IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`MARSHALL DIVISION
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`CIVIL ACTION NO. 2:19-CV-00396-JRG
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`§§§§§§§§§§§§
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`LUMINATI NETWORKS LTD.,
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`Plaintiff,
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`v.
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`CODE200, UAB, METACLUSTER LT,
`UAB, OXYSALES, UAB,
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`Defendants.
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`
`MEMORANDUM OPINION AND ORDER
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`Before the Court is the Rule 12(b)(6) Motion to Dismiss (the “Motion”) filed by
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`Defendants Code200, UAB; Oxysales, UAB; Metacluster LT, UAB (collectively, “Defendants”).
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`(Dkt. No. 37.) Having considered the Motion, the related briefing, and the relevant authority, the
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`Court is of the opinion that it should be DENIED.
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`Also before the Court are Defendants Oxysales, UAB and Metacluster LT, UAB’s Rule
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`12(b)(6) Motion to Dismiss (Dkt. No. 15) and Code200, UAB’s Rule 12(b)(6) Motion to Dismiss
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`(Dkt. No. 27), which are DENIED AS MOOT in light of the Amended Complaint (Dkt. No. 26).
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`I.
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`BACKGROUND
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`Plaintiff Luminati Networks Ltd. (“Luminati”) filed its complaint against Defendants on
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`December 6, 2019, asserting that Defendants’ data center proxy services (including Oxylabs Data
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`Center Proxy Service and Real-Time Crawler when it uses the Oxylabs Data Center Proxy Service)
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`infringe Luminati’s U.S. Patent No. 10,484,511 (the “’511 Patent”). (Dkt. No. 1.) On
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`June 9, 2020, Luminati added allegations of infringement of U.S. Patent No. 10,637,968 (the “’968
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`Patent”). (Dkt. No. 26.)
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`Defendants now file the instant Motion arguing that the claims of the ’511 Patent and the
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`’968 Patent are invalid under 35 U.S.C. § 101 and that, accordingly, Luminati has failed to state a
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`claim upon which relief can be granted.
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`II.
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`LEGAL STANDARD
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`A. Patent Eligibility
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`Anyone who “invents or discovers any new and useful process, machine, manufacture, or
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`composition of matter, or any new and useful improvement thereof” may obtain a patent.
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`35 U.S.C. § 101. Since patent protection does not extend to claims that monopolize the “building
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`blocks of human ingenuity,” claims directed to laws of nature, natural phenomena, and abstract
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`ideas are not patent eligible. Alice Corp. Pty. v. CLS Bank Int’l, 134 S. Ct. 2347, 2354 (2014).
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`The Supreme Court instructs courts to distinguish between claims that set forth patent ineligible
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`subject matter and those that “integrate the building blocks into something more.” Id.
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`First, the court “determine[s] whether the claims at issue are directed to a patent-ineligible
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`concept.” Id. at 2355. In doing so, the court must be wary not to over generalize the invention, as
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`“all inventions . . . embody, use, reflect, rest upon, or apply laws of nature, natural phenomena, or
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`abstract ideas.” Alice, 134 S. Ct. at 2354 (omission in original). In other words, the court must
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`distinguish between “ineligible ‘abstract-idea-based solution[s] implemented with generic
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`technical components in a conventional way’ from the eligible ‘technology-based solution’ and
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`‘software-based invention[] that improve[s] the performance of the computer system itself.’”
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`Amdocs (Israel) Ltd. v. Openet Telecom, Inc., 841 F.3d 1288, 1299 (Fed. Cir. 2016) (quoting
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`Bascom Glob. Internet Servs., Inc. v. AT&T Mobility LLC, 827 F.3d 1341, 1351 (Fed. Cir. 2016))
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`(alteration in original).
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`If the challenged claims recite a patent-ineligible concept, the court then “consider[s] the
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`elements of each claim both individually and ‘as an ordered combination’ to determine whether
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`the additional elements ‘transform the nature of the claim’ into a patent eligible application.”
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`Alice, 134 S. Ct. at 2355 (quoting Mayo Collaborative Servs. v. Prometheus Labs., Inc., 566 U.S.
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`66, 78–79 (2012)). This step is satisfied when the claim limitations “involve more than
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`performance of ‘well-understood, routine, [and] conventional activities previously known to the
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`industry.’” Content Extraction & Transmission LLC v. Wells Fargo Bank, Nat’l Ass’n, 776 F.3d
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`1343, 1347–48 (Fed. Cir. 2014) (quoting Alice, 134 S. Ct. at 2359). The Federal Circuit has
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`explained that “[w]hile the ultimate determination of eligibility under § 101 is a question of law,
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`like many legal questions, there can be subsidiary fact questions which must be resolved en route
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`to the ultimate legal determination.” Aatrix Software, Inc. v. Green Shades Software, Inc., 882
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`F.3d 1121, 1128 (Fed. Cir. 2018). As such, “[t]he question of whether a claim element or
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`combination of elements is well-understood, routine and conventional to a skilled artisan in the
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`relevant field is a question of fact” that must be “proven by clear and convincing evidence.”
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`Berkheimer v. HP Inc., 881 F.3d 1360, 1368 (Fed. Cir. 2018).
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`Something is not necessarily well-understood, routine, and conventional simply because it
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`is disclosed in a prior art reference. Exergen Corp. v. KAZ USA, Inc., 725 Fed. App’x. 959, 965
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`(Fed. Cir. 2018). There are many obscure references that may qualify as prior art but are
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`insufficient to establish that something rises to the level of “well-understood, routine, and
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`conventional activit[ies] previously engaged in by scientists who work in the field.” Mayo, 566
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`U.S. at 79. Additionally, specific improvements described in a patent specification, “to the extent
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`they are captured in the claims, create a factual dispute regarding whether the invention describes
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`well-understood, routine, and conventional activities.” Berkheimer, 881 F.3d at 1369. However,
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`“[w]hen there is no genuine issue of material fact regarding whether the claim element or claimed
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`combination is well-understood, routine, conventional to a skilled artisan in the relevant field,
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`[patent eligibility] can be decided on summary judgment as a matter of law.” Berkheimer, 881
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`F.3d at 1368.
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`B. Federal Rule of Civil Procedure 12(b)(6)
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`By written motion, a party may move to dismiss a complaint for failure to state a claim
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`upon which relief can be granted. Fed. R. Civ. P. 12(b)(6). When reviewing such a motion to
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`dismiss, courts look only to the allegations in the complaint to determine whether they are
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`sufficient to survive dismissal. Baker v. Putnal, 75 F.3d 190, 196 (5th Cir. 1996) (citing McCartney
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`v. First City Bank, 970 F.2d 45, 47 (5th Cir. 1992)).
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`The Supreme Court has held that a complaint does not need detailed factual allegations to
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`survive a Rule 12(b)(6) motion to dismiss, but the pleader’s obligation to state the grounds of
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`entitlement to relief requires “more than labels and conclusions.” Bell Atl. Corp. v. Twombly, 550
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`U.S. 544, 555 (2007). The well-pleaded facts must permit the court to infer more than just the mere
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`possibility of misconduct. Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009). In the Fifth Circuit, motions
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`to dismiss under Rule 12(b)(6) are viewed with disfavor and rarely granted. Lormand v. US
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`Unwired, Inc., 565 F.3d 228, 232 (5th Cir. 2009); Lowrey v. Texas A&M Univ. Sys., 117 F.3d 242,
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`247 (5th Cir. 1997).
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`There are two guiding principles in determining whether a complaint can survive a motion
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`to dismiss. Iqbal, 556 U.S. at 678–79. “First, the tenet that a court must accept as true all of the
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`allegations contained in a complaint is inapplicable to legal conclusions.” Id. at 678. “Threadbare
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`recitals of the elements of a cause of action, supported by mere conclusory statements, do not
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`suffice.” Id. Second, a complaint must state a plausible claim in order to survive a motion to
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`dismiss. Id. at 678–79. This second determination is a “context-specific task that requires the
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`reviewing court to draw on its judicial experience and common sense.” Id. at 679. “But where the
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`well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct,
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`the complaint has alleged — but is has not ‘show[n]’ — ‘that the pleader is entitled to relief.’” Id.
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`(quoting Fed. R. Civ. P. 8(a)(2)).
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`III.
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`ANALYSIS
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`Defendants claim that Luminati’s patent infringement claims should be dismissed under
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`Rule 12(b)(6) because the Asserted Patents are directed to patent-ineligible subject matter, and as
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`such, Luminati has failed to state a claim. (Dkt. No. 37.) Luminati responds that the Asserted
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`Patents are patent-eligible. (Dkt. No. 41.)
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`Defendants argue that the asserted ’511 and ’968 Patents each fail both steps of the Alice
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`analysis. (Dkt. No. 37.) Specifically, Defendants assert that the alleged invention of both patents
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`is “simply the concept of using an intermediary to obtain information, so that the user seeking the
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`information need not disclose the user’s identity to the target which possesses the information.”
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`(Dkt. No. 37 at 1.) Under Step One of the Alice analysis, Defendants argue that the patents are
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`directed to nothing more than receiving, requesting, sending, and identifying information. (Dkt.
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`No. 37 at 7–14.) Defendants contend that this covers the “entirety of the claims.” (Id. at 9.) Under
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`Alice Step Two, Defendants argue the components recited in the claims are merely off the shelf
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`(Id. at 14); use standard Internet protocols (Id. at 15, 16), and that the specification of the patents
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`itself stated the computer used may have general components. (Id. at 16.)
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`Luminati argues that the claims of the ’511 and ’968 Patents are not directed to abstract
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`ideas, but are rather directed to a novel client—server—web server architecture that involves non-
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`conventional and non-routine functionalities of the comprising parts. (Dkt. No. 41.) Specifically,
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`Luminati argues that (1) Defendants’ argument is overly simplistic (Dkt. No. 41 at 1, 13–14),
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`including because Defendants do not provide a model for the ’968 Patent (Id. at 14), leave out
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`steps of the asserted claims (Id. at 15), and cite cases from asserted claims that worked on
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`traditional, conventional network architectures (Id. at 6–17); (2) the asserted claims are not abstract
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`because they claim an innovative network system for fetching content using an IP address selected
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`from a group of IP addresses, which solves a problem in the art and is more than a generic way to
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`send or receive information (Dkt. No. 4 at 10); (3) the asserted claims are directed to clients,
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`proxies, and servers that have particular functionalities that were not conventional at the priority
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`date of the patent (Dkt. No. 41 at 7).
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`A. Claim Construction
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`Defendants contend no claim construction is needed to determine the § 101 motion (Dkt.
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`No. 37 at 3), while Luminati maintains that claim construction is needed (Dkt. No. 41 at 8). A
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`Markman hearing was held on January 29, 2021 before Magistrate Judge Payne, and a Claim
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`Construction Order issued on February 8, 2021. (Dkt. No. 97.) Subject matter eligibility may be
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`determined without claim construction. Genetic Techs. Ltd. v. Merial L.L.C., 818 F.3d 1369, 1374
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`(Fed. Cir. 2016). Nevertheless, the Court has reviewed the constructions therein and finds they do
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`not alter the analysis set forth below. See MyMail, Ltd. v. ooVoo, LLC, 934 F.3d 1373 (Fed. Cir.
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`2019) (encouraging the district court to address the parties’ claim construction disputes before
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`determining patent eligibility).
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`B. Representative Claims
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`The parties use as a representative claim1 the only independent claim of the ’511 Patent,
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`claim 1, which recites:
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`1 There is no objection as to representativeness.
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`1. A method for fetching, by a first client device, a first content identified by a first
`content identifier and stored in a web server, for use with a first server that stores a
`group of IP addresses, the method by the first server comprising:
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`receiving, from the first client device, the first content identifier;
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`selecting, in response to the receiving of the first content identifier from the first
`client device, an IP address from the group;
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`sending, in response to the selecting, the first content identifier to the web server
`using the selected IP address;
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`receiving, in response to the sending, the first content from the web server; and
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`sending the received first content to the first client device,
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`wherein the first content comprises a web-page, an audio, or a video content,
`and wherein the first content identifier comprises a Uniform Resource Locator
`(URL).
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`(U.S. Patent No. 10,484,511 (Dkt. No. 26-1) at Claim 1.)
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`The parties also look to claim 1, again the sole independent claim, of the ’968 Patent:
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`A method for use with a requesting client device that comprises an Hypertext
`Transfer Protocol (HTTP) or Hypertext Transfer Protocol Secure (HTTPS) client,
`for use with a first web server that is a HTTP or HTTPS server that respectively
`responds to HTTP or HTTPS requests and stores a first content identified by a first
`content identifier, for use with a second server distinct from the first web server and
`identified in the Internet by a second IP address, and for use with a list of IP
`addresses, the method comprising:
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`identifying, by the requesting client device, an HTTP or HTTPS request for the
`first content;
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`selecting, by the requesting client device, an IP address from the list;
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`sending, by the requesting client device, to the second server using the second
`IP address over the Internet in response to the identifying and the selecting, the
`first content identifier and the selected IP address; and
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`receiving, by the requesting client device, over the Internet in response to the
`sending, from the second server using the selected IP address, the first content.
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`(U.S. Patent No. 10,637,968 (Dkt. No. 26-2) at Claim 1.)
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`C. Step One of Alice Analysis
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`In the first step of the patent eligibility analysis laid out by the Supreme Court in Alice, the
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`court “determine[s] whether the claims at issue are directed to a patent-ineligible concept.” Alice,
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`573 U.S. at 218. “If not, the claims pass muster under § 101.” Ultramercial, Inc. v. Hulu, LLC, 772
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`F.3d 709, 714 (Fed. Cir. 2014). In making this determination, the court looks at what the claims
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`cover. See id. at 714 (“We first examine the claims because claims are the definition of what a
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`patent is intended to cover.”). “[T]he ‘directed to’ inquiry applies a stage-one filter to claims,
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`considered in light of the specification,” and asks “whether ‘their character as a whole is directed
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`to excluded subject matter.’” Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1335 (Fed. Cir. 2016)
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`(quoting Internet Patents Corp. v. Active Network, Inc., 790 F.3d 1343, 1346 (Fed. Cir. 2015)). In
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`Step One, the court must be wary not to over generalize the invention, as “all inventions . . .
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`embody, use, reflect, rest upon, or apply laws of nature, natural phenomena, or abstract ideas.”
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`Alice, 134 S. Ct. at 2354 (omission in original).
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`Looking at the claims of the ’511 and ’968 Patents, the Court notes that they are directed
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`to an architecture comprised of a clients, servers, and web servers configured into an architecture
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`to facilitate providing requested content using an IP address that is selected from a group of IP
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`addresses and used to fetch the content. See Dkt. No. 26-1 at Claim 1, Dkt. No. 26-2 at Claim 1.
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`The ’511 Patent does this at a first server, which the ’968 Patent does it at the client device. See
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`Dkt. No. 26-1 at Claim 1, Dkt. No. 26-2 at Claim 1; Dkt. No. 41 at 10.
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`In Alice Step One, the court must distinguish between “ineligible ‘abstract-idea-based
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`solution[s] implemented with generic technical components in a conventional way’ from the
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`eligible ‘technology-based solution’ and ‘software-based invention[] that improve[s] the
`
`performance of the computer system itself.’” Amdocs, 841 F.3d at 1299 (quoting 3 Bascom Glob.
`
`Internet Servs., Inc. v. AT&T Mobility LLC, 827 F.3d 1341, 1351 (Fed. Cir. 2016)) (alteration in
`
`original).
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`The patent specification can be considered on a motion to dismiss. See Aatrix, 882 F.3d at
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`1129. Considering the specification, the Asserted Patents embody technology-based solutions that
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`improve the performance of networks. Dkt. No. 26-12 at 1:26–28 (“The present invention is related
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`to Internet communication, and more particularly, to improving data communication speed and
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`bandwidth efficiency on the internet” (emphasis added).) The claimed system is “designed for
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`increasing network communication speed for users, while lowering network congestion for content
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`owners and ISPs.” Id. at Abstract. The invention as claimed intends to provide these benefits
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`across an internet that it increasingly congested, and increasingly busy. (Id. at “Background of the
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`Invention.”). These benefits are grounded in the technology at issue; namely, internet
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`communications. See id. at Abstract; 1:26–28; Claim 1.
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`In the present Motion, Defendants have not met their burden to show that the asserted
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`claims of the ’511 and ’968 Patents are directed to an abstract idea in Alice Step One. The Federal
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`Circuit has often stated that “describing the claims at such a high level of abstraction and
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`untethered from the language of the claims all but ensures that the exceptions to § 101 swallow
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`the rule.” Enfish, 822 F.3d at 1337 (citing Alice, 573 U.S. at 215). While the Court acknowledges
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`that the Federal Circuit has determined other claims directed to the requesting, sending, and
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`identifying of information are abstract, this does not mean that the present claims are abstract
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`simply because they involve steps of requesting, sending, and identifying information. Id. at 1335
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`(“The ‘directed to’ inquiry, therefore, cannot simply ask whether the claims involve a patent-
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`ineligible concept, because essentially every routinely patent-eligible claim involving physical
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`products and actions involves a law of nature and/or natural phenomenon—after all, they take
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`place in the physical world. Rather, the ‘directed to’ inquiry applies a stage-one filter to claims,
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`2 Citations to the specifications of the Asserted Patents will reference only Dkt. No. 26-1, as the patents share a
`specification.
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`considered in light of the specification, based on whether ‘their character as a whole is directed to
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`excluded subject matter.’”)
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`Defendants present the Court with a proposed abstract idea framework that, in the initial
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`stage-one filter, boils the asserted claims down to nothing more than the actions of “requesting,”
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`“sending,” and “identifying.” Defendants even fail to point out that these actions are constrained
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`to internet communications. See generally Dkt. No. 26-1; id. at Claim 1 (performing steps “over
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`the Internet”). Furthermore, Defendants’ middle school analogy of Bill asking Alice to see if
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`Susan will go to the school dance with him wholly fails to encompass the asserted claims—
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`including by failing to account for particular steps in the claims (no analogue presented for, e.g.,
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`the “selecting, by the requesting client device, an IP address from the list” step of Claim 1 of the
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`’511 Patent), as well as failing to present an analogue for the claims of the ’968 Patent at all.
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`For these reasons, the Court concludes that Defendants have failed to meet their burden to
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`establish that the asserted claims are directed to an abstract idea. Consequently, the asserted
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`patents’ eligibility remains intact and further analysis addressing Step Two of the Alice test
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`becomes unnecessary.
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`IV.
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`CONCLUSION
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`For the reasons described herein, the Court DENIES the Rule 12(b)(6) Motion to Dismiss
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`(Dkt. No. 37) filed by Defendants Code200, UAB; Oxysales, UAB; Metacluster LT, UAB.
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`So ORDERED and SIGNED this 9th day of February, 2021.
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`RODNEY GILSTRAP
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