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SmarTEN LLC v. Samsung Electronics America, Inc.

United States District Court, E.D. Virginia, Alexandria Division

March 16, 2018

SMARTEN LLC, Plaintiff,
v.
SAMSUNG ELECTRONICS AMERICA, INC., Defendant.

          MEMORANDUM OPINION

          Leonie M. Brinkema, United States District Judge

         Before the Court is defendant's Motion to Dismiss [Dkt. No. 15] pursuant to Fed.R.Civ.P. 12(b)(6), in which defendant argues that this patent infringement action should be dismissed because none of the patents-in-issue are patent-eligible under 35 U.S.C. § 101. Plaintiff has responded to the motion and oral argument has been held. For the reasons that follow, defendant's Motion to Dismiss will be granted.

         I. BACKGROUND

         Plaintiff SmarTEN LLC ("plaintiff or "SmarTEN") alleges that defendant Samsung Electronics America, Inc. ("defendant" or "Samsung") has infringed on four patents which SmarTEN owns: Patent Numbers 9, 280, 640 ('"640 patent"); 9, 378, 657 ("'657 patent"); 9, 514, 655 ("'655 patent"); and 9, 728, 102 ("'102 patent"). Compl. [Dkt. No. 1] ¶ 4.

         The four patents-in-suit, all of which are continuations of the same parent application, disclose a "mobile computing device executing weight, nutrition, health, behavior and exercise application software" that "serves as a simulated combination personal trainer and dietician/nutritionist for the user using comprehensive databases storing personalized health, nutrition and exercise information." '640 patent abs. The patents include 132 claims, each of which recites a "hand-held mobile weight and exercise management computing device, " see '640 patent 88:65-67, or a "hand-held mobile nutrition and physical activity management computing device, " see ' 102 patent 100:11 -12. When the applications for these patents were filed, there were many "commercial programs, " such as Weight Watchers, as well as "individual health care professionals" and "multidisciplinary medical weight management centers" that provided clients with "nutritional and exercise direction along with help to keep on track." '640 patent 2:6-16. In addition, these services had already been incorporated into applications for mobile devices and tablets such as iPhones and iPads designed "to assist dieters in successfully meeting their weight loss goals, " Id. at 2:36-38; however, according to the patents, there existed a "need for an easy to use weight, nutrition, exercise and behavior monitoring data processing system that, for example, simplifies data entry for food consumed and/or exercise modes of operation and/or behavior parameters, while providing valuable health beneficial feedback and rewards for behavior change and goal achievement, " Id. at 3:3-8. Accordingly, the patents claim to provide software that "serves as a simulated personal trainer, dietician/nutritionist, and physician's assistant for the user while having access to massive amounts of personalized health, nutrition and exercise information." Id. at 3:20-23.

         At bottom, the invention claimed by the patents is a handheld device with software that processes, organizes, and displays nutrition and exercise data and provides feedback to the user. Although the patents claim a "device, " they describe software which "may be implemented by any of a wide array of commercially available, conventional mobile computing devices, including, for example, conventional smart phones, such as Apple's iPhone 4s or 5, or Samsung's quad-core processor-based Galaxy S3, a tablet computing device such as Apple's iPad, or any of a number of laptop computers." Id. at 10:23-28. Similarly, although the claims reference other hardware, such as a pedometer, a GPS, and a digital camera, see, e.g.. id. at 89:22-25, 91:53-57, the patents do not purport to invent any such hardware, but instead make clear that the hardware included on conventional mobile computing devices may be used as part of the invention, see Id. at 10:32-33, 10:64-65, 44:62-64.

         Plaintiff alleges that on February 8, 2017, it sent defendant a letter to advise it that its products were infringing the '640, '657, and '655 patents, and included a copy of the entire '640 patent and the claims of the '657 and '655 patents. Compl. ¶ 5. Using claim 1 of the '640 patent as an example, the letter explained that Samsung's smartphones with a built-in S Health App[1]infringed plaintiffs patent. Id. Plaintiff alleges that Samsung did not respond to the letter but instead has continued to sell infringing smartphones. Id. ¶ 6. Plaintiff also alleges that, once the '102 patent issued on August 8, 2017, Samsung's sale of smartphones with the built-in S Health App also infringed that patent. Id.

         In this litigation, plaintiff alleges that all Samsung Galaxy S7 and S8 Series smartphones, as well as all Note 8 Series smartphones, that had the built-in S Health App and were sold in the United States on or after the issue date of each patent literally and directly infringe claims 1-3, 5-7, 9-10, 13-20, 24, 26-28, 30, 32, 34, 41, 43-44, 46, 50, 54, and 56 of the '640 patent (issued on March 8, 2016); claims 1-8, 11. 13-15, 17, 19, and 21 of the '657 patent (issued on June 28. 2016); claims 1-9, 11, 13-17, 20, and 22-23 of the'655 patent (issued on December 6, 2016); and claims 26-30 of the '102 patent (issued on August 8, 2017). Id. 1 7. In addition, plaintiff alleges that Samsung's infringement has been wanton, willful, and intentional. Id. ¶ 8.

         As a result, plaintiff seeks compensatory damages adequate to compensate it for Samsung's infringement, as well as treble damages and costs pursuant to 35 U.S.C. § 284 and attorney's fees pursuant to 35 U.S.C. § 285, as well as an injunction. Id. at 4. Samsung has filed a Motion to Dismiss, in which its sole argument is that each claim asserted against Samsung is invalid under 35 U.S.C. § 101 for claiming patent-ineligible subject matter, as explained by Alice Corp. v. CLS Bank Int'l. 134 S.Ct. 2347 (2014).

         II. DISCUSSION

         A. Standard of Review

         Under Rule 12(b)(6), a civil action must be dismissed if the complaint does not "contain sufficient facts to state a claim that is 'plausible on its face.'" E.I, du Pont de Nemours & Co. v. Kolon Indus., Inc., 637 F.3d 435, 440 (4th Cir. 2011) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544. 570 (2007)). Although the court must assume for the purposes of deciding the motion that all ''well-pleaded allegations" are true and must "view the complaint in the light most favorable to the plaintiff, " Philips v. Pitt Cty. Mem'l Hosp.. 572 F.3d 176, 180 (4th Cir. 2009), allegations that are merely conclusory need not be credited, see Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).

         Under 35 U.S.C. § 282(a), a "patent shall be presumed valid" and the "burden of establishing invalidity of a patent or any claim thereof shall rest on the party asserting such invalidity." This presumption requires the party asserting invalidity to "set forth clear and convincing evidence of invalidity." Seniu Pharm. Co. v. Lupin Ltd.. 780 F.3d 1337, 1353 (Fed. Cir. 2015). A concurring opinion in a previous en banc Federal Circuit decision has observed that this "presumption applies when § 101 is raised as a basis for invalidity in district court proceedings." CLS Bank Int'l v. Alice Corp. Pty. Ltd.. 717 F.3d 1269, 1284 (Fed. Cir. 2013) (en banc) (Lourie, J., concurring); however, in affirming the judgment of the Federal Circuit in Alice and articulating the test for patent-ineligibility that is implicated by defendant's Motion to Dismiss, the Supreme Court declined to discuss the presumption of validity and did not make any findings by clear and convincing evidence, see Alice, 134 S.Ct. 2347. Moreover, recent Supreme Court and Federal Circuit decisions addressing § 101 invalidity claims have done so without applying a clear and convincing evidence standard. See, e.g., Ass:n for Molecular Pathology v. Myriad Genetics. Inc., 569 U.S. 576 (2013); Core Wireless Licensing S.A.R.L. v. LG Elecs., Inc., 880 F.3d 1356 (Fed. Cir. 2018). Although it appears to the Court that the weight of the relevant case law indicates that the presumption of validity is not applicable to an ineligibility determination under § 101, the Court finds that Samsung has made the relevant invalidity showing by clear and convincing evidence. Accordingly, the Court does not find it necessary to resolve this dispute.

         B. Analysis

         Under the Patent Act, "[w]hoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor." 35 U.S.C. § 101. Although not evident from the text of this provision, § 101 has been interpreted for more than 150 years to contain an "important implicit exception: Laws of nature, natural phenomena, and abstract ideas are not patentable." Alice, 134 S.Ct. at 2354 (internal quotation marks omitted). This "exclusionary principle" is driven by a concern of "pre-emption." Id. Because laws of nature, natural phenomena, and abstract ideas are the "basic tools of scientific and technological work." granting patent-holders a monopoly on them might "tend to impede innovation more than it would tend to promote it, thereby thwarting the primary object of the patent laws." Id. (internal quotation marks omitted).

         At the same time, because "all inventions, " at some level, "embody, use, reflect, rest upon, or apply laws of nature, natural phenomena, or abstract ideas, " courts must "tread carefully in construing this exclusionary principle lest it swallow all of patent law." Id. (internal quotation marks omitted). Accordingly, the Supreme Court has distinguished between patent-ineligible claims of abstract ideas and patent-eligible "integrations]" or "applications of such concepts to a new and useful end." Id. (alterations and internal quotation marks omitted). To that end. the Supreme Court has developed a two-part analysis for determining whether a patent is invalid for claiming abstract ideas.[2] First, the court must "determine whether the claims at issue are directed to" an abstract idea. Id. at 2355. Second, if so. the court must "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." Ia\ (internal quotation marks omitted). This second step is, at its core, 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. (alteration in original) (internal quotation marks omitted).

         Before applying the Alice test, the Court must determine whether a single claim is representative of the asserted claims for purposes of Alice. Samsung argues that Claim 1 of the '640 patent is representative of each asserted claim. This claim recites, in full:

A hand-held mobile weight and exercise management computing device having a housing sized to be held in a ...

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