Electronic Communication v. shopperschoice.com, LLC

963 F.3d 1371
Court of Appeals for the Federal Circuit·Decided July 1, 2020·No. 19-2087·Published·Cited by 11 cases

Opinion

Case: 19-2087 Document: 71 Page: 1 Filed: 07/01/2020

United States Court of Appeals for the Federal Circuit ______________________

ELECTRONIC COMMUNICATION TECHNOLOGIES, LLC, Plaintiff-Appellee

v.

SHOPPERSCHOICE.COM, LLC, Defendant-Appellant ______________________

2019-2087 ______________________

Appeal from the United States District Court for the Southern District of Florida in Nos. 9:16-cv-81669-KAM, 9:16-cv-81677-KAM, Senior Judge Kenneth A. Marra. ______________________

Decided: July 1, 2020 ______________________

ARTOUSH OHANIAN, OhanianIP, Austin, TX, argued for plaintiff-appellee.

DAVID K. FRIEDLAND, Friedland Vining, PA, Miami, FL, argued for defendant-appellant. Also represented by JAMES STEPAN, Law Offices of James A. Stepan, P.A., Hol- lywood, FL. ______________________

Before PROST, Chief Judge, DYK and WALLACH, Circuit Judges. Case: 19-2087 Document: 71 Page: 2 Filed: 07/01/2020

WALLACH, Circuit Judge. Appellant ShoppersChoice.com, LLC (“Shop- persChoice”) appeals the denial of attorney fees by the U.S. District Court for the Southern District of Florida (“District Court”) pursuant to 35 U.S.C. § 285, following a judgment invalidating independent claim 11 of Appellee Electronic Communication Technologies, LLC’s (“ECT”) U.S. Patent No. 9,373,261 (“the ’261 patent”) as patent ineligible under 35 U.S.C. § 101. J.A. 1626–28 (Attorney Fee Order); see J.A. 1629 (Order Denying Motion for Reconsideration of Denial of Attorney Fees); see also J.A. 1–17 (Motion to Dis- miss Judgment), 18–34 (Judgment on the Pleadings). 1 We have jurisdiction pursuant to 28 U.S.C. § 1295(a)(1). We vacate and remand. BACKGROUND This case arises from ECT’s allegation that Shop- persChoice infringed claim 11 of the ’261 patent. J.A. 1049. Entitled “Secure Notification Messaging with User Option to Communicate with Delivery or Pickup Representative,” the ’261 patent is directed “to systems and methods that notify a party of travel status associated with one or more mobile things (MTs).” ’261 patent col. 1 ll. 50–51. Inde- pendent claim 11 recites a system that provides notifica- tion “involving advance notice of a delivery or pickup of a good or service” to a “personal communication device (PCD)[,]” by means of “one or more transceivers[,]” “one or more memories[,]” “one or more processors[,]” and a “com- puter program code[.]” Id. col. 93 ll. 12–45; see id. col. 6 ll. 31–33 (describing “a possible screen message that can

1 We affirmed the District Court’s decision on the merits. See Elec. Commc’n Techs., LLC v. Shop- persChoice.com, LLC, 958 F.3d 1178 (Fed. Cir. 2020). Case: 19-2087 Document: 71 Page: 3 Filed: 07/01/2020

ELECTRONIC COMMUNICATION v. SHOPPERSCHOICE.COM, LLC 3

be . . . shown on a notified PCD . . . during a notification communication”); id. Fig. 16A. 2 In September 2016, ECT filed a complaint in the Dis- trict Court against ShoppersChoice for, inter alia, infringe- ment of claim 11. J.A. 1399 (Amended Complaint); see J.A. 1049 (Complaint). 3 In December 2016, ShoppersChoice filed a motion for judgment on the pleadings, challenging claim 11 as patent ineligible. J.A. 1513–14; see 35 U.S.C. § 101. In February 2017, following discovery, the parties filed a joint claim construction statement, in which ECT specified that each of the disputed terms in claim 11 should be given its “[o]rdinary and customary meaning.” J.A. 1582–88; see J.A. 1581–90 (Joint Claim Construction Statement). ShoppersChoice then moved to join a patent- eligibility hearing set in a parallel lawsuit, also before the District Court, in which ECT alleged claim 11 infringement against other companies. J.A. 1047–48. The District Court granted the motion and conducted a consolidated patent- eligibility hearing regarding claim 11. See Motion Hearing, Elec. Commc’n Techs., LLC v. ShoppersChoice.com, LLC, No. 9:16-cv-81677-KAM (S.D. Fla. Apr. 7, 2017), ECF No. 59. 4

2 ECT’s previous name was Eclipse IP, LLC; the en- tity changed names in 2015. J.A. 255. Eclipse IP was listed as the applicant for the ’261 patent, but the patent was as- signed to ECT following the name change. J.A. 35, 520. 3 While ECT initially claimed that ShoppersChoice infringed claims from three patents, it subsequently amended its Complaint to assert infringement only of claim 11 of the ’261 patent. J.A. 1626. 4 These parallel proceedings before the District Court include: Elec. Commc’n Techs., LLC v. Minted, LLC, No. 16-cv-81669-KAM; Elec. Commc’n Techs., LLC v. Lakeshore Equip. Co., No. 16-cv-81672-KAM; and Elec. Case: 19-2087 Document: 71 Page: 4 Filed: 07/01/2020

Following the hearing, the District Court granted ShoppersChoice’s motion for a judgment on the pleadings and invalidated independent claim 11 of the ’261 patent. J.A 33–34; see J.A. 1581–90. The District Court conducted the two-step analysis set forth in Alice Corp. Party Ltd. v. CLS Bank International, 573 U.S. 208 (2014). J.A. 20–33. The District Court determined that, under Alice step one, “[independent] [c]laim 11 is directed to the abstract idea of providing advance notification of the pickup or delivery of a[n] [MT].” J.A. 23. Regarding Alice step two, the District Court concluded that “the elements of [independent] [c]laim 11 do not transform the abstract idea that they re- cite into . . . patent-eligible subject matter.” J.A. 27–28. Accordingly, the District Court concluded that independent claim 11 was directed to patent-ineligible subject matter and granted judgment on the pleadings to ShoppersChoice. J.A. 33–34. We recently affirmed the District Court, hold- ing that “the claim only entails applying longstanding com- mercial practices using generic computer components and technology.” ShoppersChoice.com, 958 F.3d at 1183. Subsequently, ShoppersChoice filed a motion for attor- ney fees. See ShoppersChoice.com’s Local Rule 7.3 Motion for Attorneys’ Fees (“Motion for Attorney Fees”) at 5, Elec. Commc’n Techs., LLC v. ShoppersChoice.com, LLC, No. 9:16-cv-81677-KAM (S.D. Fla. Mar. 15, 2019), ECF No. 82. In it, ShoppersChoice cited evidence it presented to the District Court that ECT sent standardized demand letters and filed repeat patent infringement actions for the purpose of obtaining low-value “license fees” and forcing settlements. Id. at 4–5. Specifically, ShoppersChoice had provided the District Court with evidence that, be- tween 2011 and 2015, ECT, under its former name Eclipse, filed lawsuits against at least 150 defendants, alleging

Commc’n Techs., LCC v. Pep Boys–Manny, Moe & Jack, d/b/a The Pep Boys, No. 16-cv-81676-KAM. See id. Case: 19-2087 Document: 71 Page: 5 Filed: 07/01/2020

ELECTRONIC COMMUNICATION v. SHOPPERSCHOICE.COM, LLC 5

infringement of claims in the ’261 patent and in other pa- tents in the ’261 patent’s family. Id. at 4. Following attor- ney fee briefing, but before the District Court ruled, the U.S. District Court for the Central District of California (“California District Court”) entered an award of attorney fees against ECT in yet another case for conduct related to one of ECT’s numerous ’261 patent infringement lawsuits. See Kindred Studio Illustration & Design, LLC v. Elec. Commc’n Techs., LLC (“True Grit”), Case No. 2:18-cv- 07661-GJS, 2019 WL 3064112, at *6–9 (C.D. Cal. May 23, 2019). ShoppersChoice filed a letter of supplemental au- thority informing the District Court of the ruling. J.A. 2155–56.

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Electronic Communication v. shopperschoice.com, LLC, 963 F.3d 1371 (Fed. Cir. 2020).

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