Kaavo Inc. v. Amazon.Com Inc. et al

BRIEF

D. Del.October 7, 2016

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE KAAVO INC. ) ) Plaintiff, ) ) Civil Action No. 1:14-cv-353-LPS-CJB v. ) ) AMAZON.COM, INC. and ) AMAZON WEB SERVICES, INC. ) ) Defendants. ) ) KAAVO INC. ) ) Plaintiff, ) ) Civil Action No. 1:14-cv-1193-LPS-CJB v. ) ) TIER 3, INC. et al. ) ) Defendants. ) ) PLAINTIFF KAAVO INC.'S COMBINED OPPOSITION TO DEFENDANTS' MOTION FOR SUMMARY JUDGMENT AND REPLY CLAIM CONSTRUCTION BRIEF Stamatios Stamoulis #4606 Richard C. Weinblatt #5080 STAMOULIS & WEINBLATT LLC Two Fox Point Centre 6 Denny Road, Suite 307 Wilmington, DE 19809 Telephone: (302) 999-1540 stamoulis@swdelaw.com weinblatt@swdelaw.com Attorneys for Plaintiff Kaavo Inc. Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 1 of 37 PageID #: 4186 i TABLE OF CONTENTS Page I. NATURE AND STAGE .......................................................................................................... 1 II. SUMMARY OF THE ARGUMENT....................................................................................... 1 III. STATEMENT OF FACTS ....................................................................................................... 2 IV. Legal Standard .......................................................................................................................... 8 A. Rule 56 Motion ......................................................................................................................... 8 B. Defendants' Clear and Convincing Burden of Proof regarding § 101 ..................................... 9 C. Patentability Under 35 U.S.C. § 101 ...................................................................................... 10 V. ARGUMENT .......................................................................................................................... 11 A. Defendants Failed to Overcome the Burden of Production Regarding the Presumption of Validity .......................................................................................................... 11 B. The Dependent Claims of the '974 Patent Are Patentable Under the Alice Framework .............................................................................................................................. 12 1. The Dependent Claims of the '974 Patent Are Not Directed to an Abstract Idea ............... 13 2. The Claims Provide a Patent-Eligible Inventive Concept ................................................... 18 3. The Claims Are Not Overly Preemptive ............................................................................. 21 VI. CLAIM CONSTRUCTION ................................................................................................... 25 A. "cloud provider" (claims 2, 3, 4, 14, 15, 16, 25, 26, 27, 36, 37, 38) ...................................... 25 B. "needs analysis algorithm" (claims 8, 20, 31, 42) .................................................................. 25 C. "initial cloud environment" (claims 1, 3, 13, 15, 24, 26, 35, 37) ........................................... 26 D. "initial cloud environment configuration" (claims 1, 2, 3, 13, 14, 15, 24, 25, 26, 35, 36, 37) ...................................................................................................................................... 26 E. "adjusted cloud environment" (claims 1, 2, 4, 13, 14, 16, 24, 25, 27, 35, 36, 38) ................. 27 F. "determining [or determine] a requested initial cloud environment based on user- defined provisioning information" (claims 1, 13, 24, 35) ....................................................... 27 G. "application data" (claims 1, 13, 24, 35) ................................................................................. 28 Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 2 of 37 PageID #: 4187 ii H. "cloud adjustment event" (claims 2, 4, 14, 16, 25, 27, 36, 38) ............................................... 29 I. "determining [or determine] a requested security action based on the security information" (claims 11, 23, 34, 45) ....................................................................................... 29 J. "sending [or send] a security event based on the requested security action" (claims 11, 23, 34, 45) ......................................................................................................................... 30 VII. CONCLUSION ....................................................................................................................... 30 Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 3 of 37 PageID #: 4188 iii TABLE OF AUTHORITIES Page(s) Cases Abbot Labs v. Sandoz, Inc., 544 F.3d 1341 (Fed. Cir. 2008) ................................................................ 9 Alice Corp. Pty. Ltd. v. CLS Bank Int'l, 134 S. Ct. 2347 (2014) .................................................. passim Altoona Publix Theatres, Inc. v. American Tri-Ergon Corp., 294 U.S. 477 (U.S. 1935) .................................................................................................................................................. 9 Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986) ..................................................................... 8, 9 ArcelorMittal France v. AK Steel Corp., 700 F.3d 1314 (Fed. Cir. 2012) ......................................... 28 Association for Molecular Pathology v. Myriad Genetics, Inc., 133 S. Ct. 2107 (2013) ............................................................................................................................................... 12 Bascom Global Internet Svs., Inc. v. AT&T Mobility LLC, 827 F.3d 1341 (Fed. Cir. 2016) ......................................................................................................................................... passim Bilski v. Kappos, 561 U.S. 593 (2010) ................................................................................ 9, 10, 18, 22 buySAFE, Inc. v. Google, Inc., 765 F.3d 1350 (Fed. Cir. 2014) ......................................................... 14 Celotex Corp. v. Catrett, 477 U.S. 317 (1986) ..................................................................................... 8 CLS Bank Int'l v. Alice Corp. Pty. Ltd., 717 F.3d 1269 (Fed. Cir. 2013) (en banc) ..................... 11, 12 Commil USA, LLC v. Cisco Systems, Inc., 135 S. Ct. 1920 (2015) .................................................... 9 Continental Can Co. v. Monsanto Co., 948 F.2d 1264 (Fed. Cir. 1991) .............................................. 9 Cordance Corp. v. Amazon.com, Inc., 639 F. Supp. 2d 406 (D. Del. 2009) ...................................... 24 DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245 (Fed. Cir. 2014) ........................................ 14 Diamond v. Diehr, 450 U.S. 175 (1981) ......................................................................................... 5, 13 Electric Power Grp. LLC, v. Alstom S.A., 2016 WL 4073318 (Fed. Cir. Aug. 1, 2016) .......................................................................................................................................... 13, 14 Enfish, LLC v. Microsoft Corp., 822 F. 3d 1327 (Fed. Cir. 2016) ...................................... 1, 13, 16, 21 Eon Corp. IP Holdings LLC v. Silver Spring Networks, Inc., 815 F.3d 1314 (Fed. Cir. 2016) ............................................................................................................................. 27, 28, 29 Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 4 of 37 PageID #: 4189 iv Gottschalk v. Benson, 409 U.S. 63 (1972) .......................................................................................... 11 Graham v. John Deere Co., 383 U.S. 1 (1966) ..................................................................................... 8 Harrington Mfg. Co. v. Powell Mfg. Co., 815 F.2d 1478 (Fed. Cir. 1986) .......................................... 9 In re Bilski, 545 F.3d 943 (Fed. Cir. 2008) ......................................................................................... 10 In re Mouttet, 686 F.3d 1322 (Fed. Cir. 2012) ...................................................................................... 6 In re TLI Communications LLC Patent Litig., 823 F.3d 607 (Fed. Cir. 2016) ......................... 4, 13, 15 Intellectual Ventures I LLC v. Symantec Corp., No. 2015-1769, 2016 WL 5539870 (Fed. Cir. Sept. 30, 2016) ................................................................................................................ 23 Internet Patents Corp. v. Active Networks, Inc., 790 F.3d 1343, 1346 (Fed. Cir. 2015) ............................................................................................................................................ 5, 16 Mayo Collaborative Services v. Prometheus Laboratories, Inc., 132 S. Ct. 1289 (2012) ........................................................................................................................................ passim McRO, Inc. v. Bandai Namco Games Am. Inc., No. 2015-1080, 2016 WL 4759200 (Fed. Cir. Sept. 13, 2016) ................................................................................................ 4, 13, 18, 24 Microsoft Corp. v. i4i Ltd. P'ship, 131 S. Ct. 2238, 180 L.Ed.2d 131 (2011) .................................... 11 MobileMedia Ideas LLC v. Apple Inc., 780 F.3d 1159 (Fed. Cir.), cert. denied, 136 S. Ct. 270, 193 L. Ed. 2d 136 (2015) ................................................................................................ 6 Nautilus, Inc. v. Biosig Instruments, Inc., 134 S. Ct. 2120 (2014) ..................................................... 25 Nazomi Communications, Inc. v. Samsung Telecommunications, Inc., No. C-10- 05545 RMW, 2012 WL 967968 (N.D. Cal. Mar. 21, 2012) ............................................................ 9 O2 Micro Int'l v. Beyond Innovation Tech. Co., 521 F.3d 1351 (Fed. Cir. 2008) .................. 25, 28, 29 O'Reilly v. Morse, 56 U.S. 62 (1854) .................................................................................................. 13 Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005) (en banc) .................................................... 25 Reid v. State Farm Mut. Auto. Ins. Co., 784 F.2d 577 (5th Cir. 1986) ................................................. 9 Transcenic, Inc. v. Google, Inc., No. CV 11-582-LPS, 2014 WL 7275835 (D. Del. Dec. 22, 2014) ................................................................................................................................... 6 Transocean Offshore Deepwater Drilling, Inc. v. Maersk Contractors USA, Inc., 617 F.3d 1296, 1305 (Fed. Cir. 2010) .............................................................................................. 18, 20 Verizon v. Vonage, 503 F.3d 1295 (Fed. Cir. 2007) ........................................................................... 28 Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 5 of 37 PageID #: 4190 v Walker v. Sears, Roebuck & Co., 853 F.2d 355 (5th Cir. 1988) ........................................................... 9 Statutes 35 U.S.C. § 102 ................................................................................................................................... 11 35 U.S.C. § 103 ............................................................................................................................. 11, 20 35 U.S.C. § 112 ....................................................................................................................... 11, 18, 20 35 U.S.C. § 251 ................................................................................................................................... 11 35 U.S.C. § 282 ......................................................................................................................... 9, 11, 12 Rules FED. R. CIV. P. 56................................................................................................................................... 8 Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 6 of 37 PageID #: 4191 I. NATURE AND STAGE On March 31, 2016, the Court granted Defendants' Motion to Dismiss with respect to the '974 patent's independent claims and dependent claim 12 and denied without prejudice with respect to the remaining dependent claims. (D.I. 52.)1 On May 13, 2016, the Court issued a Scheduling Order (D.I. 57) addressing the remaining dependent claims. On May 27, 2016, Plaintiff filed a motion pursuant to Federal Rule of Civil Procedure 60 for relief from the Court's March 31, 2016 order based on new guidance provided by the Federal Circuit in Enfish, LLC v. Microsoft Corp., 822 F. 3d 1327 (Fed. Cir. 2016). That motion currently is pending. On September 9, 2016, Plaintiff filed its opening brief on claim construction issues. (D.I. 77.) On September 23, 2016, Defendants filed a combined answering claim construction brief and opening brief in support of their Motion for Summary Judgment pursuant to Federal Rule of Civil Procedure 56 (the "Motion"). (D.I. 80.) Kaavo submits this combined opposition to Defendants' Motion and reply on claim construction. II. SUMMARY OF THE ARGUMENT 1. The claims of the patent-in-suit are directed to an improvement in cloud-computing technology and not an abstract idea. 2. To the extent the Court proceeds to step two of Alice, the claims of the patent-in-suit each contain an inventive concept and Defendants' arguments to the contrary, at best, raise disputed issues of material fact. 3. The Court should adopt Kaavo's proposed claim constructions to settle the claim construction disputes that clearly exist between the parties. 1 D.I. __ citations throughout this brief are to C.A. No. 1:14-cv-1193 unless otherwise specified. Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 7 of 37 PageID #: 4192 2 III. STATEMENT OF FACTS A. The '974 Patent United States Patent No. 8,271,974 (the "'974 patent"), entitled "Cloud Computing Lifecycle Management for N-tier Applications," issued on September 18, 2012, is directed to methods, systems, and devices for improving the performance and management of cloud computing networks, JA-Tab 1 at 18:44-24:63 – and is directed to a very specific way of provisioning a cloud- based computing system for use by a software application. The '974 patent describes novel methods and approaches for managing and utilizing cloud services. With the innovative inventions of the '974 patent, people may run applications more efficiently and cloud computer resources may be more efficiently provisioned and utilized. The patent discloses and claims a method for a very specific way of provisioning and managing a cloud-based computing system for use by a software application. (D.I. 78-1 ("McGuinness Opening") at ¶ 34 (citing JA-Tab 1 at 18:44-24:63).) Optimal cloud provisioning needs to integrate initially static information (i.e. user deployment requirements such as server number, type, gathered through the user interface), with dynamic information gathered from monitoring services, along with considerations, such as security and redundancy requirements. The provider could meet user requirements by providing an abundance of services – more than the user could be expected to use, but that would be inefficient on the provider's part. The '974 patent is not simply about putting together a number of known considerations when putting together a large virtual network; it is about putting together a set of virtual services customized to user needs and determining when adjustments need to happen and then executing the adjustments at both the right time and in the right way. Further, it is about handling situations where the service includes resources that are provided by another resource provider when the scope and content of those new resources may have been previously unknown. Id. at ¶ 39. The '974 patent discloses in detail a set of comprehensive steps to achieve such a dynamically readjusting cloud service. JA-Tab 1 at 13:61-16:39. This comprehensive set of steps is disclosed in the '974 patent along with technical discussion about how to leverage them Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 8 of 37 PageID #: 4193 3 together in an appropriate manner and the patent provides an example configuration file. The example includes the list below: User Interface Processing; Provisioning and Deployment Management; Life Cycle State Management, Deployment Optimization; Runtime configuration management; Load forecasting, Pricing; Audit/Reporting; Multiple Provider Plug- Ins; Monitoring; Security; Alert/Notification Processing; Software Audit; Virtual Machine Image Processing (for software movement and deployment); Access Control; High Availability Scheduling; and High Availability Querying components. McGuinness Opening at ¶ 40; see also JA-Tab 1 at 13:11-16:39. "A person skilled in the art would not be able to take a pen and paper or generic computing principles and apply each of these components to configure and maintain an appropriately provisioned cloud environment in a dynamically changing n-tier environment." McGuinness Opening at ¶ 40. Each of the dependent claims at issue in this motion, incorporate the entirety of the context of the parent claims described above. For example, claim 2 discusses a method where the initial cloud environment configuration comprises an initial first cloud configuration that is made available by a first cloud provider; the requested adjusted cloud environment comprises a requested second cloud adjusted environment; the adjusted cloud environment configuration comprises an adjusted second cloud configuration; and the cloud environment adjustment event comprises: a second cloud adjustment event based on the requested second cloud adjusted environment, where the second cloud adjustment event is configured to cause the adjusted second cloud configuration to be made available by a second cloud provider. JA-Tab 1 at 19:1-14. This aspect of the '974 patent enables configuration and adjustments to occur dynamically between cloud providers after the initial cloud environment configuration, which enhances the ability to share and manage virtualized cloud resources across cloud providers for different events. Id. at 9:9-46. "In this way, resources can be shared and even provided by one cloud provider when another provider cannot supply the requested resources." McGuinness Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 9 of 37 PageID #: 4194 4 Opening at ¶ 49. Dr. McGuinness' declaration provides a detailed description of the interconnections between the dependent and corresponding independent claims for each of the claims challenged in Defendants' Motion. McGuinness Opening at ¶¶ 22-115. B. Factual Disputes Defendants' "statement of undisputed facts" consists largely of statements that are neither facts, nor undisputed. Statement 1, regarding the Court's prior decision on the independent claims, is certainly not undisputed. That ruling is subject to a currently pending Rule 60 Motion, C.A. No. 1:14-cv-1193, D.I. 6, and recent Federal Circuit case law supports the patent eligibility of the claims as a whole. Enfish, LLC v. Microsoft Corp., 822 F. 3d 1327, 1336 (Fed. Cir. 2016) (holding that claims "directed to a specific improvement in the way computers operate" are not directed to an abstract idea under Alice step one); McRO, Inc. v. Bandai Namco Games Am. Inc., No. 2015- 1080, 2016 WL 4759200, at *9 (Fed. Cir. Sept. 13, 2016) ("While the result may not be tangible, there is nothing that requires a method 'be tied to a machine or transform an article to be patentable. The concern underlying the exceptions to § 101 is not tangibility, but preemption." (internal citations omitted)). Plaintiff need not win that Rule 60 motion to prevail on the dependent claims at issue here (as explained below), however, Defendants' arguments on this motion make clear that if the Rule 60 motion is granted, Defendants' present summary judgment motion must also fail. Defendants' Statements 2-14 are not undisputed facts either. They are conclusory statements that oversimplify the claim language of the dependent claims, which speak for themselves. These statements ignore the Federal Circuit's guidance 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." McRO, 2016 WL 4759200, at *7 (quoting In re TLI Communications LLC Patent Litig., 823 F.3d 607, 611 (Fed. Cir. 2016) and citing Diamond v. Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 10 of 37 PageID #: 4195 5 Diehr, 450 U.S. 175, 189 n.12 (1981)). These statements also ignore the context of the parent claims upon which each of the dependent claims depend, in direct violation of the directive from the Supreme Court and the Federal Circuit to consider the claim as a whole. Alice Corp. Pty. Ltd. v. CLS Bank Int'l, 134 S. Ct. 2347, 2355 n.3 (2014) ("Because the approach we made explicit in Mayo considers all claim elements, both individually and in combination, it is consistent with the general rule that patent claims 'must be considered as a whole.'" (quoting Diamond v. Diehr, 450 U.S. 175, 188 (1981)); Internet Patents Corp. v. Active Networks, Inc., 790 F.3d 1343 (Fed. Cir. 2015) ("Under step one of Mayo/Alice, the claims are considered in their entirety to ascertain whether their character as a whole is directed to excluded subject matter."). Defendants' Statements 15-24 are disputed conclusory statements based on a pseudo- obviousness analysis by Defendants' expert. See Exh. A2 at 51:1-52:6 ("So I'm not doing an obvious analysis here because we haven't reached that step here.") While Defendants' expert readily admits that he did not perform an actual obviousness analysis, all of Defendants' arguments only differ from traditional obviousness arguments in that they simply replace the phrase "obvious to combine" with "routine and conventional to combine." (D.I. 80 at 6-8.) Defendants appear to base these arguments on Internet Patents, which Defendants characterize as "finding that an analysis of inventive concept can be analogous to anticipation and obviousness under 35 U.S.C. §§ 102 and 103." (D.I. 80 at 2 n.5.) However, Internet Patents does not stand for the proposition that an "inventive concept" argument that is "analogous" to an obviousness argument can sweep away and ignore the underlying factual issues that are inherent in 2 Exhibits cited in this brief are attached to the co-filed Declaration of Richard C. Weinblatt in Support of Kaavo Inc.'s Combined Opposition to Defendants' Motion for Summary Judgment and Reply Claim Construction Brief. Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 11 of 37 PageID #: 4196 6 a proper obviousness analysis and triumph on summary judgment through conclusory statements that would clearly fail the test for obviousness. Indeed the anemic-obviousness-analogy approach that Defendants present in their motion was resoundingly rejected by the Federal Circuit in Bascom: The district court's analysis in this case, however, looks similar to an obviousness analysis under 35 U.S.C. §103, except lacking an explanation of a reason to combine the limitations as claimed. The inventive concept inquiry requires more than recognizing that each claim element, by itself, was known in the art. As is the case here, an inventive concept can be found in the non-conventional and non-generic arrangement of known, conventional pieces. Bascom Global Internet Svs., Inc. v. AT&T Mobility LLC, 827 F.3d 1341, 1350 (Fed. Cir. 2016). Defendants' pseudo-obviousness arguments, like real obviousness arguments, are based on underlying factual issues including the scope and content of the prior art and any motivation to combine references (the latter of which includes considering any teaching away). See MobileMedia Ideas LLC v. Apple Inc., 780 F.3d 1159, 1167 (Fed. Cir.), cert. denied, 136 S. Ct. 270, 193 L. Ed. 2d 136 (2015) ("What a particular reference discloses is a question of fact, as is the question of whether there was a reason to combine certain references."); In re Mouttet, 686 F.3d 1322, 1330 (Fed. Cir. 2012) ("The scope and content of the prior art, as well as whether the prior art teaches away from the claimed invention, are determinations of fact.") Defendants' conclusory statements in allegedly "undisputed facts" are based on underlying factual opinions from Dr. Weissman regarding scope and content of the prior art and alleged motivation to combine that are each disputed by Kaavo's expert, Dr. McGuinness. D.I. 78-8 ("McGuinness Rebuttal") at ¶¶ 29, 33-34, 161-63, 169-71. As this court has recognized, summary judgment is not appropriate in view of conflicting expert opinions regarding the motivation to combine purported prior art references. See Transcenic, Inc. v. Google, Inc., No. CV 11-582-LPS, 2014 WL 7275835, at *4 (D. Del. Dec. 22, 2014) (denying summary judgment where dispute between experts on the motivation to combine references was "imbued with genuine disputes of material fact."); see also id. at *2 Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 12 of 37 PageID #: 4197 7 ("summary judgment motions present a 'battle of the experts' that is not amenable to resolution prior to the presentation of evidence, including testimony"). Further, the underlying factual disputes are not merely between Drs. Weissman and McGuinness. Dr. Weissman's opinions required him to battle the express teachings in many of the references he is explicitly relying upon. Dr. Weissman's pseudo-obviousness arguments all rely on combining at least one reference that deals with cloud computing with at least one other reference that deals with grid computing. McGuinness Rebuttal at ¶¶ 29, 33, 161-63, 167-71. As Dr. McGuinness explained, "cloud computing and grid computing are technically and technologically different." Id. at ¶ 14. While Dr. Weissman disagreed with Dr. McGuinness on this point, Exh. A at 119:13-120:5, multiple references Dr. Weissman cited as prior art make similar distinctions between grid and cloud computing, and he was forced to disavow every one of them. See id. at 40:16-41:13 (disagreeing with Boss that "[c]loud computing should not be confused with grid computing. Grid computing involves dividing a large task into smaller that run in parallel on separate servers. Grids require many computers, typically in the thousands, and commonly use servers, desktops, and laptops."); id. at 42:9-44:25 (disagreeing with Nurmi that "grid systems are architected so that individual user requests can and should consume large fractions of the total size of the resource pool. Cloud systems often limit the size of an individual request to be a tiny fraction of the total available capacity and instead focus on scaling to support large numbers of the users."); id. at 48:16-50:24 (disagreeing with Buyya's definition of cloud computing as distinct and "next generation" when compared to grid or cluster.). Dr. Weissman cannot wash away the teaching away that is express in the prior art he relies upon by simply disagreeing with Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 13 of 37 PageID #: 4198 8 portions of the references that are inconsistent with his opinions.3 This is yet another factual issue that would doom a real obviousness analysis and should have the same result with Defendants' pseudo-obviousness analysis. See Bascom, 827 F.3d at 1350. Finally, even if Defendants had made a prima facie showing of obviousness – which they did not – analysis of obviousness must always consider the factual inquiry into secondary considerations of nonobviousness that are present in the record, including the commercial success of Defendants' products that practice the invention and industry praise for Kaavo's invention. See McGuinness Rebuttal at ¶ 13 (quoting a co-author of the Nurmi paper relied upon by Dr. Weissman as stating that "Kaavo's unique top down application-centric approach makes it easy to deploy and manage applications in private, hybrid, and public clouds."); Graham v. John Deere Co., 383 U.S. 1, 17-18 (1966). Secondary considerations, however, are not addressed anywhere in Defendants' Motion nor its expert's declarations or testimony. IV. LEGAL STANDARD A. Rule 56 Motion A court may grant summary judgment only when "there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." FED. R. CIV. P. 56(a); see Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986) . The party seeking summary judgment must make a showing by informing the court of the basis for its motion and identifying the portions of the record that demonstrate the absence of a genuine issue of material fact. Celotex, 477 U.S. 317 at 323; FED. R. CIV. P. 56(c). A genuine issue of material fact exists "if the evidence is such that a reasonable jury could return a verdict for the 3 Defendants' position that no construction is necessary for the disputed terms and phrases containing the word "cloud" appear to be specifically designed to provide Dr. Weissman leeway to blur the distinctions between cloud and grid computing that are express in the references upon which he relies. Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 14 of 37 PageID #: 4199 9 non-moving party." Anderson, 477 U.S. at 248. When considering a motion for summary judgment, the court "must consider fact questions with deference to the nonmovant . . . [and] 'must review the facts drawing all inferences most favorable to the party opposing the motion.'" Walker v. Sears, Roebuck & Co., 853 F.2d 355, 358 (5th Cir. 1988) (quoting Reid v. State Farm Mut. Auto. Ins. Co., 784 F.2d 577, 578 (5th Cir. 1986)). The motion for summary judgment must be denied if the court finds some support for the allegations such that "reasonable minds could differ as to the import of the evidence." Anderson, 477 U.S. at 250-51. B. Defendants' Clear and Convincing Burden of Proof regarding § 101 The U.S. Supreme Court ruled in Commil USA, LLC v. Cisco Systems, Inc., 135 S. Ct. 1920 (2015), that the clear and convincing evidentiary standard applies to all challenges to a patent's validity. Id. at 1928-29 (citing 35 U.S.C. §§ 100-212, 282). This burden of proof remains on Defendants, and Kaavo never bears the burden of proving validity. Harrington Mfg. Co. v. Powell Mfg. Co., 815 F.2d 1478, 1482 (Fed. Cir. 1986); see also Nazomi Communications, Inc. v. Samsung Telecommunications, Inc., No. C-10-05545 RMW, 2012 WL 967968 at *3 (N.D. Cal. Mar. 21, 2012) ("[I]t is not sufficient to show that a type of claim has never specifically been upheld; rather [defendants] must demonstrate that the claims fall within one of the exceptions to '§ 101's broad patent eligibility principles,' [Bilski v. Kappos, 561 U.S. 593, 601-02 (2010) ("Bilski II")]."); Abbot Labs v. Sandoz, Inc., 544 F.3d 1341, 1346 (Fed. Cir. 2008) ("'The burden of establishing invalidity of a patent or any claim thereof shall rest on the party asserting such invalidity.' . . . This burden 'exists at every stage of the litigation.'" (emphasis added)).4 4 The "clear and convincing" burden of proof must be met independently for each claim because "[e]ach claim carries an independent presumption of validity, 35 U.S.C. § 282, and stands or falls independent of the other claims." Continental Can Co. v. Monsanto Co., 948 F.2d 1264, 1266-67 (Fed. Cir. 1991) (citing Altoona Publix Theatres, Inc. v. American Tri-Ergon Corp., 294 U.S. 477, 487 (U.S. 1935)). Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 15 of 37 PageID #: 4200 10 While the determination of whether an asserted claim is invalid for lack of subject matter patentability under 35 U.S.C. § 101 is a question of law, In re Bilski, 545 F.3d 943, 950 (Fed. Cir. 2008), the question may involve several factual underpinnings. See In re Comiskey, 554 F.3d 967, 975 (Fed. Cir. 2009) (noting that "the legal question as to patentable subject matter may turn on subsidiary factual issues"). C. Patentability Under 35 U.S.C. § 101 Only three narrow judicially-created exceptions to the broad patent-eligibility principles of 35 U.S.C. § 101 exist – "laws of nature, physical phenomena, and abstract ideas." Bilski II, 561 U.S. at 601-02. The Supreme Court has never provided clear guidance as to what constitutes an "abstract idea." Id. at 621 (Stevens, J., concurring), but it did reiterate its reluctance to broadly apply these three narrow exceptions: "[W]e tread carefully in construing this exclusionary principle, lest it swallow all of patent law. At some level, 'all inventions . . . embody, use, reflect, rest upon, or apply laws of nature, natural phenomena, or abstract ideas.'" Alice Corp. Pty. Ltd. v. CLS Bank Int'l, 134 S. Ct. 2347, 2354 (2014) (quoting Mayo Collaborative Services v. Prometheus Labs., Inc. 132 S. Ct. 1289, 1293 (2012) (internal citation omitted)).5 "[T]he concern that drives" § 101 jurisprudence is "one of pre-emption." Alice, 134 S. Ct. at 2354; see also Bilski II, 561 U.S. at 611-12 (finding claims covered ineligible subject matter because they "would pre-empt use of this approach in all fields, and would effectively grant a monopoly over an abstract idea." (emphasis added)). Claims – even ones directed to 5 The Federal Circuit held a patent claim should not be found to be for an unpatentable abstract idea unless that abstractness "exhibit[s] itself so manifestly as to override the broad statutory categories of eligible subject matter." Research Corp. Techs., Inc. v. Microsoft Corp., 627 F.3d 859, 868 (Fed. Cir. 2010) (emphasis added). Further, "inventions with specific applications or improvements to technologies in the marketplace are not likely to be so abstract that they override the statutory language and framework of the Patent Act." Id. at 869. Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 16 of 37 PageID #: 4201 11 abstract ideas – are patentable where the claim (i) contains an "inventive concept," Alice, 134 S. Ct. at 2357; (ii) is "more than a drafting effort designed to monopolize" the abstract idea, id. at 2358 (quotation omitted); (iii) "improve[s] an existing technological process," id.; or (iv) supplies a "'new and useful application' of the idea." Id. at 2357 (quoting Gottschalk v. Benson, 409 U.S. 63, 67 (1972)). V. ARGUMENT A. Defendants Failed to Overcome the Burden of Production Regarding the Presumption of Validity While not addressed in the Supreme Court's opinion in Alice Corp. Pty. Ltd. v. CLS Bank Int'l, 134 S. Ct. 2347 (2014), the question of whether the statutory presumption of validity applies to § 101 challenges was squarely before the Federal Circuit en banc and all nine judges that addressed the question unanimously agreed it does6: [I]t bears remembering that all issued patent claims receive a statutory presumption of validity. 35 U.S.C. § 282; Microsoft Corp. v. i4i Ltd. P'ship, ––– U.S. ––––, 131 S.Ct. 2238, 180 L.Ed.2d 131 (2011). And, as with obviousness and enablement, that presumption applies when § 101 is raised as a basis for invalidity in district court proceedings CLS Bank Int'l v. Alice Corp. Pty. Ltd., 717 F.3d 1269, 1284 (Fed. Cir. 2013) (en banc) (J. Lourie, concurring, joined by J. Dyk, Prost, Reyna and Wallach) (emphasis added). [W]e turn to CLS Bank's contention that the presumption of validity should not apply to patent eligibility challenges. CLS Bank contends that the presumption of validity only applies to statutory bases for invalidating a patent—35 U.S.C. Sections 102, 103, 112, and 251. Thus, although the Supreme Court invalidated the patent before it in Prometheus because it fell within one of the exceptions to patent eligibility—the law of nature exception—CLS Bank contends that the Section 101 inquiry does not involve the presumption of validity in the same way the statutory bases for invalidity do. We disagree. Id. at 1304 (J. Rader, concurring-in-part, dissenting-in-part, joined by J. Linn, Moore and 6 Judge Newman in her separate opinion concurring in part and dissenting in part did not directly address the question. CLS Bank, 717 F.3d at 1321-27. Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 17 of 37 PageID #: 4202 12 O'Malley)7 (emphasis added). Because the claims of the patent-in-suit, like all issued claims, carry a presumption of validity, it is Defendants' burden of production – irrespective of what burden of proof is applied – to rebut that presumption. Defendants' Motion makes clear that they failed to rebut the presumption of validity with respect to any issued claim of the patent-in-suit. B. The Dependent Claims of the '974 Patent Are Patentable Under the Alice Framework In Alice, the Supreme Court formalized a framework to determine whether a patent claims a judicial exception (i.e., an abstract idea, natural phenomenon, or law of nature). 134 S. Ct. at 2355. Under the Alice test, a court must first ask "whether the claims at issue are directed to one of those patent-ineligible concepts"; if so, then the court must ask, "[w]hat else is there in the claims before us?" Id. (emphasis added). While the Supreme Court did not explicitly define the phrase "directed to," the wording of the Alice test confirms that the focus must be on what is actually claimed, not a single element of a claim. As discussed below, when the facts are viewed, as they must be on a Rule 56 motion, in the light most favorable to Kaavo, there are meaningful limitations that preclude the patent-in-suit from impermissibly preempting "the basic tools of scientific and technological work" and "thereby thwarting the primary object of the patent laws." Alice, 134 S. Ct. at 2354 (quoting Association for Molecular Pathology v. Myriad Genetics, Inc. 133 S. Ct. 2107, 2116 (2013)). 7 Notably, the same four-judge opinion found the clear-and-convincing burden of proof applies to § 101 challenges. CLS Bank, 717 F.3d at 1304-05 ("Because we believe the presumption of validity applies to all challenges to patentability, including those under Section 101 and the exceptions thereto, we find that any attack on an issued patent based on a challenge to the eligibility of the subject matter must be proven by clear and convincing evidence. Cf. Microsoft, 131 S.Ct. at 2242 ('We consider whether § 282 requires an invalidity defense to be proved by clear and convincing evidence. We hold that it does.')."). Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 18 of 37 PageID #: 4203 13 1. The Dependent Claims of the '974 Patent Are Not Directed to an Abstract Idea "The abstract idea exception prevents patenting a result where 'it matters not by what process or machinery the result is accomplished.'" McRO, Inc. v. Bandai Namco Games Am. Inc., No. 2015-1080, 2016 WL 4759200, at *6 (Fed. Cir. Sept. 13, 2016) (quoting O'Reilly v. Morse, 56 U.S. 62, 113 (1854)); see also id. at *8. Consequently, "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." Id. at *7 (quoting In re TLI Communications LLC Patent Litig., 823 F.3d 607, 611 (Fed. Cir. 2016) and citing Diamond v. Diehr, 450 U.S. 175, 189 n.12 (1981)). Thus, "a court must look to the claims as an ordered combination, without ignoring the requirements of the individual steps," id., and determine "whether the claims in these patents focus on a specific means or method that improves the relevant technology or are instead directed to a result or effect that itself is the abstract idea and merely invoke generic processes and machinery." Id. at *8. "[T]he first step of the [Alice] inquiry is a meaningful one." Enfish, 822 F.3d at 1335. Although that is not how it is treated in Defendants' motion. Instead, Defendants oversimplify the language of the dependent claims, completely ignore the limitations of the parent claims and repeat the same argument over and over for each and every claim. (D.I. 80 at 9-15.) "However, describing the claims at such a high level of abstraction and untethered from the language of the claims all but ensures that the exceptions to § 101 swallow the rule." Enfish, 822 F.3d at 1337. Defendants' motion never addresses any claim as a whole as required by Alice, which is perhaps best exemplified by their internally inconsistent arguments that all of the dependent claims are allegedly addressed to the same abstract idea as the parent claims (D.I. 80 at 2) while certain dependent claims are allegedly directed to different abstract ideas. (Id. at 11-12.) When the claims are considered as whole, as they must be, Defendants' reliance on Electric Power is Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 19 of 37 PageID #: 4204 14 also misplaced. In Electric Power the Federal Circuit found the claims abstract because their "focus" was "on collecting information, analyzing it, and displaying certain results of the collection and analysis" without any corresponding improvement in the functionality of the computers themselves. Electric Power Grp. LLC, v. Alstom S.A., 2016 WL 4073318, at *3 (Fed. Cir. Aug. 1, 2016); see also id. at *5 ("[T]he focus of the claim is not on such an improvement in computers as tools, but on certain independently abstract ideas that use computers as tools."). The '974 patent claims are fundamentally different in that they focus on improving the use of the computers as a tool to execute a software application. The focus of steps of the '974 are on generating and modifying as necessary one or more sets of virtualized computer resources (the "cloud environment configuration") that improve the way these resources can be used – as a tool – to execute a software application. Unlike the claims at issue in Alice, buySAFE, and similar cases, the claims here do not merely add a bald instruction to perform an abstract idea on a computer. Rather, they recite a practical innovation and contain a significant degree of detail regarding how this innovation is accomplished in practice – for example, the sequences necessary to accomplish the claimed process. The detail contained in the claims establishes they amount to a practical application of an idea, rather than effectively claiming the idea itself. Claims that "improved an existing technological process" fall within the scope of § 101. Alice, 134 S. Ct. at 2358. In the context of software innovations, claims that "improve the functioning of the computer itself" or "effect an improvement in any other technology or technical field" are patent eligible. Id. at 2359; accord, DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245, 1257 (Fed. Cir. 2014) (where a "claimed solution is necessarily rooted in computer technology in order to overcome a problem specifically arising in the realm of computer networks," Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 20 of 37 PageID #: 4205 15 it is typically eligible for patent protection). The Federal Circuit clarified that "we find it relevant to ask whether the claims are directed to an improvement to computer functionality versus being directed to an abstract idea, even at the first step of the Alice analysis." Enfish, LLC v. Microsoft Corp., 822 F.3d 1327, 1335 (Fed. Cir. 2016). In Enfish, the Federal circuit found claims eligible because the claims "are not directed to an abstract idea within the meaning of Alice. Rather, they are directed to a specific improvement to the way computers operate, embodied in the self-referential table." 822 F.3d at 1336 (ruling "the claims are not directed to an abstract idea" after completing analysis under step one of Alice and not proceeding to step two); compare In re TLI Communications, 823 F.3d at 612 (finding claims patent-ineligible and stating, "We contrasted claims 'directed to an improvement in the functioning of a computer' with claims 'simply adding conventional computer components to well-known business practices,' or claims reciting 'use of an abstract mathematical formula on any general purpose computer,' or 'a purely conventional computer implementation of a mathematical formula,' or 'generalized steps to be performed on a computer using conventional computer activity.'" (quoting Enfish, 822 F.3d at 1335)). In Alice, the Supreme Court indicated that a claim represents a patent-eligible application of an idea if it "effect[s] an improvement in any other technology or technical field." 134 S. Ct. at 2359. The invention here provides just such an improvement in the technological field of provisioning cloud computing resources for use by a software application. See Enfish, 822 F. 3d at 1336 ("[T]he plain focus of the claims is on an improvement to computer functionality itself, not on economic or other tasks for which a computer is used in its ordinary capacity."). As Kaavo's expert, Dr. McGuinness, explained, dependent claim 2 is not abstract but instead addresses the "difficult and challenging problem" of "provisioning and adjusting multi-cloud Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 21 of 37 PageID #: 4206 16 environments" that was "specific to cloud computing" and 'no one [had] successfully tackled this problem in the context of making cloud environments available to a software application" — a context required by parent claim 1. McGuinness Opening at ¶¶ 148-49. Defendants' Motion paraphrases and mischaracterizes Dr. McGuinness' opinions and then dismisses them in a single conclusory sentence, claiming that "neither the claims nor the parties constructions require such features." (D.I. 80 at 9-10.) Defendants' ipse dixit assertion is supported by no analysis, either by its expert or attorneys. In view of the patent's presumption of validity, it is clear that Defendants' have not met their burden, and denial of their motion for summary judgment is warranted. Defendants' arguments also are based on a straw man that mischaracterizes Dr. McGuinness' opinions. Defendants argue that Dr. McGuinness' opinions were based on what claim 2 "requires" (D.I. 80 at 9-10), but her actual opinion was based on what the claim "enables," abilities it "enhances" and what "can be" done using the claimed method. McGuinness Opening at ¶ 149. Accordingly, Defendants have not addressed the actual factual underpinnings of Dr. McGuinness' opinion that the claim "address[es] a specific cloud computing problem." Id.; see Enfish, 822 F.3d at 1339 ("Much of the advancement made in computer technology consists of improvements to software that, by their very nature, may not be defined by particular physical features but rather by logical structures and processes."). Furthermore, Defendants' arguments suffer from the same flaw that infects their entire brief — they do not consider the claims as a whole as required by Supreme Court and Federal Circuit precedent. Alice, 134 S. Ct. at 2355 n.3; Internet Patents, 790 F.3d at 1346. For example, Defendants argue that claim 2 does not require "'dynamic[]' configurations and adjustments between cloud providers." (D.I. 80 at 10 (alterations by Defendants).) However, while the word "dynamic" is not in the claim, the claim as a whole on its face requires Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 22 of 37 PageID #: 4207 17 dynamic configurations and adjustments between cloud providers. Claim 2 requires a "first cloud configuration that is made available by a first cloud provider." JA-Tab 1 at 19:3-4. Then in response to "a cloud environment adjustment event" a "second cloud configuration" is "made available by a second cloud provider." Id. at 19:9-14. As required by claim 1, the "cloud environment adjustment event" is sent based on the "requested adjusted cloud environment," which is in turn determined based on received "environment data that represents a current cloud environment state." Id. at 18:57-67. As properly construed, the "cloud environment adjustment event" is itself code, which as claims 1 and 2 both explicitly require, "cause" the new cloud configuration to be made available. Id. at 18:63-67, 19:10-14. Accordingly, taken as whole, the claim requires dynamic provisioning and adjustment between cloud providers. See, e.g., McGuinness Opening at ¶ 49; see also id. ¶¶ 37-40. As Dr. McGuinness explains, using this dynamic configuration and adjustment "resources can be shared and even provided by one cloud provider when another provider cannot adequately supply the requested resources, addressing a specific cloud computing technology problem." McGuinness Opening at ¶ 149. Defendants respond that the problem of one of the providers being unable to provide the required resources is not required by the claim. (D.I. 80 at 10.) However, that is irrelevant. On this record and on a motion for summary judgment, the Court must accept that the claims solve that problem because Dr. McGuinness offered an expert opinion and Defendants have not contested it. The fact that the claims may be used to solve other problems as well is irrelevant. Defendants construct similar straw-man arguments regarding claims 3-11, arguing that Dr. McGuinness' opinions that each claim covers an improvement to cloud computing technology rely on the respective claims "requir[ing]" use of specific modules from the Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 23 of 37 PageID #: 4208 18 specification. (D.I. 80 at 9-15.) But this characterization is incorrect. Dr. McGuinness merely described how the specification "addresses" certain claim steps or that certain steps are "performed by" or "accomplished by" certain modules. See, e.g., McGuinness Opening at ¶¶ 151-53. Dr. McGuinness' opinions in that regard are consistent with well-established law that it is the specification, not the claims themselves that must provide an enabling disclosure for the invention. 35 U.S.C. § 112(a); see also Bilski II, 561 U.S. at 620 (Stevens, J. concurring) ("[C]laim specification is covered by § 112, not § 101; and if a series of steps constituted an unpatentable idea merely because it was described without sufficient specificity, the Court could be calling into question some of our own prior decisions."); Transocean Offshore Deepwater Drilling, Inc. v. Maersk Contractors USA, Inc., 617 F.3d 1296, 1305 (Fed. Cir. 2010). At bottom, Dr. McGuinness' declaration shows an improvement to cloud computing technology, with one way of accomplishing it being the enabling disclosure of the specification. McGuinness Opening at ¶¶ 151-53. As such, Dr. McGuinness' opinions are analogous to the "rules" found not to be abstract in McRO in that they are directed to a genus, as opposed to a specific software module, which would constitute a particular species. McRO, 2016 WL 4759200, at *8 ("Claims to the genus of an invention, rather than a particular species, have long been acknowledged as patentable."). Defendants make no specific arguments regarding dependent claims 13-23, 25-34 and 36-45 (see D.I. 80 at 9 n.55), which are not abstract for at least the reasons described above. 2. The Claims Provide a Patent-Eligible Inventive Concept Step two of the Alice/Mayo framework assumes the court has found that the patent claims are directed to an abstract idea at step one. Here the claims are not directed to an abstract idea, and the Court need go no further. However, if the Court were to assume the patent is directed to an abstract idea, the implementation here "add[s] enough . . . to allow the [claimed] processes . . . to qualify as patent-eligible processes that apply" any purported abstract idea. Mayo, 132 S. Ct. at Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 24 of 37 PageID #: 4209 19 1297. They reflect 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 [purported abstract idea] itself.'" Alice, 134 S. Ct. at 2355 (quoting Mayo, 132 S. Ct. at 1294). Here, the claims contain several such inventive concepts directed to overcoming challenges known to those skilled in the art at the time related to increasing "performance, reliability, and optimization of an application running in a cloud environment." McGuinness Opening at ¶ 147. Defendants' step two "analysis" of the dependent claims amounts to little more than an attempt to argue obviousness with no regard to the implicit – and disputed – underlying factual issues. For example, for each claim at issue, Defendants argue verbatim, "[T]he prior art confirms that [the dependent claim] at best claims only well-known, routine, and conventional ideas." (D.I. 80 at 15-23.) Defendants' arguments suffer from multiple flaws. First, Defendants' arguments for each of the dependent claims address only (a simplification of) the dependent claim itself, divorced from the context of the respective parent claim. (See D.I. 80 at 15-24.) Even if accepted, these arguments would only prove that the dependent limitations standing alone are conventional or routine, which proves nothing. "The inventive concept inquire requires more than recognizing that each element, by itself, was known in the art." Bascom, 827 F.3d at 1350 (emphasis added). Second, to the extent Defendants' arguments are based on Dr. Weissman's pseudo- obviousness arguments, Defendants ignore the underlying factual disputes regarding the scope and content of the prior art, any motivation to combine and express teaching away within the references relied upon by Dr. Weissman. For example, with respect to claims 2-4, Defendants explicitly rely on the combination of Boss (a cloud computing reference) with Haviv (a grid computing reference). (D.I. 80 at 15-17.) However, Boss itself distinguishes cloud computing from grid computing Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 25 of 37 PageID #: 4210 20 thereby teaching away from such a combination. McGuinness Rebuttal at ¶¶ 29, 161-63, 167, 169- 71; D.I. 81-1 at p. 109 of 110. Dr. Weissman never addresses this teaching away, but instead simply disagreed with the statement within Boss at his deposition. Exh. A at 40:16-41:6. Dr. Weissman's attempts to wish away teaching away raise factual issues that preclude summary judgment. See Bascom, 827 F.3d at 1350 (reversing district court and ruling "[t]he district court's analysis in this case, however, looks similar to an obviousness analysis under 35 U.S.C. § 103, except lacking an explanation of a reason to combine the limitations as claimed."). Third, Defendants' inventive concept arguments, like their abstract idea arguments, are based on a straw- man mischaracterization of Dr. McGuinness' opinions. For example, Defendants repeatedly argue that Dr. McGuinness' opinions on inventive concept are based on assertions that a particular dependent claim "requires the use of" or "requires" certain modules described in the specification. (See D.I. 80 at 16-18, 21.) But this characterization is incorrect. Dr. McGuinness merely described how the specification "uses" certain modules to perform claim steps or that certain steps are "primarily done by" or "performed by" certain modules. See, e.g., McGuinness Opening at ¶¶ 193- 95, 199. Dr. McGuinness' opinions in that regard are consistent with well-established law that it is the specification, not the claims themselves that must provide an enabling disclosure for the invention. 35 U.S.C. § 112(a); see also Bilski II, 561 U.S. at 620 (Stevens, J. concurring) ("[C]laim specification is covered by § 112, not § 101; and if a series of steps constituted an unpatentable idea merely because it was described without sufficient specificity, the Court could be calling into question some of our own prior decisions."); Transocean, 617 F.3d at 1305. Along with the claim language itself, which is intimately tied to cloud-computing, Dr. McGuinness' discussion of the specification's enabling disclosure using particular software modules for performing particular claim steps strongly supports her conclusion that the claim Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 26 of 37 PageID #: 4211 21 steps are necessarily "rooted in computer technology." McGuinness Opening at ¶¶ 193-95. Fourth, Defendants' are overly-reliant upon arguments that the invention allegedly "can be performed on any generic computing resource." (D.I. 80 at 15-17.) But as the Federal Circuit held in Enfish, the use of generic computer resources does not doom the claims. Enfish, 822 F.3d at 1338 ("[W]e are not persuaded that the invention's ability to run on a general-purpose computer dooms the claims."); see also id. at 1339 ("Similarly, that the improvement is not defined by reference to 'physical' components does not doom the claims. To hold otherwise risks resurrecting a bright-line machine-or-transformation test."). Defendants make no specific arguments regarding dependent claims 13-23, 25-34 and 36-45 (see D.I. 80 at 9 n.55), which contain an inventive concept for at least the reasons described above. 3. The Claims Are Not Overly Preemptive Kaavo's claims do not preempt a broad building block that would unduly obstruct innovation. Instead, the claims describe a very specific means for providing and adjusting a cloud environment configuration for use by a software application. There is no risk that the claims could foreclose innovation by others. The degree of detail regarding the application or implementation of the innovation informs whether it is eligible. As the Supreme Court has explained, courts must ask whether the limitations in "the patent claims," taken as a whole, "add enough" in the way of specific, practical application to differentiate the scope of the claimed invention from the underlying abstract idea itself. Mayo, 132 S. Ct. at 1297. The claim "must include additional features to ensure that the claim is more than a drafting effort designed to monopolize the abstract idea." Alice, 134 S. Ct. at 2357 (quotation and alterations omitted). That means it must do "significantly more" than describe the abstract idea. Id. at 2359-60 (quotation omitted). Although the Supreme Court has not provided express guidance to assess whether a claim Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 27 of 37 PageID #: 4212 22 does "significantly more" than describe an abstract idea, Alice and Bilski identifies three guideposts—the preemptive effect of the claim, its degree of detail, and whether the claim constitutes an improvement upon technology. The claims here plainly satisfy the "significantly more" standard. Defendants' brief does little to address preemption beyond a series of conclusory statements alleging that the claims "disproportionately tie up the underlying ideas." (D.I. 80 at 25-28.) These conclusory statements are largely based on the opinions of Dr. Weissman (see id.), who admitted that his reports did not contain any preemption analysis. Exh. A at 71:2-72:4. Furthermore, it is clear from Dr. Weissman's arguments and the materials he cites that the "idea" of "setting up and managing a cloud computing environment" can be and is practiced without impinging upon the claims of the '974 patent. For example, in his rebuttal report Dr. Weissman provides as an example of a cloud computing environment: "on an Apple iPhone, the data on the iPhone can be backed up to the cloud. Apple charges users a certain monthly fee based on the amount of cloud storage, such as $0.99 per month for 50 GB of storage." (D.I. 81-9, Exh. 4 ("Weissman Rebuttal") at ¶ 12; see also Exh. B at 1 (describing "long-term state and data storage" as one category of "cloud services."). Apple's, or any other cloud providers, setting up and managing a cloud environment to provide backup storage services is not implicated by any claim of the '974 patent for numerous reasons, including that those storage services do not involve sending "application data" as properly construed. In each claim the "application data" must "cause the application to begin execution" in the cloud, JA-Tab 1 at 18:44-67, 20:8-36, 21:46-22:2, 23:14-44, which does not happen when Apple or anyone else stores back-up data in the cloud. In addition, each of the dependent claims at issue contains additional limitations not practiced by Dr. Weissman's Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 28 of 37 PageID #: 4213 23 example. For example, claims 2-4, 14-16, 25-27, and 36-38 require at least two cloud providers and in iPhone back-up Apple is the only cloud provider involved. Dr. Weissman's iPhone back- up example also does not practice the forecasting of claims 5-7, 17-19, 28-30, and 39-41, use the needs analysis algorithm of claims 8, 20, 31, and 42, use the geographic data as claimed in claims 9, 21, 32, and 43, use service level agreement data as required by claims 10, 22, 33, and 44, or determine a security action and send a security event as required by claims 11, 23, 34, and 45. Dr. Weissman's pseudo-obviousness analysis also shows the lack of broad preemption by any claim of the '974 patent. His opening report included over 300 pages of obviousness claim charts, though he does not refer to them as that because he claims to not have done an obviousness analysis. Exh. A at 51:1-52:6. His pseudo-obviousness arguments all rely on combining at least one reference that deals with cloud computing with at least one other reference that deals with grid computing. McGuinness Rebuttal at ¶¶ 29, 33, 161-63, 167-71. Dr. Weissman's resort to these obviousness arguments show that he could not find a single reference – other than the '974 patent itself – that describes practicing all the elements of any claim as part of setting up and maintaining a cloud network. While the Federal Circuit has held that the non- obviousness of a claim "does not resolve the question of whether the claims embody an inventive concept at the second step of Mayo/Alice," Intellectual Ventures I LLC v. Symantec Corp., No. 2015-1769, 2016 WL 5539870, at *4 (Fed. Cir. Sept. 30, 2016), on a summary judgment motion it is dispositive that Defendants' deficient obviousness analysis, which also shows a lack of preemption, raises factual issues that require denial of their motion. Bascom, 827 F.3d at 1350. The current record also makes clear that there are other disputed issues of fact regarding preemption, as shown in Dr. McGuinness' Rebuttal Declaration: Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 29 of 37 PageID #: 4214 24 As noted above, Dr. Weissman's own paper established that providing a cloud environment configuration using multiple cloud providers was not conventional or routine. In his paper – written after '974 patent was filed – he speculated, "future network applications may wish to utilize and synthesize capabilities from multiple clouds." Dr. Weissman's paper is also relevant to the issue of preemption because, while he attempted to address the same technological challenge that claims 2-4 address, he did so in a very different way that would not be covered by the claims of the '974 patent. McGuinness Rebuttal at ¶ 173; see also Exh. C. In his deposition testimony, Dr. Weissman belatedly opined that his paper could be used to show preemption by the dependent claims of the '974 patent, but admitted that he neither cited his paper in his preemption argument nor performed any preemption analysis based on it or any other reference cited in his declaration. Exh. A at 96:2-97:23; 71:2-72:24. Even if his new opinions are considered, they would only demonstrate the presence of disputed issues of fact that warrant the denial of summary judgment. See Cordance Corp. v. Amazon.com, Inc., 639 F. Supp. 2d 406, 423- 24 (D. Del. 2009) ("The conflicting expert opinions creates a question of fact that the court cannot resolve on a motion for summary judgment."). For the reasons above, the claims do not implicate the fundamental "preemption concern that undergirds" the abstract-ideas exception. Alice, 134 S. Ct. at 2358. The claims do not, as Defendants assert, seek to "disproportionately tie[] up the underlying idea of setting up and managing a cloud computing environment." (D.I. 80 at 25.) Consequently, the patents thus do not "impede innovation." Alice, 134 S. Ct. at 2354. The "building blocks of human ingenuity" and "basic tools of scientific and technological work" remain free to all. Id. The patent's scope is no larger than "the underlying discovery could reasonably justify." Mayo, 132 S. Ct. at 1301; see also McRO, 2016 W L 4759200, at *9 ("Defendants' attorney's argument that any rules-based lip-synchronization process must use the claimed type of rules has appeal, but no record evidence supports this conclusion."). Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 30 of 37 PageID #: 4215 25 VI. CLAIM CONSTRUCTION A. "cloud provider" (claims 2, 3, 4, 14, 15, 16, 25, 26, 27, 36, 37, 38) Kaavo's Proposed Construction Defendants' Proposed Construction provider or operator of a set of computing resources that can be virtualized no construction necessary; plain meaning Defendants do not dispute that Kaavo's proposed construction reflects the meaning of the term as one of ordinary skill in the art would understand it. Phillips v. AWH Corp., 415 F.3d 1303, 1312-13 (Fed. Cir. 2005) (en banc). As explained by Dr. McGuinness, a person of ordinary skill would look to the specification to understand the context and meaning of "cloud provider," which is consistent with Kaavo's construction. McGuinness Opening at ¶¶ 116-18; McGuinness Rebuttal at ¶¶ 38-39; see also O2 Micro Int'l v. Beyond Innovation Tech. Co., 521 F.3d 1351, 1361 (Fed. Cir. 2008) ("In this case, the 'ordinary' meaning of a term does not resolve the parties' dispute, and claim construction requires the court to determine what claim scope is appropriate in the context of the patents-in-suit."). B. "needs analysis algorithm" (claims 8, 20, 31, 42) Kaavo's Proposed Construction Defendants' Proposed Construction an algorithm applied to user input or a log to generate provisioning information Indefinite As explained by Dr. McGuinness, when a person of ordinary skill reads the term "needs analysis algorithm" in light of the intrinsic evidence, he or she will be able to understand the scope of the invention with reasonable certainty. McGuinness Opening at ¶¶ 119-21; McGuinness Rebuttal at ¶¶ 40-42. The definiteness requirement focuses on whether "a patent's claims, viewed in light of the specification and prosecution history, inform those skilled in the art about the scope of the invention with reasonable certainty." Nautilus, Inc. v. Biosig Instruments, Inc., 134 S. Ct. 2120, 2124 (2014). Accordingly, the term is definite and should be given Kaavo's proposed construction. Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 31 of 37 PageID #: 4216 26 C. "initial cloud environment" (claims 1, 3, 13, 15, 24, 26, 35, 37) Kaavo's Proposed Construction Defendants' Proposed Construction initial potentially accessible computing resources such as datacenters and/or other information technology-related capabilities operated by a cloud provider initial cloud computing resources that are made accessible to users Dr. McGuinness makes clear that Defendants' proposed construction effectively ignores terms in the claims and specification, such as the resources are "potentially accessible" and that such resources are provided by "cloud providers" that are necessary to understand the context of this phrase to be construed. See McGuinness Opening at ¶¶ 122-23; McGuinness Rebuttal at ¶¶ 43- 45. Defendants' construction also neglects to incorporate express language used in the specification such as the resources are "potentially accessible" and that such resources are provided by "cloud providers." JA-Tab 1 at 1:22-29. D. "initial cloud environment configuration" (claims 1, 2, 3, 13, 14, 15, 24, 25, 26, 35, 36, 37) Kaavo's Proposed Construction Defendants' Proposed Construction a virtualized set of computing resources from a N-tier cloud computing environment that is to be made available initially to the application no construction necessary; plain meaning Kaavo incorporates its positions from Section VI.C. herein in their entirety. Again, Defendants improperly ignore the specification. As Dr. McGuinness points out, the specification states that the "[a]pplication cloud environment configuration 110 may include an N-tier computing environment that is made available to the application by cloud environment 100, and may be dependent on information included in cloud environment initialization event 210." JA-Tab 1 at 5:22-26; McGuinness Opening at ¶¶ 122-23; McGuinness Rebuttal at ¶¶ 43-45. Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 32 of 37 PageID #: 4217 27 E. "adjusted cloud environment" (claims 1, 2, 4, 13, 14, 16, 24, 25, 27, 35, 36, 38) Kaavo's Proposed Construction Defendants' Proposed Construction a cloud environment that addresses a desired modification to the initial cloud environment that is made available to the application no construction necessary; plain meaning Kaavo's proposed construction is consistent with the specification and how one of one of ordinary skill in the art would understand the term. McGuinness Opening at ¶¶ 126-28; McGuinness Rebuttal at ¶¶ 48-50. While Defendants argue that no construction is necessary, the parties clearly dispute the plain and ordinary meaning of this term. The Federal Circuit has ruled that in situations where there is a clear dispute, as is the case here, the Court is required to construe the term. See O2 Micro, 521 F.3d at 1361; Eon Corp. IP Holdings LLC v. Silver Spring Networks, Inc., 815 F.3d 1314, 1319 (Fed. Cir. 2016). No construction necessary or plain meaning is not sufficient. Accordingly, Kaavo's construction should be adopted. F. "determining [or determine] a requested initial cloud environment based on user-defined provisioning information" (claims 1, 13, 24, 35) Kaavo's Proposed Construction Defendants' Proposed Construction determining [or determine] a requested initial cloud environment based on data associated with the user such as geographic preference (e.g., geographic restriction of locations for data and/or applications), service level requirements (e.g., availability), pricing information, tier definitions (e.g., number of tiers, computational resources needed for each tier, security needs for each tier), security requirements (e.g., data encryption requirements), audit/backup requirements (e.g., frequency of backup, data retention specifications), special monitoring/alert requests (e.g., alert when a firewall rule is breached, alert when average CPU utilization reaches or exceeds a threshold value for a given time in a given tier), etc. no construction necessary; plain meaning Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 33 of 37 PageID #: 4218 28 Kaavo's construction provides the proper context by using the same examples as described in the specification regarding "user-defined provisioning information." McGuinness Opening at ¶¶ 129-130; McGuinness Rebuttal at ¶¶ 51-52. See ArcelorMittal France v. AK Steel Corp., 700 F.3d 1314, 1320-21 (Fed. Cir. 2012) ("'[W]e normally do not interpret claims in a way that excludes disclosed examples in the specification.'" (quoting Verizon v. Vonage, 503 F.3d 1295, 1305 (Fed. Cir. 2007)). Defendants ignore the meaning of the terms in the claims based on the disclosure of the specification. Where parties dispute the plain and ordinary meaning of a claim term, the Federal Circuit has required courts to construe the term. See O2 Micro, 521 F.3d at 1361; Eon Corp., 815 F.3d at 1319. No construction necessary or plain meaning is not sufficient. Accordingly, Kaavo's construction should be adopted. G. "application data" (claims 1, 13, 24, 35) Kaavo's Proposed Construction Defendants' Proposed Construction computer-usable data defining all or part of the application to be executed in the initial cloud configuration no construction necessary; plain meaning The term "application data" is used consistently throughout the specification and Kaavo's proposed construction follows the words of the specification and is thus correct. See, e.g., JA-Tab 1 at 1: 64-2:2; 7:40-46. This is confirmed by Dr. McGuinness. McGuinness Opening at ¶¶ 132-33; McGuinness Rebuttal at ¶¶ 54-55. Where parties dispute the plain and ordinary meaning of a claim term, the Federal Circuit has required courts to construe the term. See O2 Micro, 521 F.3d at 1361; Eon Corp., 815 F.3d at 1319. No construction necessary or plain meaning is not sufficient. Accordingly, Kaavo's construction should be adopted. Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 34 of 37 PageID #: 4219 29 H. "cloud adjustment event" (claims 2, 4, 14, 16, 25, 27, 36, 38) Kaavo's Proposed Construction Defendants' Proposed Construction code for use in reconfiguring, adding, subtracting and/or replacing cloud configuration(s) that collectively provide the application cloud environment configuration no construction necessary; plain meaning Kaavo's construction reflects and is consistent with language of the specification, and how one of ordinary skill in the art would understand this term. McGuinness Opening at ¶¶ 134-35; McGuinness Rebuttal at ¶¶ 56-57; JA-Tab 1 at 9:39-41 Where parties dispute the plain and ordinary meaning of a claim term, the Federal Circuit has required courts to construe the term. See O2 Micro, 521 F.3d at 1361; Eon Corp., 815 F.3d at 1319. No construction necessary or plain meaning is not sufficient. Accordingly, Kaavo's construction should be adopted. I. "determining [or determine] a requested security action based on the security information" (claims 11, 23, 34, 45) Kaavo's Proposed Construction Defendants' Proposed Construction determining [or determine] a requested action related to security, such as to shut down a server or generate an alert or notification of a security breach, based on information related to security, such as firewalls, data encryption requirements or possible unauthorized access determining a requested action relating to security based on the information related to security, such as firewalls, data encryption requirements, or possible unauthorized access Kaavo's construction is clear and tracks the context of the specification. See JA-Tab 1 at 12:59-61; id. at 15:60-16:3. This is confirmed by Dr. McGuinness. McGuinness Opening at ¶¶ 136-37; McGuinness Rebuttal at ¶¶ 58-60. The only difference being Kaavo's proposed construction includes examples of "security actions" that Defendants' proposed construction does not. Defendants admit through their own construction that examples can appropriately be included in claim construction. Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 35 of 37 PageID #: 4220 30 J. "sending [or send] a security event based on the requested security action" (claims 11, 23, 34, 45) Kaavo's Proposed Construction Defendants' Proposed Construction transmitting [or transmit] information for use in performing an action or occurrence related to security, such as to shut down a server or generate an alert or notification of a security breach, based on the requested security action sending information for use in performing an action related to security based on the requested security action Kaavo incorporates its analysis in Section VI.I. herein in its entirety. Not only does Kaavo's construction provide context for the term and is consistent with the specification, JA-Tab 1 at 15:60- 16:3, it also has been confirmed by Dr. McGuinness. McGuinness Opening at ¶ 138; McGuinness Rebuttal at ¶ 61. VII. CONCLUSION For the foregoing reasons, Kaavo respectfully requests Defendants' Motion for Summary Judgment be denied and an order adopting Kaavo's proposed constructions for the disputed claim language of the patent-in-suit be entered. Dated: October 7, 2016 STAMOULIS & WEINBLATT LLC /s/ Richard C. Weinblatt Stamatios Stamoulis #4606 Richard C. Weinblatt #5080 Two Fox Point Centre 6 Denny Road, Suite 307 Wilmington, DE 19809 Telephone: (302) 999-1540 stamoulis@swdelaw.com weinblatt@swdelaw.com Attorneys for Plaintiff Kaavo Inc. Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 36 of 37 PageID #: 4221 CERTIFICATE OF SERVICE I hereby certify that on October 7, 2016, I electronically filed the above document(s) with the Clerk of Court using CM/ECF, which will send electronic notification of such filing(s) to all registered counsel. /s/ Richard C. Weinblatt Richard C. Weinblatt #5080 Case 1:14-cv-00353-LPS-CJB Document 106 Filed 10/07/16 Page 37 of 37 PageID #: 4222