Intellectual Ventures I LLC v. Erie Indemnity Co.

200 F. Supp. 3d 565, 122 U.S.P.Q. 2d (BNA) 1229, 2016 WL 4147300, 2016 U.S. Dist. LEXIS 102289
CourtDistrict Court, W.D. Pennsylvania
DecidedAugust 4, 2016
DocketCivil Action No. 2:14-cv-220
StatusPublished
Cited by2 cases

This text of 200 F. Supp. 3d 565 (Intellectual Ventures I LLC v. Erie Indemnity Co.) is published on Counsel Stack Legal Research, covering District Court, W.D. Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Intellectual Ventures I LLC v. Erie Indemnity Co., 200 F. Supp. 3d 565, 122 U.S.P.Q. 2d (BNA) 1229, 2016 WL 4147300, 2016 U.S. Dist. LEXIS 102289 (W.D. Pa. 2016).

Opinion

OPINION

Mark R. Hornak, United States District Judge

Before the Court is a Motion to Dismiss infringement claims as to the last of several patents at issue in this case. ECF No. 132. The Motion argues that this patent, U.S. Patent 7,757,298 (the ‘"298 Patent”) is not drawn to patent-eligible subject matter under 35 U.S.C. § 101. The Plaintiff patent holders disagree and the parties have fully briefed the issue. ECF Nos. 133, 134, 135. The Erie Defendants also brought some supplemental authority to the Court’s attention, ECF Nos. 138, 140, about which the Court also heard from the Plaintiffs, ECF Ños. 139, 141. With that excellent briefing, the Court will dispense with oral argument and decide the matter on the papers.

For the reasons stated in this Opinion, the Court concludes that the ’298 Patent is drawn to patent-ineligible subject matter and does not clear the Alice bar. Therefore, the Erie Defendants’ Motion to Dismiss will be granted.'

I. BACKGROUND

a. Earlier Litigation & The Court’s First Opinion

By Order of the Court, three related patent infringement cases filed by Plaintiffs Intellectual Ventures I and Intellectual Ventures II LLC (“Intellectual Ventures”) were consolidated. ECF No. 50. At issue were four patents held by Intellectual Ventures: U.S. Patent Nos. 6,519,581; 6,510,434; 6,546,002; and the ’298 Patent. The various Defendants moved to dismiss the infringement claims against them on § 101 grounds. After full briefing and argument, the Court granted the Motions to Dismiss as to the ’581 Patent,1 the ’434 [568]*568Patent, and the ’002 Patent, finding each to be drawn to patent-ineligible subject matter. Intellectual Ventures I LLC, et al. v. Erie Indem. Co., 134 F.Supp.3d 877, 926 (W.D.Pa.2015) (“Erie I”).

That Opinion did not substantively address the ’298 Patent because it was not subject to any then-pending Motion to Dismiss. Id. at 881 n. 8. When the initial Motions to Dismiss were filed, the ’298 Patent was subject to invalidity proceedings before the Patent Trial and Appeal Board (“PTAB”). EOF No. 46-1, at 1 n.2. The PTAB declined to initiate an inter partes review proceeding against the ’298 Patent on 35 U.S.C. §§ 102 or 103 grounds. See Int’l Bus. Mach. Corp. v. Intellectual Ventures I LLC, IPR2014-01516 (P.T.A.B. Aug. 24, 2015). Now that has all been cleared up, the Defendants filed this Motion to Dismiss and the matter is ripe for disposition.

b. The ’298 Patent

The ’298 Patent is titled “Method and Apparatus for Identifying,and Characterizing Errant Electronic Files” and is designed to solve the problem of the proliferation of illicit files on the Internet (like pornography, pirated music or software, etc.). ’298 Patent col. 4 11. 30-34, 47-52 (filed June 3, 2005). Claim 1 is representative:

1. A computer-implemented method for identifying and characterizing, stored electronic files, said method comprising:
under control of one or more configured computer systems:
selecting a file from a plurality of files stored in a computer storage medium, wherein selecting the. file is performed according to at least one of:
selecting the file based on the size of the.file by determining whether an aggregate size of plural identically-sized files exceeds a predetermined threshold;
selecting the file based on whether content of the file matches a file type indicated by a name of the file; or selecting the file based on whether the file comprises data beyond an end of data marker for the file;
generating an identification value associated with the selected file, wherein the identification value is representative of at least a portion of the content of the selected file;
comparing the generated identification value to one or more identification values associated with one or more of a plurality of unauthorized files; and characterizing the file as an unauthorized file if the identification value matches one of the plurality of identification values associated with the unau-thdrized files. '•

’298 Patent col. 12 11. 21^44 (Claim 1).

In non-patentspeak, the claim can be boiled down to four fundamental steps: (1) selecting a file; (2) generating a unique value corresponding to the file; (3) comparing that unique value to .a bunch of previously generated values that correspond to different types of illicit files; and (4) marking the file for deletion or other treatment if its assigned value matches a known one. ’298 Patent col. 211. 58-65.

The invention purports to “reliably characterize files according to pre-set criteria, that is not easily circumvented, and that reduces the amount of manual review necessary to verify proper operation.”2 ’298 [569]*569Patent col. 2 11. 42-44. It recognizes various characteristics of flies—like being split into parts, illegitimate files appended to legitimate ones, and names that give away illegal, illicit, or offensive content (readers can imagine such names for themselves)— and in so doing," saves Web hosting services from criminal, copyright, or some other liability.

II. LEGAL STANDARDS

a. Motion to Dismiss

Federal Rule of Civil Procedure 12(b)(6) provides for the dismissal of cases that fail to state a claim upon which relief can be granted. Complaints must allege facts “sufficient to show that the plaintiff has a ‘plausible claim for relief.’” Fowler v. UPMC Shadyside, 578 F.3d 203, 211 (3d Cir.2009) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 679, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009)). In assessing a motion to dismiss, courts must accept all “well-pleaded facts as true” and disregard any legal conclusions. Fowler, 578 F.3d at 210-11 (citing Iqbal, 556 U.S. at 677, 129 S.Ct. 1937).

A “plausible claim for relief’ in a patent infringement case necessarily requires a valid patent; otherwise there can be no infringement. And “[w]hether a claim is drawn to patent-eligible subject matter under § 101 is an issue of law.” In re Bilski, 545 F.3d 943, 951 (Fed.Cir.2008), aff'd sub nom. Bilski v. Kappos, 561 U.S. 593, 130 S.Ct. 3218, 177 L.Ed.2d 792 (2010). Thus, the 12(b)(6) stage is a proper one at which to examine patent eligibility under § 101.

b. Alice & § 101: The Law

In general, patents may be granted to “[w]hoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof ....” 35 U.S.C. § 101.

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200 F. Supp. 3d 565, 122 U.S.P.Q. 2d (BNA) 1229, 2016 WL 4147300, 2016 U.S. Dist. LEXIS 102289, Counsel Stack Legal Research, https://law.counselstack.com/opinion/intellectual-ventures-i-llc-v-erie-indemnity-co-pawd-2016.