Inventor Holdings LLC v. Gameloft Inc.
MEMORANDUM OPINION re pending motions. Signed by Judge Leonard P. Stark on 9/30/15. Associated Cases: 1:14-cv-01067-LPS et al. (ntl)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF DELAWARE
INVENTOR HOLDINGS, LLC,
C.A. No. 14-1067-LPS
INVENTOR HOLDINGS, LLC,
C.A. No. 14-1068-LPS
GLU MOBILE INC.
INVENTOR HOLDINGS, LLC,
C.A. No. 14-1070-LPS
INVENTOR HOLDINGS, LLC,
C.A. No. 14-1071-LPS
INVENTOR HOLDINGS, LLC,
C.A. No. 14-1072-LPS
ROVIO ANIMATION COMPANY,
INVENTOR HOLDINGS, LLC,
C.A. No. 14-1073-LPS
Stamatios Stamoulis, Richard C. Weinblatt, STAMOULIS & WEINBLATT LLC, Wilmington,
Attorneys for Plaintiff Inventor Holdings, LLC.
Jack B. Blumenfeld, MORRIS, NICHOLS, ARSHT & TUNNELL LLP, Wilmington, DE.
Eric A. Buresh, Michelle L. Marriott, Mark Lang, ERISE IP, P.A., Overland Park, KS.
Attorneys for Defendant Gameloft, Inc.
Steven L. Caponi, BLANK ROME LLP, Wilmington, DE.
Attorney for Defendant King.com Ltd.
Richard L. Horwitz, David E. Moore, Bindu A. Palapura, POTTER ANDERSON & CORROON
LLP, Wilmington, DE.
Michael J. Sacksteder, Lauren E:Whittemore, Hana K. Andersen, FENWICK & WEST LLP,
San Francisco, CA.
Carolyn C. Chang, FENWICK & WEST LLP, Mountain View, CA.
Attorneys for Defendants Glu Mobile Inc., ngmoco, LLC, Rovio Animation Company,
and Supercell, Inc.
September 30, 2015
Pending before the Court are Defendant Gamel oft, Inc.' s ("Gamel oft") Motion for
Judgment on the Pleadings Pursuant to Federal Rule of Civil Procedure 12(c) (C.A. 14-1067, D .I.
13) and Defendants King.com Ltd. ("King.com"), Glu Mobile Inc. ("Glu Mobile"), ngmoco,
LLC ("ngmoco"), Rovio Animation Company ("Rovio"), and Supercell, Inc. 's ("Supercell")
(collectively with Gameloft, "Defendants") Motions to Dismiss Pursuant to Federal Rule of Civil
Procedure 12(b)(6) (C.A. 14-1068, D.I. 10; C.A. 14-1070, D.I. 11, D.I. 16; C.A. 14-1071, D.I.
10; C.A. 14-1072, D.I. 10; C.A. 14-1073, D.I. 10). 1 Although Defendants' motions are
separately briefed, they raise essentially the same arguments, and the Court will address them
collectively. For the reasons discussed below, the Court will grant Defondants' motions. 2
U.S. Patent No. 8,784,198 ("the '198 patent"), entitled "Method and Apparatus for
Conducting or Facilitating a Promotion," "relates generally to a method and apparatus for
conducting a promotion and, more particularly, to a method and apparatus for distributing
promotions to potential participants and for allowing the promotion participants to receive
benefits associated with the promotions." (' 198 patent at 1:28-32) It was filed on January 4,
2013 and issued on July 22, 2014. (Id.) The claimed methods are generally directed to
"facilitating play of a game" on a "mobile device" or "computer-readable medium" in which a
The referral of these motions to Magistrate Judge Burke (see, e.g., C.A. 14-1071, D.I. 6)
will be vacated.
Defendant Kabam Inc. has settled with Plaintiff. (See C.A. 14-1069, D.I. 10)
user receives an "in-game benefit" after a "locked outcome" of the game is unlocked using an.
"unlock code" associated with that outcome. (Id. at 38:50-39:2, 40:13-27)
On August 19, 2014, Plaintiff Inventor Holdings, LLC ("Inventor Holdings" or
"Plaintiff') filed separate actions alleging infringement of the 'f98 patent against each
Defendant: Gameloft (C.A. 14-1067, D.I. 1), Glu Mobile (C.A. 14-1068, D.I. 1), King.com (C.A.
14-1070, D.I. 1), ngmoco (C.A. 14-1071, D.I. 1), Rovio (C.A. 14-1072, D.I. 1), and Supercell
(C.A. 14-1073, D.I. 1). The cases have not been consolidated. 3
Gameloft answered Plaintiffs complaint on October 10, 2014. (C.A. 14-1067, D.I. 9)
Gameloft subsequently filed its Motion for Judgment on the Pleadings on November 21, 2014.
(C.A. 14-1067, D.I. 13) Briefing on Gameloft's motion was completed on December 18, 2014.
(C.A. 14-1067, D.I. 14, 18, 22) Thereafter, Gameloft filed a Notice of Supplemental Authority
on March 25, 2015 (C.A. 14-1067, D.I. 32), to which Plaintiff filed Objections on March 26,
2015 (C.A. 14-1067, D.I. 33). Gameloft filed additional Notices of Supplemental Authority on
June 16, 2015 and September 1, 2015. (C.A. 14-1067, D.I. 36, 37) On April 7, 2015, the action
against Gameloft was stayed pending resolution of Gameloft's motion. (See C.A. 14-1067, D.I.
Glu Mobile, ngmoco, Rovio, and Supercell filed their Motions to Dismiss on October 10,
2014. (C.A. 14-1068, C.A. 14-1071, C.A. 14-1072, C.A. 14-1073, D.I. 10)4 Briefing on these
Because Plaintiffs' briefs in response to Defendants' motions are virtually the same, the
Court will only cite to Plaintiffs' responsive brief, D.I. 21, in C.A. 14-1070, which is
Because these Defendants' briefs and other filings are identical both in substance and
timing, the Court will generally refer only to the set of briefing filed in C.A. 14-1071, which is
motions was completed on November 6, 2014. (C.A. 14-1071, D.I. 11, 12, 14) Thereafter, Glu
Mobile, ngmoco, Rovio, and Supercell filed Notices of Supplemental Authority on November
17, 2014 (C.A. 14-1071, D.I. 15), and Plaintiff responded with Notices of Supplemental
Authority on December 12, 2014 (C.A. 14-1071, D.I. 18). Glu Mobile, ngmoco, Rovio, and
Supercell filed additional Notices of Supplemental Authority on March 16, 2015, June 16, 2015
and September 1, 2015. (C.A. 14-1071, D.I. 31, 35, 36). On April 7, 2015, the actions against
Glu Mobile, ngmoco, Rovio, and Supercell were stayed pending resolution of their motions.
(See C.A. 14-1071, D.I. 34)
King.com filed its first Motion to Dismiss on November 21, 2014. (C.A. 14-1070, D.I.
11) Subsequently, Plaintiff filed an Amended Complaint on December 4, 2014 (C.A. 14-1070,
D.I. 13), which King.com moved to dismiss on December 12, 2015 (C.A. 14-1070, D.I. 16).
Briefing on King.corn's motion was completed on January 8, 2015. (C.A. 14-1070, D.I. 17, 21,
24) Thereafter, King.com filed a Notice of Supplemental Authority on March 19, 2015 (C.A. 141070, D.I. 29), to which Plaintiff filed Objections on March 26, 2015 (C.A. 14-1070, D.I. 30).
King.com filed additional Notices of Supplemental Authority on June 16, 2015 and September 1,
2015. (C.A. 14-1070, D.I. 33, 34) On April 7, 2015, the action against King.com was stayed
pending resolution of Glu Mobile's motion. (See C.A. 14-1070, D.I. 32)
Motion to Dismiss for Failure to State a Claim
Evaluating a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) requires
the Court to accept as true all material allegations of the complaint. See Spruill v. Gillis, 372
F.3d 218, 223 (3d Cir. 2004); "The issue is not whether a plaintiff will ultimately prevail but
whether the claimant is entitled to offer evidence to support the claims." In re Burlington Coat
Factory Sec. Litig., 114 F.3d 1410, 1420 (3d Cir. 1997) (internal quotation marks omitted).
Thus, the Court may grant such a morion to dismiss only if, after "accepting all well-pleaded
allegations in the complaint as true, and viewing them in the light most favorable to plaintiff,
plaintiff is not entitled to relief." Maio v. Aetna, Inc., 221 F.3d 472, 481-82 (3d Cir. 2000)
(internal quotation marks omitted).
However, "[t]o survive a motion to dismiss, a civil plaintiff must allege facts that 'raise a
right to relief above the speculative level on the assumption that the allegations in the complaint
are true (even if doubtful in fact)."' Victaulic Co. v. Tieman, 499 F.3d 227, 234 (3d Cir. 2007)
(quoting Bell At!. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). A claim is facially plausible
"when the plaintiff pleads factual content that allows the court to draw the reasonable inference
that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009). At bottom, "[t]he complaint must state enough facts to raise a reasonable expectation
that discovery will reveal evidence of [each] necessary element" of a plaintiffs claim. Wilkerson
v. New Media Tech. Charter Sch. Inc., 522 F.3d 315, 321 (3d Cir. 2008) (internal quotation
The Court is not obligated to accept as true "bald assertions," Morse v. Lower Merion
Sch. Dist., 132 F .3d 902, 906 (3d Cir. 1997) (internal quotation marks omitted), "unsupported
conclusions and unwarranted inferences," Schuylkill Energy Res., Inc. v. Pa. Power & Light Co.,
113 F.3d 405, 417 (3d Cir. 1997), or allegations that are "self-evidently false," Nami v. Fauver,
82 F.3d 63, 69 (3d Cir. 1996). "[A] complaint may be subject to dismissal under Rule 12(b)(6)
when an affirmative defense ... appears on its face." ALA, Inc. v. CCAIR, Inc., 29 F.3d 855, 859
(3d Cir. 1994).
Motion for Judgment on the Pleadings
Pursuant to Federal Rule of Civil Procedure 12(c), a party may move for judgment on the
pleadings "[a]fter pleadings are closed- but early enough not to delay trial." When evaluating a
motion for judgment on the pleadings, the Court must accept all factual allegations in a
complaint as true and view them in the light most favorable to the non-moving party. See
Rosenau v. Unifund Corp., 539 F.3d 218, 221 (3d Cir. 2008); see also Maio, 221 F.3d at 482.
This is the same standard as applies to a Rule 12(b)(6) motion to dismiss. See Turbe v. Gov't of
Virgin Islands, 938 F.2d 427, 428 (3d Cir. 1991).
A Rule 12(c) motion will not be granted "unless the movant clearly establishes that no
material issue of fact remains to be resolved and that he is entitled to judgment as a matter of
law." Rosenau, 539 F.3d at 221. "The purpose of judgment on the pleadings is to dispose of
claims where the material facts are undisputed and judgment can be entered on the competing
pleadings and exhibits thereto, and documents incorporated by reference." Venetec Int'!, Inc. v.
Nexus Med., LLC, 541 F.Supp.2d 612, 617 (D. Del. 2008); see also Burlington Coat Factory,
114 F .3d at 1426 (explaining that any documents integral to pleadings may be considered in
connection with Rule 12(c) motion). "The issue is not whether a plaintiff will ultimately prevail
but whether the claimant is entitled to offer evidence to support the claims." Burlington Coat
Fact01y, 114 F.3d at 1420. Thus, a court may grant a motion for judgment on the pleadings (like
a motion to dismiss) only if, after "accepting all well-pleaded allegations in the complaint as true,
and viewing them in the light most favorable to plaintiff, plaintiff is not entitled to relief." Maio,
221 F.3d at 482.
.The Court may consider matters of public record as well as authentic documents upon
which the complaint is based if attached to the complaint or as an exhibit to the motion. See
Oshiver v. Levin, Fishbein, Sedran & Berman, 38 F.3d 1380, 1384 n.2 (3d Cir. 1994). The Court
may also take judicial notice of the factual record of a prior proceeding. See Oneida Motor
Freight, Inc. v. United Jersey Bank, 848 F.2d 414, 416 n.3 (3d Cir. 1988). Ultimately, a motion
for judgment on the pleadings can be granted "only if no relief could be afforded under any set of
facts that could be proved." Turbe, 938 F.2d at 428.
The ultimate question_ of patent eligibility is an issue of law, making it an appropriate
basis for a Rule 12(c) motion~ See In re Bilski, 545 F.3d 943, 951 (Fed. Cir. 2008), aff'd Bilski v.
Kappas, 561 U.S. 593 (2010). The Federal Circuit has affirmed District Courts that have granted
motions for judgment on the pleadings based on§ 101 challenges. See, e.g., OIP Techs., Inc. v.
Amazon.com, Inc., 788 F.3d 1359, 1360 (Fed. Cir. 2015); buySAFE, Inc. v. Google, Inc., 765
F.3d 1350, 1355 (Fed. Cir. 2014),
Lack of Patentable Subject Matter
Under 35 U.S.C. § 101, "[w]hoever invents or discovers any new and useful process,
machine, manufacture, or composition of matter, or any new and useful improvement thereof,
may obtain a patent therefor, subject to the conditions and requirements of this title." There are
three exceptions to§ 101 's broad patent-eligibility principles: "laws of nature, physical
phenomena, and abstract ideas." Diamond v. Chakrabarty, 447 U.S. 303, 309 (1980). Pertinent
·here is the third category, "abstract ideas," which "embodies the longstanding rule that an idea of
itself is not patentable." Alice Corp. Pty. Ltd. v. CLS Bank Int'!, 134 S. Ct. 2347, 2355 (2014)
(internal quotation marks omitted). "As early as Le Roy v. Tatham, 55 U.S. 156, 175 (1852), the
Supreme c;ourt explained that ' [a] principle, in the abstract, is a fundamental truth; an original
cause; a motive; these cannot be patented, as no one can claim in either of them an exclusive
right.' Since then, the unpatentable nature of abstract ideas has repeatedly been confirmed." In
re Comiskey, 554 F.3d 967, 977-78 (Fed. Cir. 2009).
In Mayo Collaborative Servs. v. Prometheus Labs., Inc., 132 S. Ct. 1289 (2012), the
Supreme Court set out a two-step "framework for distinguishing patents that claim laws of
nature, natural phenomena, and abstract ideas from those that claim patent-eligible applications
of those concepts." Alice, 134 S. Ct. at 2355. First, courts must determine if the claims at issue
. are directed at a patent-ineligible concept. See id. If so, the next step is to look for an
"'inventive concept' - i.e., an element or combination of elements that is sufficient to ensure that
the patent in practice amounts to significantly more than a patent upon the [ineligible concept]
"Simply appending conventional steps, specified at a high level of generality, [is] not
enough to supply an inventive concept." Id. at 2357 (internal quotation marks omitted; emphasis
in original). In Bilski, 130 S. Ct. at 3231, for example, the Supreme Court held that the claims
involved were drawn to the patent-ineligible abstract idea of "hedging, or protecting against
risk," which was a "fundamental economic practice." Similarly, in Alice, 134 S. Ct. at 2356, the
Supreme Court found that the claims were drawn to the patent-ineligible abstract idea of
"intermediated settlement," which was also a "fundamental economic practice." In both cases,
the Supreme Court found that the additional steps delineated in the claims did not embody an
"inventive concept" sufficient to ensure that the patents amounted to more than patents upon the
ineligible fundamental concepts themselves.
In determining, at the second step, if a patent embodies an inventive concept, courts may
consider whether the process "is tied to a particular machine or apparatus" or "transforms a
particular article into a different state or thing." Kappas, 130 S. Ct. at 3225. "[T]o impart
patent-eligibility to an otherwise unpatentabl~ process under the theory that the process is linked
to a machine, the use of the machine must impose meaningful limits on the claim's scope."
CyberSource Corp. v. Retail Decision, Inc., 654 F.3d 1366, 1375 (Fed. Cir. 2011) (internal
quotation marks omitted). To be "a meaningful limit on the scope of the claims," the addition of
a machine "must play a significant part in permitting the claimed method to be performed, rather
than function solely as an obvious mechanism for permitting a solution to be achieved more
quickly." SiRF Tech., Inc. v. ITC, 601F.3d1319, 1332-33 (Fed. Cir. 2010). Hence, the "mere
recitation of a generic computer cannot transform a patent-ineligible abstract idea into a patenteligible invention." Alice, 134 S. Ct. at 2358. "Given the ubiquity of computers, wholly generic
computer implementation is not generally the sort of additional feature that provides any
practical assurance that the process is more than a drafting effort designed to monopolize the
abstract idea itself." Id.
"[T]he machine-or-transformation test is a useful and important clue, an investigative
tool, for determining whether some claimed inventions are processes under§ 101." Bilski, 130
S. Ct. at 3227. However, it is "not the sole test for deciding whether an invention is a patenteligible 'process.'" Id. "[I]n applying the § 101 exception, [courts] must distinguish between
patents that claim the building blocks of human ingenuity and those that integrate the building
blocks into something more, thereby transforming them into a patent-eligible invention." Alice,
134 S. Ct. at 2354 (internal citation and quotation marks omitted). The "concern that drives the
exclusionary principle [i]s one of pre-emption." Id. That is, where a patent would pre-empt use
of basic tools of scientific and technological work, i.e., laws of nature, natural phenomena, and
abstract ideas, the patent would "impede innovation more than it would tend to promote it,
thereby thwarting the primary object of the patent laws." Id. (internal quotation marks omitted).
Defendants contend that all claims of the' 198 patent are patent-ineligible under the
analytical framework set forth in Mayo and Alice. Specifically, Defendants argue that the '198
patent "claims the economic strategy and abstract idea of providing an 'unlock code' in exchange
for a qualifying activity for an 'outcome' to reveal the benefit of the locked 'outcome."' (C.A.
14-1071, D.I. 11 at 2; C.A. 14-1067, D.I. 14 at 2; see also D.l. 17 at 2 ("The independent claims
of U.S. Patent No. 8,784,198 are directed at the abstract idea of using a code to unlock a benefit
in a game.")) Defendants further argue that "[t]he only 'inventive concept' the '198 Patent
purports to add is implementation of this unlock code concept on a generic mobile device."
(C.A. 14-1071, D.I. 11 at 2; C.A. 14-1067, D.I. 14 at 2; see also C.A. 14-1070, D.I. 17 at 2)
Plaintiff responds that Defendants mischaracterize the underlying concepts of the claimed
invention by "not view[ing] the claim as a whole" and ignoring the "express limitations" of the
claims. (See C.A. 14-1070, D.I. 21 at 10, 12) Plaintiff argues that the invention of the '198
patent is not directed to an abstract idea but instead is "particular to mobile device gaming." (Id.
at 12) Plaintiff emphasizes that "the claimed technology necessitates the use of discrete
computer hardware and software components configured and programmed in a particular way
that enable performance of the specified functions carried out in the context of a mobile game."
(Id. at 13)
Independent claim 1 recites the following:
A mobile device operable to facilitate a game playable on
the mobile device, the mobile device comprising:
an input mechanism for receiving input from a user
of the mobile device;
a display screen for outputting results of the game;
a memory, the memory operable to store a first
software program for conducting the game on the
mobile device and a locked outcome of the game
such that, upon the first software program being
stored in the memory, the processor is operable with
the first software program to:
facilitate play of the game by
recognizing inputs from the user via
the input mechanism;
receive a signal comprising an
unlock the locked outcome of the
game using the unlock code, thereby
determining an unlocked outcome;
determine an intra-game benefit
associated with the unlocked
incorporate the intra-game benefit
into the game while it is being played
on the mobile device by the user.
('198 patent at 38:50-39:2)
The only other independent claim, claim 18, is similar to independent claim 1 except that
its recited steps are performed by a computer-readable medium instead of a mobile device:
A non-transitory computer-readable medium storing
instructions for directing a processor of a mobile device to perform
·a method, the method comprising:
facilitating play of a game on the mobile device by
recognizing inputs provided by a user via an input
mechanism of the mobile device, at least one of the
inputs causing progress in the game;
receiving a signal comprising an unlock code;
determining a locked outcome of the game;
unlocking the locked outcome of the game using the
unlock code, thereby determining an unlocked
determining an intra-game benefit associated with
the unlocked outcome; and
providing the intra-game benefit to the user by
incorporating the intra-game benefit into the game.
(Id. at 40: 13-27)
The various dependent claims provide basic variations on the elements of the independent
claims, such as: the source of the signal being either the mobile device's "input mechanism" (id.
at 39:3-8, 40:38-41) or "a third party via a network" (id. at 39:9-15, 40:42-46); the locked
outcome being previously "stored in a memory" and subsequently "retrieved" or "accessed" (id.
at 40:28-37), "stored in an encrypted form" (id. at 39:22-27, 40:55-61), or "download[ed] ...
over the internet" (id. at 39:28-31, 40:51-54); the method further comprising "receiving a request
to use a previously stored unlock code" (id. at 39:16-21, 40:47-50); the processor being able to
"receive indication of payment from the user ... for the unlock code" (id. at 39:32-35, 40:62-65)
and further requiring "verifi [cation] that payment for the unlock code has been provided from the
user" (id. at 39:36-43); various forms of intra-game benefits (id. at 40:4-10, 40:66-41 :5),
including "an advancement within the game," and further requiring the unlock code for
"advancement in the game".(id. at 39:44-48, 41:6-11); the use of a "second software program to
download at least one of the first software program and a decryption algorithm into the memory"
(id. at 39:49-53); the processor being able "to verify that the user has completed a qualifying
activity that is a prerequisite to unlocking the locked outcome" (id. at 39:54-57, 41:12-18) and
further "wherein the qualifying activity is watching a specified advertisement" (id. at 39:58-59,
41:19-21);-and the use of a "GPS detector" (id. at 39:60-64, 41:22-25) and further "determin[ing]
an intra-game benefit based on the location" (id. at 39:65-40:3, 41 :26-29). 5
Plaintiff argues that the Court should not decide patentability before ruling on claim
construction, insisting, "[a]t most, Defendant has raised disputed material fact issues." (C.A. 141070, D .I. 21 at 15 n. 7) 6 Without proposing any particular constructions for any terms, Plaintiff
argues that "Defendant's arguments confirm that at least 'unlock code' and 'unlocked outcome'
require construction." (C.A. 14-1070, D.I. 21 at 10 n.4) (referring to C.A. 14-1070, D.I. 17 at 6
The Court finds that the briefing is adequate to permit it to resolve the § 101 challenge
with respect to each asserted claim of the '198 patent.
Plaintiff argues that because patents are presumed valid, Defendants confront a burden of
proving invalidity by clear and convincing evidence. (See C.A. 14-1071, D.I. 12 at 6) However,
Plaintiff has failed to identify a disputed fact that is material to resolution of the issue of patent
eligibility here. The issue of patentability is a question oflaw, see In re Bilsld, 545 F.3d at 95051, although it is one that "may be informed by subsidiary factual issues," CyberFone Sys., LLC
v. Cellco P 'ship, 885 F. Supp. 2d 710, 715 (D. Del. 2012). In the absence of underlying disputed
facts, Defendants do not have the burden Plaintiff would have the Court impose on them. See
Modern Telecom Sys. LLC v. Earth/ink, Inc., 2015 WL 1239992, at *7-8 (C.D. Cal. Mar. 17,
2015) ("Because, ordinarily, no evidence outside the pleadings is considered in resolving a ·
motion to dismiss or a motion for judgment on the pleadings, it makes little sense to apply a
'clear and convincing evidence' standard - a burden of proof- to such motions.").
(Defendants' analogizing of the "unlock code" and "unlocked outcome" to "roll[ing] a set of
doubles" and "being able to move forward [in a game]," respectively)) But the Court is not
required to withhold judgment on patentability until it resolves all potential claim construction
disputes. See Bancorp Servs., L.L.C. v. Sun Life Assurance Co. of Can., 687 F.3d 1266, 1273
(Fed. Cir. 2012), cert denied, 134 S. Ct. 2870 (2014) ("[C]laim construction is not an inviolable
prerequisite to a validity determination under § 101."); CyberFone Sys., LLC v. Cellco P 'ship,
885 F. Supp. 2d 710, 719 (D. Del. 2012) (deciding§ 101 issue before ~laim construction where
plaintiff failed to explain how claim construction woul~ alter§ 101 analysis); Intellectual
Ventures I LLC v. Mfrs. & Traders Trust Co., 2014 WL 7215193, at *6 (D. Del. Dec. 18, 2014)
(proceeding with § 101 analysis after finding that "Plaintiffs arguments throughout the briefing
make no mentiori of how the construction of certain limitations would inform the§ 101 analysis"
and that "parties' arguments are not focused on specific claim limitations, but instead on the
broader concepts of the claims and the computer components used").
Here, the closest any party comes to showing any claim construction dispute that is
relevant to the§ 101 analysis is Defendants' contention (with which Plaintiffs disagree) that the
"unlock code" and "unlocked outcome" terms should be construed so as to include "roll[ing] a
set of doubles" and "being able to move forward [in a board game].". The Court agrees with
Defendants that "the vast breadth of the claim language and the specification of the ' 198 Patent"
(C.A. 14-1071, D.I. 11 at 19) provide a sufficient basis for the Court to resolve the particular
claim construction issue raised by Plaintiff.
More precisely, the Court agrees that "unlock code" and "unlocked outeome" should be
given their full, plain and ordinary meaning in the context of the '198 patent's claims.
The words of a claim are generally given their ordinary and
customary meaning as understood by a person of ordinary skill in
the art when read in the context of the specification and
prosecution history. There are only two exceptions to this general
rule: 1) when a patentee sets out a definition and acts as his own
lexicographer, or 2) when the patentee disavows the full scope of a
claim term either in the specification or during prosecution.
Thorner v. Sony Computer Entm 't Am. LLC, 669 F.3d 1362, 1365 (Fed. Cir. 2012) (internal
citation omitted). Here, neither exception is present. To the contrary, the specification
emphasizes the breadth with which the inventors were using the terms "unlock code" and
In some embodiments, an unlock code used to unlock an outcome
may include or otherwise provide some or all of the information or
data needed to associate a benefit with an outcome, identify, select
or otherwise determine a benefit associated with the outcome,
complete a benefit being revealed by the unlock code, etc.
An unlock code can comprise or include a written, spoken or
data entered password, a radio or television signal, a sequence or
group of keypad selections or entries, a sequence or group of .
handwritten or spoken entries, an electronic or electromagnetic
signal, a numerical or alphanumerical sequence, a sequence,
group or combination of musical notes or other sounds, words,
syllables, phrases, tones, etc. to be provided audibly or
symbolically to unlock an outcome, a barcode, a decoding key,
rule or algorithm for a code or cypher, etc. An unlock code can
also be based on, include, or comprise an identifier associated
with a particular user, user device, intermediary, intermediary
device, etc. receiving the unlock code or otherwise being allowed
to use or distribute the unlock code.
An unlock code may also include user biometric information
(e.g., voiceprint, fingerprint, retinal scan, DNA, etc. information)
so that the unlock code may only be used by a specific user.
(' 198 patent at 5:16-59) (emphasis added) Defendants' example of "roll[ing] a set of doubles" is
"a numerical or alphanumerical sequence" and comes within the plain and ordinary meaning of
Likewise, the patent specification expressly indicates that "unlocked outcome" should be
broadly construed to have its plain and ordinary meamng. To begin with, "locked" encompasses
virtually all ways that the outcome can be locked:
The term "locked," as used herein, should be construed broadly
and is not meant to imply or suggest any specific manner or
method of hiding, covering, encoding or encrypting, storing,
screening, concealing, masking, etc. a prize, value, symbol, or
other benefit associated with an outcome or to limit how a prize,
value, symbol, or other benefit associated with the outcome is
hidden, covered, encoded or encrypted, stored, screened,
concealed, masked, etc.
(Id. at 5:7-15) (emphasis added) Similarly, "outcome" includes a large variety of outcomes:
The outcomes may be a symbol, value, prize identifier or
indicator, etc. For example, the outcome may be "television,"
"ten-thousand dollars" "cherry" "oran°e" "4" "PI-173068 ' "etc .
The outcomes of "television" and "ten-thousand dollars" indicate
specific prizes for the outcomes. The outcomes of "cherry" and
"orange" indicate a specific outcome, but not specific prize or
benefit associated with the outcome. The controller 52, an
intermediary, or other device or entity may· then associate prizes
or benefits to these outcomes at a later time and the associated
prizes and benefits may vary. For example, on one day an
outcome of "cherry" may be associated with a prize of "ten
dollars" while on the next day an outcome of"cherry" may be
associated with a prize of "one hundred dollars." The outcome of
"PI-173068" provides a specific outcome identifier, but like the
"cherry" and "orange" outcomes, the outcome identifier does not
indicate a specific prize or benefit associated with the outcome,
thereby allowing a specific prize or benefit for the outcome to be
determined by another entity or device and to change over time if
Other prizes or benefits that may be associated with an outcome
include a warrantee for a product ... , ... a discount .•. , a
charity donation, a scholarship, an unlock code .•. , a password.
.. , ... a multiplier of an outcome unlocked or a prize won •.. ,
an extender of time during which an unlock code or outcome can
be used, ... initiated or completed, a free hair cut, a coupon, .. a
joke or other entertainment, a concert ticket, free car rental, free
long distance telephone service, frequent shopper points,
frequent flyer miles, a free movie rental, a sample of music or
video, a game, a piece of a puzzle, all or part of a treasure map or
game piece, etc. ·
A prize or benefit associated with an outcome may be merchant
A prize or benefit associated with an outcome may also vary
depending on the user that unlocks the outcome ....
A prize or benefit mav also allow a user to continue to play a
game the user is playing on a user device, progress or change the
game the user is playing on the user device, or come to an end of
the game the user is playing on the user device ....
(Id. at 12:48-67) (emphasis added) Defendants' example of a prize or benefit associated with an
outcome being "allow[ing] a user to ... progress ... the game" is within the plain and ordinary
meaning of "unlocked outcome."
Accordingly, Defendants' analogy of "playing a board game and not being able to move
forward until you roll a set of doubles" (C.A. 14-1070, D.I. 17 at 6) is not an "attempt to
construe claim 18 and dependent claims by ignoring elements of the claims and descriptions jn
the specification" (C.A. 14-1070, D.I. 21 at 10). With this in mind, the Court turns to the Mayo
Mayo Step 1: Are the claims directed to a patent-ineligible "abstract idea"?
"Under step one of Mayo/Alice, the claims are considered in their entirety to ascertain
whether their character as a whole is directed to excluded subject matter." Internet Patents Corp.
v. Active Network, Inc., 790 F.3d 1343, 1346 (Fed. Cir. 2015).
Plaintiff argues that the '198 patent "claims a specific solution to a specific problem
associated with gaming on a mobile device, which itself is a recent advance. . . . Prior to the '198
patent, merchants conducting promotions faced problems dynamically changing a rule, benefit,
prize, entry criteria, or redemption criteria." (C.A. 14-1070, D.I. 21at3) (citing '198 patent at
1:33-2:17) Plaintiff does not, however, assert that the claims of the '198 patent solve a problem
specific to mobile devices, and, in any case, provides only a summary of the claims in support of
its contention. (See C.A. 14-1070, D.I. 21 at 3, 12-14 & n.8) This is insufficient to differentiate
the claims of the '198 patent from those at issue in, for example; Bilski and Alice, which were
directed to abstract ideas that could be implemented using generic computer technology. 7
Plaintiff further attempts to distinguish the claims of the '198 patent from the claims at
· issue in Bilski and Alice by arguing that they are not directed to a "fundamental economic
practice." (Id. at 12) However, the Supreme Court did not "delimit the precise contours of the
'abstract ideas' category" in Alice, and Plaintiff cites no authority for the suggestion that
"abstract ideas" are limited to fundamental economic practices. See Alice, 134 S. Ct. at 2357. In
any event, the Court concludes that the "character as a whole" of the claims of the '198 patent
are directed to a fundamental economic practice (as already explained and as further discussed
Even if Plaintiff is suggesting that the problem solved by the claims of the '198 patent is
unique to mobile devices, the specification establishes that the ability to change the promotion is
not unique to the use of the claimed method on a mobile phone. The specification offers a
proposed person-implemented solution to a problem that might arise from the ability of the game
controller to change the promotion during the promotion: "Merchant A may have had a prepublished list or table of what an outcome of 'cherry' wins, thereby avoiding the perception that
Merchant A has unfairly chosen a prize after the outcome of 'cherry' is revealed." (' 198 patent at
8:29-33) Plainly, there is nothing unique to mobile phones about the idea of changing a
Plaintiff emphasizes that the Examiner considered "many ... articles and publications ...
during publication ... that relate to promotions or coupons and are directed to the same
purported 'abstract idea' identified in Defendant's Motion." (C.A. 14-1070, D.I. 21 at 13) This
fact does not help support a finding that the claims of the '198 patent are patentable. The
references considered by the Examiner may very well have also been directed at an abstract idea.
Similarly unavailing is Plaintiffs contention that the PTO's "issuance of the' 198 patent after the
Supreme Court's Alice decision is strong evidence that Defendants' characterizations cannot be
correct" (C.A. No. 14-1071, D.I. 12 at 10-11) (emphasis in original); see also C.A. 14-1070, D.I.
21 at 2). As Defendants point out, "the Examiner issued the Notice of Allowance for the' 198
patent on March 7, 2014, several months before Alice was decided and the Patent Office issued
its new standards for determining validity under 35 U.S.C. 101." (C.A. 14-1070, D.I. 17 at 8 n.4)
The Court agrees with Defendants that the claims of the' 198 patent are directed to the
economic strategy and abstract idea of "providing an 'unlock code' in exchange for a qualifying
activity for an 'outcome' to reveal the [intra-game] benefit of the locked 'outcome"' (C.A. 141071, D.I. 11 at 2; C.A. 14-1067, D.I. 14 at 2), or, put more simply (yet still accurately), "using a
code to unlock a benefit in a game" (C.A. 14-1070, D.I. 17 at 14). This abstract concept is not
unlike the rules for any number oflong-extant promotions, lotteries, or games, or other efforts to
entice people to try a product or service. (See, e.g., '198 patent at 1:33-37 (describing prior art
and stating, "[m]erchants and manufacturers often use promotions to entice people to try or
purchase products, shop or conduct transactions in certain stores, or to make people aware of
products, store locations, etc."); see also C.A. 14-1071, D.I. 11 at 12-13 ("The specification of
the '198 Patent itself discloses both a conventional lottery-like implementation of concept where
. a player enters a drawing for a chance to win a prize, and a non-lottery implementation where a
player obtains locked outcomes and then obtains unlock codes to determine the prizes contained
in the locked outcomes.")) Further, as described above, the various dependent claims do no more
than provide variations of the abstract idea applied to a generic mobile device or computerreadable medium.
Moreover, the claims of the ' 19 8 patent bear striking similarities to other types of subject
matter that the Federal Circuit has found to be patent-ineligible. See Ultramercial, Inc. v. Hulu
LLC, 772 F.3d 709, 714 (Fed. Cir. 2014) (finding claims directed to users being given access to
copyrighted media after viewing an ad to be unpatentable); Planet Bingo, LLC v. VKGS LLC,
576 Fed. App'x 1005, 1008 (Fed. Cir. 2014) (finding claims for computerized bingo game
unpatentable); Gametek, 597 Fed. App'x 644 (Fed. Cir. 2015) (finding patent directed to offering
mid-game purchases in a video game failed to claim patent-eligible subject matter); buySAFE,
765 F.3d at 1355 (holding that "receiving a request" and "transmitting an offer in return" were
abstract concepts). Like the claims at issue in these earlier cases, the '198 patent's claims recite
limitations directed to receiving user inputs and responding to them by transmitting
corresponding outcomes to the user. All of this further supports a conclusion that the' 198 patent
is directed to an abstract idea.
Thus, the Court concludes that all the claims of the ' 198 patent are directed to an abstract
idea. It is necessary, then, to proceed to the second step of the· analysis.
Mayo Step 2: Do the claims include an "inventive concept" sufficient to "ensure that the
patent in practice amounts to significantly more" than a patent upon an ineligible concept?
The claims of the '198 patent may still be patent-eligible if they include an "inventive
concept" sufficient to "ensure that the patent in practice amounts to significantlymore" than a
patent upon an ineligible concept. Alice, 134 S. Ct. at 2355. The Supreme Court and Federal
Circuit have held that there is no "inventive concept" if a claim recites an abstract idea
implemented using "generic" technology to "perform well-understood, routine, and conventional
activities commonly used in the industry." Content Extraction & Transmission LLC v. Wells
Fargo Bank, Nat'! Ass 'n, 776 F.3d 1343, 1347 (Fed. Cir. 2014) (citing Alice, 134 S. Ct. at 2359).
In both independent claims, the only steps that do not explicitly relate to the abstract idea
relate either to a generic "mobile device comprising: an input mechanism ... ; a display screen ..
. ;. a processor; [and] a memory ... operable to store a first software program ... " in the case of
claim 1 (' 198 patent at 38:50-60), or to a "computer-readable medium storing instructions for
directing a processor ofa mobile device to perform [the] method" in the case of claim 18 (id. at
40: 13-15). However, "limiting the use of an abstract idea to a particular technological
environment" is "not enough for patent eligibility." Alice, 134 S. Ct. at 2358 (internal quotation
The' 198 patent's claims are implemented using generic mobile device technology that
existed well before the priority date of the '198 patent. This is evident from the '198 patent's
specification, which states:
[I]t would be understood by one of ordinary skill in the art
that the invention as described herein can be implemented in
many different ways using a wide range of programming
t~chniques as well as general purpose hardware systems or
dedicated controllers. In addition, many, if not all, of the steps for
the methods described above are optional or can be combined or
performed in one or inore alternative orders or sequences without
departing from the scope of the present invention and the claims
should not be construed as being limited to any particular order
or sequence, unless specifically indicated....
[M]any different types of implementations or hardware
configurations can be used in the system 50 and with the methods
100, 200, 300, 500, 550 and the methods disclosed herein are not
limited to any specific hardware configuration. . . . The methods
can be implemented in any sort or [sic] implementation of
computer software, program, sets of instructions, code, ASIC, or
specially designed chips, logic gates, or other hardware structured
to directly effect or implement such software, programs, sets of
instructions, or code. The computer software, program, sets of
instructions or code can be storable, writeable, or savable on any
computer usable or readable media or other program storage device
or media such as a floppy or other magnetic or optical disk,
magnetic or optical tape, CD-ROM, DVD, punch cards, paper tape,
· . hard disk drive, ZIP™ disk, flash or optical memory card,
. microprocessor, solid state memory device, RAM, EPROM, or
ROM. The term 'computer-readable medium' as used herein
refers to any medium that directly or indirectly participates in
providing instructions to a processor for execution. Such a
medium may take many forms, including but not limited to, nonvolatile media, volatile media, and transmission media. Nonvolatile media include, for example, optical or magnetic disks.
Volatile media include dynamic random access memory (DRAM).
Transmission media include coaxial cables, copper wire and fiber
optics, including the wires that comprise a system bus coupled to a
processor. Transmission media can also take the form of acoustic,
electrical, or electromagnetic waves, such as those generated
during radio frequency (RF) and infrared (IR) data
('198 patent at 37:24-38:9) (emphasis added) Thus, here, as in Bancorp, "[t]he computer
required by [the] claims is employed only for its most basic function, ... and as such does not
impose meaningful limits on the scope of those claims." 687 F.3d at 1278.
Plaintiff disputes these conclusions in several ways, all of which are unavailing. 8 First,
Plaintiff argues that the claims of the '198 patent meet the machine-or-transformation test, but in
support of this proposition Plaintiff points only to the use of a "mobile device" in connection
with the other claim limitations. (See C.A. 14-1070, D.I. 21 at 14, 16) To the contrary, many
exemplary embodiments in the specification indicate that the mobile device is not integral to the
performance of the claimed method: the user can obtain the "unlock code" through "an
intermediary's employee [who] can also personally transfer or verbally communicate the code to
the user" (' 198 patent at 26:23-38); the "unlock code" can be a "spoken ... password" (id. at
5:43-44); a user may receive an "unlock code" through the mail (id. at 7:18-21); a user may
unlock the "locked outcome" by "scratch[ing] off the space indicated by the code" or
"unlock[ing] the contraption using the key" (id. at 27:64-28:23); a user may download "locked
outcomes" from a website (id. at 7:57-60); and a user may receive a "free haircut," "game piece,"
"warrantee on a product," or "golf lesson from a professional golfer," as a benefit "associated
with" a "locked outcome" (id. at 13:1-19, 22:51-55)- all of which do not require a mobile
The same is true for the dependent claims. For instance, verification of a qualifying
activity pursuant to dependent claim 12 (id. at 39:54-57) can be performed by the "intermediary's
representative .. describ[ing] or attempt[ing] to ascertain the user's interest level in the can of
soup" (id. at 25:67-26:8).
Plaintiff s conclusory statements that the claims show "(i) an inventive concept, (ii) more
than a drafting effort designed to monopolize the abstract idea; (iii) improving an existing
technological process; and (iv) 'a 'new and useful' application of the idea"' (C.A. 14-1071, D.I.
21 at 16) (emphasis in original), are mere assertions, not supported by the materials the Court has
before it (and is permitted to consider).
The claims, therefore, do not satisfy the machine-or-transformation test because neither
the claims nor the specification of the '198 patent recite any machine that plays a "significant
part in permitting the claimed method to be performed." SiRF Tech., 601 F.3d at 1333 (emphasis
added). Rather, the "standard" mobile device and computer-readable medium recited as
implementing the claimed invention ('198 patent at 38:50-60, 41:13-15) is used "solely as an
obvious mechanism for permitting a solution to be achieved." SiRF Tech., 601 F.3d at 1333.
Second, Plaintiff argues that the claims do not preempt every application of the abstract
idea to which they are directed, pointing out that "the cited prior art remains available for
practice by Defendant." (C.A. 14-1070, D.I. 21 at 3)
[A]lthough courts have framed the 'second-step' analysis in terms
of preemption, there is no rule that ideas that do not preempt an
entire field are per se patent eligible. Rather, the test as articulated
by Alice is that there must be an inventive contribution on top of
the underlying abstract idea.
Money Suite Co. v. 21st Century Ins. & Fin. Servs., Inc., 2015 WL 436160, at *5 (D. Del. Jan.
27, 2015). As the Supreme Court explained in Alice, one focus of the second step of the Mayo
test is whether the claims "disproportionately t[ie] up the use of the underlying ideas." 134 S.
Ct. at 2354 (emphasis added; internal quotation marks omitted). The Court concludes that the
claims of the '198 patent do disproportionately tie up use of the underlying ideas of the '198
Moreover, the Federal Circuit recently stated: "Where a patent's claims are deemed only
to disclose patent ineligible subject matter under the Mayo framework, as they are in this case,
preemption concerns are fully addressed and made moot." Ariosa Diagnostics, Inc. v.
Sequenom, Inc., 788 F.3d-1371, 1379 (Fed. Cir. 2015) (emphasis added). The Court finds that
the claims of the '198 patent disclose only patent-ineligible subject matter. Therefore, Plaintiffs
preemption arguments are moot.
Finally, Plaintiff analogizes the claims of the '198 patent to the claims at issue in DDR
Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245 (Fed. Cir. 2004). Plaintiff argues that, as in
DDR, the claims of the '198 patent "do not recite ... a commonplace business method aimed at
processing business information, applying a known business process to the particular
technological environment of the Internet, or creating or altering contractual relations using
generic computer functions and conventional network operations." Id. at 1259. In the Court's
view, however, as discussed above, the claims here do recite standard use of a conventional
mobile phone in its normal, expected manner. The fact that they recite a particular method of
using an "unlock code" to obtain a "locked outcome" does not change this reality. "Simply
appending conventional steps, specified at a high level of generality, [is] not enough to supply an
inventive concept." Alice, 134 S. Ct. at 2357 (internal quotation marks omitted; emphasis in
Yet, conventional steps, specified at a high level of generality, are the sum total of what
the claims of the '198 patent monopolize. Although the claims of the 'J 98 patent are limited to a
particular technological environment - i.e., mobile devices - this does not save them from being
ineligible for patentability. See id. at 2358.
Therefore, the Court determines that the claims of the ' 198 patent are ineligible under
§ 101, because they are directed to an abstract idea and include no inventive concept under
For the reasons given above, all claims of the '198 patent are directed to patent-ineligible
subject matter under 35 U.S.C. § 101. The Court will grant Defendants' motions. An
appropriate order follows.
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