Uniloc USA, Inc. et al v. AVG Technologies USA, Inc.
MEMORANDUM OPINION AND ORDER (Motions to Dismiss (Docket No. 23 in Member Case No. 2:16-cv-394 and Docket No. 20 in Member Case No. 2:16-cv-396) be GRANTED-IN-PART with respect to claims 1, 2 and 7 of the 466 Patent and claims 1 and 3 of the 766 Patent and DENIED-IN-PART in all other respects without prejudice to refiling after claim construction.) Signed by Judge Robert W. Schroeder, III on 3/28/2017. (slo, )
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
UNILOC USA, INC. and
UNILOC LUXEMBOURG, S.A.,
AVG TECHNOLOGIES USA, INC.,
KASPERSKY LAB, INC.,
SQUARE ENIX, INC.,
CIVIL ACTION NO. 2:16-CV-00393-RWS
CIVIL ACTION NO. 2:16-CV-00394–RWS
CIVIL ACTION NO. 2:16-CV-00396-RWS
CIVIL ACTION NO. 2:16-CV-00397-RWS
CIVIL ACTION NO. 2:16-CV-00871-RWS
CIVIL ACTION NO. 2:16-CV-00872-RWS
MEMORANDUM OPINION AND ORDER
Before the Court is Defendant BitDefender LLC’s Motion to Dismiss for Failure to State
a Claim (Docket No. 23 in Case No. 2:16-cv-394 1), which is joined by Defendant Piriform, Inc.
(collectively with BitDefender LLC, “Defendants”). 2 Docket No. 20 in Case No. 2:16-cv-396.
The Motion was fully briefed (see Docket Nos. 26, 29 and 32), and the Court held a hearing on
Friday, December 2, 2016. See Docket No. 91 in Case No. 2:16-cv-393 (“Tr.”) at 2:1. Defendants’
Motion alleges that the asserted patent claims are drawn to ineligible subject matter under 35
U.S.C. § 101 and Alice Corp. v. CLS Bank, Int’l, 134 S. Ct. 2347 (2014). For the reasons that
follow, Defendants’ Motion is GRANTED-IN-PART and DENIED-IN-PART.
This is a consolidation of six patent-infringement actions in which Plaintiffs Uniloc USA,
Inc. and Uniloc Luxembourg S.A. (collectively, “Uniloc”) assert infringement of U.S. Patent Nos.
6,510,466 (“the ’466 Patent”), entitled “Methods, Systems and Computer Program Products for
Centralized Management of Application Programs on a Network,” and 6,728,766 (“the ’766
Patent”), entitled “Methods, Systems and Computer Program Products for License Use
management on a Network” (collectively, the “Asserted Patents”). See Docket No. 1 at ¶¶ 10, 22,
27, 29; Docket No. 39. The Defendants are providers of software, and the accused products are
Defendants’ software licensing and delivery systems. Docket No. 23 at 2.
The Asserted Patents relate to “application program management on a computer network.”
’466 Patent, col. 1:21–23; ’766 Patent, col. 1:21-23. 3 The computer network includes a server
Unless specifically stated otherwise, “Docket No.” refers to the docket in Case No. 2:16-cv-394.
BitDefender’s motion was originally also joined by Defendant AVG Technologies USA, Inc.,
which has since been dismissed. See Case No. 2:16-cv-393, Docket No. 21 (joining motion);
Docket No. 127 (dismissing AVG).
Although the Asserted Patents are related to each other, their specifications are somewhat
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supporting client stations and can be called a “client-server environment.” Docket No. 26 at 2
(citations omitted). The client-server environment is characterized by the possibility than any
given user may use different clients at different times. See ’466 Patent at col. 1:44–56. In the
context of the client-server environment, the claimed inventions of the Asserted Patents seek to
centralize application management so that “the entire process [can] be controlled from a single
point for an entire managed network environment.” Id. at col. 3:35–36; ’766 Patent, col: 3:35–36.
“Application management” is not explicitly defined in the Asserted Patents. However, the
’466 Patent specification describes “an application management system for managing configurable
application programs using both user and administrative preferences for various application
programs.” ’466 Patent, col. 7:25–28. The specification further explains that “application
management information may include configurable user preference information for the plurality
of application programs,” id. at col. 4:53–55, or may include “user, software, device, preference
and access control information.” Id. at col. 7:62–64. Application management thus includes many
aspects of providing software to users in the context of a client-server environment. See id. at col
Claim 1 of the ’466 Patent provides:
1. A method for management of application programs on a network including a
server and a client comprising the steps of:
installing a plurality of application programs at the server;
receiving at the server a login request from a user at the client;
establishing a user desktop interface at the client associated with the user
responsive to the login request from the user, the desktop interface including
a plurality of display regions associated with a set of the plurality of
application programs installed at the server for which the user is authorized;
receiving at the server a selection of one of the plurality of application programs
from the user desktop interface; and
providing an instance of the selected one of the plurality of application
programs to the client for execution responsive to the selection.
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Claim 1 of the ’766 Patent provides:
1. A method for management of license use for a network comprising the steps
maintaining license management policy information for a plurality of
application programs at a license management server, the license
management policy information including at least one of a user identity
based policy, an administrator policy override definition or a user policy
receiving at the license management server a request for a license availability
of a selected one of the plurality of application programs from a user at a
determining the license availability for the selected one of the plurality of
application programs for the user based on the maintained license
management policy information; and
providing an unavailability indication to the client responsive to the selection if
the license availability indicates that a license is not available for the user
or an availability indication if the licensed availability indicates that a
license is available for the user.
The ’466 and ’766 Patents address different aspects of application management in the
client-server environment. The ’466 Patent addresses installing application software on the server
and providing instances of that software to the clients for execution. ’466 Patent, col. 3:48–50.
The ’466 Patent further addresses establishing a user-specific desktop interface for clients from
which users may select display regions associated with the application software. See id. at col.
4:39–44. By contrast, the ’766 Patent addresses the management of licenses for the application
software, including maintaining license-related policies and information in the client-server
environment such that license availability can be communicated to clients on a user-specific basis.
’766 Patent, col. 3:24–28, 3:40–45, 5:38–60.
Federal Rule of Civil Procedure 12(b)(6)
Under Federal Rule of Civil Procedure 12(b)(6), the Court must dismiss a complaint that
does not state a claim for relief that is “plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678
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(2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). To state a plausible claim,
Plaintiffs must plead facts sufficient to allow the Court to draw a reasonable inference that
Defendants are liable for the alleged patent infringement. See id. (citing Twombly, 550 U.S. at
556). At this stage, the Court accepts all well-pleaded facts as true and views those facts in the
light most favorable to the Plaintiffs. Bustos v. Martini Club, Inc., 599 F.3d 458, 461 (5th Cir.
Eligibility Under 35 U.S.C. § 101
In determining whether a claim is patent-ineligible under Alice, the Court must “first
determine whether the claims at issue are directed to a patent-ineligible concept.” Alice, 134 S.
Ct. at 2355. Claims directed to software inventions do not automatically satisfy this first step of
the inquiry. Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1335 (Fed. Cir. 2016). Rather, “the
first step in the Alice inquiry . . . asks whether the focus of the claims is on [a] specific asserted
improvement in computer capabilities . . . or, instead, on . . . an ‘abstract idea’ for which computers
are invoked merely as a tool.” Id. at 1335–36.
If the Court determines that the claims are directed to an abstract idea, it then determines
whether the claims contain an inventive concept sufficient to transform the claimed abstract idea
into a patent-eligible application. Alice, 134 S. Ct. at 2357. An inventive concept is “some element
or combination of elements sufficient to ensure that the claim in practice amounts to ‘significantly
more’ than a patent on an ineligible concept.” DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d
1245, 1255 (Fed. Cir. 2014). The Court “consider[s] 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.” Alice, 134 S. Ct. at 2355 (internal quotation
omitted). Even if each claim element, by itself, was known in the art, “an inventive concept can
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be found in the non-conventional and non-generic arrangement of known, conventional pieces.”
Bascom Global Internet Servs., Inc. v. AT&T Mobility LLC, 827 F.3d 1341, 1350.
Asserted, Challenged and Representative Claims
Defendants’ motion originally challenged the patent-eligibility of all claims of the Asserted
Patents, but Defendants subsequently limited it to challenge only the claims that Uniloc actually
asserts: claims 1, 2, 7, 15 and 22 of the ’466 Patent and claims 1, 3, 7, 9, 13 and 15 of the ’766
Patent. 4 Docket No. 29 at 2; Tr. at 15:8–12. To the extent the motion challenges any other claim
of the Asserted Patents, it is DENIED without prejudice.
Of the ’466 Patent claims, claims 1 and 15 are independent, claims 2 and 7 depend from
claim 1, and claim 22 depends from claim 15. Docket No. 23 at 5. Defendants assert that claim 1
is representative of claim 15 and claim 7 is representative of claim 22. Docket No. 23 at 5–6. In
support of their assertion, Defendants state, “Claims 15 and 22, although drafted as systems, are
identical in substance to Claims 1 and 7 for the purposes of this motion because Claims 15 and 22
merely recited the limitations of claim 1 in means-plus-function language.” Id. at 6.
Of the ’766 Patent claims, claims 1, 7 and 13 are independent, claim 3 depends from claim
1, claim 9 depends from claim 7, and claim 15 depends from claim 13. See Docket No. 23 at 7.
Defendants assert that claim 1 of the ’766 Patent is representative of claims 7 and 13 and claim 3
is representative of claims 9 and 15. In support of their assertion, Defendants state, “Claims 7 and
9, although drawn as means plus function claims, are identical in substance to Claims 1 and 3 for
In its opposition, Uniloc represented that it is only asserting claims 1, 2, 7, 15 and 22 of the ’466
Patent and claims 1, 3, 7, 9, 13 and 15 of the ’766 Patent. Docket No. 26 at 2.
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purposes of this motion. Claims 13 and 15, although drawn as computer product claims, are
identical in substance to Claims 1 and 3 for purposes of this motion.” Id.
Defendants have not shown that the scope of the means-plus-function claims (claims 15
and 22 of the ’466 Patent and claims 7, 9, 13 and 15 of the ’766 Patent) is similar to the scope of
the non-means-plus-function claims (claims 1 and 7 of the ’466 Patent and claims 1 and 3 of the
’766 Patent). See Perdiemco, LLC v. Industrack LLC, Case No. 2:15-cv-727, 2016 WL5719697,
at *7 adopted 2016 WL 5475707 (E.D. Tex. Sept. 29, 2016) (“When the movant relies on a
representative claim in its § 101 analysis, it bears the burden of showing that the other asserted
claims are ‘substantially similar and linked to the same abstract idea.’ ”) (quoting Content
Extraction & Transmission LLC v. Wells Fargo Bank, N.A., 776 F.3d 1343, 1348 (Fed. Cir. 2014);
citing also Wright & Miller, Federal Practice and Procedure: Civil 3d § 1357 (2004)). Generally,
means-plus-function claims have a narrower scope than non-means-plus-function claims. See 35
U.S.C. § 112(f) (limiting the construction of means-plus-function terms to “the corresponding
structure, material, or acts described in the specification and equivalents thereof”). As such, they
may be patent-eligible even when similar non-means-plus-function claims are not. Because
Defendants only make arguments with respect to the non-means-plus-function claims and have
not shown the latter to be representative of the means-plus-function claims, the motion is DENIED
without prejudice as to claims 15 and 22 of the ’466 Patent and claims 7, 9, 13 and 15 of the ’766
Need for Claim Construction
The parties disagree as to whether claim construction is necessary to adjudicate the patent
eligibility of the remaining claims. Docket No. 32 at 8. Uniloc argues that claim construction is
required because Defendants’ arguments that the claims are directed to “the idea of managing the
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distribution of software over a network” and “preempt all ways of managing applications in a
client-server environment” reflect an overgeneralized construction of the claims. Id. at 8–9.
Uniloc further argues that the claims do not “monopolize every potential solution to the problem”
addressed by the claims and that any dispute as to the scope of the claims should preclude dismissal
under Section 101. Id. at 9.
The Court is not persuaded that there is a legitimate claim construction dispute in this case
that would frustrate its ability to rule on the instant motions to dismiss. Uniloc’s argument that the
scope of preemption is incomplete is irrelevant because complete preemption is not required under
Alice. See 134 S. Ct. at 2355. Significantly, neither Uniloc nor Defendants has proposed any
construction of any term in the Asserted Patents, much less demonstrated that such a construction
is plausible or favors Uniloc in this eligibility analysis. While some cases may require that the
claims be construed before their eligibility can be assessed, this is not such a case.
Alice Step One
“The Supreme Court has not established a definitive rule to determine what constitutes an
‘abstract idea’ sufficient to satisfy the first step of the Mayo/Alice inquiry.” Enfish, 822 F.3d at
1334. “Rather, both [the Federal Circuit] and the Supreme Court have found it sufficient to
compare claims at issue to those claims already found to be directed to an abstract idea in previous
cases.” Id. In the context of software inventions, the Federal Circuit has instructed that claims
directed to improvements in the functioning of a computer are not directed to an abstract idea. Id.
at 1335. Conversely, claims may be directed to abstract ideas if they are directed to fundamental
economic and conventional business practices. OIP Techs., Inc. v. Amazon.com, Inc., 788 F.3d
1359, 1362–63 (Fed. Cir. 2015). Claims may also be directed to abstract ideas if “[t]hey do not
claim a particular way of programming or designing the software to [accomplish the claimed
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functionality], but instead merely claim the resulting systems” or if the claims “are not directed to
a specific improvement in the way computers operate.” Apple, Inc. v. Ameranth, Inc., 842 F.3d
1229, 1241 (Fed. Cir. 2016).
Defendants contend that all of the asserted claims are directed to the idea of “managing the
distribution of software over a network.” Docket No. 23 at 12. In support of their contention,
Defendants compare the instant claims to those in Ultramercial, 772 F.3d at 715, Content
Extraction, 776 F.3d at 1347, Intellectual Ventures I, LLC v. Motorola Mobility LLC, 81 F.Supp.3d
356 (D. Del. Feb 24, 2015) and Tranxition, Inc. v. Lenovo (United States) Inc., Case No. 3:12-cv1065, 2015 U.S. Dist. LEXIS 89593, at *6 (D. Or. July 9, 2015). Id. at 12–15 (also citing
Landmark Tech. at *8, *18; Intellectual Ventures II, 2015 U.S. Dist. LEXIS 56092, at *13–14, 49;
Neochloris, Inc. v. Emerson Process Management LLP, 2015 U.S. Dist. LEXIS 138957, at *13
(N.D. Ill. Oct. 13, 2015)).
Defendants argue that the asserted claims are directed to abstract ideas because the
component steps of the method claims are themselves abstract. Id. at 14–15. Defendants further
argue that “distributing and maintaining software for network users” “has been recognized in the
past, and is now [recognized as] a basic and fundamental process.” Id. at 15. Finally, Defendants
support their allegation that the asserted claims are abstract “by comparing computer elements
with what a human can do manually without a computer.” Id. at 15–17 (citing Clear With
Computers, LLC v. Dick’s Sporting Goods, Inc., 21 F.Supp.3d 758, 765–66 (E.D. Tex. 2014)).
Plaintiffs respond that the asserted claims are not directed to an abstract idea because “the
claims are directed to a specific implementation of a solution to a problem in the software arts.”
Docket No. 26 at 7 (quoting Enfish, 2016 U.S. App. LEXIS 8699, at *16). Plaintiffs further
respond that the alleged abstract idea, “managing the distribution of software over a network,”
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represents an over-generalization of the Asserted Patents. Id. Plaintiffs argue that the claims are
not abstract because “the need for this type of [claimed] technology in the marketplace at the time
it was invented is apparent.” Id. at 8. Plaintiffs state that the “present inventions remedied [certain]
deficiencies [in the prior art] by providing ‘a seamless integration of application access and session
characteristics across heterogeneous networks.’ ” Id. at 9 (citing ’466 Patent, col 3:21–25).
Plaintiffs recite several limitations of the asserted claims and state these limitations give rise to
purported advantages of the claimed technology. Id. at 9–12. Plaintiffs also deny that the claimed
methods can be performed by a human mind and argue that the methods are not directed to abstract
ideas because they require a computer. Id. at 13–14.
Additionally, Plaintiffs argue that the claimed inventions of the ’466 and ’766 Patents
improve the operation of a network of computers. Id. at 13. Plaintiffs state that the claimed
technology of the ’466 Patent “fill[s] a gap in the art at the time, in providing increased efficiency
in the management of application programs in a client server environment to address the then new
problem of user roaming in networks.” Id. “The ’766 Patent allows for a reduction in costs
associated with license use management of application programs in a client server environment.”
Defendants reply that Asserted Patents do not improve the functioning of a computer under
Enfish because their claims are not as specific as the Enfish claims, Docket No. 29 at 3, and because
improved efficiency or reduced costs are not cognizable improvements to the functioning of a
computer. Id. at 5 n.25. Plaintiffs’ surreply asserts that their claims are non-abstract because their
claims are not overly vague. Docket No. 32 at 2–3 (citing ContentGuard Holdings, Inc. v.
Amazon.com, Inc. 142 F. Supp. 3d 510, 512–13 (E.D.Tex. 2015)). Plaintiffs also re-urge in
surreply that Defendants’ alleged abstraction is over-generalized. Id. at 4–6 (citations omitted).
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The Court agrees with Plaintiffs that “managing the distribution of software over a
network” describes the claims at too high a level of abstraction but disagrees that this is fatal to
Defendants’ motion. Defendants’ description is not “untethered from the language of the claims”
because it is derived from the preambles of claim 1 of the ’466 Patent and claim 1 of the ’766
Patent. Cf. Enfish, 822 F.3d at 1337. Moreover, Defendants have shown that the claims are
directed to abstract ideas at a lower level of abstraction. See Apple, Inc. v. Ameranth, Inc., 842
F.3d 1229, 1240 (Fed. Cir. 2016) (“An abstract idea can generally be described at different levels
The ’466 Patent is directed to providing a user-specific desktop interface that includes
establishing display regions associated with application programs for which the user is authorized
and, in response to the user’s selection of one such display region, providing an instance of the
application program to the user’s client for execution. The claims do not improve the functioning
of a computer or computer network because “increased efficiency in the management of
application programs” is not a technological benefit. Additionally, the claims are overly vague
because they recite “establishing a user desktop” with certain features without claiming any
“particular way of programming or designing the software to create [user desktops] that have these
feature.” Ameranth, 842 F.3d at 1241.
The ’766 Patent is directed to using “license management policy information” to provide
an indication of whether a license is available to a user for an application program in response to
a request for license availability. Claims to the maintenance of information and announcement of
that information in response to a request have been found to be abstract. See Elec. Power Grp.,
LLC v. Alston S.A., 830 F.3d 1350, 1353–54 (Fed. Cir. 2016). Moreover, the ’766 Patent is not
directed to an improvement of a computer or computer network. Reduced costs associated with
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license use management in a client server environment, like increased efficiency, is a business
benefit rather than a benefit to the client server environment itself.
In sum, the claims of the Asserted Patents are directed to abstract ideas. Because step one
of the Alice inquiry is satisfied, the Court proceeds to step two.
Alice Step Two
At the second step of the Alice eligibility inquiry, the Court evaluates “whether the claims
here do more than simply instruct the practitioner to implement the abstract idea . . . on a generic
computer” (i.e., provide an inventive concept). Alice, 124 S. Ct. at 2359. The Court first analyzes
the claim elements separately and then as an ordered combination. Id. at 2359–60.
’446 Patent, Claim 1
Defendants argue that the individual limitations of claim 1 of the ’466 Patent do not provide
an inventive concept. They argue that even if the preamble is limiting, it does not provide an
inventive concept because similar preambles have not been held to provide an inventive concept
and the preamble of claim 1 recites only generic equipment being used in a conventional manner.
Docket No. 23 at 18–19. They next contend that the first step recites routine activity—installing
computer software—on a generic computer, the “server.” Id. at 19. According to Defendants, the
second step also recites generic computer components (i.e., “server” and “client”) performing an
allegedly abstract idea of logging into a network. Id. Defendants also characterize the third step—
providing the user interface—as an abstract idea and argue that, therefore, it also does not provide
an inventive concept. Id. at 20. Finally, Defendants characterize the fourth and fifth steps—
communicating the user’s selection to a server and providing a copy of the program, respectively—
as abstract ideas. Id. Defendants also argue that the asserted claims are not like those in DDR
Holdings because the claims in that case solved a problem specific to the Internet as opposed to
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the claims in this case, which “describe a widely-understood and well-known abstract idea—
managing the distribution of software over a network—and then implement the abstract idea using
conventional computer components.” Id. at 23. Defendants also distinguish the claimed invention
of the ’466 Patent from the “technology-based solution” of Bascom because the instant claims rely
only on generic computer technology. Id. at 29–30.
Plaintiffs respond that Defendants ignore that “[t]he ‘inventive concept’ may arise in one
or more of the individual claim limitations or in the ordered combination of the limitations” and
“[t]he inventive concept inquiry requires more than recognizing that each claim element, by itself,
was known in the art.” Docket No. 26 at 14 (citing Bascom, 2016 LEXIS 11687, at *18). Plaintiffs
state that “[t]he inventive concept inherent in the ’466 Patent allows for a variety of application
programs to be maintained at the server and an instance of a selected one of the application
programs to be provided as needed to a user logged onto a client device.” Id. at 14. Plaintiffs
further state that certain limitations of the ’466 Patent claims “allow for individual application
programs to be provided to the user as needed where they are executed at a client device.” Id. at
15. Plaintiffs also compare the claims to those in DDR Holdings and Bascom and argue that the
claims of the ’466 Patent are patent-eligible because they are limited to a discrete implementation
for centralized management of applications. Id. at 15–18.
In reply, Defendants argue that “[t]he limitations of the Asserted Claims considered as an
ordered combination do not add anything significantly more to transform the Asserted Claims to
patent eligibility.” Docket No. 29 at 8. Defendants assert that the specifications of the Asserted
Patents “make clear that, even considered as an ordered combination, there is nothing ‘discrete’ in
the limitations recited in the Asserted Claims.” Id. The ordered combination contains no inventive
concept, Defendants argue, because even as combined, the limitations “function as expected in an
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entirely predictable fashion and in accordance with the conventional use at the time of the
invention.” Id. at 8–9 (citing Tridia Corp. v. Lead Case Sauce Labs, 2016 U.S. Dist. LEXIS 99878,
at *23 (N.D. Ga. 2016)).
Plaintiffs argue in surreply that Defendants have provided no evidence that the claims are
directed toward “conventional computer, network, and display technology.” Docket No. 32 at 7
(citing Docket No. 29 at 4). Plaintiffs further argue that the asserted claims supply an inventive
concept like those in SimpleAir, Inc. v. Google Inc., 136 F. Supp. 3d 745 (E.D. Tex. 2015).
The individual limitations of claim 1 of the ’466 Patent fail to provide an inventive concept.
Defendants have shown that each limitation enumerates a routine function of computers. Although
the Court credits the specification in listing purported advantages of the claimed invention, see
Enfish, 822 F.3d at 1337 (discussing purported benefits of the claimed invention over the prior
art), Plaintiffs provide no authority for their argument that these advantages can constitute an
inventive concept in themselves. A claim may be sufficiently limited that it has an inventive
concept under Alice even if the claimed invention has no advantages over the prior art, and a
claimed invention may have advantages over similar prior art inventions but be claimed in an
insufficiently limited way to confer eligibility under Alice.
Moreover, the purported advantages of the claimed invention are not stated in the claims,
and unclaimed advantages cannot, in themselves, constitute an inventive concept because any
inventive concept must be found in the claims. See Bascom, 827 F.3d at 1349 (“The ‘inventive
concept’ may arise in one or more of the individual claim limitations or in the ordered combination
of the limitations.”) (citing Alice, 134 S. Ct. at 2355). Plaintiffs attempt to tie the purported
advantages listed in the specification to certain limitations of claim 1. Even if Plaintiffs are correct
that one or more individual claim limitations is responsible for a certain advantage discussed in
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the specification, claim 1 is still patent-ineligible. The existence of other, less advantageous ways
of accomplishing similar goals, in this case maintaining Electronic Health Records, may be
evidence that the claims do not preempt every form of Electronic Health Record, but maintaining
an Electronic Health Record is not the abstract idea to be limited. Rather, organizing data in a
hierarchical format is the abstract idea to be limited, 5 and the fact that there may be other ways of
making an Electronic Health Record is irrelevant to whether the ’466 Patent meaningfully limits
Finally, the ordered combination of limitations also fails to provide an inventive concept
under Bascom and DDR Holdings. There is no inventive concept because, unlike the claims in
Bascom, the claims here rely upon only generic computer components used in a routine
arrangement. Specifically, the “client” and “server” are generic computers, and they are set up in
a generic client-server arrangement. See, e.g., ’466 Patent, col. 1:57–2:11 (describing prior art
client-server environments). The traditional arrangement of computer components in the instant
claims distinguishes this case from Bascom, in which the non-generic arrangement of otherwise
generic computer components provided the inventive concept behind the unique Internet-filtering
solution. See Bascom Global Internet Servs., Inc. v. AT&T Mobility LLC, 827 F.3d 1341, 1350
(Fed. Cir. 2016).
DDR Holdings also supports the conclusion that claim 1 of the ’466 Patent provides no
inventive concept. In that case, the Federal Circuit upheld patent-eligibility of the claims at step
two of the Alice inquiry because they solved a problem unique to the Internet with no brick-andmortar analog. DDR Holdings, 773 F.3d at 1257–58. The Federal Circuit “caution[ed], however,
The Court rephrases the abstract idea here to emphasize that the medical nature of the claimed
invention is a field of use restriction and does not contribute to an inventive concept. See Parker
v. Flook, 98 S. Ct. 2522, 2528–29 (1978).
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that not all claims purporting to address Internet-centric challenges are eligible for patent” and
contrasted the claims to those in Ultramercial, which “broadly and generically claim ‘use of the
Internet’ to perform an abstract business practice (with insignificant added activity).” Id. at 1258.
The Federal Circuit further stated that the DDR Holdings claims “specify how interactions with
the Internet are manipulated to yield a desired result—a result that overrides the routine and
conventional sequence of events ordinarily triggered by the click of a hyperlink.” Id.
In this case, the claimed “display regions” operate conventionally by triggering the client
to interact with a server such that the server provides an instance of the linked-to content to be
executed by the client.
Moreover, Defendants’ human performance example shows that
distributing software in a client-server network environment has the preexisting analog of
distributing software by hand. Thus, the ’466 Patent claims share more of the characteristics of
the invalid claims from Ultramercial than the valid claims from DDR Holdings. Claim 1 of the
’466 Patent does not provide an inventive concept.
’466 Patent, Claims 2 and 7
Claim 2 of the ’446 Patent depends from claim 1 and provides two additional limitations.
The first, “maintaining application management information for the plurality of applications at the
server,” contains no independent inventive concept because it constitutes electronic recordkeeping.
See Uniloc USA, Inc. v. E-MDs, Inc., Case No. 6:14-cv-625, 2015 WL 10791906, at *4 (E.D. Tex.
Aug. 19, 2015). The second, “wherein the establishing step includes the step of including a
plurality of display regions associated with a set of the plurality of application programs for which
the user is authorized responsive to the application management information,” only limits the
“establishing” step of claim 1 by requiring that the “establishing” be “responsive to the application
management information.” In other words, claim 2 requires that the “application management
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information” that is maintained at the server to also be used in establishing the desktop without
specifying how such information is to be used. Generic instructions to maintain and use a certain
kind of information—especially as broad a class of information as “application management
information,” see supra—do not provide an inventive concept. Id.; see also See Elec. Power Grp.,
830 F.3d at 1353–54.
Claim 7 also depends from claim 1 and limits the “establishing” step. Specifically, claim
7 calls for “configuring the user desktop interface responsive to an identifier of the user associated
with the login request so as to provide associated information for the user desktop interface; and
providing the user desktop interface and the associated information for the user desktop interface
to the client for display.” Claim 7 requires maintaining user-specific desktop-configuration
information and providing that information in response to an identifying aspect of the user login
so that the client can use it in “establishing” the desktop interface. As with claim 2, neither the
claim nor the specification identifies a specific “identifier of the user,” how that identifier might
be “associated with the login request,” or how the client might employ the information in
establishing the user desktop interface. As such, claim 7 also fails to provide an inventive concept
because it only amounts to generic instructions to maintain and employ information. Id.
Accordingly, claims 2 and 7 of the ’446 Patent are drawn to ineligible subject matter.
’766 Patent, Claim 1
Defendants argue that claim 1 of the ’766 Patent contains no inventive concept. They argue
that “[r]egardless of whether the preamble of Claim 1 is limiting, it fails to recite structure that
does any more than implement the abstract idea on a generic computer.” Docket No. 23 at 20.
They contend that the first step, “maintaining license policy information . . . at a license
management server,” “merely recites the abstract idea of maintaining a list of license information
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for software.” Id. at 21. Defendants also characterize the second step, “receiving . . . a request for
a license availability,” as an abstract idea. Id. Similarly, Defendants state the third step,
“determining the license availability,” merely recites an abstract idea. Id. at 22. Defendants also
characterize as abstract the fourth step, “providing an unavailability . . . or an availability
indication.” Id. Finally, Defendants argue that “whether alone or in an ordered combination, the
claimed steps recited above do not disclose an inventive concept.” Id. at 22–23.
Plaintiffs argue that claim 1 of the ’766 Patent does include an inventive concept. They
state that specific limitations of the claimed invention confer advantages on the user relative to the
prior art. Docket No. 26 at 15, 17. Plaintiffs further argue that claim 1 is like the claims in DDR
Holdings because both are “directed to a method of communicating information to and from a
computer server.” Id. at 16.
As discussed above, just because an invention may have some advantages over the prior
art does not necessarily mean that claims reciting one or more aspects of that invention contain an
inventive concept. Moreover, the holding of DDR Holdings does not apply to the ’766 Patent
because the problem the claimed invention purports to solve is not sufficiently tied to computers
or the Internet. Maintaining, querying and relaying license policy information is a task humans
accomplished before the advent of computers.
The Court agrees with Defendants that claim 1 of the ’766 patent does not contain an
inventive concept. This Court has held that maintaining, querying and relaying information is
electronic recordkeeping. See E-MDs, 2015 WL 10791906, at *4. Similarly, the Federal Circuit
has held that “merely selecting information, by content or source, for collection, analysis, and
display does nothing significant to differentiate a process from ordinary mental processes, whose
implicit exclusion from § 101 undergirds the information-based category of abstract ideas.” Elec.
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Power Grp., 830 F.3d at 1355. As with the claims in Electric Power Group, the claims in this case
“do not require a new source or type of information, or new techniques for analyzing it.” See id.
Rather, claim 1 requires only that standard “license management policy information” be
maintained and used, in response to a request, to determine and provide an indication of the license
availability using standard techniques. Accordingly, claim 1 of the ’766 Patent does not contain
an inventive concept and is drawn to ineligible subject matter.
’766 Patent, Claim 3
Claim 3 of the ’766 Patent depends from claim 1 and specifies that the “license
management server is an on demand server associated with the client which provides an instance
of the selected one of the application programs to the client for execution.” First, that the client
and server are associated with one another and that the server provides an instance of the selected
one of the application programs to the client for execution are already features of claim 1. The
only new limitation in claim 3 is that the license management server is an on demand server. The
specification of the ’766 Patent defines “on-demand server” as “a server delivering applications as
needed responsive to user requests as requests are received.”
’766 Patent, col. 6:51–53.
Accordingly, the “on-demand server” is a generic server performing the routine functions of a
server. See id. at col. 14:51–56. Moreover, the traditional client-server relationship is not
disturbed by providing that the same server must act as the license management server and ondemand application server. To the contrary, claim 3 reinforces that claim 1 does not require a
special or separate “license management server” but merely requires license management
functionality to be present in the one, generic server. See id. at col 14:40–44 (“[T]he abovedescribed aspects of the present invention . . . may be provided by hardware, software, or a
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combination of the above.”). Accordingly, claim 3 provides no inventive concept and is drawn to
patent-ineligible subject matter.
Defendants have not shown the patent-ineligibility of the challenged means-plus function
claims. However, they have shown the patent-ineligibility of claims 1, 2 and 7 of the ’466 Patent
and claims 1 and 3 of the ’766 Patent. Accordingly, it is
ORDERED that the Motions to Dismiss (Docket No. 23 in Case No. 2:16-cv-394 and
Docket No. 20 in Case No. 2:16-cv-396;) be GRANTED-IN-PART with respect to claims 1, 2
and 7 of the ’466 Patent and claims 1 and 3 of the ’766 Patent and DENIED-IN-PART in all other
respects without prejudice to refiling after claim construction.
SIGNED this 28th day of March, 2017.
ROBERT W. SCHROEDER III
UNITED STATES DISTRICT JUDGE
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