Case 2:17-cv-00220-BRO-KS Document 59 Filed 06/12/17 Page 1 of 13 Page ID #:999
`
`LINK:
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES - GENERAL
`
`Case No.
`
`Title
`
`CV 17-00220-BRO (KSx)
`
`Date
`
`June 12, 2017
`
`V APORSTREAM, INC. v. SNAP INC.
`
`Present: The
`Honorable
`
`BEVERLY REID O'CONNELL, United States District
`Judge
`
`Renee A. Fisher
`
`Deputy Clerk
`
`Not Present
`
`Court Reporter
`
`NIA
`
`Tape No.
`
`Attorneys Present for Plaintiffs:
`
`Attorneys Present for Defendants:
`
`Not Present
`
`Not Present
`
`Proceedings:
`
`(IN CHAMBERS) ORDER DENYING DEFENDANT'S
`MOTION TO DISMISS FOR LACK OF PATENTABLE
`SUBJECT MATTER [23]
`
`I.
`
`INTRODUCTION
`
`In this patent infringement action, Defendant Snap, Inc., d/b/a Snapchat, Inc.
`("Snap") has filed a motion to dismiss for lack of patentable subject matter of U.S.
`Patent Nos. 8,886,739 ("the '739 Patent"); 8,935,35 1 (" the ' 351 Patent"); 9,306,885 ("
`the '885 Patent"); 9,306,886 ("the '886 Patent"); 9,313,155 ("the ' 155 Patent");
`9,313,156 ("the ' 156 Patent"); 9,313,157 ("the ' 157 Patent"); 9,338,111 ("the ' 111
`Patent"); and 9,413,711 ("the '711 Patent") (collectively, "Asserted Patents").
`("Motion," Dkt. 23.) For the reasons stated in this Order, the Motion is DENIED
`WITHOUT PREJUDICE.
`
`II. BACKGROUND
`
`Plaintiff Vaporstream, Inc. has asserted 9 patents and 89 claims against Snap.
`(Dkt. 54, Ex. C.) The Asserted Patents are closely related, claim priority to the same
`July 28, 2005 filing, and share a substantially identical specification. 1 (Dkt. 23 at 2.)
`
`1 On a more granular level, the claims of the '739, ' 885, ' 155, and ' 156 patents relate to the "sending
`user device," while the claims of the '35 1, '886, ' 157, and ' 111 patents relate to the "receiving user
`device." The asserted claims of the '711 patent recite aspects of both the "send side" and the "receive
`side." (Dkt. 23 at 2, n. 2.)
`
`CV-90 (06/04)
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`CIVIL MINUTES - GENERAL
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`Page l of 13
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`Snap's Exhibit No. 1064
`Page 1
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`

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`Case 2:17-cv-00220-BRO-KS Document 59 Filed 06/12/17 Page 2 of 13 Page ID #:1000
`
`LINK:
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES - GENERAL
`
`Case No.
`
`Title
`
`CV 17-00220-BRO (KSx)
`
`Date
`
`June 12, 2017
`
`V APORSTREAM, INC. v. SNAP INC.
`
`These patents relate generally to systems and methods for "reducing traceability" of
`electronic messages. (See '739 Patent at 1 :46-2:8.) The common Background section
`explains some perceived problems with conventional email messaging:
`
`Typically, an electronic message between two people is not private. It may
`travel along a public network, such as the Internet, and be susceptible to
`interception by unintended third parties. Messages are also logged and
`archived by the communication systems themselves. They may also be
`copied, cut, pasted, printed, forwarded, blind copied, or otherwise
`manipulated. This may give a message a "shelf-life" that is often
`uncontrollable by the sender or even the recipient. Surreptitious logging
`(e.g., by keystroke and message recording software) may occur by third
`parties that have gained authorized access to either the computer of the
`sender and/or the recipient.
`
`('739 Patent at 1 :51 -64.) To address these problems, the claimed inventions disclose
`systems and methods purporting to reduce the traceability of electronic messages. (Id.
`at 3:48-4:6.)
`
`Ill. LEGAL STANDARDS
`
`A. Rule 12(b)(6)
`
`Federal Rules of Civil Procedure Rule 12(b)(6) permits a party to move to dismiss
`a suit for "failure to state a claim upon which relief can be granted." Fed. R. Civ. P.
`12(b)(6). "Judgment on the pleadings is proper when, taking all allegations in the
`pleading as true, the moving party is entitled to judgment as a matter of law." Stanley v.
`Trustees of Cal. State Univ., 433 F.3d 1129, 1133 (9th Cir. 2006); see also Fleming v.
`Pickard, 581 F.3d 922, 925 (9th Cir. 2009).
`
`A complaint may be dismissed for failure to state a claim upon which relief can be
`granted for one of two reasons: (1) lack of a cognizable legal theory or (2) insufficient
`facts under a cognizable legal theory. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555
`(2007); see also Mendiondo v. Centinela Hosp. Med. Ctr. , 521 F.3d 1097, 1104 (9th Cir.
`2008) ("Dismissal under Rule 12(b )( 6) is appropriate only where the complaint lacks a
`cognizable legal theory or sufficient facts to support a cognizable legal theory."). A
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`CV-90 (06/04)
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`Page 2
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`Case 2:17-cv-00220-BRO-KS Document 59 Filed 06/12/17 Page 3 of 13 Page ID #:1001
`
`LINK:
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES - GENERAL
`
`Case No.
`
`Title
`
`CV 17-00220-BRO (KSx)
`
`Date
`
`June 12, 2017
`
`V APORSTREAM, INC. v. SNAP INC.
`
`motion to dismiss should be granted if the complaint does not proffer enough facts to state
`a claim for relief that is plausible on its face. See Twombly, 550 U.S. at 558-59, 570; see
`also William 0. Gilley Enters., Inc. v. Atlantic Richfield Co. , 588 F.3d 659, 667 (9th Cir.
`2009) ( confirming that Twombly pleading requirements "apply in all civil cases").
`" [W]here the well-pleaded facts do not permit the court to infer more than the mere
`possibility of misconduct, the complaint has alleged - but it has not 'show[ n]' - 'that the
`pleader is entitled to relief. "' Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009) ( quoting Fed.
`R. Civ. P. 8(a)(2)).
`
`In deciding a l 2(b )( 6) motion, the court is limited to the allegations on the face of
`the complaint (including attached documents), matters which are properly judicially
`noticeable, and other extrinsic documents when "the plaintiffs claim depends on the
`contents of a document, the defendant attaches the document to its motion to dismiss, and
`the parties do not dispute the authenticity of the document, even though the plaintiff does
`not explicitly allege the contents of that document in the complaint." Knievel v. ESPN,
`393 F.3d 1068, 1076 (9th Cir. 2005). The court must construe the complaint in the light
`most favorable to the plaintiff and must accept all factual allegations as true. Cahill v.
`Liberty Mutual Ins. Co. , 80 F.3d 336, 337-38 (9th Cir. 1996). The court must also accept
`as true all reasonable inferences to be drawn from the material allegations in the
`complaint. See Brown v. Elec. Arts, Inc. , 724 F.3d 1235, 1247-48 (9th Cir. 2013); Pareto
`v. F.D.I.C. , 139 F.3d 696, 699 (9th Cir. 1998). Conclusory statements, unlike proper
`factual allegations, are not entitled to a presumption of truth. See Iqbal, 556 U.S. at 681;
`Moss v. US. Secret Serv., 572 F.3d 962, 969 (9th Cir. 2009).
`
`B. Patentable Subject Matter Under 35 U.S.C. § 101
`
`35 U.S.C. § 101 "defines the subject matter that may be patented under the Patent
`Act." Bilski v. Kappas, 561 U.S. 593, 601 (2010). It states: "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. Although acknowledging
`that " [i]n choosing such expansive terms ... Congress plainly contemplated that the
`patent laws would be given wide scope," the Supreme Court has long applied three
`exceptions to Section 101 : "laws of nature, physical phenomena, and abstract ideas."
`Diamond v. Chakrabarty, 447 U.S. 303, 308-09 (1980). "Failure to recite statutory
`
`CV-90 (06/04)
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`CIVIL MINUTES - GENERAL
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`Snap's Exhibit No. 1064
`Page 3
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`

`

`Case 2:17-cv-00220-BRO-KS Document 59 Filed 06/12/17 Page 4 of 13 Page ID #:1002
`
`LINK:
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES - GENERAL
`
`Case No.
`
`Title
`
`CV 17-00220-BRO (KSx)
`
`Date
`
`June 12, 2017
`
`V APORSTREAM, INC. v. SNAP INC.
`
`subject matter is the sort of 'basic deficiency,' that can, and should, 'be exposed at the
`point of minimum expenditure of time and money by the parties and the court."'
`Ultramercial Inc. v. Hulu, LLC, 772 F.3d 709, 718-19 (Fed. Cir. 2014) (quoting
`Twombly, 550 U.S. at 558).
`
`In Mayo Collaborative Servs. v. Prometheus Labs., Inc. , 132 S. Ct. 1289 (2012),
`the Supreme Court "set forth a framework for distinguishing patents that claim laws of
`nature, natural phenomena, and abstract ideas from those that claim patent-eligible
`applications of those concepts." Alice Corp. Pty. Ltd. v. CLS Bank Int 'l, 134 S. Ct. 234 7,
`2355 (2014). That framework is as follows:
`
`First, we determine whether the claims at issue are directed to one of those
`patent-ineligible concepts. If so, we then ask, "[ w ]hat else is there in the
`claims before us?" To answer that question, we consider the elements of
`each claim both individually and "as an ordered combination" to determine
`whether the additional elements "transform the nature of the claim" into a
`patent-eligible application. We have described step two of this analysis as a
`search for 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. at 2355 ( citations omitted).
`
`IV. ANALYSIS
`
`A. Whether the Asserted Claims are directed to a Patent-Ineligible
`Concept
`
`The first inquiry of the Alice test is whether the asserted claims are directed to a
`patent-ineligible law of nature, natural phenomena, or abstract idea. Alice, 134 S. Ct. at
`2354. The step-one inquiry determines whether the claims "focus on a specific means
`or method that improves the relevant technology" or are "directed to a result or effect
`that itself is the abstract idea and merely invoke generic processes and machinery."
`McRO, Inc. v. Bandai Namco Games Am. Inc. , 837 F.3d 1299, 1312 (Fed. Cir. 2016).
`
`CV-90 (06/04)
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`Page 4
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`

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`Case 2:17-cv-00220-BRO-KS Document 59 Filed 06/12/17 Page 5 of 13 Page ID #:1003
`
`LINK:
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES - GENERAL
`
`Case No.
`
`Title
`
`CV 17-00220-BRO (KSx)
`
`Date
`
`June 12, 2017
`
`V APORSTREAM, INC. v. SNAP INC.
`
`Here, the asserted claims generally fall into two categories: (I) claims reciting
`methods implemented on sending user devices ("send side" claims ),2 and (2) claims
`reciting methods implemented on receiving user devices ("receive side" claims).3
`
`Snap has chosen claim 1 of the '739 Patent to be representative of the "send side"
`claims.4 Claim I reads:
`
`1. A computer-implemented method of handling an electronic message, the
`method comprising:
`
`providing a first display and a second display at a sending user device, the
`first display configured to allow a sending user to associate a first message
`content including a media component with the electronic message, the
`second display configured to allow the sending user to input a first
`recipient address corresponding to the first message content, the first and
`second displays not being displayed at the same time;
`
`displaying via the first display a first message content including a media
`component;
`
`receiving via the second display a first recipient address, wherein the first
`message content including a media component and the first recipient
`address are not displayed to the sending user at the same time;
`
`associating a message ID with the first message content including a media
`component, the message ID correlating the first recipient address and the
`first message content including a media component; and
`
`2 The "send side" asse1ied claims are claims 1, 4-8, and 10 of the '739 Patent; claims 1 and 5-10 of the
`' 885 Patent; claims 1-6 and 9-13 of the ' 155 Patent; and claims 1-3 and 6-11 of the ' 156 Patent.
`3 The "receive side" asse1ied claims are claims 1, 3-7, 9, 11, and 12 of the '351 Patent; claims 1-6 and
`8-13 of the '886 Patent; claims 1-7 and 10 of the ' 157 Patent; and claims 1, 2, 4-6, and 8-12 of the ' 111
`Patent. The asse1ied claims of the '711 patents are claims 1-17, which recites aspects of both the "send
`side" and "receive side" asse1ied claims.
`4 Although Vaporstream has not conceded that this claim is representative, it is still helpful to begin by
`looking at the actual claim language.
`
`CV-90 (06/04)
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`Page 5
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`

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`Case 2:17-cv-00220-BRO-KS Document 59 Filed 06/12/17 Page 6 of 13 Page ID #:1004
`
`LINK:
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES - GENERAL
`
`Case No.
`
`Title
`
`CV 17-00220-BRO (KSx)
`
`Date
`
`June 12, 2017
`
`V APORSTREAM, INC. v. SNAP INC.
`
`transmitting the recipient address and the first message content including a
`media component from the sending user device to a server computer, the
`first message content including a media component being transmitted to the
`server computer separately from the recipient address, the first message
`content including a media component not being accessible by the sending
`user for display via the sending user device after said transmitting the
`media component to the server computer.
`
`'739 Patent, claim 1.
`
`Stated more succinctly, claim 1 is directed to a technique for allowing a sender to
`transmit a message to a recipient by: (1) separately specifying the message recipient and
`message content ( and having two displays so that the information about the recipient
`and the content are not displayed at the same time); (2) associating a message ID that
`correlates the message content with the message recipient; (3) transmitting the content
`separately from the recipient identification; and ( 4) preventing the sender from
`accessing the content after it is sent.
`
`Similarly, Snap has chosen claim 1 of the '35 1 Patent to be representative of the
`"receive side" asserted claims. It recites a similar technique but from the perspective of
`the receiving device:
`
`1. A computer-implemented method of handling an electronic message, the
`method comprising:
`
`receiving at a recipient user device a first header information corresponding
`to a first message content that includes a media component;
`
`providing a first display via the recipient user device, the first display
`including the first header information in a message list, the first display not
`displaying the media component;
`
`receiving at the recipient user device the first message content including
`the media component, wherein the first message content including the
`media component is associated with a unique message ID that correlates
`
`CV-90 (06/04)
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`CIVIL MINUTES - GENERAL
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`Page 6 of 13
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`Snap's Exhibit No. 1064
`Page 6
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`

`

`Case 2:17-cv-00220-BRO-KS Document 59 Filed 06/12/17 Page 7 of 13 Page ID #:1005
`
`LINK:
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES - GENERAL
`
`Case No.
`
`Title
`
`CV 17-00220-BRO (KSx)
`
`Date
`
`June 12, 2017
`
`V APORSTREAM, INC. v. SNAP INC.
`
`the first message content including the media component with the first
`header information;
`
`receiving a selection by the recipient user via the first display, the selection
`directed to a portion of the message list corresponding to the first header
`information;
`
`in response to the selection, providing a second display via the recipient
`user device, the second display displaying the first message content
`including the media component without displaying a usemame associated
`with the first header information; and
`
`automatically deleting the first message content including the media
`component at a predetermined amount of time after being displayed such
`that after the second display is terminated from view, the first message
`content including the media component is no longer available to the
`recipient user.
`
`('351 Patent, claim 1.)
`
`Claim 1 of the ' 351 Patent describes a technique for delivering and displaying a
`message to the recipient involving: (I) displaying the sender of the message to the
`recipient; (2) separately displaying message content to the recipient; (3) maintaining an
`association between the content and the sender; and ( 4) automatically destroying the
`content after receipt and display.
`
`From these two purportedly-representative claims, Snap concludes that the steps
`cover the abstract ideas of: (I) protecting the identity of the sender and recipient of a
`message; and (2) automatically destroying the message content after it has been
`displayed to the recipient. (Dkt. 23 at 5-6.) In particular, Snap offers three ways in
`which the asserted claims are directed to an abstract idea. At the highest level of
`abstraction, Snap argues the claims are directed to the abstract idea of "handling,
`delivering, and displaying messages." (Id. at 11.) At the next level, the claims are
`allegedly directed to the idea of "protecting the identity of the sender or recipient during
`message delivery." (Id.) And " [u]nder any level of abstraction," Snap contends that the
`
`CV-90 (06/04)
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`Page 7
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`

`

`Case 2:17-cv-00220-BRO-KS Document 59 Filed 06/12/17 Page 8 of 13 Page ID #:1006
`
`LINK:
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES - GENERAL
`
`Case No.
`
`Title
`
`CV 17-00220-BRO (KSx)
`
`Date
`
`June 12, 2017
`
`V APORSTREAM, INC. v. SNAP INC.
`
`claims are at least directed to the abstract idea of "preventing third parties from 'tracing'
`content to the sender of recipient. "' (Id.)
`
`Vaporstream protests that the asserted claims are not directed to the abstract ideas
`of identity protection and automatic message deletion. Rather, it argues that the claims
`are directed to "a specific improvement to electronic messaging systems as they existed
`in 2005-2006, the priority dates of the asserted claims." (Dkt. 51 at 6.) Specifically,
`Vaporstream notes that the asserted claims disclose a particular way of sending and
`receiving electronic messages such that privacy is ensured, sender/recipient identity is
`unascertainable, and the message content cannot be stored, manipulated or
`disseminated. (Id.) According to V aporstream, the patented methods achieve these
`objectives by requiring: (1) structured graphical user interfaces that separately display
`sender/recipient identifying information separately from the message content; (2)
`protocols that transmit sender/recipient identifying information separately from the
`message content; and (3) restrictions on accessing the message content upon
`transmission and display. (Id.)
`
`The dispute presented by the parties hinges on the appropriate level of abstraction
`that should be employed. As the Federal Circuit has recognized, " [a]t some level, all
`inventions ... embody, use, reflect, rest upon, or apply laws of nature, natural
`phenomena, or abstract ideas." Amdocs (IsraeV Ltd. v. Openet Telecom, Inc. , 841 F .3d
`1288, 1299 (Fed. Cir. 2016) ( citing Alice, 134 S. Ct. at 2354); see also McRO at 1313
`("We have previously cautioned that courts 'must be careful to avoid oversimplifying
`the claims' by looking at them generally and failing to account for the specific
`requirements of the claims.") ( citations omitted). From a macroscopic perspective, the
`asserted claims could be described as focusing on identity protection during message
`delivery. But the asserted claims can also be described in other ways, such as focusing
`on the separate graphical displays and the electronic protocols that transmit
`sender/recipient identifying information separately from the message content.
`
`In addressing the first step of the section 101 inquiry, as applied to a computer(cid:173)
`implemented invention, it is often helpful to ask whether the claims are directed to "an
`improvement in the functioning of the computer," or merely "adding conventional
`computer components to well-known business practices." Enfish, LLC v. Microsoft
`Corp. , 822 F.3d 1327, 1338 (Fed. Cir. 2016). An important consideration relevant to
`
`CV-90 (06/04)
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`Snap's Exhibit No. 1064
`Page 8
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`

`

`Case 2:17-cv-00220-BRO-KS Document 59 Filed 06/12/17 Page 9 of 13 Page ID #:1007
`
`LINK:
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES - GENERAL
`
`Case No.
`
`Title
`
`CV 17-00220-BRO (KSx)
`
`Date
`
`June 12, 2017
`
`V APORSTREAM, INC. v. SNAP INC.
`
`the determination of step one for the Asserted Patents is whether the asserted claims
`address problems that are unique to electronic messaging in computer systems.
`
`This issue is vigorously contested. Snap contends that the asserted claims are
`directed to long-standing, fundamental aspects of human communication and offers
`several real-world analogies to show that preventing third parties from tracing content to
`the sender or recipient is a "timeworn practice that carries out the fundamental human
`desire for privacy." (Dkt. 23 at 11.) For example, the classroom note pass and the
`briefcase courier analogies capture the concept of separating the sender/recipient
`information from the content itself. And the self-destructing message in MISSION:
`IMPOSSIBLE further illustrates the idea of reducing traceability by destroying the
`message after receipt. These analogies are helpful in understanding conventional
`approaches to concerns involving private communications. However, they may not
`account for certain ways the invention's objectives are to be attained by the patented
`methods, such as using multiple displays and correlating the contents and identity of
`users with a message ID. Thus, to the extent the analogies are incompatible with
`fundamental, technological aspects of the methodology and the problem to be solved,
`they are of limited value to a section 101 analysis.
`
`As described by the specification, the specific methods disclosed in the asserted
`claims are intended to ensure that the improved electronic messaging system will not
`allow an electronic message to be "archived, forwarded, copied, pasted," logged, or
`recreated, nor "leave [any] trace of the message content, header, information, or the fact
`that it was created, existed, delivered, viewed, etc." '739 Patent at 17:47-18:6. The
`claimed advance over the prior art suggests that the representative claims focus on a
`specific way (e.g. , an architecture providing for the separated display and transmission
`of message content from sender/recipient information and restricted access to/deletion
`of the message content after transmission/display) for improving an existing
`technological process (e.g., prior art electronic messaging systems that transmit
`messages without restrictions over an open network which allow such messages to be
`stored and manipulated by senders/recipients and intercepted and misused by third
`parties).
`
`Even so, the alleged problems have real-world counterparts, such as the
`interception of packages in the mail. Third-party interception, widespread
`
`CV-90 (06/04)
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`Snap's Exhibit No. 1064
`Page 9
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`

`

`Case 2:17-cv-00220-BRO-KS Document 59 Filed 06/12/17 Page 10 of 13 Page ID #:1008
`
`LINK:
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES - GENERAL
`
`Case No.
`
`Title
`
`CV 17-00220-BRO (KSx)
`
`Date
`
`June 12, 2017
`
`V APORSTREAM, INC. v. SNAP INC.
`
`dissemination, and content-identity coupling can be described as human problems that
`arose with the written word, not technology problems. If the problem Vaporstream
`purports to solve does not specifically arise in any technological field, and the "human
`problem" already has a "human solution," then the claimed invention - e.g. , separation
`of message information and automatic message deletion - may be better characterized
`as using generic computing concepts to carry out in the electronic realm abstract ideas
`from the real world, rather than an improvement in computer functionality.
`
`On the other hand, if V aporstream' s asserted claims are focused on a specific
`application of electronic messaging in computer systems, then such claims would be
`consistent with some of the recent Federal Circuit line of cases that have found
`eligibility when the claims are directed to an improvement in technology. For example,
`in DDR Holdings, the Federal Circuit found "a system and methods of generating a
`composite webpage that combines certain visual elements of a 'host' website with
`content of a third party merchant" to be patent-eligible. DDR Holdings, LLC v.
`Hotels.com, L.P. , 773 F.3d 1245, 1248 (Fed. Cir. 2014). The court found the claims to
`have provided a concrete Internet-based solution to an Internet-specific problem:
`retaining website visitors that, if adhering to the prior art functioning of Internet
`hyperlink protocol, would be instantly transported away from a host's website after
`clicking on an advertisement and activating a hyperlink. Id. at 1257. Like the claims at
`issue in DDR Holdings, Vaporstream's computer-based claims would be directed to
`overcome challenges specifically arising in the realm of Internet-based messaging
`systems, such as the uncontrolled storage, manipulation, widespread dissemination, and
`interception of electronic messages.
`
`Ultimately, whether the asserted claims are directed to: (1) an abstract idea of
`protecting the identity of a message's recipient or sender, or (2) specific solutions
`(separation of display and transmission and restriction of access) to the various
`challenges of electronic messaging (privacy, manipulation, interception), presents a
`close call. 5 Similar to the dilemma faced by the Federal Circuit in Bascom, the asserted
`
`5 At the hearing, Snap mged the Cowt to follow the Alice step-one approach adopted by Judge Birotte in Eve1yMD.com
`LLC v. Facebook Inc., Case No. LACV 16-6473-AB (JEMx). There, the technology purpo1tedly enabled Intemet users to
`communicate with members of a group who have been designated web pages through which they may be contacted. The
`court found that the claims were drawn to the basic idea of exchanging business communications that have long been
`accomplished through paper directories and telephone calls. Based on an analysis tailored to the claim language in the
`context of the specification, Judge Birotte concluded that the patents-in-suit recited standard components in conventional
`
`CV-90 (06/04)
`
`CIVIL MINUTES - GENERAL
`
`Page 10 of 13
`
`Snap's Exhibit No. 1064
`Page 10
`
`

`

`Case 2:17-cv-00220-BRO-KS Document 59 Filed 06/12/17 Page 11 of 13 Page ID #:1009
`
`LINK:
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES - GENERAL
`
`Case No.
`
`Title
`
`CV 17-00220-BRO (KSx)
`
`Date
`
`June 12, 2017
`
`V APORSTREAM, INC. v. SNAP INC.
`
`claims and their specific limitations "do not readily lend themselves to a step-one
`finding that they are directed to a nonabstract idea." Bascom Global Internet Services,
`Inc. v. AT&T Mobility LLC, 827 F.3d 1341 , 1349 (Fed. Cir. 2016); see Elec. Power
`Grp., LLC v. Alstom S.A. , 830 F.3d 1350 (Fed. Cir. 2016) ("we have noted there can be
`close questions about when the inquiry should proceed from the first stage to the
`second."). For these reasons, the Court defers its consideration of the claim limitations'
`narrowing effect for step two.
`
`B. Whether the Asserted Claims Include an "Inventive Concept"
`
`The second inquiry of the Alice test is whether the claims found to be directed to
`an abstract idea contain any inventive concept to transform the abstract idea into a
`patent-eligible subject matter. Ultramercial, 772 F.3d at 715. To satisfy this prong, the
`claims must include additional features which are significantly beyond "well(cid:173)
`understood, routine, conventional activity" or a simple "instruction to implement or
`apply the abstract idea on a computer." Id. (quoting Mayo, 132 S.Ct. at 1298.); Bascom,
`827 F.3d 1341 , 1349. The "inventive concept" may arise in individual claim limitations
`or in the ordered combination of the limitations. Bascom, 827 F.3d at 1349.
`
`Snap argues that the claims do not recite any inventive concept that would save
`them from invalidity under § 101. (Dkt. 23 at 17.) In particular, it contends that the
`claims' reliance on off-the-shelf computer components amounts to nothing more than
`well-understood, routine, and conventional activities that cannot impart patent
`eligibility. (Id. at 18.) Snap also points to the lack of "any unique or special software
`used to implement the claimed abstract ideas" as being fatal. (Id. at 18-19.) It adds that
`the asserted dependent claims are either repetitive of the representative claims or proffer
`no inventive concept. (Id. at 20.)
`
`Vaporstream responds that applications of standard components to a new and
`useful end are patent-eligible. Specifically, it contends that the recited structural
`limitations, when taken together, amounts a special-purpose computer used for
`electronic messaging working to ensure reduced traceability and enhanced privacy and
`user control of the electronic messages being exchanged. (Dkt. 51 at 19-20.) Further,
`
`ways to accomplish standard Internet communications. But, the approach taken by Judge Birotte does not identify a level
`of abstraction that is intended to suit eve1y case. Rather, it simply underscores the difficulty of this inquiry and confirms
`that the abstraction analysis can be ve1y fact-dependent. The facts in this case differ from those in Eve1yMD. com.
`
`CV-90 (06/04)
`
`CIVIL MINUTES - GENERAL
`
`Page 11 of 13
`
`Snap's Exhibit No. 1064
`Page 11
`
`

`

`Case 2:17-cv-00220-BRO-KS Document 59 Filed 06/12/17 Page 12 of 13 Page ID #:1010
`
`LINK:
`
`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
`
`CIVIL MINUTES - GENERAL
`
`Case No.
`
`Title
`
`CV 17-00220-BRO (KSx)
`
`Date
`
`June 12, 2017
`
`V APORSTREAM, INC. v. SNAP INC.
`
`Vaporstream emphasizes that the claims also recite apparatus such as a user device
`configured to generate separate displays of message content and recipient information,
`and server computers being configured to "correlate" and "associate" message content
`with identifying information at a later time. (Id. at 20-21.) Another concept disclosed
`in the asserted claims is the "display-based keyboard" in claim 10 of the '885 Patent,
`claim 13 of the ' 155 Patent, and claim 11 of the '156 Patent. (Id. at 21.) According to
`Vaporstream, the display-based keyboard has the specific function of allowing the user
`to input information while avoiding interception by keystroke logging hardware, and is
`"thus a specially-adapted and inventive part of these asserted claims to achieve the
`objectives of reduced traceability and improved privacy of electronic messages." (Id.)
`
`The Federal Circuit has found patent eligibility under step two when the claims
`solve a technology-based problem, even with conventional generic components,
`combined in an unconventional manner. Amdocs, 841 F.3d 1288, 1300; see also
`BASCOM, 827 F.3d at 1349-50 (finding claims patent eligible because the "inventive
`concept" of the improved abstract idea of "filtering content on the Internet" was "found
`in the non-conventional and non-generic arrangement of known, conventional pieces.").
`
`Whether the generic components operate in an unconventional manner to achieve
`an improvement in computer functionality raises factual issues that precludes
`adjudication of Snap's motion to dismiss. For example, even though the display-based
`keyboard utilizes pre-existing technologies, it could operate in an unconventional way
`in combination with the separate graphical interfaces and transmission protocols to
`reduce traceability of electronic messages. Analysis of patentable subject matter, "while
`ultimately a legal determination, is rife with underlying factual issues." Ultramercial,
`Inc. v. Hulu, LLC, 722 F.3d 1335, 1339 (Fed. Cir. 2013), vacated on other grounds, 134
`S. Ct. 2870 (2014). Factual issues can include the effective filing dates of the asserted
`patents, the state of the art at the relevant time, or what was well-understood, routine,
`and conventional. See id. At the pleadings stage, the record is ambiguous as to whether
`the various claimed limitations (e.g., using two displays, transmitting message content
`and header information separately; automatic deletion; placing restriction on content
`access) are conventional protocols or technological improvements.6 Given the
`
`6 This includes the prosecution histo1y of the ' 886 Patent. Notably, the Examiner rejected the then