limitations—which consist of little more than reciting the idea followed by “apply it”—are

17
insufficient to salvage a claim directed to an abstract idea. Alice, 134 S. Ct. at 2357 (quoting
18
Mayo, 132 S. Ct. at 1290); see also Dealertrack, 674 F.3d at 1333 (rejecting argument that use of
19

a computer sufficiently limited the claims where the patent “[did] not specify how the computer

20
hardware and database are specially programmed to perform the steps claimed in the patent”)
21
(quotation marks omitted).
22

Plaintiff’s arguments to the contrary, which occupy a scant three pages of Plaintiff’s

23
Opposition, largely restate the same arguments made by Plaintiff in connection with the first step
24

of the Alice framework. Opp. at 16–18. For example, as with Plaintiff’s argument that the

25
asserted claims are not directed to an abstract idea, Plaintiff contends that the claims as a whole
26

contain an “inventive concept” at Alice step two because they include a simulator, and “the

27
28

33
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1

specialized simulator is not a generic software implementation devoid of any particular details.”

2

Opp. 16. However, the Court has already considered, and rejected, that argument in connection

3

with its analysis of the first step of the Alice framework. See supra Section III.A.1. Plaintiff’s

4

contentions that the asserted claims do not seek to patent abstract ideas because the claims recite a

5

“simulator” or “packer” are thus incorrect.10
In addition, Plaintiff’s arguments that the asserted claims are transformed by individual

7

claim elements are equally unavailing. Plaintiff argues that four limitations of various asserted

8

claims—which Plaintiff identifies as the “simulator,” “packer,” “outputted error,” and

9

“adjustment” elements—are sufficient, when viewed individually, to transform the abstract idea

10

into patent-eligible claims. Opp. at 18. For the reasons previously discussed, however, the first

11
United States District Court
Northern District of California

6

two limitations upon which Plaintiff relies (the “simulator” and “packer” elements), each of which

12

is claimed at a high level of generality, are insufficient to significantly narrow the scope of the

13

claims beyond the abstract idea itself. Moreover, as the Federal Circuit has held, “[i]t is well-

14

settled that mere recitation of concrete, tangible components is insufficient to confer patent

15

eligibility to an otherwise abstract idea” where those components simply perform their “well-

16

understood, routine, conventional” functions. In re TLI Commc’ns, 2016 WL 2865693, at *5

17

(quotation marks omitted). There is no suggestion in the specification of the Papst Patents that

18

these two elements, the implementation of which is left largely unspecified, act unconventionally

19

or do anything other than operate in their expected manner.11

20
21
22
23
24
25
26
27
28

10

Plaintiff’s suggestion that the claims are sufficiently limited because the simulator is limited to
“receiving particular inputs: memory device operations and memory device operating constraints”
is essentially an argument that the abstract concept is limited because the asserted claims apply to
memory device tests. Opp. at 16. An abstract idea, however, “does not become nonabstract by
limiting the invention to a particular field of use or technological environment[.]” Intellectual
Ventures I, 792 F.3d at 1366.
11
Papst notes that the PTAB recently denied institution of Xilinx’s petition for inter partes review
in connection with certain claims of the ’759 patent containing the “packer” limitation, and argues
that the PTAB’s ruling is evidence of an inventive concept at Alice step two. Opp. at 18. Neither
a Section 101 challenge generally nor the more specific question articulated by the U.S. Supreme
Court as the second step of the Alice framework was before the PTAB, however, which ruled only
that the particular prior art cited in Xilinx’s petition failed to show a reasonable likelihood that
Xilinx would prevail in establishing unpatentability under 35 U.S.C. § 103 (relating to
obviousness). See DiNovo Decl., Ex. D., at 36; see also 35 U.S.C. § 311(b) (inter partes review
34
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1

The second set of elements, to which Plaintiff refers as the “outputted error” and

2

“adjustment” elements, similarly do not sufficiently narrow the claims in a manner sufficient to

3

avoid preemption of the abstract idea itself. The Papst Patents contain no suggestion of any novel

4

or unconventional way in which an error message or proposed adjustment would be created or

5

displayed by the simulator that might impose a meaningful limitation on the claims’ scope.

6

Rather, using a computer (in some unspecified way) to output an error message or a suggested

7

adjustment based on a calculation of rules violations (in some unspecified way) is precisely the

8

type of limitation “reciting no more than generic computer elements performing generic computer

9

tasks [that] does not make an abstract idea patent-eligible.” Intellectual Ventures I, 792 F.3d at
1368. Further, any error message or adjustment is secondary to the use of the simulator, which the

11
United States District Court
Northern District of California

10

Papst Patents describe as the component responsible for comparing the memory test to a set of

12

rules. Merely displaying the results of that calculation using a computer is similar to the type of

13

“post-solution” activity that the U.S. Supreme Court suggested was insufficient to salvage an

14

otherwise abstract claim in Bilski. See 561 U.S. at 610–11; see also Flook, 437 U.S. at 590

15

(rejecting “[t]he notion that post-solution activity, no matter how conventional or obvious in itself,

16

can transform an unpatentable principle into a patentable process” where patentee argued that “the

17

adjustment of the alarm limit to the figure computed” by the process made claim patent-eligible).

18

Finally, Plaintiff concludes its argument that the asserted claims contain transformative

19

elements by devoting a single sentence to the machine or transformation test: “Moreover, each of

20

the [a]sserted [c]laims is tied to a particular device—a computerized simulator for a

21

semiconductor device.” Opp. at 18. As explained at length above, however, the Papst Patents

22

describe and claim the simulator at a level of generality that makes it a generic computer element,

23

rather than a particular device sufficient to save an otherwise abstract claim. See Alice, 134 S. Ct.

24

at 2358 (“[T]he mere recitation of a generic computer cannot transform a patent-ineligible abstract

25

idea into a patent-eligible invention.”).

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27
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limited to grounds “that could be raised under section 102 or 103 and only on the basis of prior art
consisting of patents or printed publications”); id. § 314(a) (standard for instituting review).
35
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1
2
3
4
5
6
7

Because the asserted claims are directed to an abstract idea and nothing in the claims adds
an inventive concept, the claims are not patent-eligible under § 101.
C. Claim Construction and Papst’s Alternative Request for Denial Without
Prejudice
As a final matter, Plaintiff argues that Defendants’ Motion should be denied without
prejudice because “there are relevant fact-related disputes and claim construction issues.” Opp. at
19. Plaintiff’s generalized objection that resolution of the Motion should be delayed pending
claim construction is without force. “[C]laim construction is not an inviolable prerequisite to a

8
validity determination under § 101[.]” Bancorp Servs., 687 F.3d at 1273. Moreover, Plaintiff has
9
neither explained how any particular construction would alter the Section 101 analysis nor even
10
proposed any such construction that the Court might view in the light most favorable to Plaintiff.
11
United States District Court
Northern District of California

See, e.g., Open Text S.A. v. Alfresco Software Ltd, No. 13-CV-04843-JD, 2014 WL 4684429, at *3
12

(N.D. Cal. Sept. 19, 2014) (“In this case, the parties have not sought construction of any terms . . .

13
and this lack of dispute over the proper construction of the asserted claims confirms that it is
14
unnecessary to engage in claim construction before addressing validity under Section 101.”).
15

At best, Plaintiff’s Opposition argues elliptically that a simulator should be construed to

16
include a specific software component for modeling semiconductor devices. Opp. at 10–12. Even
17
18

if the Court were to interpret Plaintiff’s arguments as a proposed construction of the term
“simulator” and construe the term to include a software component for modeling semiconductor

19
devices or predicting the behavior of a circuit, that construction would not alter the generic nature
20

of the simulator as claimed in the asserted claims (much as inclusion of a generic “database,”

21
which is also a software component with a specific meaning, has been found not to salvage similar
22
claims).
23
24
25

As explained above the Court has a “full understanding of the basic character of the
claimed subject matter,” Content Extraction, 776 F.3d at 1349, and Plaintiff has not identified any
material factual dispute that exists or any claim construction issue that might affect the Court’s

26
Section 101 analysis. Accordingly, there is no reason why the Court cannot proceed with
27
28

36
Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS

1

adjudication of the merits of Defendant’s Motion at this time.

2

IV.

3

CONCLUSION
For the foregoing reasons, the Court concludes that each of the asserted claims of the Papst

4

Patents is directed to a patent-ineligible abstract idea, and that the limitations of the asserted

5

claims do not provide an “inventive concept” sufficient to transform these claims into patentable

6

subject matter. Accordingly, the Court GRANTS Defendants’ Motion for Judgment on the

7

Pleadings. Claims 1, 4, 5, and 14 of the ’759 patent and claims 1, 2, 5, and 6 of the ’891 patent are

8

invalid under 35 U.S.C. § 101. Because the asserted claims are directed to patent-ineligible

9

subject matter, a defect which cannot be cured through amendment of a complaint, Plaintiff’s
claims for infringement are DISMISSED WITH PREJUDICE.

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United States District Court
Northern District of California

10

IT IS SO ORDERED.

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15

Dated: June 9, 2016
______________________________________
LUCY H. KOH
United States District Judge

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Case No. 16-CV-00925-LHK; Case No. 16-CV-00926-LHK
ORDER GRANTING MOTION FOR JUDGMENT ON THE PLEADINGS