Ameranth, Inc. has filed its first original complaint in nearly seven years, targeting Olo ( 1:20-cv-00518) over its food delivery platform (Olo Digital Ordering). The plaintiff pleads at length details concerning that accused system's integration with delivery services such as Door Dash, Uber Eats, Waitr, and others; with messaging services Google Assistant and Facebook Messenger; and with hosting services provided by Amazon. A new Ameranth patent-generally related to interacting with "hospitality software" through an "intelligent automated assistant" on a remote device-makes its litigation debut in Ameranth's recent complaint, which attaches an expert declaration that purportedly demonstrates "that the technologies described and claimed in [that] patent were non-conventional at the time of the invention in 2005 and contain at least three inventive concepts that enhance computer technology". Ameranth's last original complaint, filed in August 2013 against Booking Holdings (f/k/a Priceline Group) (OpenTable), contained no such detail-which is no surprise, given the effect that June 2014's Alice decision has had on Ameranth's campaign in particular and on patent litigation more generally.

A stay has been extended in Ameranth's last active litigation, against a wide range of defendants-from Apple to Domino's Pizza-in the Southern District of California, to await the outcome of a planned appeal to the US Supreme Court. Ameranth indicates that it will seek review of a November 1, 2019 Federal Circuit (nonprecedential) opinion largely upholding an October 2018 grant of summary judgment against Ameranth in the district court. The Federal Circuit agreed with District Judge Dana M. Sabraw that claims 1, 6-9, 11, and 13-18 of the sole surviving patent in the campaign ( 8,146,077) are patent-ineligibly directed, under Alice, to the abstract idea of "synchronous communications and automatic formatting for different handheld devices".

One bright spot for Ameranth in that order is the court's refusal to endorse the district court's invalidation of claims 4-5 of the '077 patent on the same grounds. The court ruled that the Southern District of California did not have subject matter jurisdiction over the validity of those two claims. Pizza Hut had filed a motion for summary judgment as to those claims, on Alice grounds, but then settled. Domino's Pizza requested permission "in effect to substitute itself for Pizza Hut to pursue the motion", which the district court granted. However, because Ameranth never asserted claims 4-5 against Domino's, no case and controversy as to those claims existed, ruled the Federal Circuit.

That November 1, 2019 decision followed the invalidation of all asserted claims from the first three patents asserted in the campaign ( 6,384,850; 6,871,325; 6,982,733). Multiple America Invents Act reviews before the Patent Trial and Appeal Board (see here for further background), some appealed to the Federal Circuit themselves, led to the cancellation of the claims of those patents, which were subsequently dropped from the district court litigation. While Ameranth sought a rehearing of the November 1 decision from the full Federal Circuit, Domino's Pizza renewed a motion seeking to have Judge Sabraw declare the case against it exceptional and therefore worthy of shifting attorney fees. In that motion, Domino's Pizza contends, among other things, that Ameranth took inconsistent and self-serving positions to avoid pitfalls with respect to both its infringement and validity claims and that Ameranth "spoliated evidence and presented misleading and false sworn testimony . . . in pursuit of [a] damages demand that likely would have exceeded $50 million at trial". The parties jointly moved to continue the hearing on that motion, again to await the outcome of Ameranth's planned US Supreme Court appeal.

Undeterred, and shifting its energies to a new forum, Ameranth has now asserted the latest member of the family at issue in this campaign ( 9,747,651). The patent issued in August 2017, its family having an earliest estimated priority date in September 1999 even if the '651 patent does not-indeed, Ameranth pleads that the patent "contains significant new material not disclosed in [the] earlier patents", that its claims "are directed to materially different concepts", and that "this is Ameranth's first litigation where it has asserted the concepts claimed in the '651 patent".

Ameranth attaches and "incorporates in its entirety" a declaration from Dr. Ricardo Valerdi, identified as an engineering professor at the University of Arizona and a "Senior Member" of the Institute of Electrical and Electronics Engineers (IEEE), "the largest engineering professional society in the world", with industry experience with Motorola and SpaceX. Through his work for Ameranth, at a cost of $625/hour, Valerdi summarizes his opinions by claiming that the "technologies described and claimed in the '651 patent contain at least the following three inventive concepts that enhance computer technology": being able to (1) "understand and convert both fixed format and free format messaging - unstructured data such as in an email/text message or via voice to text conversion"; (2) "concurrently handle both free and fixed format messaging through a variety of communication conversions"; and (3) "make and execute intelligent decisions by accessing and applying intelligent automated assistant technology" (footnotes and claim citations omitted).

Valerdi's history of "digital food orders" acknowledges early players like Pizza Hut, waiter.com, and GrubHub, but "[t]he Pizza Hut and GrubHub solutions were simple, fixed format, menu-based food ordering systems with very limited capabilities and lacked the ability to process, understand, and execute unstructured data". Ameranth purportedly "introduced remote wireless handheld ordering in September 1999", with Valerdi's declaration purporting to recount certain developments in the "field of speech and voice recognition" (by IBM, Bell South, Apple, and Google, among others) but indicates that the "field of intelligent automation was still in development in the mid-2000s" and that "[i]n the hospitality industry, in particular, significant work was still needed in or around 2005 to advance the digital delivery and data management of remote, location-based tourism systems". The remainder of the 25 or so paragraphs in Valerdi's declaration attempt to contextualize the alleged inventions claimed in the '651 patent, with particular reference to the state of the relevant art in 2005.

Plaintiffs have been defensively pleading against Alice challenges ever since the US Supreme Court issued that decision in June 2014, a trend that has only accelerated since early 2018's twin Federal Circuit decisions in Berkheimer and Aatrix that trimmed Alice's wings by calling into question the propriety of early resolution of such challenges given the importance of the facts underlying a patent eligibility analysis. Indeed, some federal judges have taken a particularly jaundiced view of early Alice challenges. For example, District Judge Rodney Gilstrap has suggested that juries be entrusted to resolve 101-related factual issues, details about which are available at " Juries' Role in Post-Berkheimer 101 Factfinding Confirmed by Gilstrap Alice Judgment" (September 2019). As further noted here, Judge Gilstrap has also begun to require that defendants seeking to bring eligibility challenges lay out their arguments early on, establishing another potential burden for companies seeking to leverage Alice.

Meanwhile, District Judge Alan D. Albright of the Western District of Texas-an increasingly popular patent venue-has signaled a deeply skeptical posture toward early Alice motions. In a recent order, Judge Albright denied such a challenge based on several factors, including the presumption of validity, which in Judge Albright's view makes a Rule 12 motion "a procedurally awkward place for a court resolve a patent's § 101 eligibility"; the general notion that it is "generally wise" and "more efficient" for a court to delay a Section 101 determination until after issuing a Markman order; the likely need for fact discovery to resolve an Alice motion; and the overall difficulty of applying the Alice test consistently, arguing that delaying an Alice determination to gain a better understanding of a patent and its underlying technology makes it more likely the court will make the "correct" 101 ruling. See " Recent Alice Order in Delaware Invites Comparison with the Western District of Texas" (April 2020) for a fuller treatment of Judge Albright's approach.

More broadly, the elevation of factual disputes in the Section 101 analysis brought about by Berkheimer and Aatrix has had a significant narrowing impact, with Alice invalidation rates dropping significantly as a result. According to RPX data, while 67% of patents challenged under Alice that saw rulings before Berkheimer had claims invalidated, just 44% of the patents adjudicated since Berkheimer saw the invalidation of claims (excluding the small number of decisions per patent with mixed-by-claim outcomes).

Patents Invalidated Under Alice Before and After Berkheimer

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Note: Some percentages add up to more than 100%, as patent claims occasionally see multiple Alice rulings with different outcomes. (For example, a claim may be found not invalid in one case and invalid in another.)

For further information, including an analysis of Alice decisions that explicitly turned on whether courts found sufficient facts to rule in light of Berkheimer/Aatrix, see RPX's recent first-quarter review.

All that said, attaching a declaration to a complaint in hopes of defeating an Alice challenge does not always succeed. Prolific NPE IP Edge LLC attempted to overcome such an attack on the patents held by its plaintiff Pebble Tide LLC with a declaration from William Ho Chang, the patents' sole named inventor and president of Flexiworld Technologies, the original source of the patents, attesting to facts designed to establish the expertise of a person of ordinary skill in the art, to assist in claim construction, and to help contest the Alice motion (by pointing to purported problems in the prior art, alleged solutions provided by the patents, and inventive concepts "described in the specification and captured in the claims"). As RPX reported here, District Judge Leonard P. Stark invalidated the patents under Alice nonetheless.

San Diego-based Ameranth, formed in Delaware in 1996, started out as a provider of software for the hospitality industry, including systems for payment processing and wireless ordering. While the company still sells its software, its president Keith McNally admitted in early 2014 that the company has come to earn the majority of its income through patent assertion. In addition to its software menu campaign, begun all the way back in 2007, Ameranth also waged a smaller campaign starting in 2011 over an unrelated set of patents ( 7,431,650; 7,878,909; 8,393,969) generally relevant to casino management, hitting two providers of casino operations and gaming management systems as well as six casinos using those systems. The last of these lawsuits, a consolidated action against Commerce Club, ended in April 2015 following the January 2015 denial of an Alice motion against the '909 and '650 patents filed by the systems suppliers. In that case, the court ruled that a settlement between Ameranth and Genesis Gaming Solutions (the supplier of the accused products in the Commerce Club case) effectively resulted in a license to the asserted patents for Commerce Club.

The new Ameranth case against Olo has been initially assigned to District Judge Maryellen Noreika in Delaware. However, the court might treat any early challenge to the claims of the '961 patent under Alice and regardless of how any subsequent appeals play out, the results may not end the entity's campaign, which could conceivably pass the 15-year mark. Prosecution of at least one application in the asserted family of patents, filed in August 2017, continues before the USPTO.

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