Judge Gregory M. Sleet recently denied a motion for a Rule 54(b) judgment following an unopposed motion to dismiss accompanied by a covenant not to sue. Nespresso USA, Inc. v. Ethical Coffee Co. SA, C.A. No. 16-194 (GMS) (D. Del. Sept. 5, 2017). Judge Sleet explained that, under Curtis-Wright Corp. v. General Electric Co., 446 U.S. 1, 7 (1980), the Court’s granting of the unopposed motion was not an adjudication of the merits of the dispute — “[t]here was no determination by the court as to the validity of the claims at issue or whether they were infringed.” As a result, Judge Sleet explained that “this does not constitute a final judgment under Fed. R. Civ. P. 54(b) because the claims were dismissed prior to an adjudication on the merits.”
Judge Gregory M. Sleet recently found that four patents relating to the matchmaking of participants in internet chat rooms claimed unpatentable subject matter under § 101. Jedi Techs., Inc. v. Spark Networks, Inc., et al., C.A. No. 16-1055-GMS (D. Del. Aug. 3, 2017). The Court found that the lead patent rested upon “the notion of human compatibility and matchmaking, where an individual learns about the personalities and interests of two different individuals and, based upon a certain criteria, determines whether the individuals are compatible.” This, the Court found, was an abstract idea under Alice, despite the plaintiff’s insistence that “the articulation of the abstract idea fails to account for specific requirements of the independent and dependent claims” — i.e. claimed “automatically prompting,” “collecting pre-existing data that is publicly available,” and “processing user data” steps. The Court found that these steps were routine data gathering or output steps that could not save the patent claims from being found an abstract idea. As Judge Sleet explained, “[e]ven if matchmakers traditionally have not relied on the Internet, the mere application of modern technology to the field of ‘invention’ does not somehow transform or otherwise change the character of the abstract idea.”
Under the second prong of Alice, Judge Sleet found no inventive concept sufficient to render the patent claims patent-eligible. As the Court explained, “the generic computer system contemplated by the patent could be replaced with a human matchmaker who compares two individuals based on submitted or publicly available information, and then sends both chatters a message which prompts their meeting. . . . While the use of a machine might improve the efficiency of the process, this improvement is not the ‘significantly more’ contemplated by Alice that ‘ensure[s] that the patent in practice’ truly adds to the invention.
The Court next found that three other asserted patents, which built upon the lead patent, merely used conventional technology to do additional tasks related to the chat room matchmaking idea that a human otherwise could do. These patents, like the lead patent, were found to claim unpatentable subject matter.
Judge Sleet denied the defendants’ request for attorneys’ fees under § 285, explaining that “the mere fact that one side’s arguments prevailed over its opponent’s does not make a § 285 award appropriate. Furthermore, the Alice analysis is not straightforward, particularly when it comes to software patents such as the patents at issue.”
Nespresso USA file a declaratory judgment complaint against Ethical Coffee Company requesting judgment that Nespresso does not infringement ECC’s patent. Nespresso USA, Inc. v. Ethical Coffee Company SA, No. 16-194-GMS (D. Del. July 13, 2017). In response, ECC filed a counterclaim against Nespresso, as well as three additional defendants which are Switzerland corporations. The Swiss Defendants moved to dismiss for lack of personal jurisdiction. Judge Sleet granted the motion. In doing so, Judge Sleet found that general jurisdiction was not present because “there [were] no ties between the companies and Delaware that render them essentially at home in this state[.]” Id. at 5. Regarding specific jurisdiction, Judge Sleet found that the Swiss Defendants were not subject to personal jurisdiction under the stream of commerce theory because they did not “did not introduce the Nespresso machines into the stream of commerce,” therefore ECC could not demonstrate that they “placed–or otherwise influenced the placement of–the Nespresso machines into either the United States market generally or the Delaware market specifically.” Id. at 6-7. Nor could the Swiss Defendants be held responsible for the actions of their subsidiary, Nespresso, because the mere ownership of a subsidiary or a patent, without more, does not justify the assertion of personal jurisdiction on the parent/foreign patentee. Id.at 7. Judge Sleet also found a lack of evidence to support personal jurisdiction under an agency theory. Id.at 8-9. Because of the “bare assertions” in this case, Judge Sleet denied ECC’s request for jurisdictional discovery. Id. at 14.
Senior District Judge Sleet recently considered a motion to dismiss on Section 101 grounds that challenged a patent claiming “a computer implemented method of displaying search results.” As an initial matter, Judge Sleet found that it was appropriate to consider Section 101 arguments at the pleadings stage because the plaintiff “failed to identify any specific claim construction issues that could impact the analysis.” Blackbird Tech LLC v. Advanced Discovery Inc., et al., C.A. No. 16-413-GMS, Memo. at 7-8 (D. Del. June 26, 2017).
Judge Sleet went on to find that “the claims of the asserted patent are drawn to the steps of 1) conducting a search based on a search query, 2) determining a concept associated with a search query, 3) and then ranking the search results based on which documents are most relevant to that concept [which are] merely ‘generalized steps to be performed on a computer using conventional computer activity’ and therefore an abstract idea.” Id. at 8. Moreover, there was no inventive concept to transform the abstract idea into patentable subject matter: “The court is unable to discern the inventive contribution to the art made by claims that merely provide for conducting a search, determining a concept associated with the search, ranking the search results, and then displaying the results. Rather, the claims recite generic computer components . . . to perform the very same sorting and rankings steps that humans can perform using pen and paper.” Id. at 10-11.
Judge Sleet did not invalidate every asserted claim, however. The plaintiff argued that “the validity of claims 2-9, 11-15, 17-24, and 26-30 should be upheld because defendants failed to carry their burden of establishing a representative claim. Although [the defendant] conducted a thorough analysis of each of the ‘specifically asserted claims of the ’717 patent, it undisputedly failed to identify a representative claim. Because [the plaintiff] has properly raised the representative claim issue, the court concludes that [the defendant] cannot meet is burden of establishing the § 101 defense with respect to each of the twenty-six dependent claims that were not addressed in the briefing.” Id. at 8 n.1.
Judge Gregory M. Sleet recently transferred a case to the Central District of California, finding that all but two Jumara factors weighed in favor of transfer. Blackbird Tech LLC v. TuffStuff Fitness, International, Inc., C.A. No. 16-733-GMS (D. Del. Apr. 27, 2017). Judge Sleet explained that the plaintiff’s forum choice weighed in favor of maintaining the litigation in Delaware, but it did not warrant maximum deference because “Delaware is not its ‘home turf’ or principal place of business.” The Court found that the convenience of witnesses weighed against transfer, but only slightly. However, “several factors counsel transfer: the defendant’s choice of forum, convenience of the parties, location where the claim arose, the location of relevant books and records, and court congestion.” With respect to court congestion, the Court noted that the time to trial in the Central District of California was roughly five months shorter than that in Delaware, and the overall disposition time in the Central District of California was roughly four months shorter than in Delaware.
The United States District Court for the District of Delaware announced today that the Honorable Gregory M. Sleet will become a Senior United States District Court Judge as of May 1, 2017, and intends to render substantial judicial service in that role going forward.
The Court’s official announcement regarding Judge Sleet can be viewed HERE.
Judge Sleet recently ruled on a motion to dismiss direct and indirect infringement claims in a case involving VoIP technology. IP Communication Solutions, LLC v. Viber Media (USA) Inc., C.A. No. 16-134-GMS (D. Del. Apr. 5, 2017). The defendant argued that the allegations of direct infringement failed to adequately put it on notice of what it was to defend, and cited as support cases in which allegations relating to unidentified products were dismissed. Judge Sleet disagreed with the defendant’s reliance on those cases, and explained that in those cases the alleged infringers marketed a number of products that could possibly infringe product claims. On the contrary, here, the defendant marketed a single mobile VoIP client application supported by a server that together were alleged to perform a number of steps that would infringe method claims, so the defendant could not persuasively argue that it was not on notice of what the claims targeted simply because the claims did not specifically identify the accused instrumentality. With respect to indirect infringement, however, Judge Sleet agreed with the defendant that the evidence relied upon (webpages showing how customers use the VoIP application to make calls) did not rise to the level of showing that the defendant “specifically instructed or directed customers to use the Viber application and corresponding server system in a manner that would infringe.”
Judge Gregory M. Sleet recently considered defendants’ motion to stay pending inter partes review of six of the eleven patents-in-suit. Koninklijke Philips N.V., et al. v. ASUSTek Computer Inc., et al., Nos. 15-1125-GMS, 15-1126-GMS, 15-1127-GMS, 15-1128-GMS, 15-1130-GMS, 15-1131-GMS, 15-1170-GMS (D. Del. Mar. 30, 2017). Judge Sleet denied the motion without prejudice to renew upon institution of the petitions by the U.S. Patent and Trademark Office. Id. at 1 n.1.
Judge Gregory M. Sleet recently considered defendants’ motion to stay pending inter partes review of one patent in suit. f’Real Foods, LLC v. Hamilton Beach Brands, Inc., No. 16-41-GMS (D. Del. Mar. 9, 2017). Judge Sleet denied the motion, finding that the plaintiff would suffer undue prejudice and because the litigation at issue “will be minimally simplified.” Id. at 2. Judge Sleet importantly noted that the parties are direct competitors and that the Patent Trial and Appeal Board instituted inter partes review on only one claim of one of the patents in suit. Id. at 2, n.3. Further, there were many issues in the litigation that would not be impacted by the inter partes review, namely “the litigation of the two patents-in-suit for which Defendants have not sought IPR, trademark infringement issues, and Defendants inequitable conduct and antitrust counterclaims.” Id. at 3, n.4 (internal quotations omitted).
Judge Gregory M. Sleet, recently granted defendants’ motion for summary judgment of non-infringement based on upon the Court’s construction of the limitation “changing [price] information.” Quest Licensing Corporation v. Bloomberg L.P., No. 14-561-GMS (D. Del. Jan. 19, 2017). Defendants argued that summary judgment was appropriate because “defendants’ accused systems do not receive or supply ‘only data that has changed’ as required by all of the asserted claims of the patent-in-suit.” Id. at 3. Judge Sleet agreed. The Court previously construed the term “changing information” to mean “only [price] data that has changed,” and it was undisputed that the accused systems receive and supply information that “always includes non-changing information such as the stock symbol.” Id. at 5-6. Judge Sleet was not persuaded that the Court should revisit its claim construction ruling. Id. at 6.