In LivePerson, Inc. v. 24/7 Customer Inc., 2015 U.S. Dist. LEXIS 3688, No. 1:2014cv01559 (Jan. 16, 2015), the Southern District of New York dismissed a complaint alleging copyright infringement, a violation of the Digital Millennium Copyright Act (DMCA), and the Computer Fraud and Abuse Act (CFAA) for failure of the pleadings under F.R.C.P. 12(b)(6). This case thus provides good guideposts for drafting sufficient pleadings alleging both DMCA and CFAA violations. Here in Part I, we will discuss the copyright infringement and DMCA claims, while in Part II, we will discuss the CFAA claim. Plaintiff LivePerson provides customers with live-interaction and customer engagement technology for e-commerce websites, allowing real-time interaction with customers. Defendant 24/7 is a customer service technology company that historically provided human call-center operators to answer phones in customers’ call centers. In 2006 and 2007, Plaintiff and Defendant entered into a license agreement, wherein Defendant received a license to “access, operate, and use” Plaintiff’s intellectual property. As Defendant has developed its own competing software, Plaintiff alleged that Defendant misappropriated their technology to sell as Defendant’s own; notably, the alleged conduct includes improperly accessing Plaintiff’s systems to allow Defendant’s software to mimic Plaintiff’s software. A copyright infringement claim requires four… Read More »Action Brought Under DMCA and CFAA Dismissed (Part I)
More e-commerce / business method patent claims are invalidated under 35 U.S.C. § 101 . . . Enpat, Inc. v. Tenrox Inc., Case No: 6:13-cv-948-Orl-31KRS (M.D. Fla. Feb. 10, 2015). Claims of U.S. Patent No. RE38,633 were held patent ineligible under 35 U.S.C. § 101, and a defense motion for summary judgment was granted. The ‘633 patent claimed “a software-based system for managing projects automatically, with a computer that uses a database to keep track of tasks, resources . . . and priorities for a project.” When mission critical tasks occur, the computer “automatically reassigns resources to achieve the most efficient completion of the project.” The court found that there was no improvement to the “existing abstract idea of project management,” and the claimed invention “simply takes an abstract idea and computerizes it.” Essociate, Inc. v. 4355768 Canada Inc., No. 14-0679 JVS (DFMx) (C.D. Cal. Feb. 11, 2015). Granted a defense motion under FRCP 12(c) for judgment on the pleadings declaring United States Patent No. 6,804,660 invalid as not patent eligible under 35 U.S.C. § 101. The patent claimed a method, system and computer program used in electronic commerce (e-commerce) to allow internet advertisers using existing affiliate systems to cross… Read More »More Business Method and E-Commerce Patents Held Ineligible
In several recent cases, the Patent Trial and Appeals Board (PTAB) at the United States Patent and Trademark Office has rejected a petitioner’s contention that the patent claims put in issue encompassed a “financial product or service.” Accordingly, in these cases the PTAB declined to institute Covered Business Method (CBM) Review proceedings under § 18(d)(1) of the America Invents Act. Accused infringers wanting to use the CBM procedure should take note that there is a limit to how aggressive the PTAB will be in characterizing patents as encompassing a covered business method. According to Section 18(d)(1) of the AIA, a covered business method patent is one “that claims a method or corresponding apparatus for performing data processing or other operations used in the practice, administration, or management of a financial product or service,” excluding “patents for technological inventions.” Parties accused of infringement can petition the PTAB for a Post-Grant Review of covered business method patents on various grounds, including alleged invalidity under 35 U.S.C. § 101, in addition to under prior art provisions, 35 U.S.C. §§ 102, 103. Here are summaries of these recent cases in which the PTAB denied petitions for CBM review on the grounds that the patents… Read More »What Is a “Covered Business Method Patent”?
District courts continue to consider patent-eligibility under 35 U.S.C. § 101 at the pleadings stage of patent cases. The following three decisions all came on motions made under FRCP 12. Two of the motions were granted, and one was dismissed without prejudice as premature. StoneEagle Servs. V. Pay-Plus Solutions, Inc., Case No. 8:13-cv-2240-T-33MAP (M.D. Fla. Feb. 2, 2015). Denied (without prejudice) a defense motion under FRCP 12(c) for judgment on the pleadings under 35 U.S.C. § 101. Plaintiff alleged infringement of U.S. Reissue Patent Nos. RE43,904 E, and US RE44,748 E. The patent claims encompassed “a healthcare provider reimbursement system, by which a payor, such as an insurance company, makes ‘a virtual payment to a medical provider by transmitting a stored-value card account payment of the authorized benefit amount, together with an explanation of benefits.’” The court found the question of patent-eligibility to have been prematurely raised, in part because both parties had cited documents outside of the pleadings, and the court was not ready to hear a summary judgment motion. The court also thought claim construction should be done before the motion was heard. Vehicle Intelligence & Safety LLC v. Mercedes-Benz USA, LLC, No. 13 C 4417 (N.D. Ill.… Read More »Another Roundup of District Court Section 101 Patent-Eligibility Decisions
In an appeal from the Patent Trial and Appeal Board (PTAB), the Court of Appeals for the Federal Circuit (CAFC) reversed the rejection of independent claims 1, 34, and 43 of U.S. Patent Application No. 09/874,423 in In re Kevin R. Imes. The Federal Circuit held that the PTAB had improperly applied the broadest reasonable interpretation standard of claim construction. The CAFC’s decision regarding independent claim 1 is discussed in a post by Chris Francis on the Bejin Bieneman PLC blog.