Case 5:21-cv-03868-VKD Document 156 Filed 04/28/22 Page 1 of 7
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`UNITED STATES DISTRICT COURT
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`NORTHERN DISTRICT OF CALIFORNIA
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`Plaintiff,
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`10TALES INC.,
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`TIKTOK INC., TIKTOK PTE. LTD.,
`BYTEDANCE LTD., AND BYTEDANCE INC.,
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`vs.
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`Case No.: 21-CV-03868-YGR
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`ORDER DENYING MOTION TO DISMISS
`WITHOUT PREJUDICE
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`Re: Dkt. No. 132
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` Defendants.
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`Plaintiff 10Tales Inc. brings this action against defendants TikTok Inc., TikTok Pte. Ltd.,
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`ByteDance Ltd., and ByteDance Inc., (collectively, “defendants” or “TikTok”) for patent
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`infringement. (Dkt. No. 124, First Amended Complaint (“FAC”) ¶ 1.). Specifically, plaintiff
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`alleges that defendants have infringed U.S. Patent No. 856,030, entitled “Method, System and
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`Software for Associating Attributes within Digital Media Presentations.” (the “'030 Patent”). Now
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`before the Court is defendants’ motion to dismiss plaintiff’s complaint for patent ineligibility
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`under 35 U.S.C. § 101. Having carefully considered the pleadings and the papers submitted, as
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`well as oral argument from counsel on February 22, 2022, and for the reasons set forth more fully
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`below, the Court DENIES defendants’ motion to dismiss WITHOUT PREJUDICE. In summary, the
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`Court finds that it must conduct claim construction before resolving the issues.
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`I.
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`BACKGROUND
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`The complaint recites the following allegations:
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`On October 7, 2014, the United States Patent and Trademark Office issued the '030 Patent.
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`(FAC ¶¶ 1, 51.) The '030 Patent is used to deploy advanced storytelling through the use of 10
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`second videos submitted by a network of friends that become shared experiences among the friend
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`network. (Id. ¶ 2.) David Russek is the inventor of the '030 Patent and 10Tales is the owner by
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`virtue of an assignment effective as of March 29, 2015. (Id. ¶ 52.)
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`Claim 1 of the '030 Patent claims a server-based system that associates user attributes with
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`digital media attributes and creates a user-specific composite digital media display. (Id. ¶ 58.)
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`Case 5:21-cv-03868-VKD Document 156 Filed 04/28/22 Page 2 of 7
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`Concerned with the “advent of the digital era” and the threats to advertising, Mr. Russek created a
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`“method, system, and software [] . . . which allow for customizing and personalizing content based
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`on a combination of a user’s demographics, psycho-demographics, cognitive states, emotional
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`states, social placement and group interaction dynamics within an online community, and/or
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`affinity for certain content elements (images, sounds, segments, graphics, video, text, dialog), self-
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`provided narrating content, internal narrative traits preference topology, and expectation level and
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`temporal spacing of assets within the narrative.” (Patent '030 at 1:52-61, 2:65-3:7).
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`According to plaintiff, the system in Claim 1 reflects technological improvements upon the
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`state of the art at the time. (FAC ¶ 59.) For example, Claim 1 teaches how to analyze a user’s
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`interactions with other users in an online social network in order to determine the user’s affinity
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`for certain digital media content. (Id. ¶ 60.) The '030 Patent also teaches the use of a rule-based
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`algorithm to use this information to create a user-specific composite digital media display for
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`users. (Id.)
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`The '030 Patent has two independent claims, Claims 1 and 2. Claim 1 of the '030 Patent
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`recites:
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`1. A system for associating user attributes with digital media asset attributes and creating
`a user specific composite digital media display, the system comprising:
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`a. a server;
`b. a computer-readable storage medium operably connected;
`c. wherein the computer-readable storage medium contains one or more
`programming instructions for performing a method of associating user attributes
`with digital media asset attributes and creating a user specific composite digital
`media display, the method comprising:
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`identifying a first set of digital media assets stored on the
`computer-readable storage medium,
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`creating, from the first set of digital media assets, a first
`composite digital media display,
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`presenting to the user via a display server, the first composite
`digital media display;
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`retrieving user social network information from at least one
`source external to the presented first composite digital media
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`Case 5:21-cv-03868-VKD Document 156 Filed 04/28/22 Page 3 of 7
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`display, wherein the user social network information
`contains one or more user attributes;
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`selecting, based on the user attributes in the social network
`information, a second set of digital media assets, wherein the
`second set of digital media assets is associated with one or
`more user attributes found in the user social network
`information;
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`monitoring the first composite digital media display for the
`presence of a trigger, wherein the trigger indicates a
`personalization opportunity in the first set of digital media
`assets;
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`performing a rule based substitution of one or more of the
`digital media assets from the first set of digital media assets
`with one or more of the digital media assets from the second
`set of digital media assets to create a user specific set of
`digital media assets;
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`creating, from the user specific digital media assets, a user
`specific composite digital media display; and;
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`presenting to the user via the display server, the second
`composite digital media display.
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`('030 Patent, at Claim 1, 20: 61-22:15.). Claim 2 of the '030 Patent recites:
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`2. The system of Claim 1 wherein the first set of digital media assets includes one or
`more of a foreground image, a background image, or audio.
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`('030 Patent, at Claim 2, 22: 16-18.). Plaintiff alleges that TikTok’s recommendation system that
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`generates the user-specific “For you” feeds directly infringes Claim 1 of '030 Patent. (FAC ¶ 61.)
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`II.
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`LEGAL STANDARD
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`A. Motion to Dismiss Under Rule 12(b)(6)
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`Under Federal Rule of Civil Procedure 12(b)(6), a complaint may be dismissed for failure
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`to state a claim upon which relief may be granted. Dismissal for failure under Rule 12(b)(6) is
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`proper if there is a “lack of a cognizable legal theory or the absence of sufficient facts alleged
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`under a cognizable legal theory.” Conservation Force v. Salazar, 646 F.3d 1240, 1242 (9th Cir.
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`2011) (quoting Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699 (9th Cir. 1988)). For
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`purposes of ruling on a Rule 12(b)(6) motion, the Court “accept[s] factual allegations in the
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`complaint as true and construe[s] the pleadings in the light most favorable to the nonmoving
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`Case 5:21-cv-03868-VKD Document 156 Filed 04/28/22 Page 4 of 7
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`party.” Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008).
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`Nonetheless, the Court is not required to “ ‘assume the truth of legal conclusions merely because
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`they are cast in the form of factual allegations.’ ” Fayer v. Vaughn, 649 F.3d 1061, 1064 (9th Cir.
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`2011).
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`B.
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`Section 101 Patent-Eligible Subject Matter
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`TikTok’s motion argues that the '030 Patent fails to claim patent-eligible subject matter
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`under Section 101 in light of the Supreme Court’s decision in Alice Corp. Pty. Ltd. v. CLS Bank
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`International, 573 U.S. 208 (2014) (“Alice”). The question of whether a claim recites patent-
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`eligible subject matter under Section 101 is ultimately a question of law. Intell. Ventures I LLC v.
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`Cap. One Fin. Corp., 850 F.3d 1332, 1338 (Fed. Cir. 2017)) (“Patent eligibility under § 101 is an
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`issue of law[.]”); In re Roslin Inst. (Edinburgh), 750 F.3d 1333, 1335 (Fed. Cir. 2014) (same). A
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`district court may resolve the issue of patent eligibility under Section 101 by way of a motion to
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`dismiss. See, e.g., Secured Mail Sols. LLC v. Universal Wilde, Inc., 873 F.3d 905, 912 (Fed. Cir.
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`2017) (affirming determination of ineligibility made on 12(b)(6) motion); Content Extraction &
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`Transmission LLC v. Wells Fargo Bank, Nat'l Ass’n, 776 F.3d 1343, 1345 (Fed. Cir. 2014) (same).
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`Section 101 “defines the subject matter that may be patented under the Patent Act.” Bilski
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`v. Kappos, 561 U.S. 593, 601 (2010). Under Section 101, the scope of patentable subject matter
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`encompasses “any new and useful process, machine, manufacture, or composition of matter, or
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`any new and useful improvement thereof.” Id. (quoting 35 U.S.C. § 101). These categories are
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`broad, but they are not limitless. Section 101 “contains an important implicit exception: Laws of
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`nature, natural phenomena, and abstract ideas are not patentable.” Alice Corp. Pty. Ltd., 573 U.S.
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`at 208. These three categories of subject matter are excepted from patent-eligibility because “they
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`are the basic tools of scientific and technological work,” which are “free to all men and reserved
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`exclusively to none.” Mayo Collaborative Servs. v. Prometheus Lab'ys, Inc., 566 U.S. 66, 71
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`(2012)) (citations omitted). The Supreme Court has explained that allowing patent claims for such
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`purported inventions would “tend to impede innovation more than it would tend to promote it,”
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`thereby thwarting the primary object of the patent laws. Id. However, the Supreme Court has also
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`cautioned that “[a]t some level, all inventions embody, use, reflect, rest upon, or apply laws of
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`Case 5:21-cv-03868-VKD Document 156 Filed 04/28/22 Page 5 of 7
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`nature, natural phenomena, or abstract ideas.” Alice Corp. Pty. Ltd., 573 U.S. at 217 (alteration,
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`internal quotation marks, and citation omitted). Accordingly, courts must “tread carefully in
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`construing this exclusionary principle lest it swallow all of patent law.” Id.
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`In Alice, the Supreme Court refined the “framework for distinguishing patents that claim
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`laws of nature, natural phenomena, and abstract ideas from those that claim patent-eligible
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`applications of those concepts” originally set forth in Mayo. Id. This analysis, known as the
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`“Alice” framework, proceeds in two steps as follows:
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`Under the Alice framework, we first determine whether the claims at issue are directed to
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`one of those patent-ineligible concepts. If so, we then ask, “[w]hat else is there in the claims
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`before us?” Id. To answer that question, we consider the elements of each claim both individually
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`and “as an ordered combination” to determine whether the additional elements “transform the
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`nature of the claim” into a patent-eligible application. Id. We have described the second step two
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`of this analysis as a search for an “‘inventive concept’ ”— i.e., an element or combination of
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`elements that is “sufficient to ensure that the patent in practice amounts to significantly more than
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`a patent upon the [ineligible concept] itself.” Id. (alterations in original) (citations omitted).
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`III. ANALYSIS
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`The '030 Patent bears relevant similarities to the patent in Free Stream Media Corp., v.
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`Alphonso, Inc., 996 F.3d 1355, 1362-65 (Fed. Cir. 2021). There, as here, the claimed invention
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`related to a system that provided “targeted information (i.e., advertisements) that was deemed
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`relevant to the user based on data gathered [about the user.]” Id. at 1359. In Free Media Corp., the
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`Federal Circuit found that the patent was directed at the abstract idea of targeted advertising,
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`noting that the claims were “directed to: (1) gathering information about the [users’] viewing
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`habits; (2) matching the information with other content (i.e., targeted advertisements) based on
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`relevancy to the television viewer; and (3) sending that content to a second device.” Id. at 1361-
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`62. Further, as in Free Media Corp., Claim 1 also discloses the idea of targeted advertising using
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`what appears to be generic computer technology. (See '030 Patent at Claim 1, 20:62-21:6)
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`(disclosure of a “server” and a “computer-readable storage medium”.)
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`However, according to plaintiff, Claim 1 also introduces technological improvements over
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`Case 5:21-cv-03868-VKD Document 156 Filed 04/28/22 Page 6 of 7
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`the state of the art that were not conventional or generic at the time the patent issued. In support of
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`this argument, plaintiff argues that Claim 1 personalizes the content based not only on information
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`about the user provided by the user, but also based on externally retrieved user social network. (Id.
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`at 3:24-32) (explaining that user information is collected through some “form of media narrative”
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`and then “classif[ied] and include[d] into the user’s profile.”) Specifically, plaintiff argues that
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`Claim 1 discloses a system for analyzing how a user interacts with others in a social network to
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`determine a user’s affinity for content and the use of a rule based algorithm to create a
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`personalized digital media display for a particular user. (FAC ¶¶ 59-60.) Whether these
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`improvements save the '030 Patent from invalidity turns on the meaning of the terms used to
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`describe the elements, including but not limited to “retrieving user social network,” and
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`“performing a rule based substitution.” ('030 Patent at Claim 1, 21:13-22:7.) According to the
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`parties’ recently submitted joint claim construction statement, Dkt. No. 149, these terms are
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`disputed, as well as eight additional terms.
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`Additionally, the parties appear to dispute the basic character of the subject matter of the
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`claimed invention. For instance, defendants argue that the '030 Patent is a “ ‘quintessential’ do it
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`on a computer patent,” that is “simply directed to an abstract idea of customizing digital media on
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`a generic computer/sever technology,” and that the patent “fails to provide any improvement to
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`[the] technology.” (Dkt. No. 132, Motion to Dismiss (“Mot.”) at 2.) Contrary to defendant’s
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`characterization of the patent, plaintiff argues that the patent is “directed to a new field of
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`technological solutions that. . . present[s] improved personalized digital media content in a
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`network environment. (Dkt. No. 134, Opposition to Motion, (“Opp.”) at 2.) Given that the parties
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`not only dispute the nature and characterization of the patent, but also 10 claim terms, the Court
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`finds that claim construction can help clarify the basic character of the claimed invention and
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`whether the alleged improvements are in fact improvements over prior art. Thus, as claim
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`construction has not yet occurred in this case, the Court finds that it cannot, at this juncture,
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`adjudicate the issue of whether the patent is directed to patent-ineligible ideas. See Bancorp Servs.,
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`L.L.C. v. Sun Life Assur. Co. of Canada (U.S.), 687 F.3d 1266, 1273–74 (Fed. Cir. 2012)) (noting
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`“that it will ordinarily be desirable—and often necessary—to resolve claim construction disputes
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`Case 5:21-cv-03868-VKD Document 156 Filed 04/28/22 Page 7 of 7
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`prior to a §101 analysis, for the determination of patent eligibility requires a full understanding of
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`the basic character of the claimed subject matter”).
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`IV.
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`CONCLUSION
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`For the foregoing reasons, the Court DENIES WITHOUT PREJUDICE defendants’ motion to
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`dismiss plaintiff's claims as patent-ineligible under Section 101.
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`This Order terminates Docket Number 132.
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`IT IS SO ORDERED.
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`April 28, 2022
`Dated:
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`YVONNE GONZALEZ ROGERS
`UNITED STATES DISTRICT COURT JUDGE
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