Amdocs (Israel) Ltd. v. Openet Telecom, Inc.

56 F. Supp. 3d 813, 113 U.S.P.Q. 2d (BNA) 1565, 2014 U.S. Dist. LEXIS 152447, 2014 WL 5430956
CourtDistrict Court, E.D. Virginia
DecidedOctober 24, 2014
DocketNo. 1:10cv910 (LMB/TRJ)
StatusPublished
Cited by15 cases

This text of 56 F. Supp. 3d 813 (Amdocs (Israel) Ltd. v. Openet Telecom, Inc.) is published on Counsel Stack Legal Research, covering District Court, E.D. Virginia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Amdocs (Israel) Ltd. v. Openet Telecom, Inc., 56 F. Supp. 3d 813, 113 U.S.P.Q. 2d (BNA) 1565, 2014 U.S. Dist. LEXIS 152447, 2014 WL 5430956 (E.D. Va. 2014).

Opinion

MEMORANDUM OPINION

LEONIE M. BRINKEMA, District Judge.

Before the Court is Defendants’ Motion for Judgment on the Pleadings [Dkt. No. 293]. Having considered the pleadings as well as the oral argument of counsel, the motion will be granted for the reasons discussed below.

I. BACKGROUND

Amdocs (Israel) Limited (“plaintiff’ or “Amdocs”) and Openet Telecom LTD and Openet Telecom, Inc. (collectively, “Openet”) compete to provide software which allows telecommunications providers to track customer usage of computer network services. On August 16, 2010 Amdocs filed this patent infringement action alleging that Openet infringed U.S. Patent Nos. 6,836,797 (“the '797 Patent”) and 7,631,065 (“the '065 Patent.”). Complaint [Dkt. No. 1]. Amdocs added U.S. Patent Nos. 7,412,-510 (“the '510 Patent”) and 6,947,984 (“the '984 Patent”) via an Amended Complaint on February 3, 2011. [Dkt. No. 50]. Openet responded with an Answer and Counterclaim, alleging invalidity and non-infringement and filed a Motion for Summary Judgment of Non-Infringement and Invalidity on May 26, 2011. The motion was granted as to non-infringement by a memorandum opinion on January 22, 2013. [Dkt. No. 259]. Amdocs appealed. [Dkt. No. 264]. The Federal Circuit affirmed two term constructions but reversed a third, and accordingly vacated the grant of summary judgment of non-infringement. Amdocs (Israel) Ltd. v. Openet Telecom, Inc., 761 F.3d 1329 (Fed.Cir.2014). While the case was on appeal, the Supreme Court decided Alice Corp. Pty. Ltd. v. CLS Bank Int’l, which invalidated a computer [816]*816software patent under 35 U.S.C. § 101 for being directed to an abstract idea. — U.S.-, 134 S.Ct. 2347, 189 L.Ed.2d 296 (2014).

Upon remand, Openet filed the pending Motion for Judgment on the Pleadings, in which it argues that all of the asserted claims are invalid under 35 U.S.C. § 101 as being directed to, unpatentable abstract ideas. Defendants’ Memorandum In Support Of Their Motion For Judgment On The Pleadings [Dkt. No. 2941] (“Openet’s Br.”). Amdocs ’has filed an opposition, Plaintiffs Opposition To Defendants’ Motion For Judgment On The Pleadings [Dkt. No. 297] (“Opp’n”), and Openet has replied. Openet’s Reply In Support Of Their Motion For Judgment On The Pleadings [Dkt. No. 298] (“Reply”).

II. DISCUSSION

A. Standard of Review

“Section 101 patent eligibility is a question of law.” In re Roslin Institute (Edinburgh); 750 F.3d 1333,1335 (Fed.Cir. 2014). Accordingly, a court may invalidate patent claims directed to non-eligible subject matter on the pleadings. See buySAFE, Inc. v. Google, Inc., 765 F.3d 1350 (Fed.Cir.2014).

In a motion for judgment on the pleadings, the court should “assume all facts alleged in the complaint are true and draw all reasonable factual influences in [the plaintiff]’s favor.” Burbach Broadcasting Co. of Del. v. Elkins Radio Corp., 278 F.3d 401, 406 (4th Cir.2002). “Judgment should be entered when the pleadings, construing the facts in the light most favorable to the non-moving party, fail to state any cognizable claim for relief, and the matter can, therefore, be decided as a matter of law.” O’Ryan v. Dehler Mfg. Co., 99 F.Supp.2d 714, 718 (E.D.Va.2000).

B. Patentability after Alice

To be eligible for a patent, a claimed invention must be directed to “any new and useful process, machine, manufacture, or composition of matter.” 35 U.S.C. § 101 (2012). “In choosing such expansive terms ... modified by the comprehensive ‘any,’ Congress plainly contemplated that the patent laws would be given wide scope,” Diamond v. Chakrabarty, 447 U.S. 303, 308, 100 S.Ct. 2204, 65 L.Ed.2d 144 (1980); however, “for more than 150 years” the Supreme Court has “held that [§ 101] contains an important implicit exception: Laws of nature, natural phenomena, and abstract ideas are not patentable.” Alice Corp. Pty. Ltd. v. CLS Bank Intern., — U.S. -, 134 S.Ct. 2347, 2354, 189 L.Ed.2d 296 (2014) (quoting Ass’n for Molecular Pathology v. Myriad Genetics, Inc., — U.S.-, 133 S.Ct. 2107, 2116, 186 L.Ed.2d 124 (2013)). Accordingly, “a new mineral discovered in the earth or a new plant found in the wild is not patentable subject matter. Likewise, Einstein could not patent his celebrated law that E=mc2; nor could Newton have patented the law. of gravity.” Chakrabarty, 447 U.S. at 309, 100 S.Ct. 2204.

Although those examples match the Supreme Court’s old description of the exceptions as “a fundamental truth; an original cause; [or] a motive,” LeRoy v. Tatham, 55 U.S. 156, 175, 14 How. 156, 14 L.Ed. 367 (1852), claims which are not so purely abstract have also been invalidated under § 101. For example, in Bilski v. Kappos the Court found a claim directed to “the basic concept of hedging, or protecting against risk” to be unpatentable. 561 U.S. 593, 130 S.Ct. 3218, 3231, 177 L.Ed.2d 792 (2010). In Bilski, the Court looked past the text of the claims to the underlying concept, and viewing the claimed invention as manifesting no more than an abstract idea declared the claims patent ineligible. [817]*817Id. This conforms with the Supreme Court’s warning “against interpreting patent statutes in ways that make patent eligibility depend simply on the draftsman’s art.” Mayo Collab. Servs. v. Prometheus Labs. Inc., — U.S. -, 132 S.Ct. 1289, 1294, 182 L.Ed.2d 321 (2012) (internal quotation marks omitted).

Decided on June 19, 2014,1 Alice articulated a two-step process for determining whether a claim was directed to patent-eligible subject matter. 134 S.Ct. at 2355. “First, [a court must] determine whether the claims at issue are directed to [a] patent-ineligible concept[].” Id. “If so, [the court must] then ask, ‘what else is there in the claims before us?’ ” Id. (internal quotation marks omitted). “To answer that question, [the court must] consider the elements of each claim ... to determine whether the additional elements transform the nature of the claim into a patent-eligible application.” Id. (internal quotation marks omitted).

At step one, a court must evaluate the claims “[o]n their face” to determine to which “concept” the claims are “drawn.” Id. at 2356 (“On their face, the claims before us are drawn to the concept of intermediated settlement.”); Bilski, 130 S.Ct. at 3229 (finding claims drawn to “both the 'concept of hedging risk and the application of that concept to energy markets” to be patent ineligible).

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56 F. Supp. 3d 813, 113 U.S.P.Q. 2d (BNA) 1565, 2014 U.S. Dist. LEXIS 152447, 2014 WL 5430956, Counsel Stack Legal Research, https://law.counselstack.com/opinion/amdocs-israel-ltd-v-openet-telecom-inc-vaed-2014.