[00:00:00] Speaker 01:
We have two cases on the calendar this morning, one from a district court and a veteran's appeal that's submitted on the briefs and will not be argued.

[00:00:12] Speaker 01:
Our only argued case is 2021-10-52, Monument Peak Ventures versus Toshiba, America, Mr. Edmonds.

[00:00:31] Speaker 01:
That is a problem.

[00:00:34] Speaker 01:
That's ought to be fixed.

[00:00:37] Speaker 01:
Please proceed.

[00:00:39] Speaker 04:
Good morning, Your Honors, and may it please the Court.

[00:00:43] Speaker 04:
I'm here on behalf of the appellant, Monument Peak Ventures.

[00:00:46] Speaker 04:
I'm going to refer to them as MPV for short.

[00:00:50] Speaker 04:
And this opinion by the district court should be reversed for five fundamental reasons.

[00:00:59] Speaker 04:
The first reason is that MPV's second amended complaint had specific nonconclusory plausible factual details about technical problems, technical solutions to those problems, inventive concepts, the unconventionality of those solutions, and how human processes weren't automated.

[00:01:26] Speaker 04:
Those facts should have been

[00:01:29] Speaker 04:
accredited by the district court on a rule 12 motion.

[00:01:32] Speaker 01:
We can read the claims.

[00:01:36] Speaker 01:
And they talk about transferring images, storing them, deleting them.

[00:01:43] Speaker 01:
It looks all abstract.

[00:01:48] Speaker 04:
Are you referring to a particular patent, Your Honor?

[00:01:50] Speaker 04:
Which would you want me to address that remark to?

[00:01:53] Speaker 04:
Well, all of them.

[00:01:57] Speaker 04:
That's about the opinion we got from the district court in the sense that the district court did not really look at the limitations.

[00:02:07] Speaker 04:
It talked about the patents, and it didn't dig into the limitations.

[00:02:12] Speaker 04:
So I'll start with the 064.

[00:02:14] Speaker 04:
the 095 which which we'll discuss together the district court talked about representative claims but in his actual Alice step one and step two analysis he just referred to the patent

[00:02:44] Speaker 04:
In each instance, he just referred to the patent.

[00:02:47] Speaker 04:
And he drew a generalization of the patent.

[00:02:51] Speaker 04:
And that's what he used as his benchmark for 101, not the claims.

[00:02:57] Speaker 04:
That's just not simply what his analysis bears out.

[00:03:02] Speaker 00:
I hear you talking, sir.

[00:03:04] Speaker 00:
But from my perspective, at least since 1985 in this court,

[00:03:11] Speaker 00:
understanding has been that we pass on judgments, not on opinions.

[00:03:17] Speaker 00:
And so the fact that the judge might not have said the word claim when he's talking about what he finds to be the abstract idea, he clearly has looked at a representative claim in his opinion.

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And I realize that you've made some arguments that you think that he

[00:03:39] Speaker 00:
chose the wrong representative claim, but that's a different issue from whether or not the representative claim is sufficient to allow us to review what the judge's decision as opposed to his opinion was with respect to whether the representative claim was drawn to an abstract idea.

[00:04:02] Speaker 00:
that that speaks to the issue and we raise the real-time data case in particular that in our view the district court didn't provide a reviewable opinion right well that's I mean we it's clearly too that we've had on several times have expounded on the fact that we need to have a decision that we can effectively review and when you combine that notion with the notion that we're more concerned with the with the correctness of the

[00:04:30] Speaker 00:
decision as opposed to perhaps some words and an opinion, what we then do is look at the entire record.

[00:04:38] Speaker 00:
And in a case where there's a judgment based on the pleadings, we look at the arguments that were made in the opposing briefs.

[00:04:47] Speaker 00:
And I went back and read the briefs that were supplied by you and your adversary to the judge.

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And each of those briefs had extensive

[00:04:57] Speaker 00:
discussion of the case law.

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You had your view of what you cases that you selected you believe supported your point of view as to why the representative claims weren't drawn to abstract ideas and your adversary looked at other cases and cited specific language from those cases.

[00:05:16] Speaker 00:
So we have a body of material that was before the district court judge and we know from his decision

[00:05:27] Speaker 00:
that he preferred, he found your adversaries arguments more convincing as to whether or not these claims are drawn to abstract ideas.

[00:05:37] Speaker 00:
If you could start, it seems maybe you can correct me or guide me helpfully to your cause, to your side, but it seems to me our first task is to decide whether we have enough information in front of us

[00:05:52] Speaker 00:
to review the judge's decision that each of the representative claims were drawn in each patent were drawn to abstract ideas.

[00:06:02] Speaker 00:
And if so, did the judge formulate the correct abstract idea?

[00:06:08] Speaker 00:
And if the answer to that is yes, from our point of view, then you move to step two of Alice.

[00:06:13] Speaker 00:
So I want to sort of see where the gravamen of your argument is.

[00:06:18] Speaker 04:
Well, I think the groveling of our argument is that the claims were wrongly invalidated or found patent ineligible.

[00:06:31] Speaker 04:
And so if the court feels like it has enough

[00:06:34] Speaker 04:
from the record to do its own de novo review, then we should talk about the merits.

[00:06:41] Speaker 04:
And I'm fine moving on to that and start talking about each of these patents.

[00:06:45] Speaker 00:
I'm trying to be helpful to you in sort of framing, because you've got five patents here, although the 064 and the 095 look like they're pretty much the same.

[00:06:56] Speaker 00:
I mean, you started with the 064 and the 095 and the 064.

[00:07:01] Speaker 00:
The judge said this is an abstract method for file management.

[00:07:05] Speaker 00:
You can also look at the claims as saying what it's doing is storing, transferring, and deleting images.

[00:07:16] Speaker 00:
And so I asked you why is

[00:07:20] Speaker 00:
a method for file management, which is basically storing, transferring, and deleting images.

[00:07:25] Speaker 00:
Why isn't that an abstract idea under our precedent that deals with information transfer, storing, modulating information?

[00:07:38] Speaker 00:
And we have manifold cases cited by your adversary that say we treat those kinds of claims as drawn to abstract ideas.

[00:07:50] Speaker 04:
Well, the question, so you're asking, I think, about Alice step one.

[00:07:55] Speaker 00:
Yeah, that's where we're talking.

[00:07:56] Speaker 04:
Right.

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So with respect to Alice step one, what the court should consider is that this provides a technical solution to a technical problem.

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And the technical solution is that the camera itself

[00:08:16] Speaker 04:
keeps track of which images have been successfully transferred.

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And that juxtaposes.

[00:08:22] Speaker 01:
But we look at claims, and we look at claim language.

[00:08:26] Speaker 01:
And if each of the operative words in the claims reflects an abstract idea, then isn't that conclusive?

[00:08:41] Speaker 04:
No, I think that this court would ask if it's

[00:08:45] Speaker 04:
If it provides a specific technical solution to a technical problem, then it should pass step one.

[00:08:51] Speaker 04:
I mean, all claims, if we reduce them to a high enough level, you could say it's an abstract idea.

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But that's not the final question.

[00:08:59] Speaker 00:
In all of these cases that deal with data, massaging data, in all the cases in which we have found them to be drawn to an abstract idea, the same argument could be made that they were solving a technical solution.

[00:09:15] Speaker 00:
I mean, that's inherent in what they're doing.

[00:09:19] Speaker 00:
To be sure, if you are capturing images in the memory, you know, in the card, and you take a picture and you capture that image in the card, that's solving a technical problem.

[00:09:36] Speaker 00:
How do you take a picture digitally and then how do you find the image that goes somewhere that it can be transferred and manipulated?

[00:09:46] Speaker 00:
Well, all of these cases, unless I'm mistaken, I went back and looked at the core of the cases cited by your adversary.

[00:09:53] Speaker 00:
All those cases involve practical solutions to problems that have a technical character, partly because you're using a computer to drive the solution to the problem.

[00:10:09] Speaker 00:
It seems to me that your emphasis on the technical

[00:10:13] Speaker 00:
aspects the solution the problem is in my judgment more properly advanced at step two of Alice where you would be trying to say even if the claim is drawn to an abstract idea something unusual out of the ordinary exceptional is happening such as perhaps you are teaching a computer how to perform a new trick and

[00:10:39] Speaker 04:
We would suggest that the CardioNet and Utiloc cases cited in our brief take into account whether it provides a technical improvement, technical solution.

[00:10:50] Speaker 04:
But let's focus on step two in the interest of time and a fair suggestion.

[00:10:55] Speaker 04:
So with respect to step two, and we're talking about 064, and as you suggested, we can just talk about 064 and 095 in the same conversation.

[00:11:04] Speaker 04:
The invented solution, which was unconventional,

[00:11:08] Speaker 04:
is that the camera tracks which images have been transferred.

[00:11:16] Speaker 00:
First off, the camera is first off receiving and storing the image, right?

[00:11:22] Speaker 00:
Correct.

[00:11:23] Speaker 00:
It captures an image in the memory that's on the memory card, right?

[00:11:27] Speaker 00:
Correct.

[00:11:28] Speaker 00:
OK, that's happening.

[00:11:29] Speaker 00:
Is that using anything that isn't off-the-shelf technology?

[00:11:38] Speaker 04:
No, we're not into the claimed invention yet, but no.

[00:11:42] Speaker 00:
But I'm taking representative claim eight of the 064, just for example.

[00:11:51] Speaker 00:
I mean, that's sort of the way you try to see what's happening technologically.

[00:11:59] Speaker 00:
This is at step two.

[00:12:01] Speaker 04:
What's happening technologically, if you look at figure four, and this is explained at

[00:12:08] Speaker 04:
appendix 30 and in column 7 it talks about how an image can be could be uploaded but not transferred or it could be uploaded and transferred and and that that data uploaded from what to what it could be transferred it could be uploaded but not transferred and we're it's uploaded if the image is in the camera and

[00:12:31] Speaker 04:
No, uploaded somewhere else, transferred somewhere else, outside of the camera.

[00:12:35] Speaker 00:
Wait, wait, wait.

[00:12:36] Speaker 00:
The image starts in the camera, correct?

[00:12:38] Speaker 00:
Correct.

[00:12:39] Speaker 00:
You take it, snap a picture with my digital camera, and the image is recorded, you know, on the little disk that's in there, right?

[00:12:45] Speaker 00:
Yes.

[00:12:46] Speaker 00:
Now, where am I going to transfer it to?

[00:12:49] Speaker 04:
You could transfer it to the cloud, you could send it to the cloud, you could send it to another device.

[00:12:55] Speaker 00:
I could send it to my computer.

[00:12:57] Speaker 00:
Correct.

[00:12:57] Speaker 00:
So wirelessly, I could send it either to my computer or to a cloud someplace where it's going to be stored.

[00:13:03] Speaker 04:
Right.

[00:13:04] Speaker 04:
And the camera is tracking whether that transfer has taken place.

[00:13:08] Speaker 00:
So you can tell from the camera.

[00:13:09] Speaker 00:
The camera can keep track of whether that happened.

[00:13:12] Speaker 00:
Correct.

[00:13:12] Speaker 00:
In doing that, is the camera using anything new and novel?

[00:13:17] Speaker 00:
Is the camera using off-the-shelf technology?

[00:13:21] Speaker 00:
No.

[00:13:22] Speaker 01:
Is it all software?

[00:13:24] Speaker 01:
Is it all programming?

[00:13:26] Speaker 04:
It is, yes.

[00:13:28] Speaker 04:
The camera is hardware, so it is programmed hardware.

[00:13:34] Speaker 04:
But yes, the camera has been programmed in order to perform this function.

[00:13:41] Speaker 04:
Let's move on.

[00:13:42] Speaker 00:
And so the camera keeps track.

[00:13:46] Speaker 00:
I took a picture of you just now, and wirelessly it went to my computer over in my chambers.

[00:13:52] Speaker 00:
And either the camera or the computer knows that it got transferred.

[00:13:57] Speaker 01:
Right?

[00:13:58] Speaker 00:
The camera knows that that is new.

[00:14:00] Speaker 00:
And it will keep track over time.

[00:14:01] Speaker 00:
And then if I would like to delete everything that's on the disk in the camera, the chip, I can push a button or whatever and it will empty out the chip to make it free to collect more pictures.

[00:14:15] Speaker 04:
If I want to empty out what's been transferred, it now knows what's been transferred and I can just delete it.

[00:14:20] Speaker 00:
And the beauty of the patent is that all of a sudden my disk, which was otherwise full,

[00:14:28] Speaker 00:
meaning I couldn't take any more pictures.

[00:14:29] Speaker 00:
I've used up all the capacity of the disk.

[00:14:32] Speaker 00:
I can push a button or clean the disk or erase it and start over again.

[00:14:37] Speaker 04:
The benefits are that

[00:14:40] Speaker 04:
If I don't have connectivity, I can tell from the camera what I've downloaded or not.

[00:14:45] Speaker 04:
I can delete those one at a time.

[00:14:47] Speaker 04:
Now I can delete them in mass, which I couldn't do before.

[00:14:49] Speaker 03:
Can I ask you, is the software implementation needed to practice the invention?

[00:14:55] Speaker 03:
Isn't that really conventional and within the knowledge of one's skills in the art?

[00:15:02] Speaker 03:
No.

[00:15:03] Speaker 03:
In certain of the patents, it says that right in the spec.

[00:15:06] Speaker 03:
I don't recall exactly what we're talking about now.

[00:15:11] Speaker 04:
But it says that it makes a statement to that effect in the specification of the 294 patent.

[00:15:22] Speaker 04:
It doesn't make a statement to that effect in the specification of any.

[00:15:25] Speaker 04:
None of the other patents make that statement.

[00:15:29] Speaker 04:
With respect to the 064 that we were just talking about,

[00:15:33] Speaker 04:
No, it's not conventional, because the patent describes in column one what was conventional, which it could, as you're transferring an image, it might display to show you, hey, this image is being transferred.

[00:15:47] Speaker 04:
Or you may have this image deletion preference.

[00:15:51] Speaker 04:
But the functionality it's claimed is not stated to be conventional.

[00:15:55] Speaker 04:
It's juxtaposed against the conventional.

[00:15:58] Speaker 01:
Counsel, your time has expired.

[00:16:00] Speaker 01:
But let's hear from the other side, and we'll give you five minutes for rebuttal.

[00:16:05] Speaker 04:
Let me take just one more minute, and I'll take it off on the other side, because I've only talked about one patent.

[00:16:10] Speaker 04:
Because I don't want to say I didn't cover it in the opening.

[00:16:15] Speaker 04:
So we've talked about the 064.

[00:16:20] Speaker 04:
For the 294, and I think the case that the court should consider is cell span,

[00:16:26] Speaker 04:
when self-spend had a two-step process that was unconventional and was inventive.

[00:16:32] Speaker 04:
And that's exactly what we have here.

[00:16:35] Speaker 04:
The two-step process is we have a pre-screening process with a rougher algorithm that has higher false positives, and then a second step where you just analyze the windows or the regions that you got from the first step.

[00:16:55] Speaker 04:
That's juxtaposed against what's conventional.

[00:16:58] Speaker 04:
There are lots of benefits that flow from that in terms of, say, it's processing and allows you to use other devices to do this that you couldn't do it before.

[00:17:07] Speaker 04:
So it conserves processing.

[00:17:09] Speaker 04:
But the two-step process itself is enough and has been pledged to be enough to get it passed.

[00:17:15] Speaker 01:
None of which negates the idea that the steps are abstract.

[00:17:21] Speaker 04:
Well, if I'm talking more about, we would say that it passes step one because it has a specific technical improvement, a technical solution.

[00:17:30] Speaker 04:
But really, when I talk about inventiveness and unconventionality, we're talking about step two.

[00:17:35] Speaker 04:
So whether it's abstract or not is a different question than step two.

[00:17:40] Speaker 01:
Let's hear from the other side.

[00:17:42] Speaker 04:
Thank you.

[00:17:43] Speaker 01:
Mr. Stewart.

[00:17:45] Speaker 02:
Thank you, Your Honors.

[00:17:46] Speaker 02:
May it please the Court?

[00:17:47] Speaker 03:
Mr. Stewart, can I ask you a preliminary housekeeping question?

[00:17:50] Speaker 03:
Certainly.

[00:17:51] Speaker 03:
Which your friend can disagree with when he gets up on rebuttal, if that's the case.

[00:17:54] Speaker 03:
But the way I understand this case is if we were to affirm, hypothetically, on the 101 issues with respect to all the patents, that the issues we raise with respect to willfulness and inducement are moved.

[00:18:08] Speaker 02:
Correct.

[00:18:08] Speaker 02:
The remaining patent, the sixth patent that had been asserted, has been dismissed with prejudice per agreement.

[00:18:15] Speaker 02:
Your Honors, I would start by addressing the concern, perhaps, that the judge's order was not robust enough, I believe, that Mr. Edmonds raised.

[00:18:24] Speaker 02:
And I would say that the conciseness of the judge's opinion is due to the fact that all five of these patents fall squarely within the category of ineligible subject matter, which has been laid out in this Court's prior cases.

[00:18:39] Speaker 01:
Well, the Court didn't even provide for an oral argument, did it?

[00:18:43] Speaker 02:
No, Your Honor.

[00:18:44] Speaker 02:
The court did it on the briefs.

[00:18:46] Speaker 01:
And with just almost a one sentence substantive statement with respect to each patent.

[00:18:54] Speaker 02:
Well, Your Honor, I believe that the patents in this case are very squarely ineligible.

[00:19:00] Speaker 02:
And so I don't know that more than that was required to dispense with each of the representative claims.

[00:19:06] Speaker 02:
And I'm happy to talk about each of the patents.

[00:19:08] Speaker 02:
We can start with

[00:19:09] Speaker 02:
For example, the 294, which was the patent Mr. Edmonds was last speaking about.

[00:19:14] Speaker 02:
And in that case, this patent is directed to data manipulation and the recogna court decision from this court, as well as the Digitech decision.

[00:19:25] Speaker 00:
Just go back to a second to the question of whether or not the case was properly resolved on the pleadings.

[00:19:35] Speaker 00:
The standard review is de novo, correct?

[00:19:37] Speaker 02:
Correct.

[00:19:37] Speaker 00:
For every issue.

[00:19:39] Speaker 00:
And so one of the key problems with your adversary's case, from your point of view, is his second amendment complaint is conclusory.

[00:19:52] Speaker 00:
That is, allegations about technical improvements, which is where he seems to be agreeing is the core of his case, which really pretty much goes to step two.

[00:20:03] Speaker 00:
So he says this is a technological advance.

[00:20:07] Speaker 00:
sufficient under the law, cites a case.

[00:20:10] Speaker 00:
What more did he have to say to be nonconclusory?

[00:20:15] Speaker 02:
Well, Your Honor, I don't think that you can plead your way out of an eligible subject matter.

[00:20:20] Speaker 00:
Well, no, I'm not talking.

[00:20:24] Speaker 00:
Let's assume, for purposes of argument, that the panel agreed that the claims are drawn to abstract ideas.

[00:20:31] Speaker 00:
That doesn't end the case.

[00:20:32] Speaker 00:
He's got a shot at being able to prove that something unusual is happening.

[00:20:38] Speaker 00:
He has claimed there is.

[00:20:39] Speaker 00:
He has said so in his Second Amendment complaint.

[00:20:45] Speaker 00:
But his statement is being rejected by you and presumably by the court as being conclusory.

[00:20:51] Speaker 00:
Correct.

[00:20:52] Speaker 00:
What's the difference between what's conclusory about an allegation that there's a technological advance?

[00:20:59] Speaker 00:
Well, Your Honor, I think that simply stating that without... Put yourself in his shoes and just add to the... You know the technology here very well.

[00:21:08] Speaker 00:
Add to adjust up the conclusory allegation of technological advance and tell me what else he should have said.

[00:21:14] Speaker 02:
Well, Your Honor, I can't because I don't believe there is a technical advance.

[00:21:18] Speaker 02:
And to the extent that Mr. Edmonds believes there's... Well, if you were on his side, sure you could.

[00:21:23] Speaker 02:
Your Honor, I'm really at a loss because these patents are

[00:21:27] Speaker 02:
are not the type of patents that display.

[00:21:30] Speaker 00:
He just made an argument with regard to the second algorithm in the 294.

[00:21:36] Speaker 00:
And he said the second algorithm is producing an image.

[00:21:40] Speaker 00:
It's producing something tangible.

[00:21:42] Speaker 00:
Under our case law, as you know, the production of something tangible may be material.

[00:21:47] Speaker 00:
in step two analysis.

[00:21:49] Speaker 02:
Your honor, with the 294, you start with something tangible.

[00:21:51] Speaker 02:
You have a data set.

[00:21:53] Speaker 02:
Then you apply an algorithm.

[00:21:54] Speaker 02:
You get results.

[00:21:55] Speaker 02:
You apply another algorithm.

[00:21:56] Speaker 02:
You get another set of results.

[00:21:57] Speaker 02:
That's a data in, data out analysis that falls squarely in Recognacorp.

[00:22:02] Speaker 02:
There's nothing new about that.

[00:22:04] Speaker 02:
The algorithms that are disclosed.

[00:22:05] Speaker 00:
You're pulling a different image.

[00:22:07] Speaker 00:
Basically, you're starting with seeing, you know, I know the way it works.

[00:22:11] Speaker 00:
The software hunts through all the pictures.

[00:22:14] Speaker 00:
And it's first off, it's hiding through all of the faces.

[00:22:18] Speaker 00:
So it pulls them all up, and then it has a little piece, and it takes my face and runs it against all those other faces and tells me whether my face is in there.

[00:22:27] Speaker 00:
So it is producing, when it produces my face, it's producing something new as a part right from the other step.

[00:22:34] Speaker 02:
To the computer, it's just data.

[00:22:36] Speaker 02:
It starts with a data set, and that data set is image data.

[00:22:39] Speaker 00:
OK, but I mean, why shouldn't we be able to read his complaint to say that when he says,

[00:22:44] Speaker 00:
that there's technological advance, that that's what he was saying.

[00:22:49] Speaker 00:
I mean, if, for example, he had said in his second amendment complaint, when I get to this 294 patent, I'll concede for purposes of argument that it's abstract idea.

[00:23:01] Speaker 00:
But I think the second algorithm saves it under the case law because it's producing this new image.

[00:23:08] Speaker 00:
Would that have been sufficient to survive a motion to dismiss on the pleading?

[00:23:13] Speaker 02:
I don't think so, Your Honor, because I think that the judge is entitled to examine the allegation and determine whether or not there's merit to it.

[00:23:21] Speaker 02:
You can't just go and put anything you want in your complaint and have it be taken as true.

[00:23:27] Speaker 02:
The judge has to evaluate the statement.

[00:23:29] Speaker 02:
And if there is a conclusory statement that is not tied to any fact that's laid out in the patent, then I don't believe that the judge has to accept it.

[00:23:40] Speaker 00:
Well, Your Honor, in this case, we gave them a roadmap.

[00:23:52] Speaker 02:
You know, they filed a complaint.

[00:23:54] Speaker 02:
They filed a first amended complaint that related to the parties.

[00:23:56] Speaker 02:
We filed a motion to dismiss.

[00:23:58] Speaker 02:
And then they filed the second amended complaint in an attempt to work around our motion to dismiss.

[00:24:03] Speaker 02:
So we gave them a roadmap of what to do.

[00:24:06] Speaker 02:
They did make changes to the complaint, but it just consisted of conclusive allegations.

[00:24:11] Speaker 02:
They didn't point to a specific technical advance.

[00:24:14] Speaker 02:
They just made a bunch of statements about the impact of the patent or what the judge should believe the patent does.

[00:24:22] Speaker 02:
But the claims themselves are directed to data analysis.

[00:24:25] Speaker 02:
And that subject matter is squarely within the line of cases from this court that say it's patent-eligible.

[00:24:36] Speaker 00:
Disagreeing with you on the question of whether or not step one is met.

[00:24:39] Speaker 00:
I think the game is it step two And what I'm asking you is how much specificity does a plaintiff have to make in his?

[00:24:48] Speaker 02:
First or first complain or second a minute complaint to survive a motion to dismiss on the step two issue well, I think that I think that a patent owner would need to say there is a technical advance and what the technical advance is and that technical advance cannot be a

[00:25:04] Speaker 02:
a conventional outcome using conventional generic software and hardware, which in all five of these patents, they're using conventional computer components.

[00:25:14] Speaker 02:
There's nothing new.

[00:25:15] Speaker 02:
There's no new computer functionality that's described.

[00:25:18] Speaker 02:
This is all computer.

[00:25:20] Speaker 02:
Computers are computer hardware and software manipulating data.

[00:25:23] Speaker 02:
Each of the five patents presented slightly differently.

[00:25:26] Speaker 02:
A few of them are drawn to user experience.

[00:25:29] Speaker 00:
And you've said as much in your papers filed

[00:25:34] Speaker 00:
And to support your motion to dismiss, right?

[00:25:36] Speaker 02:
Correct, Your Honor.

[00:25:39] Speaker 02:
Correct.

[00:25:40] Speaker 02:
So Your Honor, with regard to the 294, I think the 294 patent in particular, if you examine the claim, the claim is drawn to data in, data out, as I said.

[00:25:51] Speaker 02:
The Rekognikorp case, I think, treats that concept that you are not entitled to a patent on that.

[00:25:56] Speaker 02:
In fact, in this particular case, if you look at figure 3, it says, if the algorithm doesn't give you the result you want,

[00:26:04] Speaker 02:
A human can just modify, can select the image themselves.

[00:26:08] Speaker 02:
So it is juxtaposing human intervention and the data analysis that the computer hardware is conducting.

[00:26:16] Speaker 02:
On the 064 patent, in that case, it's the exact same issue.

[00:26:22] Speaker 02:
I think Your Honor already referred to this.

[00:26:24] Speaker 02:
It's basically using a computer as a tool to manage data.

[00:26:28] Speaker 02:
And the user could track that information themselves.

[00:26:33] Speaker 02:
In fact, paragraph 111, this is at appendix 293, that's in the second amended complaint, paragraph 111, MPV says, humans could compare what is in the remote storage device with what is on the camera.

[00:26:45] Speaker 02:
So that automation of a human memory task is squarely within those cases that this court has issued in that regard.

[00:26:55] Speaker 02:
With regard to the 762 patent,

[00:26:58] Speaker 02:
That is another case, and I would say too that the 064, 095, and 762 patent are really about improving the user's experience with the hardware.

[00:27:07] Speaker 02:
In fact, the 064 talks about the purpose of the invention is to alleviate a user's worry that they're going to be losing track of which photos have been deleted and which ones haven't.

[00:27:19] Speaker 02:
The 762 patent likewise talks about a user anxiety of being overwhelmed

[00:27:25] Speaker 02:
That's at column one, lines 38 to 40 of the 7.62 patent, by so many new features in the camera.

[00:27:33] Speaker 02:
So the purpose of the 7.62 patent is not to improve the camera or to improve its functionality, it's to improve the user's experience by reducing the number of features that a particular user is presented with at any given time.

[00:27:47] Speaker 02:
Everything that's in these patents, 0.64, 0.95, and 7.62, is all conventional.

[00:27:53] Speaker 02:
The 762, in addition, uses functional claiming to describe it.

[00:27:58] Speaker 02:
The last element of the representative claim 19 is programming the programmable memory.

[00:28:03] Speaker 02:
There's nothing there.

[00:28:04] Speaker 02:
That is definitely patent ineligible.

[00:28:06] Speaker 01:
Do you think every step performed through an algorithm is abstract?

[00:28:16] Speaker 02:
In general, Your Honor?

[00:28:17] Speaker 01:
Yes.

[00:28:18] Speaker 02:
I believe that the case law holds that algorithms themselves, the performance of an algorithm, is abstract.

[00:28:26] Speaker 02:
And whether you have, for example, two algorithms, as in the 294 or one, is irrelevant because you are performing math and this goes back to the decision in Fluke that mere mathematical calculations is not patent eligible.

[00:28:43] Speaker 00:
And the last part... Well, it depends on what it does.

[00:28:45] Speaker 00:
That's step two, right?

[00:28:48] Speaker 02:
Well, it depends on what the claim says.

[00:28:50] Speaker 00:
I mean, in the cases where we've sustained a patent at step two over a step one determination that the patent was drawn to an abstract idea, there has been an algorithm driving the computer.

[00:29:04] Speaker 02:
There has, but there's been some sort of technological improvement in the computer's function.

[00:29:09] Speaker 02:
And that's true.

[00:29:10] Speaker 00:
That's what I mean.

[00:29:10] Speaker 00:
So it's not the fact that you are driving, you're using an algorithm to give instructions to a machine doesn't fully invalidate that.

[00:29:23] Speaker 00:
Correct, Your Honor, correct.

[00:29:24] Speaker 00:
You always have to come to step two and ask what's going on.

[00:29:26] Speaker 02:
Correct, Your Honor.

[00:29:27] Speaker 02:
And I apologize if I gave that impression.

[00:29:29] Speaker 02:
It's true that you could have a claim that is drawn to the use of an algorithm.

[00:29:33] Speaker 02:
But the use of the algorithm has to be

[00:29:35] Speaker 02:
providing something further.

[00:29:37] Speaker 02:
It has to be doing something to improve the functionality of the hardware on which it's running.

[00:29:42] Speaker 02:
And that is not what's present in any of these patents.

[00:29:45] Speaker 02:
That is what's present in the line of cases that this court has issued, where you all have upheld claims as being patentable, because there was some improvement in computer functionality.

[00:30:00] Speaker 02:
And the last patent here, Your Honor, is the 484.

[00:30:05] Speaker 02:
This patent I think is perhaps the easiest to dispose of.

[00:30:09] Speaker 02:
It is directly in line with the American Needle case, which we cited.

[00:30:14] Speaker 02:
And this is simply about selling.

[00:30:16] Speaker 02:
This is about using a kiosk to replace a clerk.

[00:30:19] Speaker 02:
And the patent itself talks about the stated objective of the patent is to provide an opportunity for

[00:30:27] Speaker 02:
retail customers to purchase more products and it does so by presenting the the user the retail customer with a product configuration that might appeal to them and it does so using a kiosk this is a Do it on a computer type of case this this pattern so I think all five of these patents fall as I said squarely within the category of of claims that

[00:30:57] Speaker 02:
are not making a functional improvement to the hardware on which the algorithm is running, on which the software is based.

[00:31:06] Speaker 02:
These are simply using a computer to automate a human activity or to use a computer as a tool.

[00:31:14] Speaker 02:
I'm happy to see the rest of my time unless there are some questions.

[00:31:17] Speaker 01:
Fine.

[00:31:17] Speaker 01:
Thank you, counsel.

[00:31:19] Speaker 02:
Thank you, your honor.

[00:31:21] Speaker 01:
Mr. Edmonds, we'll give you five minutes for a bottle.

[00:31:29] Speaker 04:
Taking two points up front that my colleague made, so he characterized the 484 pattern as just about selling, but that gloss is over.

[00:31:42] Speaker 04:
The 484 pattern has modifying the user supplied image.

[00:31:48] Speaker 04:
And the specification teaches an example of that.

[00:31:50] Speaker 04:
For example, if you're going to put something on a t-shirt, you would texture the image to mimic the texturing of the t-shirt and then put it on a t-shirt.

[00:32:00] Speaker 04:
Like a regular Photoshop, it's in the specification.

[00:32:02] Speaker 04:
That's conventional.

[00:32:03] Speaker 04:
Or if you put on a coffee mug that's 3D, you would take the user-supplied image and

[00:32:09] Speaker 04:
and render that in space to where it would show up in the correct spatial arrangement of the coffee mug.

[00:32:16] Speaker 04:
So it is a technical solution.

[00:32:19] Speaker 04:
It's not just some type of advertising, as my friend said.

[00:32:23] Speaker 04:
With respect to the 762 patent, he characterizes user experience.

[00:32:28] Speaker 04:
In the specification, it talked about that you could modify the user interface for somebody to try to make it easier.

[00:32:35] Speaker 04:
The 762 patent took a different tack.

[00:32:38] Speaker 04:
They're actually using software that's external to the camera to modify the firmware and disable features.

[00:32:47] Speaker 04:
So those features, it's not just a user experience.

[00:32:50] Speaker 04:
It's effectively a different camera for that user because the features that they don't want have now been disabled.

[00:32:57] Speaker 04:
And when it goes to another user, then the features that they want are now enabled and the ones they don't want are disabled.

[00:33:03] Speaker 04:
So it's a different camera.

[00:33:04] Speaker 04:
It's not just a user experience.

[00:33:07] Speaker 04:
Judge Clevinger asked about what more could MPV do than say it's inventive.

[00:33:16] Speaker 04:
Here's what MPV did in a second amended complaint and in its briefing with the district court and here too.

[00:33:24] Speaker 04:
It didn't just say this is inventive.

[00:33:27] Speaker 04:
What we did was we explained the conventional art

[00:33:32] Speaker 04:
And this has all been pledged, so these facts should be accepted as true.

[00:33:35] Speaker 04:
We explained the conventional art.

[00:33:37] Speaker 04:
We juxtaposed the solution with the conventional art.

[00:33:42] Speaker 04:
We pointed out what was invented and what's unconventional about that.

[00:33:47] Speaker 04:
And you can't do any more than that on the pleadings.

[00:33:51] Speaker 04:
And that's exactly what we did.

[00:33:53] Speaker 04:
And that should be enough at the pleading stage to do that.

[00:33:58] Speaker 04:
So just so the court gets the... We talked about the 762 and 484.

[00:34:08] Speaker 04:
For the 294, this two-step process

[00:34:13] Speaker 04:
And the point that my friend misses is that the second step is only analyzing the regions with face candidates.

[00:34:21] Speaker 04:
So you're saving a lot of processing, saving a lot of memory, because you're only looking at certain small areas as opposed to, I think Judge Clevinger said, that you're familiar with the system where it would just scan the entire image looking for a face.

[00:34:33] Speaker 04:
That's what we're not doing here.

[00:34:35] Speaker 04:
We're narrowing it to just regions that might likely have a face and using the computational power just in those regions.

[00:34:42] Speaker 04:
And that's what's inventive and unconventional about it.

[00:34:45] Speaker 04:
With respect to the 484, let me just talk briefly about the willfulness and the inducement allegations and the lack of leave to amend.

[00:35:03] Speaker 04:
The district court misunderstood the standard for willfulness, and that's been clarified in this court's reason to opinion, SRI versus Cisco, September 28th of this year.

[00:35:15] Speaker 04:
That's been clarified.

[00:35:19] Speaker 04:
NPV pled that the infringement was clear, unmistakable, inexcusable, egregious.

[00:35:25] Speaker 04:
Clearly, that pleading has been met.

[00:35:28] Speaker 04:
With respect to the inducement, the district court

[00:35:33] Speaker 04:
did not carefully read or just mistakenly characterize the inducement allegations.

[00:35:41] Speaker 04:
The district court's opinion is just incorrect.

[00:35:44] Speaker 04:
The things the district court says that weren't alleged

[00:35:46] Speaker 04:
were absolutely alleged.

[00:35:48] Speaker 04:
And those are in our brief.

[00:35:50] Speaker 04:
But specific intent was alleged.

[00:35:53] Speaker 04:
Usage by customers as infringing was alleged.

[00:35:58] Speaker 04:
That the instructions caused infringing behavior was alleged.

[00:36:01] Speaker 04:
The district court just respectfully got all that wrong.

[00:36:06] Speaker 04:
At a minimum, the district court should have granted leave to amend

[00:36:12] Speaker 04:
And the district court's view was, well, I found they're ineligible.

[00:36:17] Speaker 04:
Therefore, the amendment would be futile.

[00:36:20] Speaker 04:
But that's incorrect.

[00:36:22] Speaker 04:
I mean, we know from Atrix that amendments can be made to address factual concerns.

[00:36:34] Speaker 04:
And the district court misunderstood how many times the first

[00:36:39] Speaker 01:
complaint that was amended was amended to drop a party and the district court some of this is not rebuttal of course but we understand your points and your time has expired thank you for your time your honor thank you the case is submitted