Broadsoft, Inc. v. Callwave Commc'ns, LLC

• Decision Date: 01 October 2017
• Docket Number: Civil Action No. 13–711–RGA
• Citation: 282 F.Supp.3d 771
• Parties: BROADSOFT, INC., Plaintiff, v. CALLWAVE COMMUNICATIONS, LLC, Defendant.
• Court: U.S. District Court — District of Delaware

282 F.Supp.3d 771

BROADSOFT, INC., Plaintiff,

v.CALLWAVE COMMUNICATIONS, LLC, Defendant.

Civil Action No. 13–711–RGA

United States District Court, D. Delaware.

October 1, 2017

John G. Day, Esq., ASHBY & GEDDES, Wilmington, DE; Tiffany Geyer Lydon, Esq., ASHBY & GEDDES, Wilmington, DE; Andrew C. Mayo, Esq., ASHBY & GEDDES, Wilmington, DE; Jonathan G. Graves, Esq. (argued), COOLEY LLP, Reston, VA; Stephen P. McBride, Esq., COOLEY LLP, Reston, VA., Attorneys for Plaintiff

James G. McMillan, III, Esq., PEPPER HAMILTON LLP, Wilmington, DE; William D. Belanger, Esq. (argued), PEPPER HAMILTON LLP, Boston, MA; Suparna Datta, Esq., PEPPER HAMILTON LLP, Boston, MA; L. Andrew Tseng, Esq., PEPPER HAMILTON LLP, Boston, MA; Megan E. L. Bigelow, Esq., PEPPER HAMILTON LLP, Boston, MA; Gregory S. Bishop, Esq., PEPPER HAMILTON LLP, Redwood City, CA; Charles F. Koch, Esq., PEPPER HAMILTON LLP, Redwood City, CA., Attorneys for Defendant

MEMORANDUM OPINION

ANDREWS, U.S. DISTRICT JUDGE

Presently before the Court are Plaintiff's Motion for Judgment on the Pleadings Based on Patent Ineligibility Under 35 U.S.C. § 101 (D.I. 290) and related briefing (D.I. 291, 366, 385) and Plaintiff's Motion for Summary Judgment of Invalidity Based on Broadworks (D.I. 304) and related briefing (D.I. 305, 359, 388).¹ The Court held oral argument on July 31, 2017. (D.I. 419) ("Hr'g Tr."). For the reasons that follow, the Court will grant Plaintiff's Motion for Judgment on the Pleadings Based on Patent Ineligibility Under 35 U.S.C. § 101 (D.I. 290) and will grant Plaintiff's Motion for Summary Judgment of Invalidity Based on BroadWorks (D.I. 304).

I. BACKGROUND

Plaintiff filed a declaratory judgment action on April 23, 2013 seeking a declaration that none of Plaintiff's accused products infringed any valid claims of Defendant's U.S. Patent Nos. 8,351,591 ("the '591 patent") and 7,822,188 ("the '188 patent"), and further that one or more claims of those patents were invalid. (D.I. 1). Plaintiff had previously licensed the accused software products to Telovations, Inc., which was subsequently acquired by Bright House Networks, LLC. (Id. at 2, 4). As part of that acquisition, Telovations assigned all of its rights under the license agreement to Bright House. (Id. at 4). The license agreement between Plaintiff and Telovations contained an indemnification clause specifying that Plaintiff would defend any intellectual property infringement action brought based on the accused software products. (Id. at 3). After Defendant sued Telovations and Bright House for patent infringement based on the accused software (CallWave Commc'ns, Inc. v. Telovations, Inc. , Civ. Act. No. 1:13–cv–00074), those two entities sought indemnification from Plaintiff under their license agreement. (D.I. 1 at 3–4). Plaintiff brought this declaratory judgment action as part of its indemnification of Telovations and Bright House. (Id. at 4).

The '591 and '188 patents share a common specification and generally relate to "systems and methods for processing and placing telephone calls." ( '188 patent at 1:48–50; '591 patent at 1:50–52). The parties separate the asserted claims into two categories: the sequential dialing claims (claims 40 and 41 of the '188 patent ) and the single number outcall claims (claims 6, 14, 26, 27, 29, 34, and 37 of the '188 patent and claims 1, 9, 16, and 17 of the '591 patent ).

A. Sequential Dialing Claims

Claim 40 is an independent claim and reads as follows:

40. A method of processing calls, comprising:

receiving at a call processing system a message from an Internet protocol proxy regarding a first call from a caller;

determining if the first call is directed to a telephone address of a subscriber of services offered by the call processing system, wherein at least partly in response to determining that the telephone address is that of a subscriber:

accessing an account record associated with the subscriber, the account record including at least one subscriber instruction;

based at least in part on the subscriber instruction, placing a first outcall to a first communication device associated with the subscriber;

if the first outcall is not answered within a first number of rings or period of time, placing a second outcall to a second communication device associated with the subscriber; andreceiving a call connect instruction from the subscriber; and

instructing the call processing system to connect the first call to a third communication device.

( '188 patent, claim 40). Claim 41 depends from claim 40 and adds the limitation that the internet protocol proxy is a session internet protocol proxy that converts SS7 signaling to SIP protocol. ( '188 patent, claim 41).

B. Single Number Outcall Claims

Claim 1 of the '591 patent reads as follows:

1. A method of processing calls, the method comprising:

storing in computer readable memory associated with a call processing system a first phone address associated with a first subscriber;

storing in computer readable memory a plurality of phone addresses for the first subscriber;

participating at the call processing system in a first call associated with the first subscriber, the first call associated with a second phone address different than the first phone address;

placing a first outcall from the call processing system to a first called party, wherein the call processing system inserts at least a portion of the first phone address in a callerID field associated with signaling information associated with the first outcall;

causing the first call and the first outcall to be bridged;

participating at the call processing system in a second call associated with the first subscriber, the second call involving a subscriber communication device associated with a third phone address different than the first phone address;

placing a second outcall from the call processing system to a second called party, wherein the call processing system inserts at least a portion of the first phone address in a callerID field associated with signaling information associated with the second outcall; and

causing the second call and the second outcall to be bridged.

( '591 patent, claim 1).

Defendant disagrees with Plaintiff's assertion that claim 1 of the '591 patent is representative of all of the single number outcall claims. (D.I. 291 at 8–12; D.I. 366 at 4, 6).

II. LEGAL STANDARD

A. Patentable Subject Matter under 35 U.S.C. § 101

Section 101 of the Patent Act defines patent-eligible subject matter. It provides: "Whoever 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, subject to the conditions and requirements of this title." 35 U.S.C. § 101. The Supreme Court has recognized an implicit exception for three categories of subject matter not eligible for patentability—laws of nature, natural phenomena, and abstract ideas. Alice Corp. Pty. v. CLS Bank Int'l , ––– U.S. ––––, 134 S.Ct. 2347, 2354, 189 L.Ed.2d 296 (2014). The purpose of these carve outs is to protect the "basic tools of scientific and technological work." Mayo Collaborative Servs. v. Prometheus Labs., Inc. , 566 U.S. 66, 71, 132 S.Ct. 1289, 182 L.Ed.2d 321 (2012). "[A] process is not unpatentable simply because it contains a law of nature or a mathematical algorithm," as "an application of a law of nature or mathematical formula to a known structure or process may well be deserving of patent protection." Id. at 1293–94 (emphasis omitted). In order "to transform an unpatentable law of nature into a patent-eligible application of such a law, one must do more than simply state the law of nature while adding the words ‘apply it.’ " Id. at 1294 (emphasis omitted).

The Supreme Court recently reaffirmed the framework laid out in Mayo "for distinguishing patents that claim laws of nature, natural phenomena, and abstract ideas from those that claim patent-eligible applications of those concepts." Alice , 134 S.Ct. at 2355. First, the court must determine whether the claims are drawn to a patent-ineligible concept. Id. If the answer is yes, the court must look to "the elements of the claim both individually and as an ‘ordered combination’ " to see if there is 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). "A claim that recites an abstract idea must include ‘additional features’ to ensure ‘that the [claim] is more than a drafting effort designed to monopolize the [abstract idea].’ " Id. at 2357 (alterations in original) (quoting Mayo , 566 U.S. at 77, 132 S.Ct. 1289)."[S]imply appending conventional steps, specified at a high level of generality, to ... abstract ideas cannot make those ... ideas patentable." Mayo , 566 U.S. at 82, 132 S.Ct. 1289. Further, "the prohibition against patenting abstract ideas cannot be circumvented by attempting to limit the use of [the idea] to a particular technological environment." Alice , 134 S.Ct. at 2358 (quoting Bilski v. Kappos , 561 U.S. 593, 610–11, 130 S.Ct. 3218, 177 L.Ed.2d 792 (2010) ). Thus, "the mere recitation of a generic computer cannot transform a patent-ineligible abstract idea into a patent-eligible invention." Id. For this second step, the machine-or-transformation test can be a "useful clue," although it is not determinative. Ultramercial, Inc. v. Hulu, LLC , 772 F.3d 709, 716 (Fed. Cir. 2014), cert. denied , ––– U.S. ––––, 135 S.Ct. 2907, 192 L.Ed.2d 929 (2015).

Patent eligibility under § 101 is a question of law suitable for resolution on a motion for judgment on the pleadings. Amdocs (Israel) Ltd. v. Openet Telecom, Inc. , 841 F.3d 1288, 1293 (Fed. Cir. 2016). The Federal Circuit follows regional circuit law for motions for judgment on the pleadings. Id. Under Third Circuit law, a Rule 12(c) motion for judgment on the pleadings is reviewed under the same...