SZ DJI Technology Co., Ltd. et al v. Yuneec International Co. Ltd. et al

MEMORANDUM in Support of NOTICE OF MOTION AND MOTION to Dismiss First Cause of Action Under Federal Rule of Civil Procedure 12

C.D. Cal.August 29, 2016

YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 BRYAN WILSON (CA SBN 138842) BWilson@mofo.com ALESSA HWANG (CA SBN 286872) AHwang@mofo.com MORRISON & FOERSTER LLP 755 Page Mill Road Palo Alto, California 94304-1018 Telephone: 650.813.5600 Facsimile: 650.494.0792 BITA RAHEBI (CA SBN 209351) BRahebi@mofo.com MORRISON & FOERSTER LLP 707 Wilshire Boulevard, Suite 600 Los Angeles, California 90017-3543 Telephone: 213.892.5200 Facsimile: 213.892.5454 Attorneys for Defendant YUNEEC INTERNATIONAL CO., LTD. UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA SZ DJI Technology Co., Ltd. and DJI Europe B.V., Plaintiffs, v. Yuneec International Co., Ltd. and Yuneec USA, Inc., Defendants. Case No. 5:16-cv-00595-BRO(KKx) YUNEEC INTERNATIONAL’S MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPOT OF MOTION TO DISMISS UNDER FEDERAL RULE OF CIVIL PROCEDURE 12(B)(6) Date: October 3, 2016 Time: 1:30 p.m. Courtroom: 14 Yuneec USA, Inc., Counter-Claimant, v. SZ DJI Technology Co., Ltd. and DJI Europe B.V., Counter-Defendants. Judge: Hon. Beverly Reid O’Connell Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 1 of 20 Page ID #:449 i YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 TABLE OF CONTENTS Page I. INTRODUCTION AND SUMMARY............................................................ 1 II. STATEMENT OF FACTS .............................................................................. 2 A. DJI’s Complaint .................................................................................... 2 B. The ’506 Patent ..................................................................................... 2 III. ARGUMENT ................................................................................................... 7 A. It Is Appropriate To Decide Patent Eligibility At The Pleading Stage ...................................................................................................... 7 B. Abstract Ideas Are Not Eligible For Patent Protection ......................... 8 C. The ’506 Patent Claims Are Not Eligible For Patent Protection .......... 9 1. Step 1: The Asserted Claims of the ’506 Patent Are Directed to an Abstract Idea ....................................................... 9 2. Step 2: The Asserted Claims of the ’506 Patent Do Not Recite an Inventive Concept ..................................................... 11 IV. CONCLUSION.............................................................................................. 16 Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 2 of 20 Page ID #:450 ii YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 TABLE OF AUTHORITIES Page(s) CASES Alice Corp. v. CLS Bank Int’l, 134 S. Ct. 2347 (2014), 189 L. Ed. 2d 296 (2014) ........................................... 8, 9 Apollo Fin., LLC v. Cisco Sys., Inc., No. 2:15-CV-9696, 2016 WL 3234518 (C.D. Cal. June 7, 2016) ....................... 8 Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) .............................................................................................. 7 Bilski v. Kappos, 561 U.S. 593 (2010) .......................................................................................... 7, 8 Blue Spike, LLC v. Google, Inc., No. 14 cv 01650, 2015 WL 5260506 (N.D. Cal. Sept. 8, 2015) .......................... 8 buySAFE, Inc. v. Google, Inc., 765 F.3d 1350 (Fed. Cir. 2014) .......................................................................... 14 California Institute of Technology v. Hughes Communications, Inc., 59 F. Supp. 3d 974 (C.D. Cal. 2014) .................................................................. 12 CMG Fin. Servs. Inc. v. Pac. Trust Bank, FSB, 50 F. Supp. 3d 1306 ............................................................................................ 13 Coinstar,Inc. v. CoinBank Automated Sys., Inc., 998 F. Supp. 1109 (N.D. Cal. 1999) ................................................................... 15 Content Extraction & Transmission LLC v. Wells Fargo Bank, Nat. Ass’n, 776 F.3d 1343 (Fed. Cir. 2014), cert. denied, 136 S. Ct. 119, 193 L. Ed. 2d 208 (2015) ................................................. 9, 11, 13 CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d 1366 (Fed. Cir. 2011) .......................................................................... 11 DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245 (Fed. Cir. 2014) .................................................................... 11, 14 Eclipse IP LLC v. McKinley Equip. Corp., No. SACV 14-154-GW, 2014 WL 4407592 (C.D. Cal. Sept. 4, 2014) ......... 8, 15 Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 3 of 20 Page ID #:451 iii YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Electric Power Group, LLC v. Alstom, S.A., No. 2015-1778, 2016 WL 4073318 (Fed. Cir. Aug. 1, 2016) ...................... 14, 15 Enfish, LLC. v. Microsoft Corp., 822 F.3d 1327 (Fed. Cir. 2016) ...................................................................... 9, 10 In re TLI Commc’ns LLC Patent Litig., 823 F.3d 607 (Fed. Cir. May 17, 2016) .......................................................... 9, 13 MacroPoint, LLC v. FourKites, Inc., No. 1:15 CV 1002, 2015 WL 6870118 (N.D. Ohio Nov. 6, 2015) .................... 10 Mayo Collaborative Servs. v. Prometheus Labs.,Inc., 132 S. Ct. 1289 (2012), 182 L. ed. 2d 321 (2012) ................................................ 8 Open Text S.A. v. Box, Inc., 78 F. Supp. 3d 1043 .............................................................................................. 9 TDE Petroleum Data Sols., Inc. v. AKM Enter., Inc., No. 2016-1004, 2016 WL 4271975 (Fed. Cir. Aug. 15, 2016) .......................... 15 Thales Visionix, Inc. v. United States, 122 Fed. Cl. 245 (2015) ...................................................................................... 10 Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709 (Fed. Cir. 2014) .............................................................................. 7 Versata Dev. Grp., Inc. v. SAP Am., Inc., 793 F.3d 1306 (Fed. Cir. 2015) .......................................................................... 11 Wireless Media Innovations, LLC v. Maher Terminals, LLC, 100 F. Supp.3d 405 ............................................................................................. 10 Wolf v. Capstone Photography, Inc., No. 2:13-CV-09573, 2014 WL 7639820 (C.D. Cal. Oct. 28, 2014) .................... 7 STATUTES AND OTHER AUTHORITIES 35 U.S.C. § 101 ................................................................................................. passim Fed. R. Civ. P. 8(b)(3) ................................................................................................ 1 Fed. R. Civ. P. 12(a)(4) .............................................................................................. 1 Fed. R. Civ. P. 12(b)(6) .............................................................................................. 7 Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 4 of 20 Page ID #:452 1 YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Defendant Yuneec International Co. Ltd. (“Yuneec International”) moves to dismiss Plaintiffs’ first cause of action in their complaint as to United States Patent No. 9,164,506 (“the ’506 Patent”) for failure to state a claim under which relief can be granted.1 The asserted claims of the ’506 Patent are invalid because they are directed to ineligible subject matter under 35 U.S.C. § 101. I. INTRODUCTION AND SUMMARY The ’506 Patent is directed to tracking a target by an unmanned aerial vehicle (“UAV”). The patent itself recognizes that target tracking using unmanned aerial vehicles (UAVs) has long been performed for purposes such as surveillance, reconnaissance, and exploration. Traditionally, a person would visually track a target with his or her eyes, and direct a UAV to follow it using a remote-controlled device. The patent takes the everyday concept of target tracking and purports to make it automatic or semi-automatic on UAVs with the help of generic computer components. These components receive the target data, process it, and send signals to the UAV to adjust itself based on fundamental laws of nature such as angles and velocities. The patent does not claim improved methods for tracking, does not invent any new tracking software or hardware, and does not describe any specialized UAV-specific technology. The asserted claims of the ’506 Patent- which recite only abstract ideas and are devoid of inventive concept-are therefore invalid under Section 101. 1 Under Fed. R. Civ. P. 12(a)(4), Yuneec International understands that it may bring this Rule 12(b)(6) Motion to Dismiss in lieu of an Answer, and does not therefore need to respond to the other allegations in the Complaint or file a Counterclaim at this time. To the extent any response is needed at this time, Yuneec International hereby generally denies all allegations of the Complaint (see Fed. R. Civ. P. 8(b)(3)) to avoid any perceived waiver, while at the same time reserving the right to file an amended responsive pleading at an appropriate juncture in which it will specifically deny certain allegations and assert certain additional defenses as well as counterclaims. Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 5 of 20 Page ID #:453 2 YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 II. STATEMENT OF FACTS A. DJI’s Complaint On April 1, 2016, Plaintiff SZ DJI Technology Co., Ltd. and DJI Europe B.V. (collectively, “DJI”) filed a complaint alleging that Yuneec International and Yuneec USA, Inc. infringe the ’506 Patent as well as an additional patent. (ECF No. 1.) The ’506 Patent is attached as an exhibit to the Complaint and is therefore properly considered under a Rule 12(b)(6) motion. Exhibit 3 to the Complaint is entitled “Infringement Claim Chart for U.S. Patent No. 9,164,506” and identifies two asserted claims: claims 1 and 6. (ECF No. 1, Ex. 3 at 136.) B. The ’506 Patent The ’506 Patent does not purport to invent target tracking on UAVs. In fact, as recognized in the ’506 Patent, aerial vehicles, such as unmanned aerial vehicles (UAVs), have long been used for performing tasks such as surveillance, reconnaissance, and exploration tasks for military and civilian applications. (’506 Patent, 1:12-15.) The ’506 Patent describes automating or semi-automating the process of manual target tracking. (’506 Patent, Abstract.) The idea of the claimed invention is for a UAV to automatically or semi-automatically track a target by maintaining the same relative position with the target as it is moving. (See e.g.,’506 Patent, 24:16-34.) To achieve this, a user inputs “target information” into a control terminal. The computer component on the UAV (e.g., the processor) receives this target information and detects how far a target has deviated from its former position. As best can be understood, the processor then determines how to adjust the UAV and/or the imaging device (e.g., a camera) to correct for any deviations, based on mathematical principles and laws of nature such as angles and speed. (See e.g., ’506 Patent, 24:16-63.) The claims do not include anything about how this determination is made. Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 6 of 20 Page ID #:454 3 YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 The patent’s illustrations show that the purported invention is made up of conventional components, used in a conventional way. Figure 1shows a moveable object (101), which can be a UAV, attached by carrier (102) to a payload (104). The payload may be a camera or a camcorder. (’506 Patent, 12:8-10.) A control terminal (112), which can be a tablet or a smartphone, communicates with the movable object to control the movable object, the carrier, and/or the payload as it tracks the target (116). (’506 Patent, 12:42-59.) There is nothing new about any of this. In another example, Figure 8 is a non-substantive depiction of the simple input and output process of receiving target information, controlling the movable object using this information, and adjusting it to track the target. Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 7 of 20 Page ID #:455 4 YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 In another example, Figure 16 is an even less substantive depiction of the connections between the generic components, i.e., the sensing module (1602) connects to the processing unit (1604), which connects to the computer-readable medium (1606), which connects to the control module (1608), which connects to the communication module (1610). Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 8 of 20 Page ID #:456 5 YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 According to its complaint and attached claim charts, DJI asserts that Yuneec infringes independent claim 1 and dependent claim 6.2 Claim 1 recites: 1. A system for controlling an unmanned aerial vehicle (UAV), comprising: one or more receivers, individually or collectively, configured to receive from a remote user (1) one or more navigation commands to move the UAV along a flight path, and (2) target information of a target to be tracked by an imaging device on the UAV; and one or more processors, individually or collectively, configured to track the target according to the target information by automatically adjusting at least one of the UAV or the imaging device while the UAV moves along the flight path according to the one or more navigation commands from the remote user, wherein the one or more processors, individually or collectively, make a determination to adjust 1) the UAV, 2) the imaging device, or 3) both the UAV and the imaging device, wherein said determination is dependent upon a) number of rotational axes of the imaging device and orientation of said rotational axes relative to the UAV; b) a navigation path of the UAV; or c) a maximum angular speed allowable for the UAV or the imaging device. This simply describes using these conventional components to collect data about a target. The claim refers to receivers configured to receive information, but says nothing about what the configuration should be or how it should be done. The claim then refers to processors that are configured to track the target by making a determination to adjust the UAV, the imaging device, or both. The determination is dependent on mathematical principles. However, nothing in the claim provides any details about how the processors should be configured, or how the determination should be made. The specification does not fill in these details. It broadly discusses general, well-known principles related to movement and orientation, such as changing the 2 To the extent that DJI may eventually attempt to assert other claims, it is appropriate to treat claims 1 and 6 as representative claims because they are the claims that DJI identified in its complaint and claim charts. Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 9 of 20 Page ID #:457 6 YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 linear or angular velocity, zoom, or focus. (See, e.g., ’506 Patent at 24:45-25:18.) The specification also generally discusses the types of calculations that can be made to determine appropriate velocities for the UAV and/or the imaging device based on the position of the target. (See, e.g., ’506 Patent, 27:17-31:61.) These calculations are not part of the claim. Claim 6 adds only the additional limitation “wherein the UAV comprises a plurality of rotors configured to generate lift for the UAV,” but says nothing about how the system of claim 6 is in any way meaningfully different from the system of claim 1. The specification also confirms that the computer elements referred to in the claims are entirely conventional: • a receiver that can be a proximity sensor or a camera (’506 Patent, 25:38- 41); • a target that can be identified by “[a]ny suitable image recognition or identification techniques” (’506 Patent, 24:1-15); • a pre-processing unit that can include “any hardware, software, or a combination thereof” (’506 Patent, 19:22-26); • a processor that can be a “programmable processor (e.g., a central processing unit (CPU))” (’506 Patent, 48:7-12); • a control terminal that can be a “a handheld or wearable device” such as “a smartphone, tablet, laptop, computer, glasses, gloves, helmet, microphone, or suitable combinations thereof” (’506 Patent, 16:42-51); and • a communication module that can communicate via any one of well- known communication networks, including local area networks (LAN), wide area networks (WAN), infrared, radio, WiFi, point-to-point (P2P) networks, telecommunication networks, or cloud communication. (’506 Patent, 48:44-63.) The ’506 Patent does not even purport to claim anything unique to UAVs. It Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 10 of 20 Page ID #:458 7 YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 says the claimed systems and methods can be applied to a “wide variety” of movable objects including a fixed-wing aircraft, a rotary-wing aircraft, a ship, a submarine, a motor vehicle such as a car, truck, bus, van, motorcycle, or a spaceplane or probe: (’506 Patent, 40:47-67.) The claims, of course, say nothing about any of these other objects. III. ARGUMENT The ’506 Patent claims only an abstract idea, without an inventive concept. It is therefore invalid under Section 101 of the Patent Act because it does not claim patent-eligible subject matter. A. It Is Appropriate To Decide Patent Eligibility At The Pleading Stage Under Fed. R. Civ. Proc. 12(b)(6) the Court should dismiss a complaint for failure to state a claim upon which relief can be granted when the complaint does not plead a cognizable legal theory, or does not plead sufficient facts under a cognizable legal theory. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). Patentability under 35 U.S.C. § 101 (the Patent Act) is a threshold determination on a purely legal issue. Bilski v. Kappos, 561 U.S. 593, 602 (2010). It is appropriate to decide Section 101 issues at the pleading stage: From a practical perspective, addressing section 101 at the outset of litigation will have a number of salutary effects. First, it will conserve scarce judicial resources. Failure to recite statutory subject matter is the sort of ‘basic deficiency,’ that can, and should, ‘be exposed at the point of minimum expenditure of time and money by the parties and the court.’ Ultramercial, Inc. v. Hulu, LLC, 772 F.3d 709, 718-19 (Fed. Cir. 2014). Courts in this District have invalidated patent claims on Rule 12 motions prior to claim construction. For example, in Wolf v. Capstone Photography, Inc., this Court ordered a 12(c) dismissal on § 101 grounds (“the basic character of the claimed subject matter is readily ascertainable from the face of the patent, and that plaintiffs’ arguments for delaying the § 101 inquiry are unpersuasive.”), No. 2:13- Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 11 of 20 Page ID #:459 8 YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 CV-09573, 2014 WL 7639820, at *6, *10 (C.D. Cal. Oct. 28, 2014) (Snyder, C.) (quotations omitted); see also Eclipse IP LLC v. McKinley Equip. Corp., No. SACV 14-154-GW (AJWx), 2014 WL 4407592, at *7-9 (C.D. Cal. Sept. 4, 2014) (granting motion to dismiss). B. Abstract Ideas Are Not Eligible For Patent Protection. Section 101 of the Patent Act defines patent-eligible subject matter as “any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof.” 35 U.S.C. § 101. The Supreme Court has long recognized that abstract ideas are not eligible for patent protection. See Alice Corp. v. CLS Bank Int’l, 134 S. Ct. 2347, 2359 (2014), 189 L. Ed. 2d 296 (2014) (patent claims directed toward abstract ideas implemented using conventional computer technology are invalid for lack of patentable subject matter under § 101); see also Mayo Collaborative Servs. v. Prometheus Labs.,Inc., 132 S. Ct. 1289, 1293 (2012), 182 L. Ed. 2d 321 (2012); Bilski, 561 U.S. at 653 (“Phenomena of nature…, mental processes, and abstract intellectual concepts are not patentable.”). To determine if a patent claim is ineligible under §101, the Supreme Court has established a two-step test. Alice, 134 S. Ct. at 2354. Step 1. The Court must first determine whether the claims at issue are directed to a patent-ineligible concept. Alice, 134 S. Ct. at 2355. Claims that are “drawn to an abstract idea” are ineligible. Id. at 2353. “Identifying whether a claim is ‘directed to an abstract idea’ under step one of the Alice test requires courts to examine the purpose of a challenged claim.” Apollo Fin., LLC v. Cisco Sys., Inc., No. 2:15-CV-9696 RSWL (PJWX), 2016 WL 3234518, at *4 (C.D. Cal. June 7, 2016); see Blue Spike, LLC v. Google, Inc., No. 14 cv 01650, 2015 WL 5260506, at *4 (N.D. Cal. Sept. 8, 2015) (“To determine whether patent claims are directed to an abstract idea, the Court must ‘distill[] the gist of the claim[s].’”). If the focus of the claims is “on a process that qualifies as an ‘abstract idea’ for which computers are invoked merely as a tool,” the claim must be subjected to step two of the Alice Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 12 of 20 Page ID #:460 9 YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 test. Enfish, LLC. v. Microsoft Corp., 822 F.3d 1327, 1336 (Fed. Cir. 2016). Step 2. If the claims are directed to a patent-ineligible concept, the Court must then determine whether there is an “inventive concept” that is “sufficient to ensure that the patent in practice amounts to significantly more than a patent upon the [ineligible concept] itself.” Alice, 134 S. Ct. at 2355. Transformation of a patent-ineligible abstract idea “into a patent-eligible application requires ‘more than simply stat[ing] the [abstract idea] while adding the words ‘apply it.’” Id. at 2357. The Supreme Court has made clear that merely taking an abstract idea and adding steps (or breaking the idea into steps) involving “well-understood,” “routine,” or “conventional” activity does nothing to add an inventive concept to an abstract idea. Alice, 134 S. Ct. at 2359 (claims to abstract idea invalid despite reciting computer components); Content Extraction & Transmission LLC v. Wells Fargo Bank, Nat. Ass'n, 776 F.3d 1343, 1347-48 (Fed. Cir. 2014), cert. denied, 136 S. Ct. 119, 193 L. Ed. 2d 208 (2015) (claims to abstract idea invalid despite requirement of scanner and computer). Additionally, “limiting the use of an abstract idea to a ‘particular technological environment [,]”’ such as “the mere recitation of a generic computer[,] cannot transform a patent-ineligible abstract idea into a patent-eligible invention.” Alice, 134 S. Ct. at 2358; see also In re TLI Commc’ns LLC Patent Litig., 823 F.3d 607, 611 (Fed. Cir. May 17, 2016) (holding concrete, tangible components that “merely provide a generic environment in which to carry out an abstract idea” did not make the patent valid). C. The ’506 Patent Claims Are Not Eligible For Patent Protection. 1. Step 1: The Asserted Claims of the ’506 Patent Are Directed to an Abstract Idea As part of the first step of the Section 101 inquiry, “the Court distills the gist of the claim,” in other words, whether the “character” of the claims as a whole is directed to an abstract idea. Open Text S.A. v. Box, Inc., 78 F. Supp. 3d 1043, 1046- Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 13 of 20 Page ID #:461 10 YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 47 (N.D. Cal. 2015); Enfish, 822 F.3d at 1335-36. There can be no real dispute that the gist of the ’506 Patent is directed to an abstract idea-automatic tracking of a target. (’506 Patent, 1:19-31.) The claim language makes this clear. The purported invention is a system for controlling a UAV, using receivers and processors that are configured in some general but unstated way, and making a determination according to some unspecified method. The claims cover, at best, an abstract system without providing any details. Moreover, tracking and monitoring are everyday concepts that courts have held to be abstract. See MacroPoint, LLC v. FourKites, Inc., No. 1:15 CV 1002, 2015 WL 6870118, at *3 (N.D. Ohio Nov. 6, 2015) (claims directed toward tracking freight abstract since “the claim discloses nothing more than a process for tracking freight, including monitoring, locating, and communicating regarding the location of the freight,” and specifically,“[t]hese ideas are all abstract in and of themselves.”); see also Wireless Media Innovations, LLC v. Maher Terminals, LLC, 100 F. Supp.3d 405, 413 (D.N.J. 2015) (claims directed toward an “abstract idea: monitoring locations, movement, and load status of shipping containers within a container-receiving yard, and storing, reporting, and communicating this information in various forms through generic computer functions.”). Similarly, the Court of Federal Claims recently held in a case involving motion tracking using generic sensors that tracking is an abstract concept. In Thales Visionix, Inc. v. United States, 122 Fed. Cl. 245, 252 (2015), the court found as abstract the idea of “tracking two moving objects [the pilot and the target]” which incorporated laws of nature governing motion. The asserted patent, entitled “Motion Tracking,” covered a helmet display that automatically tracked targets in a pilot’s vision. Id. at 248. The patent claimed a system with (1) two tracking sensors, one mounted on the tracked object and the other on a moving reference frame, and (2) a receiver “configured to determine an orientation of the object relative to the moving reference frame.” Id. at 249. Based on mathematical Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 14 of 20 Page ID #:462 11 YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 equations (related to angular speed and relative rotational positioning), the positions of the targets would automatically adjust as the pilot moved. Id. The Court dismissed the case on a motion for judgment on the pleadings because the patent covered ineligible subject matter. Id. at 257. The purported inventions of the ’506 Patent are similarly abstract. They are simply directed to the automation of motion tracking a process that can be performed manually. (’506 Patent, 1:35-40; 11:19-22; 11:33-36.) Tracking can be done as rudimentarily as with the naked eye, and the Federal Circuit has affirmed that processes that can be performed manually are abstract under § 101. See CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d 1366, 1371-72 (Fed. Cir. 2011) (method of verifying validity of credit card transactions over the Internet held unpatentable, as it could be performed manually); Versata Dev. Grp., Inc. v. SAP Am., Inc., 793 F.3d 1306, 1333 (Fed. Cir. 2015) (noting idea was patent ineligible when it “could be performed in the human mind or by a human using a pen and paper.”); Content Extraction, 776 F.3d at 1347 (claims unpatentable since “humans have always performed these functions” of “data collection, recognition, and storage,” which are “indisputably well-known.”). Nothing in the claims is anything other than an abstract idea. 2. Step 2: The Asserted Claims of the ’506 Patent Do Not Recite an Inventive Concept For patent claims to have an inventive concept, they need to address a specific technological problem and provide a technological solution that is tied to particular computer hardware or software solutions. For example, in DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245 (Fed. Cir. 2014), the patent claims addressed a problem specific to the Internet-in particular, the fact that when a user clicks on an advertisement on a certain website, conventional function would send the user to a third party merchant’s website and thus away from the original website. Id. at 1257. The patent claims addressed this problem by creating Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 15 of 20 Page ID #:463 12 YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 a “hybrid web page,” according to a specific method, that displays the third party’s content within the original website. Id. The court found this to be a sufficiently inventive concept because the claims did not “broadly and generically claim ‘use of the internet’ to perform an abstract business practice” - rather, the claims provided “a result that overrides the routine and conventional sequence of events ordinarily triggered by the click of a hyperlink.” Id. at 1258. Similarly, in California Institute of Technology v. Hughes Communications, Inc., 59 F. Supp. 3d 974 (C.D. Cal. 2014), this court upheld patent claims directed to directed to correcting corrupt stored data with an error correction code called irregular repeat and accumulate code. Id. at 1000-01. This method of error correction applies unconventional steps to solving the problem of corrupted data, including “irregular repetition and the use of a prior parity bit to calculate the next parity bit.” Id. at 998. Critically, the patent claims covered only this approach to error correction, thus ensuring that upholding the patent would not “preempt the field of error correction” or “preclude the use of other effective error correction techniques.” Id. at 994. There is nothing like this in the ’506 patent. It does not purport to invent UAVs, or tracking targets, or tracking targets using UAVs, or any specialized computer hardware related to UAV tracking. It does not purport to invent any of the recited computer components: processors are not new, receivers are not new, sensors are not new, controllers are not new, imaging devices are not new. The only thing the patent purports to do is to automate the long-known process of target tracking on drones. (’506 Patent, 11:37-40.) But it does so without including anything in the claims about how this may be done. In that respect, the ’506 patent seeks to do exactly what the court in California Institute of Technology said was improper-namely, preempting any method of automating target tracking on drones. See Cal. Inst. of Tech., 59 F. Supp. 3d at 994. The mere automation of a traditionally manual process, or use of updated Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 16 of 20 Page ID #:464 13 YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 technology to automate a process, is not inventive. See Content Extraction, 776 F.3d at 1347 (claims reciting the steps of “(1) collecting data, (2) recognizing certain data within the collected data set, and (3) storing that recognized data in a memory” were unpatentable since “humans have always performed these functions” of “data collection, recognition, and storage,” which are “indisputably well- known.”). The ’506 Patent’s claimed invention describes generic systems and methods for receiving and processing target information and adjusting a UAV to track the target. But this was traditionally done by a user manually tracking the target with his or her eyes and then controlling the UAV with a remote control. (’506 Patent, 1:20-31.) According to the ’506 Patent, this same concept is achieved via basic input and output functions performed using generic and conventional computer components. Where “the recited physical components behave exactly as expected according to their ordinary use,” there is no inventive concept. In re TLI, 823 F.3d at 615; see CMG Fin. Servs. Inc. v. Pac. Trust Bank, FSB, 50 F. Supp. 3d 1306, 1320-21 (C.D. Cal. 2014) (“None of the claims here actually describe any particular software, how it is designed, who designed it, or how it achieves the identified tasks. . . . [O]ne cannot merely claim that an abstract idea is tied to a machine by stating that the abstract steps will be performed via software instructions.”). Claim 1 fails to recite any element, individually or as an ordered combination, that can rescue it from patent ineligibility under § 101. Claim 6, which merely recites the UAV compromises a plurality of rotors configured to generate lift for the UAV. There is no disclosure or details of this supposed configuration and likewise no inventive concept is disclosed. The specification confirms that all of the computer components recited in the ’506 Patent are conventional everyday components performing their expected functions: Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 17 of 20 Page ID #:465 14 YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 • The imaging device can be a camera or a camcorder. (’506 Patent, 12:8- 12.) • The receivers can be a proximity sensor or a GPS sensor or a camera. (’506 Patent, 25:38-41.) • The processor can be a central processing unit (CPU) (’506 Patent, 48:7- 10.). The pre-processing unit can include “any hardware, software”. (’506 Patent, 19:22-26.) • The communication module can use infrared, radio, WiFi, or point-to- point networks. (’506 Patent, 44-63.) • The control terminal can be a smartphone, tablet, laptop, computer, glasses, gloves, helmet, or a microphone. (’506 Patent, 16:42-51.) There is no inventive concept in a recitation of generic computer components used to receive and process data in their expected capacities. In fact, as summarized in DDR Holdings, both the Supreme Court in Alice and the Federal Circuit many times since have found there to be no inventive concept where an abstract idea is simply applied to generic computer hardware. DDR Holdings, 773 F.3d at 1256 (summarizing cases where no inventive concept was found because the “patent-ineligible abstract ideas [were] plainly identifiable and divisible from the generic computer limitations recited by the remainder of the claim”); see also Electric Power Group, LLC v. Alstom, S.A., No. 2015-1778, 2016 WL 4073318, at *5 (Fed. Cir. Aug. 1, 2016) (no inventive concept when “[n]othing in the claims, understood in light of the specification, requires anything other than off-the-shelf, conventional computer, network, and display technology for gathering, sending, and presenting the desired information.”); buySAFE, Inc. v. Google, Inc., 765 F.3d 1350, 1355 (Fed. Cir. 2014) (no inventive concept in case involving “generic” computer functionality; “[t]hat a computer receives and sends the information over a network-with no further specification-is not even arguably inventive.”). The prosecution history of the ’506 Patent likewise confirms there is no Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 18 of 20 Page ID #:466 15 YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 inventive concept.3 During prosecution, the Examiner rejected all of the claims of the ’506 Patent as anticipated and/or obvious. (Request for Judicial Notice (“RJN”), Ex. A (1/5/15 Non-Final Rejection at p. 3-18).) Claim 1 was allowed only after the Applicant amended the claim to add a “wherein” limitation to require making a determination to adjust the UAV and/or imaging device in some unspecified way, based on known mathematical principles related to motion and orientation.4 (RJN, Ex. B (5/7/15 Supplemental Amendment, Response to Non- Final Office Action at 9-10).) Although the issuance of the ’506 Patent required adding this limitation, the additional language has no substance or inventive concept. It simply states that a determination is made based on certain factors, but it does not say how the factors should be applied, or even how they relate to making the required determination. The “determination” limitation is still abstract, and still lacks an inventive concept. See TDE Petroleum Data Sols., Inc. v. AKM Enter., Inc., No. 2016-1004, 2016 WL 4271975, at *2 (Fed. Cir. Aug. 15, 2016) (affirming patent-ineligibility of patent that “recites the what of the invention, but none of the how that is necessary to turn the abstract idea into a patent-eligible invention.”); Electric Power Group, 2016 WL 4073318, at *1 (claims patent-ineligible when they stated a function in general terms, without limiting them to technical means for 3 The prosecution history is a “public record,” and the Court may properly take judicial notice of it when considering a Rule 12 motion under Federal Rule of Evidence 201. See e.g. Coinstar,Inc. v. CoinBank Automated Sys., Inc., 998 F. Supp. 1109, 1114 (N.D. Cal. 1999) (taking judicial notice of prosecution history); Eclipse, 2014 WL 4407592, at *7-9 (court may consider on a 12(b)(6) motion matters which are properly judicially noticeable). 4 The following language was added: “wherein the one or more processors, individually or collectively, make a determination to adjust 1) the UAV, 2) the imaging device, or 3) both the UAV and the imaging device, wherein said determination is dependent upon a) number of rotational axes of the imaging device and orientation of said rotational axes relative to the UAV; b) a navigation path of the UAX; b) a navigation path of the UAV; or c) a maximum angular speed allowable for the UAV or the imaging device.” (RJN, Ex. B (5/7/16 Supplemental Amendment at 2).) Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 19 of 20 Page ID #:467 16 YUNEEC INTERNATIONAL’S MEMORANDUM ISO MOTION TO DISMISS CASE NO. 5:16-CV-00595-BRO(KKX) pa-1749567 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 performing the functions that are arguably an advance over conventional computer and network technology.) IV. CONCLUSION For the foregoing reasons, Defendant respectfully requests that the Court find the ’506 Patent invalid under 35 U.S.C. § 101 and dismiss DJI’s first cause of action in its complaint with prejudice. Dated: August 29, 2016 Respectfully submitted, By: /s/ Bryan Wilson Bryan Wilson BRYAN WILSON (CA SBN 138842) BWilson@mofo.com ALESSA HWANG (CA SBN 286872) AHwang@mofo.com MORRISON & FOERSTER LLP 755 Page Mill Road Palo Alto, California 94304-1018 Telephone: 650.813.5600 Facsimile: 650.494.0792 BITA RAHEBI (CA SBN 209351) BRahebi@mofo.com MORRISON & FOERSTER LLP 707 Wilshire Boulevard, Suite 600 Los Angeles, California 90017-3543 Telephone: 213.892.5200 Facsimile: 213.892.5454 Attorneys for Defendant YUNEEC INTERNATIONAL CO., LTD. Case 5:16-cv-00595-BRO-KK Document 41 Filed 08/29/16 Page 20 of 20 Page ID #:468