Case 6:21-cv-00898-ADA Document 142 Filed 08/30/23 Page 1 of 29
`
`
`IN THE UNITED STATES DISTRICT COURT
`WESTERN DISTRICT OF TEXAS
`WACO DIVISION
`
`
`
`
`
`Civil Action No. 6:21-cv-00898-ADA-DTG
`
`JURY TRIAL DEMANDED
`
`
`
`
`Defendants.
`
`MOTION FOR SUMMARY JUDGMENT OF
`INVALIDITY UNDER 35 U.S.C. § 101
`
`ALMONDNET, INC.,
`
`
`Plaintiff,
`
`
`AMAZON.COM, INC.; AMAZON.COM
`SERVICES LLC; and AMAZON WEB
`SERVICES, INC.,
`
`
`
`
`v.
`
`
`
`
`
`
`

`

`Case 6:21-cv-00898-ADA Document 142 Filed 08/30/23 Page 2 of 29
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`
`TABLE OF CONTENTS
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`
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`Page
`
`I.
`
`FACTUAL BACKGROUND ..............................................................................................2
`
`A.
`
`B.
`
`The history of Internet advertising. ..........................................................................2
`
`The Asserted Patents ................................................................................................3
`
`1.
`
`2.
`
`The ’639 and ’586 patents............................................................................3
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`The ’139 patent ............................................................................................6
`
`II.
`
`ARGUMENT .......................................................................................................................9
`
`A.
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`The ’639 and ’586 patents are patent ineligible under § 101. ..................................9
`
`1.
`
`2.
`
`The asserted claims of the ’639 and ’586 patents are directed to
`the abstract idea of receiving revenue from internet advertising
`targeted using user profile and website visit information. ...........................9
`
`The asserted claims of the ’639 and ’586 patents add no
`inventive concept. ......................................................................................12
`
`B.
`
`The ’139 patent is patent ineligible under §101. ....................................................17
`
`1.
`
`2.
`
`The asserted claims of the ’139 patent are drawn to the abstract
`idea of directing targeted advertisements to users on a second
`website based on profile information collected from a first
`website if a condition is met. .....................................................................17
`
`The asserted claims of the ’139 patent recite no inventive
`concept. ......................................................................................................19
`
`III.
`
`CONCLUSION ..................................................................................................................23
`
`
`
`
`i
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`

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`Case 6:21-cv-00898-ADA Document 142 Filed 08/30/23 Page 3 of 29
`
`TABLE OF AUTHORITIES
`
`
`
`Page(s)
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`
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`CASES
`
`Affinity Labs of Tex., LLC v. DIRECTV, LLC,
`838 F.3d 1253 (Fed. Cir. 2016)..........................................................................................15, 21
`
`Alice Corp. Pty. Ltd. v. CLS Bank Int’l,
`573 U.S. 208 (2014) ......................................................................................................... passim
`
`Berkheimer v. HP Inc.,
`881 F.3d 1360 (Fed. Cir. 2018)..................................................................................................9
`
`Bridge & Post, Inc. v. Verizon Commc'ns, Inc.,
`778 F. App’x 882 (Fed. Cir. 2019) ....................................................................................12, 19
`
`Broadband iTV, Inc. v. Amazon.com, Inc.,
`No. 6:20-CV-00921-ADA, 2022 WL 4703425 (W.D. Tex. Sept. 30, 2022) ..........9, 12, 13, 20
`
`BSG Tech LLC v. BuySeasons, Inc.,
`899 F.3d 1281 (Fed. Cir. 2018)................................................................................9, 12, 14, 19
`
`buySAFE, Inc. v. Google, Inc.,
`765 F.3d 1350 (Fed. Cir. 2014)..........................................................................................11, 18
`
`Content Extraction & Transmission LLC v. Wells Fargo Bank, Nat’l Ass’n,
`776 F.3d 1343 (Fed. Cir. 2014)............................................................................................2, 16
`
`Customedia Techs., LLC v. Dish Network Corp.,
`951 F.3d 1359 (Fed. Cir. 2020)......................................................................................2, 11, 18
`
`Elec. Power Grp., LLC v. Alstom S.A.,
`830 F.3d 1350 (Fed. Cir. 2016)..................................................................................2, 9, 10, 18
`
`Enfish, LLC v. Microsoft Corp.,
`822 F.3d 1327 (Fed. Cir. 2016)................................................................................................10
`
`In re Morsa,
`809 F. App’x ................................................................................................................11, 12, 18
`
`Intell. Ventures I LLC v. Erie Indem. Co.,
`850 F.3d 1315 (Fed. Cir. 2017)..........................................................................................13, 20
`
`Mayo Collaborative Servs. v. Prometheus Labs., Inc.,
`566 U.S. 66 (2012) .....................................................................................................................9
`
`ii
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`

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`Case 6:21-cv-00898-ADA Document 142 Filed 08/30/23 Page 4 of 29
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`
`
`TABLE OF AUTHORITIES
`(Continued)
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`
`
`Page(s)
`
`OIP Techs., Inc. v. Amazon.com, Inc.,
`788 F.3d 1359 (Fed. Cir. )........................................................................................................18
`
`PersonalWeb Technologies LLC v. Google LLC,
`8 F.4th 1310 (Fed. Cir. 2021) ..................................................................................................14
`
`SAP Am., Inc. v. InvestPic, LLC,
`898 F.3d 1161 (Fed. Cir. 2018)....................................................................................11, 18, 20
`
`Univ. of Fla. Rsch. Found., Inc. v. Gen. Elec. Co.,
`916 F.3d 1363 (Fed. Cir. 2019)................................................................................................19
`
`USC IP P’ship, L.P. v. Facebook, Inc.,
`576 F. Supp. 3d 446 (W.D. Tex. 2021)....................................................................9, 12, 15, 20
`
`
`
`
`iii
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`

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`Case 6:21-cv-00898-ADA Document 142 Filed 08/30/23 Page 5 of 29
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`In this case, AlmondNet asserts three patents, each related to particular business
`
`arrangements using targeted advertising. The titles of the patents, which recite revenue and profit,
`
`make clear that the claimed inventions are about business arrangements, not technology.
`
`(Dkt. 68-9 (“’639 patent”) (titled “Added-Revenue Off-Site Targeted Internet Advertising”);
`
`Dkt. 68-1 (“’586 patent”) (titled “Computerized Systems for Added-Revenue Off-Site Targeted
`
`Internet Advertising”), Dkt. 68-7 (“’139 patent”) (titled “Media Properties Selection Method and
`
`System Based on Expected Profit from Profile-Based Ad Delivery”).)
`
`The related ’639 and ’586 patents describe a simple idea to address the problem of
`
`“saturation,” when an advertiser wishes to target a visitor on a website that cannot accommodate
`
`additional advertisements. The patents propose a business arrangement between a first and second
`
`website for display of overflow ads: the advertiser pays a first website to display an ad to a visitor;
`
`the first website places a tag on the user’s computer when they visit the first website; the second
`
`website recognizes the visitor based on the tag and displays the ad; and the first and second
`
`websites split the revenue from the advertiser. The ’139 patent also describes a simple business
`
`idea to ensure profit from targeted advertising: collecting profile information about users that visit
`
`a first website and tagging those users; identifying the websites that charge less to display an ad
`
`than an advertiser is willing to pay to target that user (e.g., where displaying an ad would be
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`profitable for the advertiser); and displaying the advertisement when the tagged user visits one of
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`these websites. But the patents claim only these high-level business arrangements and practices,
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`in a results-focused fashion, and do not disclose any technological solution. They claim no new
`
`or improved means of tagging or collecting profile information about website visitors or displaying
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`advertisements.
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`1
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`

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`Case 6:21-cv-00898-ADA Document 142 Filed 08/30/23 Page 6 of 29
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`A long line of Federal Circuit cases has held such claims abstract at Alice step one. Elec.
`
`Power Grp., LLC v. Alstom S.A., 830 F.3d 1350, 1356 (Fed. Cir. 2016) (“result-focused,
`
`functional” claims are ineligible under § 101, “especially in the area of using generic computer
`
`and network technology to carry out economic transactions.”); Content Extraction & Transmission
`
`LLC v. Wells Fargo Bank, Nat’l Ass’n, 776 F.3d 1343, 1347 (Fed. Cir. 2014) (“formation and
`
`manipulation of economic relations”) (collecting cases); Customedia Techs., LLC v. Dish Network
`
`Corp., 951 F.3d 1359, 1362 (Fed. Cir. 2020) (“the abstract idea of using a computer to deliver
`
`targeted advertising to a user.”). AlmondNet’s asserted claims are no different; they are directed
`
`to abstract ideas.
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`They are also non-inventive at Alice step two: based on the patents themselves, as well as
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`admissions by AlmondNet’s technical expert and the patent inventor, there is no dispute that the
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`asserted claims recite only well-understood, routine, and conventional components and steps or
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`purely functional limitations. And the patents claim these steps and components in a logical and
`
`conventional order necessary to carry out the abstract idea. The claims are thus non-inventive, and
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`ineligible under § 101. The Court should grant summary judgment of invalidity.
`
`I.
`
`FACTUAL BACKGROUND
`
`A.
`
`The history of Internet advertising.
`
`The idea of targeted advertisement dates back at least to the early 1900’s, when companies
`
`like Proctor and Gamble sought to advertise household products to customers in specific urban
`
`markets. (Decl. of Eric A. Menist (“Menist Decl.”) Ex. 16 (“Hanson Rep.”) ¶ 51.) The goal of
`
`targeted advertising is to “
`
`
`
`.” (Hanson Rep. ¶ 60.) As methods of communication evolved, i.e., with
`
`the mass-market adoption of radio and television, advertisers developed new campaigns and
`
`strategies to reach target customers. (See id. ¶¶ 61-111.)
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`2
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`

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`Case 6:21-cv-00898-ADA Document 142 Filed 08/30/23 Page 7 of 29
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`The advent of the Internet beginning in the early 1990’s provided a new opportunity for
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`advertisers and spurred important technological innovation. (See id. ¶¶ 55, 76-77 (internet
`
`commercialized in early 1990s and ad campaigns began in 1994).) One of the most significant
`
`innovations in Internet advertising was the development in the early- to mid-1990’s of visitor
`
`tracking technology such as Netscape’s “cookie” system,
`
`
`
` (Id. ¶¶ 78-81;
`
`see also ’139 patent, 1:28-2:13.) Internet advertising firms, such as DoubleClick, tracked users
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`across a network of websites, collected data in databases, and placed specific ads to users based
`
`on that data. (See id. ¶¶ 82, 90, 92, 94-111.) By the late 1990s,
`
`
`
`. (Id. ¶¶ 1049, 1125.) As discussed below, the asserted patents describe and
`
`claim particular business arrangements related to targeted internet advertising and utilize this well-
`
`known technology.
`
`B.
`
`The Asserted Patents1
`
`1.
`
`The ’639 and ’586 patents.
`
`The ’639 patent is titled “Added-Revenue Off-Site Targeted Internet Advertising.” The
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`’586 patent is titled “Computerized Systems for Added-Revenue Off-Site Targeted Internet
`
`Advertising.” Both patents share an identical specification and substantially similar claims and
`
`claim priority to an application dated November 28, 2000. (Hanson Rep. ¶¶ 139, 147.)
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`The patents purport to address the well-known problem of a lack of advertising space,
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`which the patents refer to as “saturation.”2 (’639 patent, 2:10-13; Hanson Rep. ¶ 140.) Saturation
`
`
`1 AlmondNet asserts claims 24, 29, 31, 32 and 44 of the ’639 patent, claims 1, 3, 4, 11-13, 16,
`17 and 20 of the ’586 patent, and claims 37, 42, 43, 45 and 48 of the ’139 patent. This motion
`challenges all asserted claims.
`2 Citations to the specification of the ’639 patent apply equally to the ’586 patent. (Hanson
`Rep. ¶ 148.)
`
`3
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`

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`Case 6:21-cv-00898-ADA Document 142 Filed 08/30/23 Page 8 of 29
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`occurs when a website has more demand to place ads than it has space to display. (’639 patent,
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`
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`2:10-13, 2:25-27; Hanson Rep. ¶ 140.) As the specification explains, saturation “is itself not a
`
`technical problem but rather one of financial, aesthetic and pragmatic considerations.” (’639
`
`patent, 2:48-51.) Indeed, the problem of saturation long pre-dated the Internet, and existed in print
`
`media such as newspapers and magazines for a century. (See id., 2:56-59, 2:35-37; Hanson Rep.
`
`¶ 140.) The patents purport to solve the non-technical problem of saturation with a non-technical
`
`solution: placing overflow ads (referred to variously as “special messages” or “non-core
`
`information”) on a different website. (’639 patent, 2:56-59 (“[t]his solution is achieved by making
`
`an alternative site . . . available for additional special messages.”).) According to the patent, once
`
`a first website reaches saturation, it directs the advertisement to a second website through an
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`agency, which allows the advertiser to reach “substantially the same targeted client base” on an
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`“off-site basis at another site servicing substantially the same client base.” (Id., 6:38-43; Hanson
`
`Rep. ¶ 142.)
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`The specification describes three contracts that facilitate this business arrangement, each
`
`involving an “agency” as an intermediary. (’639 patent, 7:35-36; Hanson Rep. ¶ 143.) First, the
`
`advertiser pays the agency to deliver an ad to an identified visitor. (’639 patent, 7:35-44.) Second,
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`the agency pays a first broadcaster—i.e., the publisher of the first website—to track visitors to the
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`first website and provide a second website for displaying overflow ads to identified visitors. (’639
`
`patent, 7:45-50, 53-54.) Third, the agency pays a second broadcaster—i.e., the publisher of the
`
`second website—to recognize and present an advertisement to the tagged visitor. (Id., 7:55-61;
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`Hanson Rep. ¶ 144.) According to the patents, all parties benefit from the arrangement: the first
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`website receives additional ad revenue despite having reached saturation; the agency is paid for its
`
`facilitating role; the second website receives additional revenue from display of the ad; and the
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`4
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`Case 6:21-cv-00898-ADA Document 142 Filed 08/30/23 Page 9 of 29
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`advertiser can target an advertisement to a desired visitor. (See ’639 patent, 10:65-11:6.) The
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`
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`patents provide an example of this arrangement: an advertiser pays $50 CPM3 to deliver an offsite
`
`ad, the agency helps a saturated first site “AAA” place the ad on a second site “BBB,” which
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`normally charges $30 CPM, and the $20 CPM difference is split among the parties. (Id., Abstract;
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`Hanson Rep. ¶ 144.)
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`The key to the claimed invention is tagging visitors at a first website and to identify them
`
`using the tag when they visit a second website.4 (See ’639 patent, Abstract, 10:45-50, cl. 24; 586
`
`patent, cl. 1.) But the claims do not require any new or unconventional way of tagging users;
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`tagging is described in the patent as any generic way of identifying a website visitor. (See ’639
`
`patent, 5:23-32; Hanson Rep. ¶ 145.) Nor do the patents provide any new technology for tagging;
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`they describe and claim only the existing, well-known method of inserting a cookie into a visitor’s
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`browser. (’639 patent, 10:48-50, 4:39-45.)
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`The patents also describe no new technology for serving targeted advertisements. (Hanson
`
`Rep. ¶ 146.) Instead, they make clear that the alleged invention uses “existing modules and
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`technology” that the patentee did not claim to invent. (’639 patent, 2:55-58.) This “existing”
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`technology includes, for example, the “Internet,” websites, “computers,” “electronic records,” and
`
`a “tag.” (Id., cl. 24). And the limited technological descriptions in the patent are high-level and
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`functional. (See id., 25:43-63 (describing a “computer program product,” “computer readable
`
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`3 “CPM” refers to cost per thousand impressions. (Hanson Rep. ¶ 114.) “A CPM of $1.00 for
`a standard banner ad means the publisher receives $1.00 for every thousand ads it displays.” (Id.)
`4 In the claimed invention, the first website places a tag on the visitor when it visits the first
`site. (’639 patent, 10:47-49.) The tags are later recognized “when a tagged visitor requests a visit
`to the second” site. (Id., 10:51-54.) The visitor receives the ad at the second site after the second
`site recognizes the tag. (Id., 10:55-59; Hanson Rep. ¶ 145.)
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`5
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`Case 6:21-cv-00898-ADA Document 142 Filed 08/30/23 Page 10 of 29
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`program code,” and “computer readable software” in functional terms), 28:12-22 (describing a
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`
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`“program storage device readable by machine” in functional terms).)
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`AlmondNet asserts just one independent claim of the ’639 patent—claim 24—which
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`recites a method for securing revenue for offsite targeted Internet advertising, comprising:
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`(1) using a tag to create a record of a visitor computer visiting a first internet site, (2) delivering
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`an advertisement to the visitor computer visiting a second internet site as a consequence of
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`determining, using the tag and record, that the visitor computer visited the first internet site, and
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`(3) causing the first internet site to receive a portion of the revenue from the advertisement. (’639
`
`patent, cl. 24.) AlmondNet asserts two independent claims of the ’586 patent—claims 1 and 11—
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`both of which require a “tangible computer system programmed to implement” substantially the
`
`same method as claim 24 of the ’639 patent. (’586 patent, cls. 1, 11.)
`
`2.
`
`The ’139 patent
`
`The ’139 patent is titled “Media Properties Selection Method and System Based on
`
`Expected Profit from Profile-Based Ad Delivery.” (’139 patent, Cover.) The patent purports to
`
`claim priority to an application filed June 16, 2006. (Id.; Hanson Rep. ¶ 149.) The patent claims
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`an “automatic system” for something humans can do and have done before: calculating profit for
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`an ad placement and placing ads only when profitable. (139 patent, Abstract; Hanson Rep. ¶ 150.)
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`More specifically, the patent describes the idea of calculating profits derived from selecting and
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`displaying an advertisement to a visitor visiting a second media property, based on a profile created
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`for the visitor who visited a first property. (See ’639 patent, Abstract, cl. 37, 1:22-24 (“present
`
`invention relates to electronic advertisement placement based on expected profit from the
`
`placement.”).)
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`The patent purportedly addresses the business problem of a “behavioral targeting” or “BT”
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`company that does not generate enough revenue from an ad to cover the cost of buying the ad
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`6
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`Case 6:21-cv-00898-ADA Document 142 Filed 08/30/23 Page 11 of 29
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`space on a media property. (Id., 6:1-8.) A BT company is one that specializes in “targeting ads
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`
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`based on observed” visitor behavior at “specific sections of a publisher’s website.” (See id., 1:63-
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`2:4.) A “media property” is a “web site, TV channel, radio show . . ., computer, a mobile device,
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`a TV set, . . . or any other device.” (Id., 3:21-26.)
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`The patent describes two simple mathematical formulas to calculate expected profit from
`
`placing an ad: (1) deduct the ad space cost from the expected ad revenue (id., 6:64-7:2); and
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`(2) deduct the ad space cost, sales cost, and desired margin from expected ad revenue (id., 7:3-8).
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`In the business arrangement described in the patent, a user visits a first media property (website),
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`and the BT company recognizes the user’s activities on the first property. (Id., 7:55-64.) The BT
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`company then determines “how much advertisers are willing to pay for delivering ads to” that user
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`based on the user’s collected information, described as a “profile.” (Id., 8:9-29.) To do so, the BT
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`company uses the above formulas to calculate expected revenue. (Id., 8:23-29.) Next, the BT
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`company selects a second media property (website) with ad space, where the cost to display the ad
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`is less than the “calculated expected profit” of placing the ad. (Id., 8:30-35.) To ensure the second
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`media property recognizes the user, the BT company arranges to tag the visitor “with a tag readable
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`by the [second] media property.” (Id., 8:34-35.) The company can place the tag in many ways,
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`such as using cookies. (See id., 8:37-63.) Finally, when the user next visits the second property,
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`the second property recognizes the tag and
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`“will arrange for the BT company 30 to serve
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`an ad (720) to the visitor.” (See id., 8:64-9:3;
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`see also Hanson Rep. ¶¶ 151-52.) Figure 1 of
`
`the patent, reproduced here, is a flow diagram
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`that shows the basic steps of the claimed
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`7
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`Case 6:21-cv-00898-ADA Document 142 Filed 08/30/23 Page 12 of 29
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`process: recognize a user, determine profit from serving the user with an ad, identify websites
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`
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`where serving an ad would be profitable, and store a tag so those sites can recognize and serve an
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`ad to the user.
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`The patent provides an example of how this works in practice: when a user searches for
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`“mortgage” on a first website, i.e., Google, the BT Company calculates expected revenue of
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`$9 from showing the user a mortgage-related (id., 9:45-53); the BT Company knows delivering
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`ads to the second website, weather.com, costs $3 (id., 9:53-56); and the BT Company then
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`determines it can earn a profit of $6 when it delivers a mortgage-related ad to the user when the
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`user visits weather.com (id., 9:56-60). (See Hanson Rep. ¶ 153.)
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`The patent describes no new technology for serving the targeted advertisement. Like the
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`saturation patents, the ’139 patent provides no technical solution for tagging users. It defines a
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`“tag” as a generic “identifier used to mark a person electronically visiting a media property, such
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`as a web site.” (Id., 3:21-26; Hanson Rep. ¶ 154.) It describes only the use of cookies, an existing
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`method that predated the patent, as a way to tag visitors. (Id.) The patent generally describes and
`
`claims generic components and computing functions, such as “computers,” “electronic
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`advertisements,” “electronic visitors,” “media property,” “automatically directing,” “server,”
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`“indicia of a condition,” “automatically electronically authorizing,” “determining,” “profile
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`attributes,” and “visiting.” (See ’139 patent, cl. 37, Fig. 3 (depicting generic servers and computers
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`and the internet as boxes and cylinders); see also Hanson Rep. ¶ 155.)
`
`AlmondNet asserts only one independent claim—claim 37—of the ’139 patent. It requires
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`a computer system that performs the basic steps of: (1) directing “conditions” to a third party
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`server for displaying an advertisement to an electronic visitor; (2) determining whether a condition
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`is met by an electronic visitor on a second media property after visiting a first media property,
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`8
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`Case 6:21-cv-00898-ADA Document 142 Filed 08/30/23 Page 13 of 29
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`where the determination is made based on profile information applicable to the electronic visitor
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`
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`collected as a result of the visit to the first media property; and (3) displaying a targeted
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`advertisement to the electronic visitor on the second media property if the condition is met. (’139
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`patent, cl. 37.)
`
`II.
`
`ARGUMENT
`
`The Supreme Court directs courts to take a two-step approach in evaluating patent
`
`eligibility. Alice Corp. Pty. Ltd. v. CLS Bank Int’l, 573 U.S. 208, 217 (2014). First, the court must
`
`determine whether the claims are directed to an abstract idea. Id. If so, the court must decide
`
`whether the claims add an “inventive concept”—“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 [abstract idea] itself.’” Id. at 217-18 (quoting Mayo Collaborative Servs. v. Prometheus Labs.,
`
`Inc., 566 U.S. 66, 72-73 (2012)). Because patent eligibility is an issue of law, resolving eligibility
`
`rarely involves “genuine disputes over the underlying facts material to the § 101 inquiry.”
`
`Berkheimer v. HP Inc., 881 F.3d 1360, 1368 (Fed. Cir. 2018). That is why courts routinely resolve
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`patent eligibility at summary judgment. See BSG Tech LLC v. BuySeasons, Inc., 899 F.3d 1281,
`
`1291 (Fed. Cir. 2018); Broadband iTV, Inc. v. Amazon.com, Inc., No. 6:20-CV-00921-ADA, 2022
`
`WL 4703425, at *18 (W.D. Tex. Sept. 30, 2022); USC IP P’ship, L.P. v. Facebook, Inc., 576 F.
`
`Supp. 3d 446 (W.D. Tex. 2021).
`
`A.
`
`The ’639 and ’586 patents are patent ineligible under § 101.
`
`1.
`
`The asserted claims of the ’639 and ’586 patents are directed to the
`abstract idea of receiving revenue from internet advertising targeted
`using user profile and website visit information.
`
`At Alice step one, courts look at the focus of the claims to determine their “character as a
`
`whole.” Elec. Power Grp., 830 F.3d at 1353. Here, the asserted claims of the ’639 and ’586 focus
`
`on a business arrangement that expands advertising opportunities by referring overflow ads to a
`
`9
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`Case 6:21-cv-00898-ADA Document 142 Filed 08/30/23 Page 14 of 29
`Case 6:21-cv-00898-ADA Document 142 Filed 08/30/23 Page 14 of 29
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`second website. (Hanson Rep. § 1049.)? Each independentclaim recites the following basic steps:
`
`(1) use a tag to create a record of a visitor computer visiting a first internet site; (2) deliver an ad
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`to the visitor computer visiting a second internet site as a consequence of determining, using the
`
`tag and record, that the visitor computervisited the first site; and (3) causeat least the first site to
`
`receive a portion of the revenue from the ad. (See, e.g., °639 patent, cl. 24; °586 patent, cls. 1, 11.)
`
`Moresimply, the claimsre:
`
`I©(20:00 Rep. 1050.) The claims
`
`recite only these resw/ts and provide no specific technological solution or improvement to
`
`computing technology to achieve them. (See Hanson Rep. § 1049-54.) They are therefore abstract
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`at Alice step one. Elec. Power Grp., 830 F.3d at 1356 (“result-focused, functional character of
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`claim language has been a frequent feature of claims held ineligible under § 101, especially in the
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`area of using generic computer and network technology to carry out economic transactions.’’);
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`Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1335-36 (Fed. Cir. 2016) (“the first step in the
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`Alice inquiry in this case asks whether the focus of the claims is on the specific asserted
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`improvement in computer capabilities .
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`.
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`. or, instead, on a process that qualifies as an ‘abstract
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`idea’ for which computers are invoked merely as a tool.”).
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`It makes sense that the patents provide no specific technical solution because the problem
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`they purport to solve—saturation—is a non-technical problem that requires a non-technical,
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`business solution. That solution is a series of contracts between and among an agency and two
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`websites.
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`(lanson Rep. 1052(a
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`° The analysis in this section and Dr. Hanson’s report applies to both the 639 and ’586 patents.
`See Hanson Rep.
`1109-10
`
`)-)
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`Case 6:21-cv-00898-ADA Document 142 Filed 08/30/23 Page 15 of 29
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` ’639 patent, 2:50-54, 3:15-19, 5:65-6:3.)
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`
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`
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` (Hanson Rep. ¶ 1049.) Both the Supreme Court in Alice and the Federal
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`Circuit in numerous cases that followed have held claims directed to a business arrangement
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`implemented on the internet to be abstract and ineligible. See Alice, 573 U.S. at 219 (“method of
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`exchanging financial obligations between two parties using a third-party intermediary to mitigate
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`settlement risk”); buySAFE, Inc. v. Google, Inc., 765 F.3d 1350, 1355 (Fed. Cir. 2014)
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`(invalidating claims “squarely about creating a contractual relationship—a ‘transaction
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`performance guaranty’—that is beyond question of ancient lineage.”); SAP Am., Inc. v. InvestPic,
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`LLC, 898 F.3d 1161, 1168 (Fed. Cir. 2018) (“the creation and manipulation of legal obligations
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`such as contracts involved in fundamental economic practices” are abstract) (citation omitted).
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`The fact that the patents attempt to claim a business arrangement in the context of targeted
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`advertising over the Internet does not make them any less abstract; the Federal Circuit has
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`consistently held claims directed to targeted advertising impermissibly abstract. For example, in
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`Customedia Techs., LLC, the Federal Circuit held claims reciting a “programmable local receiver
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`unit” with “advertising data storage . . . for storing the specifically identified advertising data’”
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`were “directed to the abstract idea of using a computer to deliver targeted advertising to a user.”
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`951 F.3d at 1362-63. Similarly, in In re Morsa, the Federal Circuit invalidated claims reciting the
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`steps of (1) receiving user information; (2) saving the information; (3) receiving from advertisers
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`associations between certain criteria, an ad, and a bid to place that ad; (4) determining if the criteria
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`matches the user information; (5) determining the highest bid; and (6) transmitting the ad. 809 F.
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`App’x 913, 915-16 (Fed. Cir. 2020). The court held the claims focused on targeted advertising
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`and bidding, “both abstract ideas relating to customizing information based on the user and
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`Case 6:21-cv-00898-ADA Document 142 Filed 08/30/23 Page 16 of 29
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`matching them to the advertiser.” Id. at 917 (citation and quotations omitted); see also Broadband
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`
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`iTV, 2022 WL 4703425, at *11-13 (“The Federal Circuit has held patents directed to collecting
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`information about a user’s past behavior and providing content based on that information to be
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`abstract and ineligible under § 101”); Bridge & Post, Inc. v. Verizon Commc'ns, Inc., 778 F. App’x
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`882, 889 (Fed. Cir. 2019) (claim reciting using a “tag” to identify a user is abstract and ineligible).
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`Thus, the asserted claims of the ’639 and ’586 patents amount to nothing more than the
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`abstract idea of receiving revenue from internet advertising targeted using user profile and website
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`visit information.6 They fail at step one of Alice.
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`2.
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`The asserted claims of the ’639 and ’586 patents add no inventive
`concept.
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`At step two, courts consider “the elements of each claim both individually and ‘as an ordered
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`combination’ to determine whether the additional elements ‘transform the nature of the claim’ into a
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`patent-eligible application.” Alice, 573 U.S. at 217. Here, the specification admits that the claimed
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`invention utilizes “generally existing, known modules and technology.” (’639 patent, 3:7-10; see
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`also id., 3:18-21; 3:35-43 (describing known ways websites sell ad space on their pages).)
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`For example, the asserted independent claims recite the following basic computing and
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`networking components: “computer,” “Internet site(s),” “electronic records,” and “tag,” as well
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`as basic communications over the Internet. (’639 patent, cl. 24; ’586 patent, cls. 1, 11.) Each was
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`well-understood, routine, and conventional as of the date of the patent. (Hanson Rep. ¶ 1057-58,
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`1113.) Generic “computers” and the “Internet” are non-inventive as a matter of law. See USC IP
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`P’ship, L.P., 576 F. Supp. 3d at 457 (elements that amount to nothing “other than off-the-shelf,
`
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`6 The patents’ dependent claims—which require tagging for specific user actions, calculating
`price on an impression basis, and displaying ads on web TV—merely narrow and do not change
`the focus of the claims. See BSG Tech LLC, 899 F.3d 1281 at 1287 (“claim is not patent eligible
`merely because it applies an abstract idea in a narrow way.”). They too are directed to an abstract
`idea.
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`12
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`Case 6:21-cv-00898-ADA Document 142 Filed 08/30/23 Page 17 of 29
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`conventional computer, network, and display technology for gathering, sending, and presenting
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`
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`the desired information” are conventional); Broadband iTV, 2022 WL 4703425, at *17
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`(conventional databases storing data, conventional servers for processing data). The ’586 patent’s
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`“tangible computer system programmed to implement” the claimed method
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`
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` (Hanson Rep. ¶ 1113 (citing ’586 patent, Abstract, 1:32-34).)
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`The use of tags and cookies was also well-known and non-inventive. See, e.g., Intell.
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`Ventures I LLC v. Erie Indem. Co., 850 F.3d 1315, 1328 (Fed. Cir. 2017) (“we fail to see how the
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`patentee's use of a well-known tag . . . sufficiently transforms