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Triplay, Inc. v. Whatsapp Inc.

United States District Court, D. Delaware

April 28, 2015

TRIPLAY, INC. and TRIPLAY, LTD., Plaintiffs,
v.
WHATSAPP INC., Defendant.

REPORT AND RECOMMENDATION

CHRISTOPHER J. BURKE, Magistrate Judge.

Presently pending before the Court is Defendant WhatsApp Inc.'s ("Defendant") motion to dismiss for failure to state a claim, filed pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure (the "Motion"). (D.I. 7) Defendant argues that the claims of Plaintiffs TriPlay, Inc. and TriPlay, Ltd.'s (collectively, "Plaintiffs") United States Patent No. 8, 332, 475 (the "'475 patent") are directed to non-patent-eligible subject matter under 35 U.S.C. § 101 ("Section 101"). (D.I. 8 at 1) For the reasons that follow, the Court recommends that Defendant's Motion be GRANTED as to claim 12 of the '475 patent, and DENIED without prejudice as to the remaining claims of the '475 patent.

I. BACKGROUND

A. Factual Background

Plaintiff TriPlay, Ltd. is an Israeli corporation and is the owner of the '475 patent. (D.I. 4 at ¶¶ 3, 12) Plaintiff Triplay, Inc., a Delaware corporation, is the exclusive licensee of the patent. (Id. at ¶¶ 2, 12) The '475 patent is entitled "Messaging System and Method, " and was issued on December 11, 2012. ('475 patent at 1)[1]

The specification of the '475 patent states that "[t]his invention relates to a field of electronic messaging and, in particular, to cross-platform messaging." ('475 patent, col. 1:5-6) At the time of patenting, the "versatility of contemporary electronic messaging services [wa]s growing and giving rise to new message formats and new devices with messaging capabilities." ( Id., col. 1: 10-12) The specification lists examples of"[e]merging message formats" such as "MMS (Multimedia Message Service)" that complemented "traditional messaging services (e.g., e-mail, Short Message Service, instant messaging, etc.)." ( Id., col. 1:12-16) The adoption of these new messaging capabilities sometimes resulted in a situation where communication devices supported "different and not always compatible message and communication formats." ( Id., col. 1: 16-19) The specification described this as "[t]he problem of cross-platform messaging[.]" ( Id., col. 1:20)

As a solution to this problem, the patent sets forth various systems and methods for converting the layout and format of messages from one electronic device, such as a cellular phone, to another, such as a personal computer. ( Id., col. 10:32-35; see, e.g. id., cols. 5:22-8:60 (describing "aspects" of the invention)). These systems and methods generally involve adapting or converting the layout and/or format of a message based on criteria relating to the communication or display capabilities of the destination device, or to the communication media between the originating and destination devices. ( See, e.g., id., cols. 5:22-45, 6:36-59, 7:1-19, 7:30-53, 16:24-30) Changes to the layout of a message may include, for example, truncating a portion of the message, substituting text for graphical elements of the message, or a reduction in the quality of an image. ( Id., cols. 21:22-22:12) Message formats subject to adaptation or conversion may include "text (including rich text), video format (e.g. MPEG family, WMV family, 3GPP, etc.), audio format (e.g. AMR family, MPEG audio layers, AAC, MIDI, etc.), image format (e.g. JPEG, GIF, BMP[, ] etc.), and others." ( Id., col. 12:18-21)

The patent specification recognizes that electronic messaging devices existed in the prior art, ( id., col. 10:27-42), and that various prior art "transcoding functionalities" existed to enable conversion of a message from one format or layout to another, ( id., col. 16:24-34). Likewise, the networks (or combinations of networks) upon which such messages are sent were known in the prior art. ( Id., col. 11:40-43) All told, the specification includes a list of 18 specific prior art systems addressing "the problem of cross-platform messaging[.]" ( Id., cols. 1:20-5:18).

The patent has 42 claims, including 14 independent claims and 28 dependent claims. The independent claims cover variations of the idea of using criterion relating to the capabilities of the destination device, or to the communication media, in order to convert a message from an originating device. Claim 1, for example, reads as follows:

1. A system for message communication via a communication media between one or more originating communication devices assigned to a sender and one or more destination communication devices assigned to a receiver, the system comprising:
a) an access block configured to receive, directly or indirectly, from at least one originating communication device a message having initial characteristics comprising, at least message format and an initial message layout, and to transmit the message to at least one destination communication device;
b) a media block operatively coupled to said access block and configured to select, before transmitting, at least one message format and a message layout for each of the at least one message formats fitting to each of said at least one destination device, and to then convert at least said initial message layout to the selected message layouts, said selection and conversion being done in accordance with at least one criterion selected from a group comprising:
i) criterion related to message communication capabilities of the destination communication device with regard to message communication capabilities of the originating communication device;
ii) criterion related to message displaying capabilities of the destination communication device with regard to message communication capabilities of the originating communication device; and
iii) criterion related to the communication media.

(Id., col. 23:6-34) Claim 12 is a method claim variation of the same idea:

12. A method of message communication via a messaging system between one or more originating communication devices assigned to a sender and one or more destination communication devices assigned to a receiver, the method comprising:
a) before delivery to the receiver, obtaining by a messaging system a message having initial characteristics comprising, at least, a message format and an initial message layout;
b) selecting a message layout and converting at least said initial message layout to said selected message layout to form an adapted message layout in accordance with at least one criterion selected from a group comprising:
i) criterion related to message communication capabilities of the destination communication device with regard to message communication capabilities of the originating communication device;
ii) criterion related to message displaying capabilities of the destination communication device with regard to message communication capabilities of the originating communication device; and
iii) criterion related to communication media between originating and destination device; and
c) facilitating delivery of the adapted message to the receiver.

( Id., cols. 24:55-25:12) The dependent claims include additional limitations, such as the use of multiple communication devices assigned to a single receiver, ( id. at claim 2), messages having layouts based on templates with unique identifiers ( id. at claim 6), and interactive messages ( id. at claim 7).

According to the Second Amended Complaint, WhatsApp infringes the '475 patent by using and selling the "WhatsApp Messenger System, " a cross-platform messaging product which is alleged to infringe at least claims 1 and 12 of the '475 patent. (D.I. 46 at ¶¶ 19-20) Exhibit C to that Complaint sets forth Plaintiffs' allegations of infringement in some detail, including a description of the WhatsApp Messenger "app, " which "is available for iPhone, Blackberry, Android, Windows Phone and Nokia, " and allows users to exchange messages between their devices "without having to pay for SMS." (D.I. 46 at ex. C ["Infringement Chart"], at 1 (emphasis omitted)) Plaintiffs' Infringement Chart alleges that the WhatsApp Messenger app uses a server as an intermediary to receive messages, to convert the layout of a message to one that is suitable for the recipient's mobile devices, and then to transmit the messages to the recipient's mobile devices. (Id. at 33, 35-36, 45-46, 52-60)

B. Procedural Background

Plaintiffs commenced this action on October 15, 2013, and filed their Amended Complaint on October 16, 2013. (D.I. 1, 4) Defendant filed the instant Motion in lieu of answering, (D.I. 7), and briefing was completed on the Motion on May 15, 2014.[2] The Motion was referred to the Court for resolution by Chief Judge Leonard P. Stark on May 20, 2014. (D.I. 19) Oral argument was held on October 17, 2014. Both before and after oral argument, the parties filed several notices of supplemental authority. (D.I. 21, 22, 24, 27, 28, 30, 34, 35, 40, 42, 43, 50, 51) As the law relevant to the Motion has continued to develop substantially since the completion of briefing, the Court has considered the full content of these notices in resolving the Motion.

II. APPLICABLE LEGAL STANDARDS

A. Articulation of the Standard of Review

Pursuant to Federal Rule of Civil Procedure 12(b)(6), a party may move to dismiss the plaintiff's complaint based on the failure to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). The sufficiency of pleadings for non-fraud cases is governed by Federal Rule of Civil Procedure 8, which requires "a short and plain statement of the claim showing that the pleader is entitled to relief[.]" Fed.R.Civ.P. 8(a)(2). In order to survive a motion to dismiss pursuant to Rule 12(b)(6), "a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (internal quotation marks and citation omitted). In assessing the plausibility of a claim, the court must "construe the complaint in the light most favorable to the plaintiff, and determine whether, under any reasonable reading of the complaint, the plaintiff may be entitled to relief.'" Fowler v. UPMC Shadyside, 578 F.3d 203, 210 (3d Cir. 2009) (citing Phillips v. Cnty. of Allegheny, 515 F.3d 224, 233 (3d Cir. 2008)).

Here, the Motion filed pursuant to Rule 12(b)(6) is used to assert an affirmative defense. In such cases, dismissal is permitted only if the well-pleaded factual allegations in the complaint, construed in the light most favorable to the plaintiff, suffice to establish the defense. See Jones v. Bock, 549 U.S. 199, 215 (2007); Kabbaj v. Google, Inc., Civ. No. 13-1522-RGA, 2014 WL 1369864, at *2 n.2 (D. Del. Apr. 7, 2014); see also Genetic Techs. Ltd. v. Agilent Techs., Inc., 24 F.Supp. 3d 922, 927 (N.D. Cal. Mar. 7, 2014).

Patentability under Section 101 is a "threshold inquiry" and a question of law. In re Bilski, 545 F.3d 943, 950-51 (Fed. Cir. 2008), aff'd, Bilski v. Kappas, 561 U.S. 593 (2010). Yet this question of law is also 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) (citing In re Comiskey, 554 F.3d 967, 976 (Fed. Cir. 2009)). Certain members of the United States Court of Appeals for the Federal Circuit have recently suggested that "any attack on an issued patent based on a challenge to the eligibility of the subject matter must be proven by clear and convincing evidence." CLS Bank Int'l v. Alice Court Pty. Ltd., 717 F.3d 1269, 1304-05 (Fed. Cir. 2013) (Rader, J., concurring-in-part and dissenting-in-part).[3] However, even assuming that the "clear and convincing" evidence standard is applicable to Section 101 challenges, [4] it would apply only to the resolution of factual disputes, not to the resolution of pure issues of law. See Microsoft Corp. v. i4i Ltd. P'ship, 131 S.Ct. 2238, 2242-43 (2011) (analyzing the burden on validity challenges brought under 35 U.S.C. §§ 102 & 103, noting that these challenges involve "factual questions[, ]" and concluding that invalidity defenses must be proven by clear and convincing evidence); see also id. at 2253 (Breyer, J., concurring) (noting that "the evidentiary standard of proof applies to questions of fact and not questions of law" and that "[m]any claims of invalidity rest... not upon factual disputes, but upon how the law applies to facts as given" such that where "the ultimate question of patent validity turns on the correct answer to legal questions [including] how [a legal standard] appl[ies] to the facts as given [then the clear and convincing] standard of proof has no application."). Thus, this standard would be inapplicable in the Section 101 context if there are no disputed issues of fact that bear on the ultimate question of subject matter eligibility. Cf. Genetic Technologies Ltd. v. Bristol-Myers Squibb Co., ___ F.Supp. 3d ___, 2014 WL 5507637, at *15 (D. Del. Oct. 30, 2014); Calif. Inst. Of Tech. v. Hughes Commc'ns Inc., ___ F.Supp. 3d. ___, 2014 WL 5661290, at *2 n.6 (C.D. Cal. Nov. 3, 2014).[5]

B. Need for Claim Construction

There is no hard-and-fast rule that a court must construe terms in the claims at issue before it performs a Section 101 analysis. Bancorp Servs., L.L.C. v. Sun Life Assur. Co. of Canada (U.S.), 687 F.3d 1266, 1273-74 (Fed. Cir. 2012) ("[W]e perceive no flaw in the notion that claim construction is not an inviolable prerequisite to a validity determination under [Section] 101.") On the other hand, the Federal Circuit has also noted that "it will ordinarily be desirable - and often necessary - to resolve claim construction disputes prior to a [Section] 101 ...


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