DealerTrack, Inc. v. Huber

• Citation: 674 F.3d 1315,101 U.S.P.Q.2d 1325
• Decision Date: 20 January 2012
• Docket Number: 2009–1588.,Nos. 2009–1566,s. 2009–1566
• Parties: DEALERTRACK, INC., Plaintiff–Appellant, v. David L. HUBER and Finance Express, LLC, Defendants–Appellees,andJohn Doe Dealers, Defendant,andRouteOne, LLC, Defendant–Cross Appellant.
• Court: United States Courts of Appeals. United States Court of Appeals for the Federal Circuit

101 U.S.P.Q.2d 1325

674 F.3d 1315

DEALERTRACK, INC., Plaintiff–Appellant,

v.David L. HUBER and Finance Express, LLC, Defendants–Appellees,andJohn Doe Dealers, Defendant,andRouteOne, LLC, Defendant–Cross Appellant.

Nos. 2009–1566

2009–1588.

United States Court of Appeals, Federal Circuit.

Jan. 20, 2012.

Henry C. Dinger, Goodwin Procter, LLP, of Boston, MA, argued for the plaintiff-appellant. With him on the brief were Robert D. Carroll; and Forrest A. Hainline, of San Francisco, CA.

Lawrence M. Hadley, McKool Smith Hennigan, P.C., of Los Angeles, CA, argued for the defendants-appellees. With him on the brief were Roderick G. Dorman, Brian L. Yates and Mieke K. Malmberg.

Laurence S. Rogers, Ropes & Gray, LLP, of New York, NY, argued for defendant-cross appellant. With him on the brief were Jesse J. Jenner, Ching–Lee Fukuda and Brian P. Biddinger.

Before LINN, PLAGER, and DYK, Circuit Judges.

Opinion for the court filed by Circuit Judge LINN.

Opinion concurring in part and dissenting in part filed by Circuit Judge PLAGER.

LINN, Circuit Judge.

Dealertrack, Inc. (“Dealertrack”) appeals the grant of summary judgment of noninfringement of claims 7–9, 12, 14, 16, and 17 of U.S. Patent No. 6,587,841 (“'841 Patent”) and the grant of summary judgment of invalidity of claims 1, 3, and 4 of U.S. Patent No. 7,181,427 (“'427 Patent”) for failure to claim patentable subject matter under 35 U.S.C. § 101. Dealertrack, Inc. v. Huber, No. CV–06–2335, 2008 WL 5792509 (C.D.Cal. Sept. 27, 2008) (“ Claim Construction ”); DealerTrack, Inc. v. Huber, 657 F.Supp.2d 1152 (C.D.Cal.2009) (“ Invalidity ”). RouteOne, LLC (“RouteOne”) cross-appeals the district court's denial of summary judgment of invalidity of claims 14, 16, and 17 of the '841 Patent for indefiniteness. For the reasons set forth below, we affirm-in-part, vacate-in-part, reverse-in-part, and remand.

Background

I. The Patents in Suit

Dealertrack is the owner of the '841 and '427 Patents, directed to a computer-aided method and system, respectively, for processing credit applications over electronic networks. The '841 Patent claims priority to and incorporates by reference U.S. Patent No. 5,878,403 (“'403 Patent”) and uses the following incorporation language: “This is a division of application Ser. No. 08/526,776, filed Sep. 12, 1995, hereby incorporated by reference. Now U.S. Pat. No. 5,878,403.” '841 Patent col.1 ll.5–7. The '427 Patent also claims priority to the '403 Patent, of which it is a continuation-in-part.

Prior to Dealertrack's invention, car dealers, in seeking car loans on behalf of their customers, would apply to funding sources (i.e. banks) by: filling out application forms particular to each bank; faxing or transmitting the application to the respective banks; waiting for bank personnel to enter the application information into their internal computer systems; and eventually receiving responses from each bank. Dealertrack proposed to automate the process through the use of a “central processor,” which receives credit application data from dealers, processes the data to conform to the individual application forms of different banks, forwards the completed applications to banks selected by the dealer, receives answers from the banks, and forwards those answers back to the dealer. Figure 1A of the '841 Patent, below, displays a preferred embodiment of the system:

Image 1 (4.48" X 3.36") Available for Offline Print '841 Patent, fig. 1A. An important feature of the invention was to allow the dealer to fill out a single application, to control which banks would receive the application, and to control the order and timing in which the applications were sent to the banks.

II. District Court Proceedings

Dealertrack sued appellees David L. Huber and Finance Express, LLC (“Finance Express”) for infringement of the '841, '427, and '403 Patents by their FEX system, and sued appellee RouteOne for infringement by its Credit Aggregation System (“CAS”) and its Messenger system. The validity of the '403 Patent and infringement of any of the patents by RouteOne's Messenger system are not in dispute on appeal. All of the accused products offer automobile dealers loan management services that pass all communications between dealers and lenders through the Internet.

Appellees Finance Express, John Doe Dealers, and RouteOne (collectively, “Appellees”) filed four summary judgment motions ¹: (1) non-infringement of all asserted claims of the ' 841 Patent based on the absence of a “communications medium,” as construed by the district court, in the accused devices and based on several other proposed claim constructions; (2) invalidity of claims 14, 16, and 17 of the ' 841 Patent for indefiniteness under 35 U.S.C. § 112, ¶¶ 2, 6 for failure to disclose adequate structure corresponding to the purported means-plus-function “tracking” limitation; (3) invalidity of all asserted claims of the ' 427 Patent for failure to claim patent-eligible subject matter under 35 U.S.C. § 101; (4) invalidity of all asserted claims of the ' 427 Patent for failure to claim priority to the ' 403 Patent.

The district court agreed with Appellees' proposed claim construction of the phrase “communications medium” in the '841 Patent as “a ‘network for transferring data,’ not including the internet.” Claim Construction, at 19. Because “communications medium” was a limitation in all claims of the ' 841 Patent, and because it was undisputed that the accused products transferred data only over the Internet, the district court granted summary judgment of non-infringement of all asserted claims of the '841 Patent. The district court denied summary judgment of invalidity for failure to disclose adequate structure for the “tracking” limitation of the claims of the '841 Patent because the district court determined that “tracking” was not part of the function of the central processing means limitation. The district court granted summary judgment of invalidity of all claims of the '427 Patent for failure to claim patent-eligible subject matter under § 101. The district court denied summary judgment of invalidity of the '427 Patent for failure to claim priority to the '403 Patent. These rulings are all at issue on appeal—directly, as alternative grounds of affirmance, or in the cross-appeal.

Dealertrack timely appealed, and RouteOne properly cross-appealed. We have jurisdiction pursuant to 28 U.S.C. § 1295(a)(1).

Discussion

I. The '841 Patent

Independent claim 7 of the '841 Patent reads as follows, with the contested limitations highlighted in bold:

7. A computer based method of operating a credit application and routing system, the system including a central processor coupled to a communications medium for communicating with remote application entry and display devices, remote credit bureau terminal devices, and remote funding source terminal devices, the method comprising:

selectively receiving credit application data from a remote application entry and display device;

selectively obtaining credit report data from at least one remote credit bureau terminal device;

selectively forwarding the credit application data, and credit report data if appropriate, to at least one remote funding source terminal device; and

forwarding funding decision data from the at least one remote funding source terminal device to the respective remote application entry and display device, wherein the step of selectively forwarding the credit application data and credit report data to at least one remote funding source terminal device comprises:

sending at least a portion of the credit application data, and the credit report data if appropriate, to more than one of said at least one remote funding source terminal devices substantially at the same time.

'841 Patent col.32 l.55–col.33 l.10. Dependent claim 8 adds “[the method of claim 7] further comprising the step of enabling reviewing, analysis and editing of the credit application data at the remote application entry and display device prior to the step of selectively forwarding the credit application data.” Id. col.33 ll.11–15. Dependent claim 9 adds, “wherein said remote application entry and display device is located at a vehicle dealer.” Id. col.33 ll.16–18. These claims are not argued separately.

Independent claim 14 of the '841 Patent reads as follows, with the limitations relevant to this appeal highlighted in bold:

14. A credit application and routing system, comprising:

a communications medium;

central processing means, operably coupled to said communications medium, for executing a computer program which implements and controls credit application processing and routing;

at least one credit application input terminal device, operably coupled to said communications medium, for keyboard entry of at least credit application information, for visual display of at least funding decision information, and for sending and receiving to and from said central processing means over said communications medium; and

at least one funding source terminal device, operably coupled to said communications medium, for receiving at least a portion of a credit application over said communications medium from said at least one credit application input terminal device through said central processing means, and for sending a funding decision to said at least one credit application input terminal device through said central processing means over said communications medium,

wherein said central processing means computer program which implements and controls credit application processing and routing, further provides for tracking pending credit applications.

'841 Patent col.34 l.48–col.35 l.6. Independent claim 12 is the same as claim 14 except for the wherein clause, which reads “wherein there are a plurality of funding source terminal devices connected to said communications medium, and wherein a credit application is sent to more than one of said plurality of funding source terminal devices over said...