Samsung Electronics Co, Ltd. v. Blaze Mobile, Inc.

Background

Samsung Electronics Co., Ltd. and Samsung Electronics America, Inc. sued Blaze Mobile, Inc. and Michelle Fisher seeking a declaration that Samsung did not infringe eight patents. Blaze answered and counterclaimed for infringement. Fisher was identified as Blaze Mobile’s cofounder and chief executive officer, named inventor of the patents, and assignor of the patents to Blaze Mobile.

The patents were divided into three groups: the Advertising Patents, the NFC Security Patents, and the Mobile Payment Patents. The order addressed Samsung’s motion for judgment on the pleadings under Federal Rule of Civil Procedure 12(c) only as to the NFC Security Patents and Mobile Payment Patents. The court had previously denied the motion as to the Advertising Patents.

Legal standard

A Rule 12(c) motion tests whether the pleadings legally support the opposing party’s claims. The court accepts the pleaded factual allegations as true and views them in the light most favorable to the nonmoving party. The court may grant the motion if the moving party is entitled to judgment as a matter of law.

Samsung sought a judgment under 35 U.S.C. § 101 that the patents were unpatentable. The court applied the two-step framework from Alice Corp. v. CLS Bank. First, it asked whether the claims were directed to an abstract idea. If so, it asked whether the claims included an inventive concept—an element or ordered combination that added significantly more than the abstract idea itself. The court also rejected Blaze’s arguments that claim construction or factual disputes made the § 101 analysis premature.

NFC Security Patents

The NFC Security Patents concern securely processing near field communication transactions through a mobile device, a secure element, an identification code, and management and transaction servers. The court treated a claim from the ’493 Patent as representative of the group.

At the first Alice step, the court held that the claims were directed to the abstract idea of enabling a transaction between a user and a merchant using a code instead of the user’s secure payment information. The court characterized the claimed steps—detecting an NFC signal, activating an application, transferring an identification code through devices and servers, and processing the payment—as conventional actions described in a generic way. It also found that the claims described the results of the security process without explaining how to accomplish the tasks.

At the second Alice step, the court held that the claims did not contain an inventive concept. The court found that the mobile device, management server, transaction server, NFC protocol, secure element, and secure element application were conventional computer components or techniques. It also rejected Blaze’s arguments concerning separate storage of an identification code and payment information. The court further found that Blaze had not plausibly alleged an inventive concept based on operation without a wireless connection. The court concluded that the NFC Security Patents were patent-ineligible under § 101.

Mobile Payment Patents

The Mobile Payment Patents concern processing product purchases through mobile devices, including a non-browser-based application, product selection, user authentication, payment processing, and communication with remote servers. The court treated a claim from the ’259 Patent as representative.

At the first Alice step, the court held that the claims involved two abstract economic practices: selecting and purchasing products, and securing mobile-device transactions. The use of mobile devices and generic computing components did not by itself make those practices patent-eligible.

At the second Alice step, however, the court found that Blaze had plausibly alleged an inventive concept. Blaze alleged that the non-browser-based application could remain open and continue displaying information, and could allow users to store and change a shopping list, when the mobile device was not connected to a wireless network. The court found that these allegations were supported by the patent’s specification and claims and were sufficiently specific to defeat judgment on the pleadings. Samsung argued that this was merely conventional caching, but the court did not resolve that argument at this stage.

Disposition

The court granted Samsung’s motion for a judgment of unpatentability under 35 U.S.C. § 101 as to the NFC Security Patents and denied the motion as to the Mobile Payment Patents. The order did not alter the court’s earlier denial of the motion as to the Advertising Patents.