United States District Court, D. Delaware
W. Shaw and Karen E. Keller, SHAW KELLER LLP, Wilmington, DE
Blair M. Jacobs, Christina A. Ondrick, Patrick J. Stafford,
John S. Holley, and Diva Ranade, PAUL HASTINGS LLP,
Washington, DC Thomas A. Counts, PAUL HASTINGS LLP, San
Francisco, CA Attorneys for Plaintiff
Geoffrey Grivner, BUCHANAN INGERSOLL & ROONEY PC,
Wilmington, DE S. Lloyd Smith and Kimberly E. Coghill,
BUCHANAN INGERSOLL & ROONEY PC, Alexandria, VA Attorneys
U.S. DISTRICT JUDGE.
Align Technology, Inc. ("Align") filed four
separate suits against Defendants 3Shape A/S and 3Shape Inc.
(together, "3Shape" or "Defendants") on
November 14, 2017. On February 2, 2018, 3Shape moved to
dismiss the complaints in Civil Action Nos. 17-1646-LPS-CJB
and 17-1647-LPS-CJB (the "Complaints") for failure
to state a claim, pursuant to Federal Rule of Civil Procedure
12(b)(6), based on its contention that Align failed to
plausibly allege direct, indirect, and willful infringement
of all asserted patents and that certain of the asserted
patents are not directed to patent-eligible subject matter
under 35 U.S.C. § 101. (C.A. No. 17-1646-LPS-CJB D.I.
21; C.A. No. 17-1647-LPS-CJB D.I. 21) 3Shape's motions
are fully briefed and the Court heard oral argument on July
20, 2018. (See D.I. 55 ("Tr."))
reasons stated below, the Court will grant in part and deny
in part Defendants' motions to dismiss.
parties are competitors in the field of intraoral scanners
and software. (D.I. 1 at ¶ 29) Align is a global medical
device company selling products such as the iTero intraoral
scanner and OrthoCAD software, both of which "help
dental and orthodontic professionals deliver effective,
cutting-edge dental and orthodontic options to their
patients." (D.I. 1 at ¶ 23; D.I. 25 at 2) 3Shape
"designs, develops, manufactures, and markets the TRIOS
and TRIOS 3 scanners, as well as related Dental Software
products" such as the Implant Studio, Ortho System,
Ortho Analyzer, Ortho Planner, Appliance Designer, and Ortho
Control Patent. (D.I. 1 at ¶ 28; D.I. 25 at 2)
November 14, 2017, Align filed four actions against 3Shape in
this District. The patents asserted in each action are as
C.A. No. 17-1646-LPS-CJB: United States Patent Nos. 9, 510,
757; 7, 112, 065 ('"065 patent"); 9, 451, 873
('"873 patent"); 9, 299, 192; 9, 427, 916; 8,
454, 364; and 8, 845, 330. (C.A. No. 17-1646-LPS-CJB D.I. 1
at ¶¶ 16-22)
C.A. No. 17-1647-LPS-CJB: U.S. Patent Nos. 9, 566, 132; 8,
545, 221; 8, 092, 215; 7, 056, 115; 8, 734, 149
("'149 patent"); and 6, 227, 850
("'850 patent"). (C.A. No. 17-1647-LPS-CJB D.I.
1 at ¶¶ 16-21)
C.A. No. 17-1648-LPS-CJB: U.S. Patent Nos. 7, 092, 107
("'107 patent"); 9, 615, 901; 8, 638, 448; 8,
638, 447; 6, 845, 175; and 6, 334, 853. (C.A. No.
17-1648-LPS-CJB D.I. 1 at ¶¶ 16-21)
C.A. No. 17-1649-LPS-CJB: U.S. Patent Nos. 6, 948, 931; 6,
685, 470; 6, 514, 074 ("'074 patent"); 8, 363,
228; 8, 451, 456; 8, 675, 207; and 9, 101, 433. (C.A. No.
17-1649-LPS-CJB D.I. 1 at ¶¶ 16-22)
total, Align asserts 26 patents, all of which relate to
"dental scanning technology." (C.A. No.
17-1646-LPS-CJB D.I. 22 at 1)
also filed two complaints with the International Trade
Commission ("ITC"), involving 11 of the 26 patents
also at issue here. The ITC instituted investigations as to
those 11 patents on December 14, 2017. (C.A. No.
17-1646-LPS-CJB D.I. 15 at 1) The 11 patents involved in the
ITC proceedings include all but one of the patents at issue
in C.A. No. 17-1648-LPS-CJB (the '107 patent) and all but
one at issue in C.A. No. 17-1649-LPS-CJB (the '074
moved to stay all four District Court actions pending the ITC
investigations. All of the patents subject to the ITC
investigations were subject to a mandatory stay; Align
stipulated on January 23, 2018 to a stay of both C.A. Nos.
17-1648-LPS-CJB and 17-1649-LPS-CJB as to all claims, pending
resolution of the ITC investigations. (C.A. No.
17-1648-LPS-CJB D.I. 19; C.A. No. 17-1649-LPS-CJB D.I. 20)
3Shape's motions to stay as to C.A. Nos. 17-1646-LPS-CJB
and 17-1647-LPS-CJB remained pending.
February 1, 2018, 3Shape moved to dismiss the Complaints in
C.A. Nos. 17-1646-LPS-CJB and 17-1647-LPS-CJB for failing to
plausibly allege direct, indirect, and willful infringement
of any of the 13 patents asserted in those actions
(hereinafter, the "asserted patents" or
"patents-in-suit"). (C.A. No. 17-1646-LPS-CJB D.I.
21; C.A. No. 17-1647-LPS-CJB D.I. 21) 3Shape's motions
further sought to dismiss patent infringement claims as to
some of the asserted patents on the grounds that they claim
ineligible subject matter under Section 101. Specifically,
this portion of 3Shape's motions is directed to the
'873 and '065 patents in C.A. No. 17-1646-LPS-CJB and
the '850 and' 149 patents in C.A. No.
Rule 12(b)(6) Motion to Dismiss
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
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 v. Aetna,
Inc., 221 F.3d 472, 481-82 (3d Cir. 2000) (internal
quotation marks omitted).
well-pleaded complaint must contain more than mere labels and
conclusions. See Ashcroft v. Iqbal, 556 U.S. 662,
678 (2009); Bell Atl. Corp. v. Twombly, 550 U.S.
544, 555 (2007). A plaintiff must plead facts sufficient to
show that a claim has substantive plausibility. See
Johnson v. City of Shelby, 135 S.Ct. 346, 347 (2014). A
complaint may not be dismissed, however, for imperfect
statements of the legal theory supporting the claim asserted.
See Id. at 346.
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
Twombly, 550 U.S. at 555). 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."
Iqbal, 556 U.S. at 678. 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 plaintiff s claim. Wilkerson
v. New Media Tech. Charter Sch. Inc., 522 F.3d 315, 321
(3d Cir. 2008) (internal quotation marks omitted).
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).
Patentable Subject Matter
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). "Whether a
claim recites patent eligible subject matter is a question of
law which may contain disputes over underlying facts."
Berkheimer v. HP Inc., 881 F.3d 1360, 1368 (Fed.
Mayo Collaborative Services v. Prometheus Laboratories,
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 Corp. Pty. Ltd. v. CLS Bank
Int'l, 134 S.Ct. 2347, 2355 (2014). First, courts
must determine if the claims at issue are directed to a
patent-ineligible concept ("step one"). 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] itself ("step
two"). Id. The two steps are "plainly
related" and "involve overlapping scrutiny of the
content of the claims." Elec. Power Grp., LLC v.
Alstom S.A., 830 F.3d 1350, 1353 (Fed. Cir. 2016).
one, "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) (emphasis
added); see also Affinity Labs of Texas, LLC v. DIRECTV,
LLC, 838 F.3d 1253, 1257 (Fed. Cir. 2016)
("Affinity Labs I'') (stating first
step "calls upon us to look at the 'focus of the
claimed advance over the prior art' to determine if the
claim's 'character as a whole' is directed to
excluded subject matter").
conducting the step one analysis, courts should not
"oversimplif[y]" key inventive concepts or
"downplay" an invention's benefits. Enfish,
LLC v. Microsoft Corp., 822 F.3d 1327, 1337-38 (Fed.
Cir. 2016); see also McRO, Inc. v. Bandai Namco Games Am.
Inc., 837 F.3d 1299, 1313 (Fed. Cir. 2016)
("[C]ourts 'must be careful to avoid oversimplifying
the claims' by looking at them generally and failing to
account for the specific requirements of the claims.")
(quoting In re TLI Commc'ns LLC Patent Litig.,
823 F.3d 607, 611 (Fed. Cir. 2016)).
two, courts must "look to both the claim as a whole and
the individual claim elements to determine whether the claims
contain 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
itself." McRo, 837 F.3d at 1312 (internal
brackets and quotation marks omitted). The
"standard" step two inquiry includes consideration
of whether claim elements "simply recite
'well-understood, routine, conventional
activities]."' Bascom Glob. Internet Servs.,
Inc. v. AT&T Mobility LLC, 827 F.3d 1341, 1350 (Fed.
Cir. 2016) (quoting A lice, 134 S.Ct. at 2359).
"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 original).
"[t]he inventive concept inquiry requires more than
recognizing that each claim element, by itself, was known in
the art." Bascom, 827 F.3d at 1350. In
Bascom, the Federal Circuit held that "the
limitations of the claims, taken individually, recite generic
computer, network and Internet components, none of which is
inventive by itself," but nonetheless determined that an
ordered combination of these
limitations was patent-eligible under step two. Id.
Federal Circuit recently elaborated on the step two standard,
stating that "[t]he question of whether a claim element
or combination of elements is well-understood, routine and
conventional to a skilled artisan in the relevant field is a
question of fact. Any fact, such as this one, that is
pertinent to the invalidity conclusion must be proven by
clear and convincing evidence." Berkheimer, 881
F.3d at 1368; see also Aatrix Software, Inc. v. Green
Shades Software, Inc., 882 F.3d 1121, 1128 (Fed. Cir.
2018) ("While the ultimate determination of eligibility
under § 101 is a question of law, like many legal
questions, there can be subsidiary fact questions which must
be resolved en route to the ultimate legal
determination."); Automated Tracking Sols., LLC v.
Coca-Cola Co., 723 Fed.Appx. 989, 995 (Fed. Cir. 2018)
("We have held that 'whether a claim element or
combination of elements is well-understood, routine and
conventional to a skilled artisan in the relevant field is a
question of fact."') (quoting Berkheimer,
881 F.3d at 1368).
a particular technology is well-understood, routine, and
conventional goes beyond what was simply known in the prior
art. The mere fact that something is disclosed in a piece of
prior art, for example, does not mean it was well-understood,
routine, and conventional." Berkheimer, 881
F.3d at 1369; see also Exergen Corp. v. Kaz USA
Inc., 725 Fed.Appx. 959, 965 (Fed. Cir. 2018)
("Something is not well-understood, routine, and
conventional merely because it is disclosed in a prior art
reference. There are many obscure references that nonetheless
qualify as prior art.").
of the step two "inventive concept" inquiry, the
Federal Circuit has looked to the claims as well as the
specification. See Affinity Labs of Texas, LLC v.
Amazon.com Inc., 838 F.3d 1266, 1271 (Fed. Cir. 2016)
("Affinity Labs II'') ("[N]either
the claim nor the specification reveals any concrete way of
employing a customized user interface."). Still, it is
not enough just to disclose the improvement in the
specification; instead, the Court's task becomes to
"analyze the asserted claims and determine whether they
capture these improvements.'"
Berkheimer, 881 F.3d at 1369 (emphasis added). In other
words, "[t]o save a patent at step two, an inventive
concept must be evident in the
claims.'" RecogniCorp, LLC v. Nintendo Co.,
Ltd., 855 F.3d 1322, 1327 (Fed. Cir. 2017) (emphasis
added); see also Alice, 134 S.Ct. at 2357
("[W]e must examine the elements of the
claim to determine whether it contains an
'inventive concept.'") (emphasis added);
Synopsys, Inc. v. Mentor Graphics Corp., 839 F.3d
1138, 1149 (Fed. Cir. 2016) ("The § 101 inquiry
must focus on the language of the Asserted Claims
steps one and two, it is often useful for the Court to
compare the claims at issue with claims that have been
considered in the now considerably large body of decisions
applying § 101. See Amdocs (Israel) Ltd. v. Openet
Telecom, Inc., 841 F.3d 1288, 1294 (Fed. Cir. 2016).
as a procedural matter, the Federal Circuit has observed
frequently that § 101 disputes may be amenable to
resolution on motions for judgment on the pleadings, motions
to dismiss, or summary judgment. See, e.g.,
Berkheimer, 881 F.3d at 1368 ("Whether a claim
recites patent eligible subject matter is a question of law
which may contain disputes over underlying facts. Patent
eligibility has in many cases been resolved on
motions to dismiss or summary
judgment. Nothing in this decision should be viewed as
casting doubt on the propriety of those cases.
When there is no genuine issue of material fact regarding
whether the claim element or claimed combination is
well-understood, routine, conventional to a skilled artisan
in the relevant field, this issue can be decided on summary
judgment as a matter of law.") (emphasis added);
buySAFE, Inc. v. Google, Inc., 765 F.3d 1350,
1351-52 (Fed. Cir. 2014) (affirming grant of Rule 12(c)
motion for judgment on pleadings for lack of patentable
Plausibly Pleaded Allegations of Infringement
challenges the sufficiency of Align's allegations
regarding direct, indirect, and willful infringement of the
asserted patents on numerous grounds. The Court will address
each in turn.
Direct Infringement of All Asserted Patents
order to "survive a motion to dismiss under 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." Nalco Co. v. Chem-Mod,
LLC, 883 F.3d 1337, 1347 (Fed. Cir. 2018) (internal
quotation marks and citation omitted). This does not require
that a plaintiff'"prove its case at the pleading
stage.'" Id. at 1350 (citation omitted).
Additionally, the '"Federal Rules of Civil Procedure
do not require a plaintiff to plead facts establishing that
each element of an asserted claim is met.'"
Id. (citation omitted). Instead, the complaint must
merely "place the potential infringer ... on notice of
what activity ... is being accused of infringement."
Id. (internal quotation marks and citation omitted).
argues that the allegations of direct infringement in the
Complaints are insufficient because they "fail to tie
the Accused Products or actions of any part to the elements
of the asserted patent claims." (D.I. 22 at 5) Align
responds that its allegations give 3Shape "fair notice
of what activity is being accused of infringement" and
that "[n]o greater detail is required." (D.I. 25 at
6) The Court concludes that Align has sufficiently alleged
the counts in the Complaints follows essentially the same
format: reciting the language of a representative claim,
alleging that the accused products practice that claim, and
providing examples drawn from "product documentation,
demonstration and informational videos, user manuals, and/or
promotional materials" demonstrating the alleged use of
some aspect of the accused product of the products performing
at least some of the requirements of the representative
claim. For example, Count Two in CA. 17-1646-LPS-CJB alleges
infringement of at least claim 28 the '192 patent. (D.I.
1 at ¶ 49) As described in that Complaint, "[t]he
'192 patent is directed to modifying a virtual model of a
physical structure with additional 3D data obtained from the
physical structure to provide a modified virtual model."
(Id. at ¶ 48) That paragraph goes on to recite
the language of claim 28, which claims:
28. A system to generate a modified virtual model of a
physical structure, comprising:
a display to display images of said modified virtual model;
a computer system operatively connected to the display and
comprising a program that, when executed by the computer
system, causes the computer system to, display an image of a
first virtual model generated from
first 3D scan data of the physical structure on the display,
wherein said first virtual model fails to properly represent
a first physical part of the physical structure,
receive user input identifying at least a portion of the
first virtual model that is desired to be modified, the user
input generated by user interaction with the image of the
first virtual model on the display,
receive a second virtual model of the physical structure, the
second virtual model generated from second 3D scan data of