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Epic IP LLC v. Backblaze, Inc.

United States District Court, D. Delaware

November 21, 2018

EPIC IP LLC, Plaintiff,
v.
BACKBLAZE, INC., Defendant.

          MEMORANDUM OPINION AND ORDER

          WILLIAM C. BRYSON UNITED STATES CIRCUIT JUDGE.

         This is a patent infringement action brought by plaintiff Epic IP LLC against defendant Backblaze, Inc. Before the Court is Backblaze's motion to dismiss the complaint based on patent ineligibility under 35 U.S.C. § 101. Following briefing and oral argument before the Court on November 16, 2018, the Court GRANTS the motion and dismisses the complaint with prejudice. A judgment will be separately entered terminating this action.

         BACKGROUND

         Epic owns U.S. Patent No. 6, 434, 599 (“the '599 patent”), which is entitled “Method and Apparatus for On-Line Chatting.” The patent is directed to the formation of an Internet chat session in which on-line users who visit an information site can establish a separate chat session with a sub-group of those visiting the site. Epic has asserted five of the twenty-five claims against Backblaze. The asserted claims are claims 1-4 and 19. The first four claims are method claims; the last is an apparatus claim to an “information server” that enables the formation of a chat session unaffiliated with a pre-established chat room.

         Claim 1 of the '599 patent provides as follows:

1. An on-line chatting method comprising:
facilitating visit [sic: a visit] by a first on-line user to an information page of an information site;
facilitating dynamic formation of a chat session unaffiliated with any pre-established chat room for said first on-line user and a second on-line user to chat with each other; and
facilitating said chat session through which said first and second on-line users chat with each other.

         Claim 2 depends from claim 1 and adds that “said facilitating of dynamic formation of a chat session unaffiliated with any pre-established chat room comprises providing a mechanism to said first on-line user to initiate formation of said unaffiliated chat session.”

         Claim 3 depends from claim 2 and adds that “said provision of a mechanism to said first on-line user to initiate formation of said unaffiliated chat session comprises providing a selectable icon for said first on-line user to indicate the first on-line user's desire to chat with another non-particularized on-line user.”

         Claim 4 depends from claim 3 and adds that “said provision of a mechanism to said first on-line user to initiate formation of said unaffiliated chat session further comprises providing one or more dialog panels for said first on-line user to specific [sic: specify] one or more descriptive characteristics of said first on-line user.”

         Claim 19 provides as follows:

19. An information server comprising:
a plurality of information pages to be selectively provided to a client computer responsive to the client computer's request; and
a first script/applet to be included with a responsive information page to enable the client computer to initiate dynamic formation of a chat session unaffiliated with any pre-established chat room for a user of the client computer to chat with a second user of interest, also visiting the information server.

         On January 24, 2018, Epic filed separate actions against three defendants: AutoNation, Inc. (No. 1:18-cv-139), Blue Jeans Network, Inc. (No. 1:18-cv-140), and Backblaze, Inc. (No. 1:18-cv-141). The actions against Blue Jeans Network and AutoNation, Inc., were subsequently dismissed following settlement.

         Backblaze has now sought dismissal of the action against it under Federal Rule of Civil Procedure 12(b)(6) on the ground that the asserted claims of the '599 patent are directed to abstract ideas and are not eligible for patenting in light of section 101 of the Patent Act. For the reasons set forth in detail below, the Court agrees with Backblaze that the asserted claims of the '599 patent are drawn to abstract ideas and are not patent-eligible.

         DISCUSSION

         The framework for analyzing the issue of patentable subject matter under 35 U.S.C. § 101 is well settled. The Supreme Court's decision in Alice Corp. v. CLS Bank International, 134 S.Ct. 2347 (2014), established a two-step test for determining whether a patent is directed to an unpatentable idea. First, the court must determine “whether the claims at issue are directed to a patent-ineligible concept, ” such as an abstract idea. 134 S.Ct. at 2355. Second, if the claims are directed to an abstract idea, the court must decide whether there is an “inventive concept” in the claims at issue. The Supreme Court characterized an “inventive concept” as “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'”; the presence of an “inventive concept, ” the Court explained, is enough to “‘transform the nature of the claim' into a patent-eligible application.” Id. (quoting Mayo Collaborative Servs. v. Prometheus Labs., Inc. 566 U.S. 66, 72-73, 78 (2012)).

         The first step of the two-step analysis requires the court to examine the “focus” of the claim, i.e., its “character as a whole, ” in order to determine whether the claim is directed to an abstract idea. SAP Am., Inc. v. InvestPic, LLC, 898 F.3d 1161, 1167 (Fed. Cir. 2018); Internet Patents Corp. v. Active Network, Inc., 790 F.3d 1343, 1346 (Fed. Cir. 2015). The second step, if reached, requires the court to “look[] more precisely at what the claim elements add- specifically, whether, in the Supreme Court's terms, they identify an ‘“inventive concept”' in the application of the ineligible matter to which (by assumption at step two) the claim is directed.” Elec. Power Grp., LLC v. Alstom S.A., 830 F.3d 1350, 1353 (Fed. Cir. 2016) (citations omitted).

         I. Abstract Idea

         A. Governing Principles

         Defining an “abstract idea, ” as that term is used in section 101 jurisprudence, has not proved to be a simple task. Neither the Supreme Court nor the Federal Circuit has ventured a single, comprehensive definition. See Alice, 134 S.Ct. at 2357 (“[W]e need not labor to delimit the precise contours of the ‘abstract ideas' category in this case.”); Bilski v. Kappos, 561 U.S. 593, 621 (2010) (Stevens, J., concurring in the judgment) (“The Court . . . never provides a satisfying account of what constitutes an abstract idea.”); Elec. Power Grp., 830 F.3d at 1353 (“We need not define the outer limits of ‘abstract idea'”); Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1334 (Fed. Cir. 2016) (“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. . . . Rather, both this court 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.”). Rather than a unitary test, what has emerged from the section 101 cases is a group of related principles that can be applied in gauging whether or not a patent claim is directed to an abstract idea. They include the following:

         First, the courts have characterized “method[s] of organizing human activity” as abstract. See Alice, 134 S.Ct. at 2356; BSG Tech LLC v. BuySeasons, Inc., 899 F.3d 1281, 1285 (Fed. Cir. 2018). In particular, the courts have identified fundamental economic practices that have long been prevalent in our system of commerce as abstract ideas. Applying that principle in the field of computers and telecommunications, the courts have held that claims directed to simply implementing such economic practices on a computer are not patent-eligible. See Alice, 134 S.Ct. at 2355-57; Bilski, 561 U.S. at 611; BSG, 899 F.3d at 1285 (“If a claimed invention only performs an abstract idea on a generic computer, the invention is directed to an abstract idea at step one” of Alice.). Nor does the fact that a computer can perform such operations more rapidly and efficiently make an abstract idea any less abstract or any more patent-eligible. See, e.g., RecogniCorp. LLC v. Nintendo Co., 855 F.3d 1322, 1326 (Fed. Cir. 2017); FairWarning IP, LLC v. Iatric Sys., Inc., 839 F.3d 1089, 1097 (Fed. Cir. 2016); Intellectual Ventures I LLC v. Symantec Corp., 838 F.3d 1307, 1315 (Fed. Cir. 2016); Accenture Glob. Servs., GmbH v. Guidewire Software, Inc., 728 F.3d 1336, 1345 (Fed. Cir. 2013); Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 717 (Fed. Cir. 2014) (“Any transformation from the use of computers or the transfer of content between computers is merely what computers do and does not change the analysis.”).

         Second, as applied to computer applications, the courts have looked to whether the claim in question is directed to an improvement in computer technology as opposed to simply providing for the use of a computer to perform “economic or other tasks for which a computer is used in its ordinary capacity.” Enfish, 822 F.3d at 1336. Where the claims at issue provide for an improvement in the operation of a computer, such as a new memory system, a new type of virus scan, or a new type of interface that makes a computer function more accessible, the Federal Circuit has found the claims patent-eligible. See Data Engine Techs. LLC v. Google LLC, 906 F.3d 999 (Fed. Cir. 2018) (methods for making electronic spreadsheets more accessible); Core Wireless Licensing S.A.R.L. v. LG Elec., Inc., 880 F.3d 1356, 1361-63 (Fed. Cir. 2018) (improved display devices); Finjan, Inc. v. Blue Coat Sys., Inc., 879 F.3d 1299 (Fed. Cir. 2018) (novel method of virus scanning); Visual Memory LLC v. NVIDIA Corp., 867 F.3d 1253 (Fed. Cir. 2017) (improved computer memory system).

         Numerous Federal Circuit decisions have drawn the distinction between patent-eligible claims that “are directed to a specific improvement in the capabilities of computing devices, ” as opposed to “‘a process that qualifies as an “abstract idea” for which computers are invoked merely as a tool.'” Core Wireless, 880 F.3d at 1361-62 (quoting Enfish, 822 F.3d at 1336); see also McRO, Inc. v. Bandai Namco Games Am., Inc., 837 F.3d 1299, 1316 (Fed. Cir. 2016); DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245, 1257-58 (Fed. Cir. 2014). This principle has sometimes been described as requiring, in the computer field, a “technological solution to a technological problem specific to computer networks.” Amdocs (Israel) Ltd. v. Openet Telecom, Inc., 841 F.3d 1288, 1301 (Fed. Cir. 2016); In re TLI Commc'ns LLC Patent Litig., 823 F.3d 607, 613 (Fed. Cir. 2016) (“the claims are not directed to a solution to a ‘technological problem'”).

         Third, in determining whether a particular claim is directed to an abstract idea, courts have focused on whether the claim is purely functional in nature rather than containing the specificity necessary to recite how the claimed function is achieved. The Federal Circuit has focused on the problem of functional claiming in a number of recent section 101 decisions. In those cases, the Federal Circuit, treating the term “abstract” as an antonym of “concrete” or “specific, ” has analyzed whether the claims before it are sufficiently concrete or specific to be directed to a patent-eligible process rather than a patent-ineligible result. For example, in SAP America, 898 F.3d at 1167, the court asked whether the claim had “the specificity required to transform [it] from one claiming only a result to one claiming a way of achieving it.” To answer that question, the Federal Circuit has directed courts to “look to whether the claims focus on a specific means or method, or are instead directed to a result or effect that itself is the abstract idea and merely invokes generic processes and machinery.” Two-Way Media Ltd. v. Comcast Cable Commc'ns, LLC, 874 F.3d 1329, 1337 (Fed. Cir. 2017); McRO, 837 F.3d at 1314 (“We therefore look to whether the claims in these patents focus on a specific means or method that improves the relevant technology or are instead directed to a result or ...


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