Ip Commc'n Solutions, LLC v. Viber Media (Usa) Inc.

• Decision Date: 05 April 2017
• Docket Number: C.A. No. 16-134-GMS
• Parties: IP COMMUNICATION SOLUTIONS, LLC, Plaintiff, v. VIBER MEDIA (USA) INC. Defendant.
• Court: U.S. District Court — District of Delaware

IP COMMUNICATION SOLUTIONS, LLC, Plaintiff, v. VIBER MEDIA (USA) INC. Defendant.

C.A. No. 16-134-GMS

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE

April 5, 2017

JURY TRIAL DEMANDED

MEMORANDUM

I. INTRODUCTION

Plaintiff IP Communications Solutions, LLC ("IPCS") filed a patent infringement suit against Viber Media (USA) Inc. ("Viber"), on March 4, 2016. (D.I. 1). Plaintiffs subsequently filed an Amended Complaint on May 31, 2016. (D.I. 14). The Amended Complaint accused Defendant of direct and induced infringement of U.S. Patent No. 9,247,071 ("the '071 patent"), directed to Methods and Systems for Providing Portable VoIP Services. Id. Presently before the court is Viber's Motion to Dismiss for Failure to State a Claim, filed June 14, 2016. (D.I. 16).

For the reasons discussed below, the court grants Defendant's motion in-part and denies it in-part.

II. BACKGROUND

In the Amended Complaint, Plaintiff accuses Defendant of infringing at least claims 49, 51, 52, 54 and 56 of the '071 patent by "making, using, selling, offering to sell, and/or selling within, and/or importing into, the United States, a VoIP server system that supports its Viber Mobile VoIP application." (D.I. 14, ¶ 12). The Amended Complaint includes a claim chart comparing each element of the asserted claims and Viber's sever system that supports its VoIP application. Id. at Ex. 2. Plaintiff also includes print-outs from Defendant's webpage, as well as Defendant's privacy policy, to support their allegations about Defendant's system's functionality in the claim chart. Id. at Addendum.

The Amended Complaint also alleges indirect infringement—specifically, induced infringement—of claims 49, 51, 52, 54 and 56 of the '071 patent. Id. ¶ 15. Plaintiff alleges that Defendant has "been on notice of the '071 patent since at least service of the original complaint in this matter." Id. ¶ 16. Plaintiffs provide exemplary evidence from Defendant's website to demonstrate that Defendant "instructs and encourage[s] users to use the Viber VoIP app, and the VoIP server system that supports the Viber VoIP app, in a manner that infringes the '071 patent." Id. ¶ 19. Such examples include: (1) a webpage that instructs and encourages users to use the VoIP application to make VoIP calls; (2) a webpage that provides support and instruction to users on how to make VoIP calls using the Viber VoIP application; and (3) a webpage detailing a "Media Kit" that further encourages users to make VoIP calls using the Viber VoIP app and the server system. Id. ¶¶ 20-22.

Viber filed a Motion to Dismiss for Failure to State a Claim in which it argues that IPCS' Amended Complaint fails to satisfy the pleading standards for both direct and induced infringement. For the reasons that follow, the court will deny the Motion for claims of direct infringement, but grant the Motion, without prejudice, for allegations of induced infringement.

III. LEGAL STANDARD

Rule 12(b)(6) of the Federal Rules of Civil Procedure provides for dismissal where the plaintiff "fail[s] to state a claim upon which relief can be granted." Fed. R. Civ. P. 12(b)(6). In considering a motion to dismiss, the court "accept[s] all factual allegations as true, construe[s] the complaint in the light most favorable to the plaintiff, and determine[s] whether, under anyreasonable reading of the complaint, the plaintiff may be entitled to relief." Phillips v. Cnty. of Allegheny, 515 F.3d 224, 233 (3d Cir. 2008). Plaintiffs must provide sufficient factual allegations "to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). This requirement of plausibility is satisfied when "the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. at 556). "Determining whether a complaint states a plausible claim for relief will . . . be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009). A complaint must contain "a short and plain statement of the claim showing that the pleader is entitled to relief, in order to give the defendant fair notice of what the . . . claim is and the grounds upon which it rests." Bell Atl. Corp., 550 U.S. at 545.

IV. DISCUSSION

Viber contends the Amended Complaint fails to satisfy the Twombty/Iqbal pleading standard for direct infringement because it does not adequately identify the accused instrumentality. (D.I. 17 at 1). Viber also contends that the Amended Complaint fails to plead all necessary elements of a claim for induced infringement. (D.I. 17 at 7.) The court will address each in turn.

A. Direct Infringement

As an initial matter, Form 18 no longer provides the proper measure for the sufficiency of a complaint that alleges direct infringement. Because the Advisory Committee for the Federal Rules of Civil Procedure abrogated Rule 84 and the Appendix of Forms effective December 1, 2015, the court must apply the Twombly/Iqbal pleading standard to the plaintiffs' complaint whichwas filed on March 4, 2016.¹ The court finds that IPCS has met its burden under Twombly/Iqbal.

This District's local rules provide that "[w]ithin 30 days after the Rule 16 Conference and for each defendant, the plaintiff shall specifically identify the accused products and the asserted patent(s) they allegedly infringe, and produce the file history for each asserted patent." D. Del. Default Std. §4.a. These rules were promulgated post Twombly/Iqbal and are consistent with the Federal Rules of Civil Procedure's and courts' concern that a complaint "give[s] the defendant fair notice of what the . . . claim is and the grounds upon which it rests."² Twombly, 550 U.S. 544, 555 (2007); Iqbal, 556 U.S. 662, 698 (2009).

Viber contends that IPCS' Amended Complaint fails to place Viber on notice of what is accused because the Complaint makes "generic infringement allegations[s]," "directed to an undefined 'V[o]IP server system that supports Viber's application. (D.I. 17 at 6). Defendant cites Bender v. LG Elecs. U.S.A., Inc., No. C 09-02114 JF (PVT), 2010 WL 889541, at *1 (N.D. Cal. Mar. 11, 2010), Wistron Corp. v. Phillip M. Adams & Assocs. LLC, No. C-10-4458 EMC, 2011 WL 4079231, *1 (N.D. Cal. Sept. 12, 2011), and Fifth Marker Inc. v. CME Group, Inc., C.A. No. 08-520-GMS, 2009 WL 5966836, *1 (D. Del. May 14, 2009) in support of its argument that thedirect infringement claim should be dismissed.

In Bender, the court dismissed a complaint which accused only "categories of products" the defendants produced "by way of example and without limitation." 2010 WL 889541, at *2. The Bender court explained that "[s]sufficient allegations would include, at a minimum, a brief description of what the patent at issue does, and an allegation that certain named and specifically identified products or product components also do what the patent does." Id. at *6. Similarly, in Wistron, the court dismissed the complaint because it only listed the categories of allegedly infringing products without identifying any specific examples of a particular infringing computer chip, motherboard, or computer. 2011 WL 4079231, at *3. In Fifth Marker, this court found that the defendants were not provided with fair notice of how they infringe the patents-in-suit because none of Fifth Marker's claims contained any reference to a single infringing product or method. 2009 WL 5966836, at *1. In fact, the only reference to the defendant's product was in the facts section of the complaint. Id. Here, Viber argues that IPCS' allegation that an "undefined" server system infringes the '071 patent is analogous to Bender's and Wistron's allegations naming broad categories of infringing products. See (D.I. 17 at 6-7). Accordingly, Viber states that IPCS' Amended Complaint fails to provide meaningful identification of the accused instrumentality. (D.I. 19 at 3). The court is not persuaded.

IPCS' Amended Complaint provides specific details of how Defendant's application and servers infringe the '071 patent claims. (D.I. 14, Ex.2). Defendants acknowledge that fact, but state that they must be on notice of specifically what products infringe. This case is easily distinguishable from the cases that Defendants cite, however, because the patent-in-suit is directed to methods and systems for providing a service. (D.I. 1). The cases that Defendant cites all dealt primarily with product claims. See Wistron, 2011 WL 4079231 at *3; Bender, 2010 WL 889541,at *2; Fifth Marker, 2009 WL 5966836, at *1. The patent at issue in Bender, for instance, was directed to electrical circuity—a buffered transconductance amplifier. 2010 WL 889541 at *2. IPCS' patent is not directed to a specific product, but instead, to a server system that comprises a number of components. '071 patent, col. 34, l. 28-col.35, l.27. The way those components work together to communicate with a plurality of portable endpoints is the novelty of the invention. Id. col. 2, l. 30-col. 3, l. 3.

IPCS' claim chart plausibly alleges how Viber's network-based system provides VoIP services in a way that meets all of the claim limitations of the patents-in-suit. (D.I. 14, Ex. 2). For example, Viber's Privacy Policy describes the functionality of its servers—"[a] copy of the phone numbers and names in your address book . . . will be stored on our servers." (D.I. 14, Addendum at 2). One limitation of claim 49 of the '071 patent requires "a database that includes a plurality of VoIP subscriber identifiers associated with a respective plurality of users." Col. 41, ll. 6-8. To require that IPCS name a specific infringing product would be nonsensical in this instance. It is unclear how IPCS can be any more specific about what aspects of Viber's technology infringe its patent when IPCS likely does not have access to Viber's computer code.

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