United States District Court, D. Hawaii
Broadband iTV, Inc., Plaintiff: Frederick A. Tecce, John D.
Simmons, LEAD ATTORNEYS, PRO HAC VICE, Panitch Schwarze
Belisario & Nadel, Philadelphia, PA; John S. Rhee, Paul
Alston, LEAD ATTORNEYS, Alston Hunt Floyd & Ing, Honolulu,
Hawaiian Telcom, Inc., Defendant: Brandon H. Stroy, LEAD
ATTORNEY, PRO HAC VICE, Bingham McCutchen LLP, Palo Alto, CA;
Brian Y. Hiyane, Randall Y. Yamamoto, LEAD ATTORNEYS,
Yamamoto Kim LLP, Honolulu, HI; Charlene S. Shimada, LEAD
ATTORNEY, Bingham McCutchen LLP, San Francisco, CA; Sasha G.
Rao, LEAD ATTORNEY, PRO HAC VICE, Maynard Cooper & Gale, San
Oceanic Time Warner Cable, LLC, Defendant: Aaron Stiefel,
David S. Benyacar, LEAD ATTORNEYS, PRO HAC VICE, Kaye Scholer
LLP, New York, NY; Brett R. Tobin, Lisa W. Munger, LEAD
ATTORNEYS, Goodsill Anderson Quinn & Stifel LLLP, Honolulu,
HI; Daniel L. Reisner, LEAD ATTORNEY, Kaye Scholer LLP, New
Time Warner Cable, Inc., Time Warner Entertainment Company,
LP, Defendants: Aaron Stiefel, David S. Benyacar, Nathan
Brown, LEAD ATTORNEYS, PRO HAC VICE, Kaye Scholer LLP, New
York, NY; Brett R. Tobin, Lisa W. Munger, LEAD ATTORNEYS,
Goodsill Anderson Quinn & Stifel LLLP, Honolulu, HI; Daniel
L. Reisner, LEAD ATTORNEY, Kaye Scholer LLP, New York, NY.
GRANTING DEFENDANT HAWAIIAN TELCOM, INC.'S MOTION FOR
SUMMARY JUDGMENT OF INVALIDITY UNDER 35 U.S.C. §
Kay, Senior United States District Judge.
reasons set forth below, the Court GRANTS Defendant Hawaiian
Telcom, Inc.'s Motion for Summary Judgment of Invalidity
under 35 U.S.C. § 101, ECF No. 463.
AND PROCEDURAL HISTORY
December 8, 2009, the United States Patent and Trademark
Office (" USPTO" ) issued Patent No. 7,631,336 (the
" '336 Patent" ), entitled " Method for
Converting, Navigating and Displaying Video Content Uploaded
from the Internet to a Digital TV Video-on-Demand
Compl. ¶ 19, Ex. A, ECF Nos. 100, 100-1. The patent was
issued in the name of Milton Diaz Perez (" Diaz
Perez" ) and based on United States Patent
Application No. 11/685,188 (the " '188
Application" ), which was assigned to Broadband iTV,
Inc. (" Plaintiff" ). Am. Compl. ¶ 18, ECF No.
'336 Patent discloses and claims various features related
to the delivery of video-on-demand (" VOD"
) content to a VOD server. Id.
¶ 21. According to the patent itself, the invention is
intended to facilitate " the provision of video content
to viewers through digital TV infrastructure." '336
Patent at Col. 1, ln. 17-18. Specifically, it relates
to a method for " converting, navigating and displaying
video content uploaded from the Internet on a digital TV
video-on-demand platform." Id. at Col. 1, ln.
19-21. The patent includes eleven claims, out of which Claim
1 is independent and Claims 2-10 are dependent. See
id. at Col. 21-22.
April 9, 2014, Plaintiff filed a Complaint against Defendants
Oceanic Time Warner Cable, LLC, Time Warner Cable, Inc., Time
Warner Entertainment Company, LP (collectively, "
TWC" ), and Hawaiian Telcom, Inc. (" HTI" )
(collectively, " Defendants" ). Compl., ECF No. 1.
The Complaint was amended on December 5, 2014. Am. Compl.,
ECF No. 100. The Amended Complaint accuses Defendants of
infringing the '336 Patent by " making, using,
offering for sale and selling the '336 patent's
claimed method for converting, navigating and displaying
video content in connection with their providing, selling and
offering for sale digital television services."
Id. ¶ 22. Defendants deny that they infringe
the '336 Patent. Def. HTI's Answer and Affirmative
Defenses to Plf. BBiTV's Am. Compl. ¶ 22, ECF No.
104; Def. TWC's Answer to Am. Compl. ¶ 22, ECF No.
to the parties' stipulation, the Court ordered the
severance of the cases against TWC and HTI on April 16, 2015.
The severed cases were consolidated " for all pre-trial
purposes, including claim construction." Stipulation and
Order at 2, ECF No. 164. Following an off-the-record
technology tutorial, held on June 3, 2015, and a Markman
hearing, held on June 4, 2015, the Court issued its Claim
Construction Order on June 24, 2015. ECF No. 290.
correspondence from the parties, the Court issued a Minute
Order on August 4, 2015 outlining the number of permissible
summary judgment motions. ECF No. 432. In the interests of
judicial economy and pursuant to Federal Rules of Civil
Procedure 1 and 16, the Court permitted each party to file
one summary judgment motion regarding patent validity. In
addition, each Defendant was permitted to file one summary
judgment motion regarding patent infringement, and Plaintiff
was permitted to file one summary judgment motion regarding
patent infringement with respect to each Defendant.
Id. at 2.
instant motion relates to the validity of the '336
Patent. On August 10, 2015, HTI filed its Motion for Summary
Judgment of Invalidity under 35 U.S.C. § 101, ECF No.
463 (" HTI's MSJ" ), and a Concise Statement of
Facts attached thereto, ECF No. 465 (" HTI's
CSF" ). HTI's motion challenges that the '336
Patent is invalid as related to ineligible subject matter
under 35 U.S.C. § 101.
August 27, 2015, Plaintiff filed its Memorandum in Opposition
to HTI's MSJ, ECF No. 559 (" Plf.'s Opp. to
HTI's MSJ" ), and a Concise Statement of Facts
attached thereto, ECF No. 560 (" Plf.'s CSF --
HTI's MSJ" ).
September 3, 2015, HTI filed its Reply in Support of Its MSJ,
ECF No. 606 (" HTI's Reply" ). Hearings were
held on TWC's MSJ and HTI's MSJ on September 17,
Summary Judgment Standard
party is entitled to summary judgment on any claim or defense
if it can be shown " that there is no genuine dispute as
to any material fact and the movant is entitled to judgment
as a matter of law.'" Maxwell v. Cnty. of San
Diego, 697 F.3d 941, 947 (9th Cir. 2012) (quoting
Fed.R.Civ.P. 56(a)). A party asserting that a fact cannot be
or is genuinely disputed must support the assertion by either
" citing to particular parts of materials in the
record" or " showing that the materials cited do
not establish the absence or presence of a genuine dispute,
or that an adverse party cannot produce admissible evidence
to support the fact." Fed.R.Civ.P. 56(c)(1).
genuine issue of material fact exists if " a reasonable
jury could return a verdict for the nonmoving party."
United States v. Arango, 670 F.3d 988, 992 (9th Cir.
2012) (quoting Anderson v. Liberty Lobby, Inc., 477
U.S. 242, 247, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)).
Conversely, " [w]here the record taken as a whole could
not lead a rational trier of fact to find for the nonmoving
party, there is no genuine issue for trial." Scott
v. Harris, 550 U.S. 372, 380,
127 S.Ct. 1769, 167 L.Ed.2d 686 (2007).
movant has the burden of persuading the court as to the
absence of a genuine issue of material fact. Avalos v.
Baca, 596 F.3d 583, 587 (9th Cir. 2010). If the movant
satisfies its burden, the nonmovant must present evidence of
a " genuine issue for trial," Fed.R.Civ.P. 56(e),
that is " significantly probative or more than merely
colorable,"  LVRC Holdings LLC v. Brekka,
581 F.3d 1127, 1137 (9th Cir. 2009) (citation omitted). When
evaluating a motion for summary judgment, the court must
" view the facts and draw reasonable inferences in the
light most favorable to the party opposing the summary
judgment motion." Scott, 550 U.S. at 378.
Standards Related to Patent Eligibility Under 35 U.S.C.
of patent-eligible subject matter under 35 U.S.C. § 101
(" Section 101" ) are questions of law.
CyberSource Corp. v. Retail Decisions, Inc., 654
F.3d 1366, 1369 (Fed. Cir. 2011). To the extent that the
Court must resolve underlying questions of fact related to
eligibility, they must be proven by clear and convincing
evidence. See, e.g., Affinity Labs. of Texas, LLC v.
DirecTV, LLC, 109 F.Supp.3d 916, 2015 WL 3764356 *16
(W.D. Tex. July 7, 2015); Kickstarter, Inc. v. Fan
Funded, LLC, No. 11 Civ. 6909 (KPF), 2015 WL 3947178 * 5
n. 7 (S.D.N.Y. June 29, 2015). Defendants, as the moving
parties, bear the burden of establishing that the claims are
patent-ineligible under Section 101. See, e.g., Modern
Telecom Sys. LLC v. Juno Online Servs., Inc., No. SA CV
14-0348-DOC (ANx), 2015 WL 1240182 * 7 (C.D. Cal. Mar. 17,
disagree regarding whether a presumption of eligibility
should apply in Section 101 cases. A recent Federal Circuit
concurrence stated that " no presumption of eligibility
attends the section 101 inquiry." Ultramercial, Inc.
v. Hulu, LLC, 772 F.3d 709, 717 (Fed. Cir. 2014) (Mayer,
J., concurring). District courts have taken different
approaches. Compare, e.g., Tranxition, Inc. v. Lenovo
(U.S.) Inc., No. 3:12-cv-01065-HZ, 2015 WL 4203469 *4
(D. Or. July 9, 2015) (declining to apply presumption of
eligibility in Section 101 challenge) with Exergen Corp.
v. Brooklands Inc., Civil Action No. 12-12243-DPW, 125
F.Supp.3d 307, 2015 WL 5096464 * 2 (D. Mass. Aug. 28, 2015)
(applying presumption of eligibility in Section 101 challenge
but noting that it " has less significance in the
context of a largely legal determination" ). Given the
most recent available guidance from the Federal Circuit, the
Court will assume that such a presumption does not
argues in the instant motion that the '336 Patent is
invalid as directed to unpatentable subject matter under 35
U.S.C. § 101. For the reasons set forth below, the Court
agrees. Accordingly, the '336 Patent is invalid and may
not be enforced against HTI in this case.
35 U.S.C. § 101, an invention is eligible for patenting
if it fits into one of four subject-matter categories:
processes, machines, manufactures, and compositions. The
Supreme Court has recognized three implicit exclusions from
eligible subject matter: " laws of nature, natural
phenomena, and abstract ideas." Alice, 134 S.Ct. at 2354
(citation omitted). The latter exclusion, " abstract
ideas," is relevant here.
determine whether an invention impermissibly claims a law of
nature, natural phenomenon, or abstract idea, courts
undertake a two-step test. First, they must determine "
whether the claims at issue are directed to one of those
patent-ineligible concepts." Id. at 2355
(citing Mayo Collaborative Servs. v. Prometheus Labs.,
Inc., 132 S.Ct. 1289, 1296-97, 182 L.Ed.2d 321
courts next " consider the elements of each claim both
individually and 'as an ordered combination' to
determine whether the additional elements 'transform the
nature of the claim' into a patent-eligible
application." Id. (citation omitted). This
second step was described in Alice as a " search for an
'inventive concept' -- i.e., an element or
combination of elements that is 'sufficient to ensure
that the patent in practice amounts to significantly more
than a patent upon the ineligible concept itself.'"
Id. (quoting Mayo, 132 S.Ct. at 1294, 1298).
Supreme Court explained that the second step of the Alice
test is designed to ensure that a patent reflects " more
than a drafting effort designed to monopolize the abstract
idea." Id. at 2347 (citation and alteration
omitted). Recognizing that all inventions depend, at some
level, on abstract concepts, courts are nonetheless to
invalidate patents that would " t[ie] up the future use
of these building blocks of human ingenuity." The
Supreme Court has cautioned that doing otherwise would
threaten the " pre-emption" of further innovation
through the operation of patent monopolies on abstract ideas.
Id. at 2354-55 (quotation omitted).
wake of Alice, the Federal Circuit has observed that "
any given analysis in a § 101 'abstract idea'
case is hardly a clear guidepost for future cases arising
under § 101 -- each case stands on its own."
Versata Dev. Grp., Inc. v. SAP Am., Inc., 793 F.3d
1306, 1336 (Fed. Cir. 2015). Nonetheless, certain general
principles are clear. For example, mathematical algorithms,
even when executed on computers,
are unpatentable abstract ideas. See Gottschalk v.
Benson, 409 U.S. 63, 64, 93 S.Ct. 253, 34 L.Ed.2d 273
(1972). Certain fundamental economic and business practices
are also unpatentable abstract ideas, even when computers are
used to implement them. See Bilski v.
Kappos, 561 U.S. 593, 611, 130 S.Ct. 3218, 177 L.Ed.2d
792 (2010) (risk-hedging strategy reduced to mathematical
formula was not patent eligible); Alice, 134 S.Ct.
at 2356 (same for " computer-implemented scheme"
for exchanging financial obligations to mitigate risk).
general, even if claims " recite various computer
hardware elements," they are ineligible for patenting if
they are directed simply to the " performance of an
abstract business practice on the Internet or using a
conventional computer." DDR Holdings, LLC v.
Hotels.com, LP, 773 F.3d 1245, 1256 (Fed. Cir. 2014).
This is because " [t]he improved speed or efficiency
inherent with applying an abstract idea on a computer does
not provide an inventive concept." Personalized
Media Commc'ns, 2015 WL 4730906 at *9 (citation
omitted). Conversely, a patent directed to an "
inventive concept for resolving [a] particular
Internet-centric problem" may not be unpatentable.
See DDR Holdings, 773 F.3d at 1259.
The '336 Patent Claims an Abstract Idea
Court begins by considering Step 1 of the Alice analysis:
identifying " the concept" of the '336 Patent
and whether it claims an abstract idea. See, e.g.,
Ultramercial, 772 F.3d at 715 (" Although certain
additional limitations, such as consulting an activity log,
add a degree of particularity, the concept embodied by the
majority of the limitations describes only the abstract idea
of showing an advertisement before delivering free
content." ); Alice, 134 S.Ct. at 2355. For the reasons
discussed below, the Court finds that the '336 Patent
claims an abstract idea.
preliminary matter, the Court summarizes the claims of the
'336 Patent (of which Claims 1-4 and 7 are asserted
against TWC and HTI). Claim 1 is the only independent claim
in the patent. In summary, Claim 1 discloses:
1. A method for " automatically enabling the converting,
navigating and displaying" of videos from a publisher on
an " open online network" to a TV service provider
for inclusion in its electronic program guide ("
EPG" ), by:
a. Enabling the online uploading of videos to a Web-based
content management server (" WBCMS" ) connected to
a TV service provider's " VOD platform,"
 along with metadata specifying
certain hierarchical category information related to the
b. Converting the uploaded videos into standard TV digital
format and storing " local instances" of the videos
at video ID (" VID" ) addresses in the service
provider's VOD platform;
c. Listing the titles of the videos in the service
provider's EPG using the same hierarchical category
information that was uploaded as metadata;
d. Giving TV subscribers access to the service provider's
EPG to choose from among the " hierarchically-arranged
titles of video content; "
e. Enabling a chosen video to be retrieved and sent to a
subscriber's set-top box (" STB" ) after the
sends his video request to the VOD platform using his remote
See '336 Patent at Col. 21, ln. 15-Col. 22, ln. 7.
2-4 and 7 are much shorter: Claims 2 and 3 disclose uploading
videos from a user's computer and using a uniform
resource locator (" URL" ), Claim 4 discloses using
metadata expressed as a " string of category and
subcategory terms and the title delimited by standard
delimiters," and Claim 7 discloses using an EPG in which
users can ...