Secured Mail Solutions LLC v. Universal Wilde, Inc.

United States Court of Appeals
for the Federal Circuit
______________________
SECURED MAIL SOLUTIONS LLC,
Plaintiff-Appellant
v.
UNIVERSAL WILDE, INC.,
Defendant-Appellee
______________________
2016-1728
______________________
Appeal from the United States District Court for the
Central District of California in No. 2:15-cv-07562-DOC-
GJS, Judge David O. Carter.
______________________
Decided: October 16, 2017
______________________
WILLIAM J. O’BRIEN, One LLP, Beverly Hills, CA, ar-
gued for plaintiff-appellant.
GREGORY H. LANTIER, Wilmer, Cutler, Pickering, Hale
and Dorr LLP, Washington, DC, argued for defendant-
appellee. Also represented by ROBERT MANHAS.
______________________
Before PROST, Chief Judge, CLEVENGER, and REYNA,
Circuit Judges.
REYNA, Circuit Judge.
2 SECURED MAIL SOLUTIONS LLC v. UNIVERSAL WILDE, INC.
Secured Mail Solutions LLC appeals from the United
States District Court for the Central District of Califor-
nia’s grant of a motion to dismiss on grounds that the
claims of seven asserted patents are directed to subject
matter ineligible for patenting under 35 U.S.C. § 101.
Because the claims of the asserted patents are directed to
an abstract idea and the claims contain no additional
elements that transform the nature of the claims into a
patent-eligible application of the abstract idea, we affirm.
BACKGROUND
This appeal involves seven patents that Secured Mail
groups into three categories. U.S. Patent Nos. 7,814,032,
7,818,268, and 8,073,787 are the “Intelligent Mail Bar-
code” patents. U.S. Patent Nos. 8,260,629 and 8,429,093
are the “QR Code” patents. U.S. Patent Nos. 8,910,860
and 9,105,002 are the “Personalized URL” patents.
All the patents involve methods whereby a sender af-
fixes an identifier on the outer surface of a mail object
(e.g. envelope or package) before the mail object is sent.
Computers and networks are used to communicate the
information about the mail object’s contents and its
sender after the mail object is delivered.
The Intelligent Mail Barcode patents recite a method
for verifying the authenticity of the mail object. The
identifier or barcode is a single set of encoded data that is
generated by concatenating a sender-assigned unique
identifier with sender data, recipient data, and shipping
method data. ’268 patent, J.A. 76–77. The barcode is
affixed to the outside of the mail object and an authenti-
cating portion of the barcode is stored in a database. The
recipient of the mail object can access the database and
use that authenticating portion to verify that a mail
object is authentic.
The QR Code and Personalized URL patents addi-
tionally require that a reception device (e.g., personal
SECURED MAIL SOLUTIONS LLC v. UNIVERSAL WILDE, INC. 3
computer) be used to scan the encoded data and display
the resulting data on the reception device’s display screen.
See, e.g., ’629 patent, J.A. 98; ’093 patent, J.A. 107; ’860
patent, J.A. 120. In the QR Code patents, the identifier is
a QR code (two-dimensional barcode) which a user can
scan to look up additional electronic information related
to the mail object. Specifically, the barcode includes data
that allows the recipient of the mail object to request data
directly from the sender and allows the sender to provide
personalized data directly to the recipient, without the
involvement of the mail carrier. For example, a customer
might scan the QR code and be directed straight to her
account rather than having to log in to access the account.
In the Personalized URL patents, a method similar to
the QR Code patents is used, except the identifier is a
personalized network address, or URL. For example, the
user can type the URL into her web browser and be
directed straight to a specific account, or to other person-
alized information. The types of data provided by the
sender include content information, warranty infor-
mation, and account information.
For the Intelligent Mail Barcode patents, claim 1 of
the ’268 patent is representative:
1. A method of verifying mail identification data,
comprising:
affixing mail identification data to at least one
mail object, said mail identification data compris-
ing a single set of encoded data that includes at
least a unique identifier, sender data, recipient
data and shipping method data, wherein said
unique identifier consists of a numeric value as-
signed by a sender of said at least one mail object;
storing at least a verifying portion of said mail
identification data;
4 SECURED MAIL SOLUTIONS LLC v. UNIVERSAL WILDE, INC.
receiving by a computer at least an authenticating
portion of said mail identification data from at
least one reception device via a network, wherein
said authenticating portion of said mail identifica-
tion data comprises at least said sender data and
said shipping method data; and
providing by said computer mail verification data
via said network when said authenticating portion
of said mail identification data corresponds with
said verifying portion of said mail identification
data.
J.A. 76 at col. 6 ll. 18–37.
For the QR Code patents, claim 1 of the ’093 patent is
representative:
1. A method for providing electronic data to a re-
cipient of a mail object, comprising:
Generating, by a processor, a barcode for a mail
object, said barcode including at least a first set of
mail data, said first set of mail data including da-
ta corresponding to said recipient of said mail ob-
ject;
affixing said barcode to said mail object;
submitting said mail object to a mail carrier for
delivery to said recipient of said mail object;
receiving said first set of mail data, including data
corresponding to said recipient of said mail object,
from a reception device of said recipient via a
network;
providing said electronic data to said reception
device via said network in response to receiving
said first set of mail data, said electronic data in-
cluding a content of said mail object;
SECURED MAIL SOLUTIONS LLC v. UNIVERSAL WILDE, INC. 5
wherein said reception device displays said elec-
tronic data to a recipient of said mail object by
displaying said electronic data on a screen of said
reception device.
J.A. 107 at col. 6 ll. 22–40.
For the Personalized URL patents, claim 1 of the ’860
patent is representative:
1. A method for providing electronic data to a re-
cipient of a mail object, comprising:
using an output device to affix a single set of mail
ID data to said mail object, said single set of mail
ID data including at least recipient data, said re-
cipient data comprising a personalized network
address associated with said recipient of said mail
object;
submitting said mail object to a mail carrier for
delivery to said recipient of said mail object;
receiving said recipient data from a reception de-
vice of said recipient via a network; and
providing by at least one processor said electronic
data to said reception device via said network in
response to receiving said recipient data, said
electronic data including data on a content of said
mail object;
wherein said reception device displays said elec-
tronic data to a recipient of said mail object by
displaying said electronic data on a screen of said
reception device.
J.A. 120 at col. 6 ll. 34–51.
Universal moved to dismiss Secured Mail’s complaint
under Fed. R. Civ. P. 12(b)(6), arguing that Secured Mail’s
patents were not patent-eligible under Section 101. On
February 16, 2016, the district court found that all seven
6 SECURED MAIL SOLUTIONS LLC v. UNIVERSAL WILDE, INC.
patents were directed to patent-ineligible subject matter.
It reasoned that “the asserted claims, viewed individually
or in combination, do not meaningfully limit the abstract
idea of communicating information about a mailpiece by
use of marking.” Secure Mail Sols. LLC v. Universal
Wilde, Inc., 169 F. Supp. 3d 1039, 1058 (C.D. Cal. 2016).
Secured Mail appeals. We have jurisdiction under 28
U.S.C. § 1295(a)(1).
STANDARD OF REVIEW
We review procedural questions that are not unique to
patent law, such as a grant of a motion to dismiss for
failure to state a claim, according to the law of the region-
al circuit, which in this case is the Ninth Circuit. See,
e.g., Univ. of Utah v. Max-Planck-Gesellschaft Zur
Forderung Der Wissenschaften E.V., 734 F.3d 1315, 1319
(Fed. Cir. 2013). The Ninth Circuit reviews de novo a
dismissal for failure to state a claim. See, e.g., Livid
Holdings Ltd. v. Salomon Smith Barney, Inc., 416 F.3d
940, 946 (9th Cir. 2005). This court also reviews a district
court’s determination of patent eligibility under 35 U.S.C.
§ 101 de novo. See, e.g., McRO, Inc. v. Bandai Namco
Games Am. Inc., 837 F.3d 1299, 1311 (Fed. Cir. 2016).
DISCUSSION
The Patent Act defines patent-eligible subject matter
as “any new and useful process, machine, manufacture, or
composition of matter, or any new and useful improve-
ment thereof.” 35 U.S.C. § 101. The courts have created
certain exceptions to the literal scope of § 101, determin-
ing that laws of nature, natural phenomena, and abstract
ideas are not patent-eligible. Alice Corp. v. CLS Bank
Int’l, 134 S. Ct. 2347, 2354 (2014) (quoting Ass’n for
Molecular Pathology v. Myriad Genetics, Inc., 133 S. Ct.
2107, 2116 (2013)).
In Alice, the Supreme Court applied a two-step
framework for analyzing whether claims are patent-
SECURED MAIL SOLUTIONS LLC v. UNIVERSAL WILDE, INC. 7
eligible under section 101. First, we determine whether
the claims at issue are “directed to” a judicial exception,
such as an abstract idea. 134 S. Ct. at 2355. If not, the
inquiry ends. Thales Visionix Inc. v. United States, 850
F.3d 1343, 1346 (Fed. Cir. 2017); Enfish, LLC v. Microsoft
Corp., 822 F.3d 1327, 1339 (Fed. Cir. 2016). If the claims
are determined to be directed to an abstract idea we next
consider under step two whether the claims contain an
“inventive concept” sufficient to “transform the nature of
the claim into a patent-eligible application.” Alice, 134 S.
Ct. at 2355.
1. Alice Step One
Under Alice step one we consider the claims in their
entirety to ascertain whether they are directed to ineligi-
ble subject matter. Internet Patents Corp. v. Active Net-
work, Inc., 790 F.3d 1343, 1346 (Fed. Cir. 2015). We look
to whether the claims “focus on a specific means or meth-
od[, . . .] or are instead directed to a result or effect that
itself is the abstract idea and merely invokes generic
processes and machinery.” McRO, 837 F.3d at 1314
(citation omitted).
The district court found that the claims of all seven of
the asserted patents “are directed to the abstract idea of
communicating information about a [mail object] by use of
a marking.” Secured Mail, 169 F. Supp. 3d at 1049.
On appeal, Secured Mail argues that its claims are
patent-eligible under Enfish, an opinion issued after the
district court’s decision in this case. In particular, the
district court quoted the since-reversed district court
decision in Enfish to hold that courts “should recite a
claim’s purpose at a reasonably high level of generality.”
Secure Mail, 169 F. Supp. 3d at 1048 (quoting Enfish,
LLC v. Microsoft Corp., 56 F. Supp. 3d 1167, 1173 (C.D.
Cal. 2014), rev’d, 822 F.3d 1327 (Fed. Cir. 2016)). The
Federal Circuit in Enfish held that the district court had
described the claims at too high a level of abstraction, and
8 SECURED MAIL SOLUTIONS LLC v. UNIVERSAL WILDE, INC.
“describing the claims at such a high level of abstraction
and untethered from the language of the claims all but
ensures that the exceptions to § 101 swallow the rule.”
822 F.3d at 1337. Here, despite the district court’s state-
ment that “a reasonably high level of generality” should
be used, the district court’s analysis correctly found that
Secured Mail’s claims are directed to an abstract idea.
The court in Enfish held the claims relating to a com-
puter database implementation to be patent-eligible
under Alice step one because the claims focused on an
improvement to computer functionality itself, not on
economic or other tasks for which a computer is used in
its ordinary capacity. Id. at 1332–33. The claims in
Enfish related to organization of data in a table in com-
puter memory and a system for indexing that data. Id. at
1332–332. In contrast, the claims of Secured Mail’s
patents are not directed to an improvement in computer
functionality. For example, the claims are not directed to
a new barcode format, an improved method of generating
or scanning barcodes, or similar improvements in com-
puter functionality.
Secured Mail argues that the claims are specifically
directed to a sender-generated unique identifier, which
improved on the existing process both by reliably identify-
ing the sender of the mail object and by permitting the
sender to create a bi-directional communication channel
between the sender and recipient of the mail object. The
fact that an identifier can be used to make a process more
efficient, however, does not necessarily render an abstract
idea less abstract.
The claims of the Intelligent Mail Barcode patents are
not directed to specific details of the barcode or the
equipment for generating and processing it. The claims
generically provide for the encoding of various data onto a
mail object but do not set out how this is to be performed.
The claims state that various identifiers are affixed to a
SECURED MAIL SOLUTIONS LLC v. UNIVERSAL WILDE, INC. 9
mail object, stored in a database, scanned from the mail
object, and retrieved from the database. No special rules
or details of the computers, databases, printers, or scan-
ners are recited. Cf. McRO, 837 F.3d at 1315 (finding
patent eligibility where the “claimed process uses a com-
bined order of specific rules that renders information into
a specific format that is then used and applied to create
desired results”); Thales, 850 F.3d at 1349 (finding patent
eligibility where the “claims specify a particular configu-
ration of inertial sensors and a particular method of using
the raw data from the sensors”).
There is no description of how the unique identifier is
generated or how a unique identifier is different from a
personal name, or return address. Rather, the claim
language cited by Secured Mail merely recites that the
unique identifier is generated by the sender. The fact
that the sender generates a barcode, which itself is not
claimed, does not render the idea any less abstract.
The QR Code patents fare no better. The claims of
these patents provide a method whereby a barcode is
generated, affixed to a mail object, and sent through the
mail system. Then, upon receipt, the barcode is scanned,
and data corresponding to the sender is sent to the recipi-
ent over the network and displayed on the recipient’s
device. This method is not limited to any particular
technology of generating, printing, or scanning a barcode,
of sending a mail object, or of sending the recipient-
specific information over a network. Rather, each step of
the process is directed to the abstract process of com-
municating information about a mail object using a per-
sonalized marking.
The Personalized URL patents are directed to the
same abstract idea. The claims recite a personalized
network address that is affixed to a mail object using an
output device, the mail object is submitted to a mail
carrier, and then once the mail object is received, a re-
10 SECURED MAIL SOLUTIONS LLC v. UNIVERSAL WILDE, INC.
quest is made by the recipient over the network using the
personalized network address, and data is displayed on a
screen. As with the other patents, each step of the pro-
cess uses an identifier, in this case a personalized net-
work address, to communicate information about a mail
object.
The claims of the three sets of patents are not limited
by rules or steps that establish how the focus of the
methods is achieved. Instead, the claims embrace the
abstract idea of using a marking affixed to the outside of a
mail object to communicate information about the mail
object, i.e., the sender, recipient, and contents of the mail
object. Because the claims are directed to an abstract
idea, we turn to the second step of the Alice inquiry.
2. Alice Step Two
In step two, we consider the elements of the claims to
determine whether they transform the nature of the claim
into a patent-eligible application of the abstract idea.
Content Extraction & Transmission LLC v. Wells Fargo
Bank, 776 F.3d 1343, 1347 (Fed. Cir. 2014). This is the
search for an inventive concept, which is something
sufficient to ensure that the claim amounts to significant-
ly more than the abstract idea itself. Id. “To save a
patent at step two, an inventive concept must be evident
in the claims.” Recognicorp, LLC v. Nintendo Co., 855
F.3d 1322, 1327 (Fed. Cir. 2017). Merely reciting the use
of a generic computer or adding the words “apply it with a
computer” cannot convert a patent-ineligible abstract idea
into a patent-eligible invention. Versata Dev. Grp., Inc. v.
SAP Am., Inc., 793 F.3d 1306, 1332 (Fed. Cir. 2015)
(citing Alice, 134 S. Ct. at 2358).
Secured Mail argues that the district court misunder-
stood the step two analysis, and instead of searching for
an inventive concept, it only asked whether the “underly-
ing” technology was conventional. We disagree. The
district court decision has pages analyzing the individual
SECURED MAIL SOLUTIONS LLC v. UNIVERSAL WILDE, INC. 11
claim elements concluding that the claims are “replete”
with routine steps, including “affixing mail identification
data,” such as a barcode, to a mail object or “submitting a
mail object to a mail carrier for delivery.” Secure Mail,
169 F. Supp. 3d at 1051. The district court focused on the
sender-generated barcode because Secured Mail argued
that the sender-generated barcode was the inventive
concept. The district court is correct to search for an
inventive concept in precisely the factors that Secured
Mail argues comprises the inventive concept. The district
court addressed Secured Mail’s argument that “the devel-
opment of a unique, sender-generated identifier is the
critical invention.” Id. at 1052.
In the Intelligent Mail Barcode patents, the sender-
generated identifier is created by combining various
pieces of data, such as a unique identifier, sender data,
recipient data and shipping method data. The data need
not even be in the form of a barcode, much less a specific
new type of barcode. The claim language does not explain
how the sender generates the information, only that the
information itself is unique or new. The claim language
does not provide any specific showing of what is inventive
about the identifier or about the technology used to gen-
erate and process it. The district court is correct that the
sender-generated identifier is not a sufficiently inventive
concept. Id. at 1051–53.
For the QR Code and Personalized URL patents, the
district court concluded that there was no inventive
concept. We agree. The claims merely provide that an
identifier is affixed to a mail object that is used by the
recipient to request and display electronic information.
The use of barcodes was commonplace and conventional
in 2001. See, e.g., ’860 patent, J.A. 112–114 (citing refer-
ences prior to 2001 regarding use of barcodes); see also
’032 patent, J.A. 65 at col. 3 ll. 28–34, col. 4 ll. 65–67
(noting that barcode scanners were generally known to
those skilled in the art). In addition, sending a personal-
12 SECURED MAIL SOLUTIONS LLC v. UNIVERSAL WILDE, INC.
ized URL to a recipient was not an unconventional use of
the Internet in 2001, for example, in emails that con-
tained a personalized response URL. Nor is the “bi-
directional communication line” inventive; the idea of
responding to or inquiring about mail using a personal-
ized identifier through the use of a marking (such as an
account number printed on a utility bill, or a check num-
ber printed on a check) has long been a conventional
concept.
Secured Mail analogizes to DDR Holdings, LLC v. Ho-
tels.com, L.P., which held claims that “specify how inter-
actions with the Internet are manipulated to yield a
desired result” and recite “a specific way to automate the
creation of a composite web page by an ‘outsource provid-
er’ that incorporates elements from multiple sources in
order to solve a problem faced by websites on the Inter-
net” are patent-eligible under section 101. 773 F.3d 1245,
1258–59 (Fed. Cir. 2014). The claims in Secured Mail’s
patents are non-specific and lack technical detail. Rather
than citing a specific way to solve a specific problem as in
DDR, the asserted claims cite well known and conven-
tional ways to allow generic communication between a
sender and recipient using generic computer technology.
The fact that many of these technologies were well-
known can be discerned from Secured Mail’s patents
themselves. The patents mention that the invention can
be performed using many types of hardware, including
“personal computers, set top boxes, personal digital
assistances (PDAs), mobile phones, land-line phones,
televisions, bar code readers, and all other physically and
wirelessly connected reception devices generally known to
those skilled in the art,” suggesting that the hardware
used is conventional. ’032 patent, J.A. 65 at col. 3 ll. 29–
34. The “Background of the Invention” section notes that
contents that can be delivered electronically are often
included in mail objects that are delivered via traditional
mail services. ’032 patent, J.A. 64 at col. 1 ll. 50–52.
SECURED MAIL SOLUTIONS LLC v. UNIVERSAL WILDE, INC. 13
Some of the claim elements, such as submitting a mail
object to a mail carrier or affixing information to a mail
object, are routine to persons that have mailed a letter.
We see no inventive concept that transforms the na-
ture of the claims into a patent-eligible application of the
abstract idea.
Secured Mail argues that because the district court’s
conclusions address questions of fact, it was inappropriate
for the district court to dismiss the case via Rule 12(b)(6).
Yet, this court has determined claims to be patent-
ineligible at the motion to dismiss stage based on intrinsic
evidence from the specification without need for “extrane-
ous fact finding outside the record.” See, e.g., In re TLI
Commc’ns LLC Patent Litig., 823 F.3d 607, 613–14 (Fed.
Cir. 2016); Content Extraction, 776 F.3d at 1349; cf. OIP
Techs., Inc. v. Amazon.com, Inc., 788 F.3d 1359, 1362
(Fed. Cir. 2015) (holding that a Section 101 inquiry is a
question of law).
Secured Mail also argues that the district court erro-
neously shifted the burden of proof on the question of
whether more than just industry-standard technology is
claimed. According to Secured Mail, the district court
improperly required it to prove that affixing a URL or
barcode to a mail object was unconventional. Secured
Mail’s argument is misplaced. In ruling on a 12(b)(6)
motion, a court need not “accept as true allegations that
contradict matters properly subject to judicial notice or by
exhibit,” such as the claims and the patent specification.
Anderson v. Kimberly-Clark Corp., 570 F. App’x 927, 931
(Fed. Cir. 2014) (quoting Sprewell v. Golden State Warri-
ors, 266 F.3d 979, 988 (9th Cir. 2001)). Here, the district
court did not place any special burden of proof on Secured
Mail, but simply concluded from the claims that they were
directed to patent-ineligible subject matter.
14 SECURED MAIL SOLUTIONS LLC v. UNIVERSAL WILDE, INC.
CONCLUSION
For the foregoing reasons, we affirm the district
court’s grant of Universal’s motion to dismiss.
AFFIRMED
COSTS
No costs.