Case 1:17-cv-01692-CFC-SRF Document 16 Filed 02/27/18 Page 1 of 15 PageID #: 544
`
`REALTIME ADAPTIVE STREAMING
`LLC,
`
`
`
`
`
`NETFLIX, INC. and
`NETFLIX STREAMING SERVICES, INC.,
`
`
`
`
`
`
`
`v.
`
`
`
`
`
`
`
`
`C.A. No. 17-1692 (JFB) (SRF)
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF DELAWARE
`
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`)
`
`
` Plaintiff,
`
`Defendants.
`
`DEFENDANTS’ REPLY BRIEF IN SUPPORT OF THEIR
`MOTION TO DISMISS COMPLAINT
`
`
`
`MORRIS, NICHOLS, ARSHT & TUNNELL LLP
`Jack B. Blumenfeld (#1014)
`1201 North Market Street
`P.O. Box 1347
`Wilmington, DE 19899
`(302) 658-9200
`jblumenfeld@mnat.com
`
`Attorneys for Defendants
`
`
`
`
`
`
`
`
`
`
`OF COUNSEL:
`
`Katherine Vidal
`Matthew R. McCullough
`WINSTON & STRAWN LLP
`275 Middlefield Road, Suite 205
`Menlo Park, CA 94025
`(650) 858-6500
`
`Andrew B. Grossman
`WINSTON & STRAWN LLP
`333 South Grand Avenue
`Los Angeles, CA 90071
`(213) 615-1700
`
`February 27, 2018
`
`
`
`

`

`Case 1:17-cv-01692-CFC-SRF Document 16 Filed 02/27/18 Page 2 of 15 PageID #: 545
`
`TABLE OF CONTENTS
`
`
`Page
`
`I. 
`II. 
`
`III. 
`
`IV. 
`V. 
`
`VI. 
`
`
`INTRODUCTION .............................................................................................................1 
`THE FALLON PATENT CLAIMS ARE ABSTRACT UNDER ALICE
`STEP ONE .........................................................................................................................2 
`THE FALLON PATENT CLAIMS DO NOT CAPTURE ANY
`INVENTIVE CONCEPT UNDER ALICE STEP TWO ...................................................4 
`THE USE OF REPRESENTATIVE CLAIMS IS APPROPRIATE .................................8 
`REALTIME HAS NOT PLEADED FACTS SUFFICIENT FOR A
`PLAUSIBLE CLAIM FOR RELIEF .................................................................................9 
`REALTIME HAS NOT PROPERLY PLEADED INFRINGEMENT
`OF THE ’462 & ’298 PATENTS ......................................................................................9 
`VII.  THE COURT SHOULD DISMISS PRE-SUIT INDIRECT
`INFRINGEMENT............................................................................................................10 
`VIII.  CONCLUSION ................................................................................................................10 
`
`
`
`
`
`
`
`
`
`i
`
`

`

`Case 1:17-cv-01692-CFC-SRF Document 16 Filed 02/27/18 Page 3 of 15 PageID #: 546
`
`TABLE OF AUTHORITIES
`
`
`
`Page(s)
`
`Cases
`
`Aatrix Software, Inc. v. Green Shades Software, Inc.,
`--- F.3d ----, 2018 WL 843288 (Fed. Cir. Feb. 14, 2018) ..........................................................5
`
`Automated Tracking Solutions, LLC v. The Coca-Cola Co.,
`--- F. App’x ----, 2018 WL 935455 (Fed. Cir. Feb. 16, 2018) ...........................................5, 6, 7
`
`Berkheimer v. HP, Inc.,
`--- F.3d ----, 2018 WL 744096 (Fed. Cir. Feb. 8, 2018) ................................................4, 5, 6, 8
`
`Content Extraction & Transmission LLC v. Wells Fargo Bank, Nat’l Ass’n,
`776 F.3d 1343 (Fed. Cir. 2014)..................................................................................................8
`
`Diamond v. Diehr,
`450 U.S. 175 (1981) ...................................................................................................................7
`
`Enfish, LLC v. Microsoft Corp.,
`822 F.3d 1327 (Fed. Cir. 2016)..................................................................................................3
`
`Finjan, Inc. v. Blue Coat Sys., Inc.,
`2018 WL 341882 (Fed. Cir. Jan. 10, 2018) ...............................................................................3
`
`Intellectual Ventures I LLC v. Symantec Corp.,
`838 F.3d 1307 (Fed. Cir. 2016)..................................................................................................7
`
`IQS US Inc. v. Calsoft Labs Inc.,
`No. 16 CV 7774, 2017 WL 3581162 (N.D. Ill. Aug. 18, 2017) ................................................8
`
`RecogniCorp, LLC v. Nintendo Co.,
`855 F.3d 1322 (Fed. Cir. 2017)..........................................................................................2, 3, 4
`
`Two-Way Media Ltd. v. Comcast Cable Commc’ns, LLC,
`874 F.3d 1329 (Fed. Cir. 2017)..........................................................................................2, 4, 8
`
`Visual Memory LLC v. NVIDIA Corp.,
`867 F.3d 1253 (Fed. Cir. 2017)..................................................................................................3
`
`Other Authorities
`
`Fed. R. Civ. P. 8 .....................................................................................................................1, 9, 10
`
`Fed. R. Civ. P. 12(c) ........................................................................................................................5
`
`
`
`ii
`
`

`

`Case 1:17-cv-01692-CFC-SRF Document 16 Filed 02/27/18 Page 4 of 15 PageID #: 547
`
`I.
`
`INTRODUCTION
`Realtime’s opposition fails to demonstrate how the claims of the asserted Fallon patents
`
`meet the requirements for subject-matter eligibility. At Alice step 1, Realtime admits that its
`
`claims “are directed to digital data compression” (Opp. at 1), which is “widely used to reduce the
`
`amount of data required to process, transmit, or store a given quantity of information” and is,
`
`therefore, abstract. ’535 patent at 2:44-46. At Alice step 2, Realtime does not point to any claim
`
`limitations reciting any improvements to a computer system; instead, it claims arrangements of
`
`general-purpose computer components employing well-understood, conventional, and routine
`
`techniques. Its rhetoric aside, Realtime’s opposition does not identify any inventive component
`
`in any claim. Indeed, the patent specifications confirm that all the claimed hardware and
`
`compression mechanisms were conventional, and there is nothing inventive about their ordered
`
`combination.
`
`Realtime’s deficient infringement allegations fare no better. Realtime does not dispute
`
`that its complaint lacks factual allegations supporting a plausible claim of infringement for each
`
`accused product. Instead, Realtime argues that the sheer volume of allegations in the complaint
`
`should exempt it from its obligations under Rule 8. Similarly, Realtime does not dispute that it
`
`failed to sufficiently plead standards-based infringement for the ’462 and ’298 patents. Here
`
`again, Realtime focuses on the volume of allegations to distract from the lack of relevant facts
`
`supporting its claims of infringement. There are no facts to support any “reasonable inference”
`
`about how Netflix encoding technology works, let alone how it allegedly infringes the ’462
`
`patent. And Realtime conflates the evidentiary and pleading requirements for alleging standards-
`
`based infringement in hopes of avoiding its obligations to provide facts showing how Netflix
`
`allegedly uses “tile” functionality in a manner that allegedly infringes the ’298 patent. Finally,
`
`Realtime’s opposition concedes that it has not pleaded sufficient facts to plausibly allege pre-suit
`
`1
`
`

`

`Case 1:17-cv-01692-CFC-SRF Document 16 Filed 02/27/18 Page 5 of 15 PageID #: 548
`
`indirect infringement. For all these reasons, the Court should find the Fallon patents ineligible
`
`under § 101 and dismiss Realtime’s direct and indirect infringement claims.
`
`II.
`
`THE FALLON PATENT CLAIMS ARE ABSTRACT UNDER ALICE STEP ONE
`It is undisputed that the Fallon claims are directed toward data compression (e.g., Opp. at
`
`1), a type of “encoding and decoding” data, which the Federal Circuit has stated is “an abstract
`
`concept long utilized to transmit information” and is thus patent-ineligible. RecogniCorp, LLC v.
`
`Nintendo Co., 855 F.3d 1322, 1326 (Fed. Cir. 2017).1 Realtime argues that, notwithstanding
`
`RecogniCorp’s clear and unambiguous holding, its patents should survive because they are
`
`“technological solutions to technological problems.” Opp. at 2. Not so.
`
`Realtime focuses on problems in the prior art identified in the specification. But it fails
`
`to explain how those problems were solved by the Fallon patents, or how that solution is
`
`captured in the claim language. It is well settled that the “claim—as opposed to something
`
`purportedly described in the specification” must satisfy the eligibility test. Two-Way Media Ltd.
`
`v. Comcast Cable Commc’ns, LLC, 874 F.3d 1329, 1338-39 (Fed. Cir. 2017).
`
`Despite repeated reference to “novel digital data compression” purportedly recited in the
`
`Fallon patent claims, Realtime does not identify a single one out of the 114 claims of the Fallon
`
`patents reciting a new, non-abstract type of “digital data compression” or unconventional
`
`computer components not well-understood in the prior art.2 Opp. at 3. Instead, Realtime points
`
`to the recitation in the claims of “asymmetrical” compression, which is nothing more than a term
`
`defined by the inventors to broadly categorize a class of well-understood, conventional
`
`algorithms (contrasted with “symmetrical” compression algorithms). See ’535 patent at 9:60-66;
`
`
`1 Realtime argues that Netflix “mischaracterizes” the claims, but describes the patent as directed
`to essentially the same abstract idea identified by Netflix. E.g., Motion at 8.
`2 Realtime’s opposition does not cite to a single claim reciting “digital data compression.”
`
`2
`
`

`

`Case 1:17-cv-01692-CFC-SRF Document 16 Filed 02/27/18 Page 6 of 15 PageID #: 549
`
`10:2-4 (“asymmetrical compression algorithms include dictionary-based compression schemes
`
`such as Lempel-Ziv”).3
`
`Additionally, Realtime cites the specification’s identification of “problems” related to
`
`known file allocation tables as a surrogate for the claimed invention. ’535 patent at 6:31-34
`
`(cited by Opp. at 5) (“limitations in the size of the data required to both represent and process an
`
`individual data block address, along with the size of individual data blocks governs the type of
`
`file allocation tables currently in use”) (emphasis added). But the claims of the Fallon patents
`
`do not capture an alleged solution to those problems, or even recite the term “file allocation
`
`table.” Nor do the claims recite any new type of file allocation table or an improvement to file
`
`allocation tables. In fact, Realtime’s Opposition is silent on how file allocation tables allegedly
`
`relate to the Fallon claims or how they alter the abstract nature of the claims.
`
`The cases that Realtime cites do not suggest otherwise. Unlike RecogniCorp, none of
`
`Realtime’s cases relate to encoding data. Instead, Realtime cites to cases concerning behavior-
`
`based virus scanning (Finjan, Inc. v. Blue Coat Sys., Inc., 2018 WL 341882, *3 (Fed. Cir. Jan.
`
`10, 2018)), self-referential databases (Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1332 (Fed.
`
`Cir. 2016)), computer memory caches (Visual Memory LLC v. NVIDIA Corp., 867 F.3d 1253,
`
`1259 (Fed. Cir. 2017)), and a user interface for un-launched applications (Core Wireless, 2018
`
`WL 542672, at *4). None of these technologies is analogous to the abstract idea described in the
`
`Fallon patents of encoding data based on a parameter.
`
`Realtime’s reliance on Eastern District of Texas cases concerning unrelated patents also
`
`fails to inform the inquiry into the abstract nature of the claims of the patents in this case.
`
`
`3 U.S. Patent No. 5,243,341, cited on the face of the ’535 patent, was filed in 1992 and is entitled
`“Lempel-Ziv compression scheme with enhanced adaption,” confirming that “asymmetrical”
`compression algorithms like Lempel-Ziv were well-known.
`
`3
`
`

`

`Case 1:17-cv-01692-CFC-SRF Document 16 Filed 02/27/18 Page 7 of 15 PageID #: 550
`
`Realtime does not identify any common claim terms or inventive concepts in these separate
`
`patents—not asserted in this case—that alters the abstract nature of the claims asserted here.
`
`Finally, Realtime’s argument that Netflix mischaracterizes the claims is wrong. As noted
`
`above, Realtime similarly characterizes its claims as directed at encoding data based on a
`
`parameter. As explained in RecogniCorp, using a “CPU” or similar generic computer hardware
`
`to perform an otherwise abstract process that could be performed by a human does not make an
`
`idea patent-eligible. See RecogniCorp, 855 F.3d at 1328.4 In the Fallon patents, the computer is
`
`recited merely as a tool for performing the abstract steps of selecting an encoder and then
`
`applying that encoder, steps which could otherwise be performed by a human.
`
`III. THE FALLON PATENT CLAIMS DO NOT CAPTURE ANY INVENTIVE
`CONCEPT UNDER ALICE STEP TWO
`
`
`
`
`
`
`At Alice step two, Realtime fails to identify how any alleged inventive concept is
`
`captured in the asserted claims. Two-Way Media, 874 F.3d at 1338-39 (specification of asserted
`
`patent described “a technological innovation” but it was not present in claims, which were thus
`
`held patent-ineligible). To survive under Alice step two, any inventive concept must be captured
`
`in the claims regardless of whether any such concept is described in the specification. See id.
`
`Moreover, Realtime misleadingly argues based on a recent Federal Circuit decision that
`
`“any Alice step 2 analysis involves underlying factual questions.” Opp. at 11 (citing Berkheimer
`
`v. HP, Inc., --- F.3d ----, 2018 WL 744096, *5, 6 (Fed. Cir. Feb. 8, 2018)) (emphasis added). In
`
`actuality, Berkheimer held that “whether a claim recites patent eligible subject matter is a
`
`question of law which may contain underlying facts.” 2018 WL 744096, at *6 (emphasis added).
`
`Berkheimer also makes clear that courts may continue to decide patent eligibility on a motion to
`
`4 Realtime’s attempt to distinguish RecogniCorp as not requiring a computer (Opp. at 8) is
`misplaced. One claim did require a computer but was nonetheless held abstract because the
`computer was a mere tool for implementing the abstract idea. RecogniCorp, 855 F.3d at 1328.
`
`4
`
`

`

`Case 1:17-cv-01692-CFC-SRF Document 16 Filed 02/27/18 Page 8 of 15 PageID #: 551
`
`dismiss. Id. (“Patent eligibility has in many cases been resolved on motions to dismiss . . .
`
`Nothing in this decision should be viewed as casting doubt on the propriety of those cases.”).
`
`Under Berkheimer, questions of fact precluding Netflix’s motion to dismiss may only
`
`exist “to the extent [the improvements in the specification] are captured in the claims.” 2018
`
`WL 774096, at *6. In Berkheimer, the Federal Circuit affirmed summary judgment of
`
`ineligibility for four claims that “do[] not include limitations which incorporate [the arguably
`
`inventive concept].” Id. at *7. The court only found a fact issue that precluded summary
`
`judgment for claims that explicitly recited the inventive concept alleged in the specification. Id.5
`
`Two subsequent Federal Circuit decisions confirmed this framework – in order to survive
`
`Alice step two, the alleged inventive concept must be captured in the claims. Aatrix Software,
`
`Inc. v. Green Shades Software, Inc., --- F.3d ----, 2018 WL 843288 (Fed. Cir. Feb. 14, 2018);
`
`Automated Tracking Solutions, LLC v. The Coca-Cola Co., --- F. App’x ----, 2018 WL 935455
`
`(Fed. Cir. Feb. 16, 2018). In Aatrix, the Federal Circuit reversed a denial of leave to amend a
`
`complaint where the proposed amended complaint alleged that the claims recite an inventive
`
`concept. 2018 WL 843288, at *4. Specifically, the Federal Circuit found that there were
`
`allegations related to the claim term “data file” describing “the problems present in prior art
`
`form file creation” and then “present[ed] specific allegations directed to ‘improvements and
`
`problems solved by the Aatrix patented invention.’” Id. (emphasis added). In Automated
`
`Tracking, the Federal Circuit held that neither the allegations in the complaint nor the patent
`
`specification created a factual issue precluding judgment under Rule 12(c). 2018 WL 935455,
`
`*5. The court noted that there were no allegations that “the hardware components in the
`
`
`5 Specifically, Berkheimer only held there was a factual issue for claims reciting “storing a
`reconciled object structure . . . without substantial redundancy” or “selectively editing an
`object structure . . . to thereby effect a one-to-many change.” Id. (emphasis added).
`
`5
`
`

`

`Case 1:17-cv-01692-CFC-SRF Document 16 Filed 02/27/18 Page 9 of 15 PageID #: 552
`
`representative claims—either alone or in combination as a system—are anything but well-
`
`understood, routine, and conventional.” Id. And the Federal Circuit declined to allow a generic
`
`statement in the specification about hardware components to create a factual issue because the
`
`recited claim elements were identified as conventional. Id.
`
`Applying the precedent in Berkheimer, the court in D&M Holdings Inc. v. Sonos, Inc.
`
`recently granted summary judgment of patent ineligibility because there was no inventive
`
`concept captured in the claims. No. 16-141-RGA, 2018 WL 1001052, *6 (D. Del. Feb. 20,
`
`2018) (“In Berkheimer, the Federal Circuit found a genuine dispute of material fact as to whether
`
`a claim element was well-understood, routine, and conventional only where the claims
`
`‘capture[d] the purportedly inventive concepts.’”) (quoting Berkheimer). Similar to Realtime’s
`
`arguments, the plaintiff in D&M Holdings argued that its claims were “unique to and necessarily
`
`rooted in computerized (audio/visual) technology which are . . . predicated on ‘sophisticated
`
`computer programming.’” Id. at *5. The court, however, determined that “the claim language
`
`does not demonstrate a need for or claim ‘sophisticated computer programming.’” Id. at *6.
`
`Thus, it held that “none of the independent or dependent claim language captures the
`
`‘sophisticated computer programming’ or the ‘user interface’ that Plaintiffs argue provide
`
`inventive concepts that were not well-understood, routine, or conventional. Accordingly, there is
`
`no genuine dispute of material fact.” Id. (citing Berkheimer).
`
`Here, Realtime fails to identify any material factual dispute that precludes a
`
`determination that the Fallon patents are invalid under Section 101 at the 12(b)(6) stage.
`
`Realtime provides a listing of various claim elements present—in whole or in part—in various
`
`claims across four separate patents, but those elements are presented without an articulation of
`
`how they capture the inventive concept. For example, Realtime alleges that the claims recite
`
`6
`
`

`

`Case 1:17-cv-01692-CFC-SRF Document 16 Filed 02/27/18 Page 10 of 15 PageID #: 553
`
`“unconventional technological solutions” (Opp. at 13) but never states what is allegedly
`
`unconventional except for reference to the abstract idea itself untethered to any specific claim
`
`element. Opp. at 13-14 (citing, e.g., discussion of “seek-time access delays” without citing any
`
`relevant claim language). Realtime also cites to the Fallon patents’ statement that “provid[ing]
`
`an optimal balance between . . . compression rate . . . and the resulting compression ratio, is
`
`highly desirable.” Opp. at 14 (quoting ’535 patent at 1:56-60) (emphasis added). But, as the
`
`specification makes clear, this was already known to be desirable in the art; it is not an inventive
`
`concept sufficient to satisfy Alice step two. Even assuming this were an inventive concept,
`
`Realtime has not identified a single claim reciting “an optimal balance between…compression
`
`rate…and the resulting compression ratio.” See, e.g., ’535 claim 15 (reciting neither
`
`“compression rate” nor “compression ratio”). Realtime’s allegations are thus like the generic
`
`allegations in Automated Tracking and D&M Holdings, and do not save the claims.
`
`Finally, Realtime seeks to introduce new evidence outside of the pleadings in the form of
`
`“reasons for allowance” issued by the Patent Office during prosecution of one of the Fallon
`
`patents. Opp. at 13. Although such evidence is not properly considered on Netflix’s Motion, as
`
`it is outside the scope of the pleadings, it is nonetheless irrelevant to the Section 101 analysis.
`
`The Supreme Court has held that novelty under § 102 and § 103 “is of no relevance in
`
`determining whether the subject matter of a claim falls within [] § 101.” Diamond v. Diehr, 450
`
`U.S. 175, 188-89 (1981); see also Intellectual Ventures I LLC v. Symantec Corp., 838 F.3d 1307,
`
`1315 (Fed. Cir. 2016) (“While the claims may not have been anticipated or obvious . . . that does
`
`not suggest that the idea of ‘determining’ and ‘outputting’ is not abstract, much less that its
`
`implementation is not routine and conventional.”).
`
`At bottom, the claims of the Fallon patents describe nothing more than well-understood,
`
`7
`
`

`

`Case 1:17-cv-01692-CFC-SRF Document 16 Filed 02/27/18 Page 11 of 15 PageID #: 554
`
`conventional and routine techniques. Realtime suggests there is something inventive about the
`
`system’s ability to optimize the balance between compression rate and compression ratio, but,
`
`even assuming that this an inventive concept (which it is not), it is not captured in the claims of
`
`the Fallon patents. Moreover, the claims of the Fallon patents recite merely conventional data
`
`operations (e.g., that compressors compress digital data) incident to the underlying abstract idea.
`
`See IQS US Inc. v. Calsoft Labs Inc., No. 16 CV 7774, 2017 WL 3581162, at *5 (N.D. Ill. Aug.
`
`18, 2017) (finding nothing unique about arrangement of a “receiver” and “verifier”); Two-Way
`
`Media, 874 F.3d at 1339 (“The claim uses a conventional ordering of steps—first processing the
`
`data, then routing it, controlling it, and monitoring its reception—with conventional technology
`
`to achieve its desired result”). Accordingly, the claims of the Fallon patents are invalid under §
`
`101.
`
`IV.
`
`THE USE OF REPRESENTATIVE CLAIMS IS APPROPRIATE
`In Berkheimer, the Federal Circuit confirmed that the Court may treat a claim as
`
`representative where “the patentee does not present any meaningful argument for the distinctive
`
`significance of any claim limitations not found in the representative claim.” 2018 WL 774096,
`
`at *3. Realtime has failed to present any “meaningful argument” supporting patentability of a
`
`single one of the 114 claims in the Fallon patents, let alone identified any other claim reciting an
`
`inventive concept not otherwise recited in the representative claims set forth in Netflix’s Motion.
`
`Instead, Realtime itself groups together concepts from across the group of claims and patents
`
`without any meaningful argument as to why such concepts are “inventive” or how they are
`
`captured in the claims. Moreover, as many cases have held, there is no requirement that the
`
`Court analyze each and every claim with the same degree of precision where, as here, the claims
`
`are “substantially similar and linked to the same abstract idea.” Content Extraction &
`
`Transmission LLC v. Wells Fargo Bank, Nat’l Ass’n, 776 F.3d 1343, 1348 (Fed. Cir. 2014).
`
`8
`
`

`

`Case 1:17-cv-01692-CFC-SRF Document 16 Filed 02/27/18 Page 12 of 15 PageID #: 555
`
`V.
`
`REALTIME HAS NOT PLEADED FACTS SUFFICIENT FOR A PLAUSIBLE
`CLAIM FOR RELIEF
`
`
`
`
`
`
`
`
`
`Realtime does not dispute the legitimate deficiencies in its Complaint caused in part by
`
`its contradictory allegations that different “Accused Instrumentalities” infringe “in substantially
`
`the same way” (e.g., Complaint, ¶¶ 27, 51, 70, 89, 108 (at 55), 108 (at 67)) but that various
`
`products included in the catch-all of “Accused Instrumentalities” operate differently (e.g.,
`
`Complaint, ¶ 18). Realtime instead attempts to drown its obligations under Rule 8 by sheer
`
`volume and incorrectly criticize Netflix as seeking infringement contentions. Netflix is not
`
`seeking infringement contentions, but rather the fair notice required by Rule 8 of what products
`
`are at issue in the case supported by sufficient factual allegations to support a plausible claim for
`
`relief (e.g., whether the VP9 codec is accused given that Realtime concedes VP9 operates
`
`differently from the specifically accused H.264 and H.265 codecs). Realtime’s argument that it
`
`“need not include an exhaustive list of accused products” avoids the issue. Opp. at 17. Netflix is
`
`not seeking an identification of products, but rather facts, as required by Rule 8, supporting
`
`Realtime’s infringement allegations of those products that are identified. Ultimately, Realtime’s
`
`allegations cannot withstand scrutiny and should be dismissed.
`
`VI. REALTIME HAS NOT PROPERLY PLEADED INFRINGEMENT OF THE ’462
`& ’298 PATENTS
`
`
`
`
`
`
`
`
`
`
`Realtime does not meaningfully dispute that it failed to sufficiently plead standards-based
`
`infringement for the ’462 and ’298 patents. Instead, Realtime again leads with and focuses on
`
`the volume of allegations to distract from the lack of relevant facts supporting its claims.
`
`For the ’462 patent, after wading through the allegations spanning “24 paragraphs over
`
`11 pages,” (Opp. at 18), it clear that there are no facts supporting any “reasonable inference” of
`
`how Netflix encoding technology works, let alone how it allegedly infringes the’462 patent.
`
`Similarly, there are no facts that the HEVC standard “provide[s] details regarding HEVC
`
`9
`
`

`

`Case 1:17-cv-01692-CFC-SRF Document 16 Filed 02/27/18 Page 13 of 15 PageID #: 556
`
`encoders.” Opp. at 18 (emphasis added). Facts supporting a plausible claim for relief cannot be
`
`premised on a word search through a technical standard as Realtime argues. Rule 8 is not a
`
`requirement based on semantics, but rather an obligation of Realtime to provide sufficient facts
`
`to state a plausible claim for relief. Arguments based on volume and word searches are
`
`insufficient.
`
`For the ’298 patent, Realtime conflates the evidentiary and pleading requirements for in
`
`hopes of avoiding its obligations to provide facts showing how Netflix allegedly uses “tile”
`
`functionality in a manner that allegedly infringes the ’298 patent. Here again, Realtime points to
`
`its voluminous allegations spanning “19 paragraphs over 8 pages,” (Opp. at 20), but fails to point
`
`to any facts regarding, for example, Netflix’s use of tiles in an allegedly infringing manner.
`
`Instead, Realtime argues that “Netflix does not assert that its products do not implement ‘tiles,’
`
`or otherwise dispute allegations about [sic] ‘tiles_enabled_flag.’” Opp. at 20. At the 12(b)(6)
`
`stage, however, the burden is not on Netflix to provide evidence of its defenses, but instead is on
`
`Realtime to allege facts sufficient to state a plausible claim for relief. Realtime has failed to do
`
`so.
`
`VII. THE COURT SHOULD DISMISS PRE-SUIT INDIRECT INFRINGEMENT
`Realtime does not dispute that it alleged no facts relevant to pre-suit indirect
`
`infringement. Realtime’s argument that this is “simply a damages issue”—made without any
`
`support or citation—does not relieve it of its obligation to allege facts to support pre-suit indirect
`
`infringement in the complaint. Realtime has failed to do so, and the Court should dismiss those
`
`claims.
`
`VIII. CONCLUSION
`The Court should find the Fallon patents invalid and dismiss all infringement claims.
`
`10
`
`

`

`Case 1:17-cv-01692-CFC-SRF Document 16 Filed 02/27/18 Page 14 of 15 PageID #: 557
`
`
`
`
`
`MORRIS, NICHOLS, ARSHT & TUNNELL LLP
`
`/s/ Jack B. Blumenfeld
`
`
`
`
`Jack B. Blumenfeld (#1014)
`1201 North Market Street
`P.O. Box 1347
`Wilmington, DE 19899
`(302) 658-9200
`jblumenfeld@mnat.com
`
`Attorneys for Defendants
`
`
`
`
`
`
`
`OF COUNSEL:
`
`Katherine Vidal
`Matthew R. McCullough
`WINSTON & STRAWN LLP
`275 Middlefield Road, Suite 205
`Menlo Park, CA 94025
`(650) 858-6500
`
`Andrew B. Grossman
`WINSTON & STRAWN LLP
`333 South Grand Avenue
`Los Angeles, CA 90071
`(213) 615-1700
`
`February 27, 2018
`
`
`11
`
`

`

`Case 1:17-cv-01692-CFC-SRF Document 16 Filed 02/27/18 Page 15 of 15 PageID #: 558
`
`CERTIFICATE OF SERVICE
`
`I hereby certify that on February 27, 2018, I caused the foregoing to be electronically
`
`
`
`filed with the Clerk of the Court using CM/ECF, which will send notification of such filing to all
`
`registered participants.
`
`
`
`I further certify that I caused copies of the foregoing document to be served on
`
`February 27, 201 8upon the following in the manner indicated:
`
`Stephen B. Brauerman, Esquire
`Sara E. Bussiere, Esquire
`BAYARD, P.A.
`600 North King Street, Suite 400
`Wilmington, DE 19801
`Attorneys for Plaintiff
`
`Mark A. Fenster, Esquire
`Reza Mirzaie, Esquire
`Brian D. Ledahl, Esquire
`C. Jay Chung, Esquire
`Philip X. Wang, Esquire
`Timothy T. Hsieh, Esquire
`RUSS, AUGUST & KABAT
`12424 Wilshire Boulevard, 12th Floor
`Los Angeles, CA 90025-1031
`Attorneys for Plaintiff
`
`
`
`
`
`VIA ELECTRONIC MAIL
`
`VIA ELECTRONIC MAIL
`
`/s/ Jack B. Blumenfeld
`___________________________________
`Jack B. Blumenfeld (#1014)
`
`
`
`
`
`
`
`