Lyda v. CBS Corp.

• Decision Date: 30 September 2016
• Docket Number: 2015-1923
• Citation: 838 F.3d 1331,120 U.S.P.Q.2d 1310
• Parties: Edwin Lyda, Plaintiff–Appellant v. CBS Corporation, CBS Interactive, Inc., Defendants–Appellees
• Court: U.S. Court of Appeals — Federal Circuit

838 F.3d 1331

120 U.S.P.Q.2d 1310

Edwin Lyda, Plaintiff–Appellant

v.CBS Corporation, CBS Interactive, Inc., Defendants–Appellees

2015-1923

United States Court of Appeals, Federal Circuit.

Decided: September 30, 2016

David Fink , Fink & Johnson, Houston, TX, argued for plaintiff-appellant.

Jason C. White , Morgan, Lewis & Bockius LLP, Chicago, IL, argued for defendants-appellees. Also represented by Scott D. Sherwin ; Thomas M. Peterson , San, Francisco, CA; Stephanie Gamiz , New York, NY.

Before Reyna, Hughes, and Stoll, Circuit Judges.

Stoll, Circuit Judge.

Appellant Edwin Lyda appeals a decision of the United States District Court for the Southern District of New York dismissing his complaint of patent infringement under Federal Rule of Civil Procedure 12(b)(6). Lyda v. CBS Corp. , No. 14–CV–6572–VEC, 2015 WL 4393120 (S.D.N.Y. July 16, 2015). We hold that Form 18 does not apply to a claim of joint patent infringement. Because Mr. Lyda's Amended Complaint fails to state a claim for relief under the Twombly /Iqbal pleading standard, we affirm the dismissal under Rule 12(b)(6).

BACKGROUND

Mr. Lyda is the named inventor on United States Patent Nos. 7,434,243 and 7,730,506. According to the patents, audience members of game shows or reality programs often use input devices to electronically vote in response to cues during the shows. In particular, the '243 and '506 patents cover methods and systems for “obtaining real time responses to remote programming” by “allow[ing] persons viewing or listening to a broadcast to respond to the broadcast in real time without requiring a personal computer.” '243 patent col. 1 ll. 14–15, 56–58; '506 patent col. 1 ll. 16–17, 57–59. The specifications describe that “the present invention provides a response device for each person who is listening to/viewing a program.” '243 patent col. 1 ll. 62–64; '506 patent col. 1 ll. 63–65. This response device is “configured to allow the audience member to send response data.” '506 patent col. 7 ll. 47–48. The specifications describe embodiments of the response device ranging from a key pad that is “limited to the choices available to the user presented by the key pad,” to a full alpha-numeric key pad for “unlimited entry possibilities.” Id. col. 5 ll. 62–67; '243 patent col. 5 ll. 53–58. The audience members input their vote along with an “identifier code” that identifies the person voting. The responses are sent over a “standard communication system,” such as a telephone line or a two-way paging network. '243 patent col. 1 l. 66; '506 patent col. 1 l. 67. The responses are collected at a central location, correlated with the identifier code, and tallied. “If the programming is being presented live as the responses are sent in, the program presenter can incorporate the responses into the programming and modify the programming to meet the audience's needs.” '506 patent col. 5 ll. 37–41; see also '243 patent col. 5 ll. 28–32.

The Amended Complaint asserts four independent claims: method claim 8 and system claim 9 of the '243 patent, and method claim 1 and system claim 7 of the '506 patent. Independent method claim 1 of the '506 patent is representative of the asserted claims and recites:

1. A method for receiving and processing responses to a program comprising:

providing a program identifier code for the program;

providing means for identifying an audience member[;]

providing a user input device not requiring a personal computer, the device configured to allow the audience member to send response data directly from the user input device over a standard communication system in response to the program received apart from the device, the device operating without receiving program data;

having the audience member input the program identifier code into the user input device;

having the audience member input responses to the program received apart from the device into the user input device;

transmitting response data comprising the program identifier code, the means for identifying an audience member, and the responses over the standard communication system;

collecting the response data at a central location;

correlating the program identifier code to the responses;

processing the response data.

'506 patent col. 7 ll. 42—col. 8 l. 3.

Claim 9 of the '243 patent and claim 7 of the '506 patent, while identified as “system” claims in their preambles, recite the same method steps as claim 1. In effect then, the system claims should be treated as method claims. For example, claim 7 of the '506 patent recites:

7. A system for receiving and processing responses to a program comprising:

providing a program identifier code for the program being presented;

providing a user input device not requiring a personal computer, the device configured to allow an audience member to send response data directly from the user input device over a standard communication system in response to the program received apart from the device, the device operating without receiving program data;

having the audience member input the program identifier code into the user input device;

having the audience member input responses to the program received apart from the device into the user input device;

transmitting the program identifier code and the responses associated with a user identifier over the standard communication system;

collecting, correlating, and processing the program identifier and the responses;

routing the responses to a program presenter.

Id. col. 8 ll. 23–43.

Mr. Lyda sued Defendants CBS Corporation and its wholly owned subsidiary CBS Interactive, Inc. (collectively, “CBS”) for infringement of the '243 and '506 patents for producing and operating the television show “Big Brother.” After CBS notified Mr. Lyda of alleged deficiencies in the original complaint, Mr. Lyda filed the Amended Complaint at issue here. The Amended Complaint alleged that Defendants' operation of the television show Big Brother infringed Mr. Lyda's patents by allowing television audience members to influence aspects of the show by voting via text message on their cellular phones. The text messages allegedly used codes identifying the sender and the sender's vote selection.

The Amended Complaint asserts eight nearly identical counts of infringement based on the four asserted independent claims against each of the two defendants.¹ For each of the four claims, method and system claims alike, the Amended Complaint alleges “the participation of people under the control or direction of an independent contractor engaged by the Defendant CBS Interactive to send votes using text messages.” Am. Compl. ¶¶ 17, 24, 31, 38.

The Amended Complaint further alleges that CBS Interactive tested the system's capability to receive text message responses prior to using the system during live broadcasts. The Amended Complaint indicates that such testing was carried out by an independent contractor, “[a]pparently under the control of Defendant CBS Interactive.” Id. ¶ 8. These independent contractors, themselves under the direction and control of CBS Interactive, allegedly directed and controlled unnamed third parties to test the voting operations using “well known cell phones” that they either owned or borrowed from some unidentified source. Id. ¶ 17. Mr. Lyda alleged that Defendant CBS Corporation infringed the asserted patents “by having Defendant CBS Interactive operate the show Big Brother and use an independent contractor in conjunction with testing the system under the control of Defendant CBS Interactive.” Id. ¶¶ 18, 25, 32, 39. For example, in Count One, Mr. Lyda alleged the following:

16. BIG BROTHER tests ... its electrical systems such as audience voting using cell phones to send ... text messages along with the computer processing systems under the control of Defendant CBS Interactive for compiling votes as well [as] other electrical system functions anticipated for conducting a major show on television before a live audience.

17. The testing of text voting operations by Defendant CBS Interactive using cell phones sending text messages requires the participation of people under the control or direction of an independent contractor engaged by the Defendant CBS Interactive to send votes using text messages using well known cell phones either their own respective cell phones, or borrowed cell phones to test the electronic text voting system used by Defendant CBS Interactive for its show BIG BROTHER.

Id. ¶¶ 16, 17.

Defendants moved to dismiss the Amended Complaint for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6). During an initial pre-trial conference, the district court judge informed Mr. Lyda that, pursuant to the judge's Individual Rules of Practice in Civil Cases, he could either amend the complaint a second time, or oppose the motion and forfeit his ability to further amend the complaint. Mr. Lyda elected to oppose the motion to dismiss.

In evaluating Defendants' motion to dismiss, the district court addressed the parties' dispute regarding the type of infringement involved and the applicable pleading standard. The court determined that while the Amended Complaint “certainly leaves room for doubt regarding Plaintiff's theory of liability,” the allegations regarding an “independent contractor” acting under the direction or control of CBS Interactive implicated a theory of joint infringement. Lyda , 2015 WL 4393120, at *3. While this court has not directly spoken on the issue of whether Form 18 applies to a claim of joint infringement, the district court noted that the general consensus among district courts was “that Form 18 does not apply to joint infringement claims.” Id. The court determined, nonetheless, that Plaintiffs did not allege joint infringement and that “Plaintiff's allegations are simply too vague, even under the Form 18 standard, to articulate a claim for relief.” Id.

The court determined that Mr. Lyda “fail[ed] to establish which of Defendants' alleged practices constitutes infringement, and he fai...