Gonzalez v. InfoStream Group Inc.
Filing
185
MEMORANDUM OPINION AND ORDER. Signed by Judge Rodney Gilstrap on 04/25/2016. (nkl, )
UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
MARSHALL DIVISION
EMMANUEL C. GONZALEZ,
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Plaintiff,
v.
INFOSTREAM GROUP, INC.,
Defendant.
NEW LIFE VENTURES, INC.
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Case No. 2:14-cv-906-JRG
Consolidated Lead Case
Case No. 2:14-cv-907-JRG
MEMORANDUM OPINION AND ORDER
Before the Court is Defendant New Life Ventures, Inc.’s (“NLV”) Motion for Summary
Judgment of Invalidity (“Mot.”, Dkt. No. 142). In its motion, NLV argues that the asserted
claims of U.S. Patent No. 7,873,665 (the “’665 Patent”) and U.S. Patent No. 7,558,807 (the
“’807 Patent”) (collectively, the “Patents-in-Suit”) are invalid because they are ineligible for
patent protection under 35 U.S.C. § 101. Having reviewed the motions and the Patents-in-Suit,
the Court is persuaded that none of the asserted claims are directed to patentable subject matter.
Accordingly, NLV’s motion is GRANTED.
I.
BACKGROUND
On September 23, 2014, Plaintiff Emmannuel C. Gonzalez (“Plaintiff”) filed a complaint
for patent infringement against multiple defendants and initially asserted five patents, including
the ’665 Patent and the ’807 Patent. (“Complaint,” Dkt. No. 1.) The Court held a Markman
hearing on August 18, 2015, and issued a Claim Construction Order (Dkt. No. 109). Plaintiff
currently asserts claims 1, 42, and 53 of the ’655 Patent and claims 1, 2, and 3 of the ’807 Patent.
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Asserted independent claim 1 of the ’665 Patent recites:
1.
A method for multi-parameter digital labelling of Internet Websites,
comprising:
gathering of unambiguous, multi-parameter qualitative data concerning
single or a plurality of at least one of an Internet website, an
Internet posting, their substantive contents, and their owner or
creator;
sourcing, from the owner or creator of said website or Internet posting,
each said item of qualitative data referring to said website, said
internet posting, or its substantive contents or its owner or creator;
producing a plurality of digital labels for each said website or internet
posting, wherein each digital label uniquely refers to and
represents a particular item of qualitative information;
wherein producing of digital labels further comprises encoding of the
qualitative data in any digital form;
domiciling of these multi-parameter digital labels on at least one of the
same computer, the same computer network, and on several
computers linked to each other;
manipulation of the said multi-parameter digital labels comprising
generation of a list of at least one of websites and Internet postings
that match parameters stipulated by an entity conducting a search
and represented in the digital labels according to at least one of the
presence of, the absence of, the numerical or other value contained
in, the numerical or other value not contained in, any one, all, and
any configuration of the labels that have reference to one or more
websites or Internet postings; and
making available the effective use of these multi-parameter digital labels
and the means for their manipulation, to the general public through
the Internet.
(’665 Patent, col. 23, ll. 28–58.) The other asserted claims of the ’665 Patent are dependent
claims.
Asserted independent claim 1 of the ’807 Patent recites:
1.
A host website apparatus for listing subscribers comprising:
a computer system,
said computer system includes a digital label database for providing to a
listing subscriber digital labels representing different specific
qualities and a subscriber database for storing a listing of
subscribers’ digital labels;
said computer system being configured to respond to a subscriber’s
request for listing and guiding the subscriber via the Host Website
display to enter information pertaining to the subscriber and
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converting the information to digital labels by accessing said
digital label database and storing the subscriber’s digital labels in
said subscriber database; and
said computer system further configured to enable users to search said
subscriber database for subscriber digital labels identifying
subscriber qualities.
(’807 Patent, col. 19, l. 19–col. 20, l. 8.) The Court finds that claim 1 of the ’807 Patent is
representative of claim 3, the only other independent claim in that patent.
II.
A.
LEGAL STANDARD
Summary Judgment Under Rule 56
Federal Rule of Civil Procedure 56(c) authorizes a Court to grant summary judgment
where “there is no genuine issue as to any material fact and . . . the moving party is entitled to a
judgment as a matter of law.” A party moving for summary judgment must satisfy its initial
burden by showing that “there is an absence of evidence to support the nonmoving party’s case.”
Celotex Corp. v. Catrett, 477 U.S. 317, 323–25 (1986).
Patent eligibility under § 101 is an issue of law, but the legal conclusion may contain
underlying factual issues. Accenture Global Servs., GmbH v. Guidewire Software, Inc., 728 F.3d
1336, 1340–41 (Fed. Cir. 2013). Here, there are no material factual disputes that would prevent
the Court from deciding NLV’s motion pursuant to Rule 56.
B.
Patent Eligibility under 35 U.S.C. § 101
Section 101 of the Patent Act defines scope of patent eligible subject matter:
Whoever 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.
The Supreme Court has held that there are three specific exceptions to patent eligibility
under § 101: laws of nature, natural phenomena, and abstract ideas. Bilski v. Kappos, 561 U.S.
593, 601 (2010). In Mayo, the Supreme Court articulated a two-step test for “distinguishing
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patents that claim laws of nature, natural phenomena, and abstract ideas from those that claim
patent eligible applications of those concepts.” Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 134 S. Ct.
2347, 2355 (2014) (citing Mayo Collaborative Servs. v. Prometheus Labs., Inc., 132 S. Ct. 1289,
1296–97 (2012)).
The first step of Mayo requires a court to determine if the claims are directed to a law of
nature, natural phenomenon, or abstract idea. Alice, 134 S. Ct. at 2355. “If not, the claims pass
muster under § 101.” Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 714 (Fed. Cir. 2014). In
making this determination, the court looks at what the claims cover. Ultramercial, 772 F.3d at
714–15 (“We first examine the claims because claims are the definition of what a patent is
intended to cover.”); see also Intellectual Ventures I LLC v. Capital One Bank (USA), 792 F.3d
1363, 1369 (Fed. Cir. 2015) (“At step one of the Alice framework, it is often useful to determine
the breadth of the claims in order to determine whether the claims extend to cover a
‘fundamental . . . practice long prevalent in our system . . . .’”).
For example, in Bilski, the Supreme Court rejected as patent-ineligible “Claims 1 and 4 in
petitioners’ application” because the claims simply “explain[ed] the basic concept of hedging, or
protecting against risk.” Bilski, 561 U.S. at 611. Similarly, in Ultramercial, the Federal Circuit
found patent ineligible a claim that included “eleven steps for displaying an advertisement in
exchange for access to copyrighted media.” Ultramercial, 772 F.3d at 714. In Intellectual
Ventures, the Federal Circuit held that a claim that contained steps “relat[ing]to customizing
information based on (1) information known about the user and (2) navigation data.” Intellectual
Ventures, 792 F.3d at 1369.
A court applies the second step, per Mayo, only if it finds as part of the first step that the
claims are directed to a law of nature, natural phenomenon, or abstract idea. Alice, 134 S. Ct. at
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2355. Such a second step requires the court to determine if the elements of the claim
individually, or as an ordered combination, “transform the nature of the claim” into a patenteligible application. Alice, 134 S. Ct. at 2355. In determining if the claim is transformed, “[t]he
cases most directly on point are Diehr and Flook, two cases in which the [Supreme] Court
reached opposite conclusions about the patent eligibility of a process that embodied the
equivalent of natural laws.” Mayo Collaborative Servs. v. Prometheus Labs., Inc., 132 S. Ct.
1289, 1298 (2012); see also Alice, 134 S. Ct. at 2355 (“We have described step two of this
analysis as a search for an ‘inventive concept.’”).
In Diehr, the Court “found [that] the overall process [was] patent eligible because of the
way the additional steps of the process integrated the equation into the process as a whole.”
Mayo, 132 S. Ct. at 1298 (citing Diamond v. Diehr, 450 U.S. 175, 187 (1981)); see also Mayo,
132 S. Ct. at 1300 (“It nowhere suggested that all these steps, or at least the combination of those
steps, were in context obvious, already in use, or purely conventional.”). In Flook, the Court
found that a process was patent-ineligible because the additional steps of the process amounted
to nothing more than “insignificant post-solution activity.” Diehr, 450 U.S. at 191–92 (citing
Parker v. Flook, 437 U.S. 584 (1978)).
A claim may become patent-eligible when the “claimed process include[s] not only a law
of nature but also several unconventional steps . . . that confine[] the claims to a particular, useful
application of the principle.” Mayo, 132 S. Ct. at 1300; see also DDR Holdings, LLC v.
Hotels.com, L.P., 773 F.3d 1245, 1257 (Fed. Cir. 2014) (“In particular, the ’399 patent’s claims
address the problem of retaining website visitors that, if adhering to the routine, conventional
functioning of Internet hyperlink protocol, would be instantly transported away from a host’s
website after ‘clicking’ on an advertisement and activating a hyperlink.”). A claim, however,
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remains patent-ineligible if it describes only “‘post-solution activity’ that is purely ‘conventional
or obvious.’” Mayo, 132 S. Ct. at 1299.
III.
DISCUSSION
In order to prevail on a § 101 challenge, the movant must show that the challenged claims
first fail the “ineligible concept” step and then also fail the “inventive concept” step of the Alice
test. In this case, NLV contends that the Patents-in-Suit fail both steps. First, NLV argues that the
asserted claims are directed to the abstract idea of “using labels to facilitate searches.” (Mot. at
9.) Second, NLV asserts that the asserted claims include no inventive concept “beyond the idea
of using digital labels for websites.” (Id. at 1.)
A.
Alice Step One: The Ineligible Concept Step
Here, the Court finds that the asserted claims are directed to the abstract idea of
gathering and labeling information to facilitate efficient retrieval of the labeled information.
Claim 1 of the ’665 Patent describes a method for making “digital labels,” while Claim 1 of the
’807 Patent describes a website configured to retrieve information based upon a “digital label
database.” (’665 Patent, col. 23, l. 38; ’807 Patent, col. 19, l. 22.) As the Court recently found in
eDekka, a case in which the asserted patent (“eDekka patent”) was similarly directed to the
abstract idea of storing and labeling information, “the claimed idea represents routine tasks that
could be performed by a human.” eDekka v. 3balls.com, 2015 WL 5579840, at *4 (E.D. Tex.
Sept. 21, 2015).
B.
Alice Step Two: The Inventive Concept Step
Because the asserted claims are directed toward an abstract idea, the Court must next
determine whether an inventive concept exists that is sufficient to transform the claims into
patent-eligible subject matter. Such transformation requires more than simply stating the abstract
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idea “while adding the words ‘apply it.’” Mayo, 132 S. Ct. at 1294. Here, the Court finds that
such an inventive concept does not exist to transform the asserted claims of the Patents-in-Suit
into patent-eligible subject matter.
Like the eDekka patent, which included terms that, at best, vaguely alluded to computerbased activity, the claim limitations of both the ’665 Patent and the ’807 Patent are insufficient to
demonstrate that the Patents-in-Suit amount to more than patents on abstract ideas. See Alice,
134 S. Ct. at 2355. The purported inventive step, as argued by Plaintiff, is applying the wellknown concept of labeling information to websites. Alice holds that implementing an abstract
idea (such as generic labeling) on a computer does not make that idea patentable. Id. at 2352.
Similarly, “use of the Internet does not transform an otherwise abstract idea into patent-eligible
subject matter.” Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 716 (Fed. Cir. 2014).
In describing the invention to the Patent Office, Plaintiff conceded that “this kind of
labeling is common in commerce in physical form,” but “it has not heretofore been used or
proposed in digital form for websites.” (Mot., Ex. 9) The claims themselves offer nothing more
than taking the well-known concept of labeling and applying it to the internet. The Court finds
that this application does support finding an inventive concept to be present in the asserted
patents.
Though Plaintiff contends that “several important claim elements” elevate the contested
claims beyond the realm of an abstract idea, the Supreme Court explained that an abstract idea
cannot be transformed into a patentable invention by “appending conventional steps, specified at
a high level of generality.” Alice, 134 S. Ct. at 2357 (quoting Mayo, 132 S. Ct. at 1300). Whether
analyzed individually or collectively, the “important claim elements” cited by Plaintiff amount to
nothing more than inherently abstract ideas, conventional steps, or both. Accordingly, the Court
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concludes that the Patents-in-Suit fall outside the scope of patentable subject matter defined by §
101.
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IV.
CONCLUSION
For the reasons set forth above, the Court holds that the claims of the ’665 Patent and the
’807 Patent are not directed toward eligible subject matter under 35 U.S.C. § 101.
Accordingly, the Court GRANTS NLV’s Motion for Summary Judgment of Invalidity (Dkt. No.
142).
SIGNED this 19th day of December, 2011.
So ORDERED and SIGNED this 25th day of April, 2016.
____________________________________
RODNEY GILSTRAP
UNITED STATES DISTRICT JUDGE
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