United States District Court, W.D. Texas, San Antonio Division
ORDER ON MOTION TO DISMISS
RODRIGUEZ UNITED STATES DISTRICT JUDGE
date, the Court considered Defendant's Motion to Dismiss
(docket no. 13), Plaintiff's response (docket no. 25),
and Defendant's reply (docket no. 26). After careful
consideration, Defendant's Motion to Dismiss is DENIED.
Encoditech, LLC brings this patent infringement suit,
alleging the Proximity watch made by Defendant Citizen Watch
Company of America, LLC infringes Plaintiff's patent.
Encoditech was issued Patent No. 6, 321, 095 (“the
Patent”) on November 20, 2001. The Patent is titled
“Wireless Communication Approach.” Encoditech
alleges it “relates to a mobile station that provides
direct, wireless communications with another mobile station
on a portion of a radio frequency (RF) band.” Docket
no. 1 at 3. Encoditech alleges the Patent addresses the
problem of providing wireless communications methods that
allow users to communicate and have private conversations,
and it does so by “using a frequency division multiple
access/time division multiple access communication
protocol.” Id. The Proximity watch allegedly
infringes on Claim 7 of the Patent by providing notifications
for social media, email, and events. Id. at 4. After
Encoditech its complaint on December 28, 2018, Citizen filed
the Motion to Dismiss (docket no. 13) now before the Court on
February 21, 2019.
survive a 12(b)(6) motion to dismiss, “a complaint must
contain sufficient factual matter, accepted as true, to
‘state a claim to relief that is plausible on its
face.'” Ashcroft v. Iqbal, 556 U.S. 662,
678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550
U.S. 544, 570 (2007)). A claim for relief must contain: (1)
“a short and plain statement of the grounds for the
court's jurisdiction”; (2) “a short and plain
statement of the claim showing that the pleader is entitled
to the relief”; and (3) “a demand for the relief
sought.” Fed.R.Civ.P. 8(a). In considering a motion to
dismiss under Rule 12(b)(6), all factual allegations from the
complaint should be taken as true, and the facts are to be
construed favorably to the plaintiff. Fernandez-Montez v.
Allied Pilots Assoc., 987 F.2d 278, 284 (5th Cir. 1993).
To survive a 12(b)(6) motion, a complaint must contain
“more than labels and conclusions, and a formulaic
recitation of the elements of a cause of action will not
do.” Twombly, 550 U.S. at 555.
argues that the Patent covers subject matter that is not
patentable and that, even if it does cover patentable subject
matter, not all elements of Claim 7 are met, so Encoditech
does not state a direct infringement claim.
Patentable Under Section 101
argues the Patent is invalid under 35 U.S.C. 101. Section 101
of the Patent Act provides that one who “invents or
discovers any new and useful process, machine, manufacture,
or composition of matter, or any new and useful improvement
thereof” may obtain a patent. 35 U.S.C. § 101.
Three categories-“laws of nature, physical phenomena,
and abstract ideas”-are exceptions to the subject
matter patentable under the Patent Act. Alice Corp. Pty.
Ltd. v. CLS Bank Int'l, 134 S.Ct. 2347 (2014).
“[W]hether a claim recites patent eligible subject
matter is a question of law which may contain underlying
facts.” Berkheimer v. HP Inc., 881 F.3d 1360,
1368 (Fed. Cir. 2018).
requires a two-part test derived from the Supreme Court's
decision in Alice. First, the court determines “whether
the claims at issue are directed to a patent-ineligible
concept.” Citizen argues the Patent covers an abstract
idea. If the claims are not directed to a patent-ineligible
concept, “the claims satisfy § 101 and [the court]
need not proceed to the second step.” Core Wireless
Licensing S.A.R.L. v. LG Elecs., Inc., 880 F.3d 1356,
1361 (Fed. Cir. 2018). Second, if the claim contains an
abstract idea, the court evaluates whether there is “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 ineligible concept itself.” Alice, 134
S.Ct. at 2355.
Alice Step One
one, “the claims are considered in their entirety to
ascertain whether their character as a whole is directed to
excluded subject matter.” Internet Patents Corp. v.
Active Network, Inc.,790 F.3d 1343, 1346 (Fed. Cir.
2015). “In performing step one of Alice, the Court
should be careful not to oversimplify the claims or the
claimed invention because, at some level, all inventions are
based upon or touch on abstract ideas, natural phenomena, or
laws of nature.” Encoditech, LLC v. Qardio, Inc.,
C.A. No. 1:18-864, 2019 WL 2526725, at *2 (D. Del. June
19, 2019). “At step one, therefore, it is not enough to
merely identify a patent-ineligible concept underlying the
claim; [courts] ...