Discovery Patents v. Amazon.com

Discovery Patents v. Amazon.com

DISCOVERY PATENT HOLDINGS, LLC. V. AMAZON.COM, INC., NO. 10-600-ER, U.S. Dist. Ct. Delaware, 2011. This is a patent infringement case involving four patents, two from Discovery and two from Amazon. Both parties presented complex defenses in regards to the patents in question.


Case Details

Issue: What is the definition of numerous disputed terms in patents in question from Discovery Patent Holdings LLC and Amazon.com, Inc.?

Plaintiff Discovery Patent Holdings LLC, sued Amazon for patent infringement regarding the infringement of two of its patents, the ‘690 Patent and the ‘851 Patent. Amazon also alleges patent infringements by Discovery in the area of e-commerce and its underlying technology regarding their patents, the ‘141 Patent and the ‘131 Patent. Both parties sought declaratory relief and compensatory and punitive damages.

Discovery Patents

  • The ‘690 patent. Discovery’s ‘690 Patent is entitled “Electronic Book Selection and Delivery Service” and was issued on Nov. 15, 1999. The ‘690 Patent describes a “method of distributing electronic books to a portable book-shaped viewing device.” The ‘690 Patent’s disclosure is comprised of 1) the viewing unit, and 2) the operations center that stores and transmits the e-books. The ‘690 Patent effectively transmits books to e-readers for reading, as opposed to physical book transportation.
  • The ‘851 patent. Discovery’s ‘851 Patent is entitled “Electronic Book Security and Copyright Protection System” and was issued on Nov. 20, 2007. The ‘851 Patent covers the same system as the ‘690 Patent, a “system and method of securely distributing electronic books to a portable book-shaped viewing device.” However, the ‘851 Patent “details an encryption process for securing” the e-books transmitted to the viewing device.  Specifically, the ‘851 Patent encrypts e-books by modifying unencrypted (“clear”) text and transforming it into encrypted text (“cipher text”); the reverse is done for encrypted text. The ‘851 Patent is comprised of (1) an operations center to store/transmit e-books, and (2) a device to view the books.

Amazon Patents

  • Amazon’s ‘141 Patent is entitled “Internet-Based Customer Referral System” and issued on February 2, 2000.
  • Amazon’s related ‘133 Patent is entitled “Internet-Based Customer Referral System” and issued on February 26, 2000.

Amazon describes the ‘141 and ‘133 Patents as creating technological out paths from Amazon.com to associates’ websites that avoids costly obstructions for the e-merchant, such as having the burden of reviewing the associates’ sites and having to pay for conventional advertising. Thus, the associate is able to get referrals to its website (and products) from Amazon.com in exchange for a commission. Associates are also able to generate feedback reports regarding the success of their referrals.

Both parties briefed the court on claim construction with suggested definitions for disputed claim terms in their patents.

Discovery’s Arguments

Discovery Patent Holdings LLC argues that Amazon’s construction of website is improper:

(1) Discovery stated that Amazon is required to obtain a license to “make, use, sell, offer for sale and/or import products” under numerous patents in Amazon’s E-book Patent Portfolio, including the Kindle, the Kindle 2, and the content of other e-books.

(2) Amazon’s definition of “website” is vague and imprecise, and therefore, not a regulatory guideline.

Amazon’s Arguments

Amazon declared the following four defenses:

  1. Non-infringement of the ‘851 patent
  2. Invalidity/unenforceability of the ‘851 patent
  3. Inequitable conduct from Discovery by withholding material information to the USPTO regarding prosecution of the ‘851 patent
  4. Patent misuse.

Summary and Conclusion

The ‘141 Patent’s specification supports deleting “generally intended” and “typically” and requiring both “hardware and software.” While Amazon provided a definition in the patent itself, Amazon’s definition includes wording that is not sufficiently precise. For example: typically, generally intended to, and hardware/software.

The Court will adopt a definition that is a fusion of the two: “A computer system that serves informational content over a network using the standard protocols of the World Wide Web. A website corresponds to a particular Internet domain name, such as ‘amazon.com, ‘ and includes the content associated with a particular organization. As used in this case, the term encompasses both 1) the hardware and software server components that serve the informational content over the network, and 2) the ‘back end’ hardware and software components, including any non-standard or specialized components that interact with the server components to perform services for website users.”

The court’s analysis of patent infringement involves a two-step process:

1) The meaning of disputed claims are construed

2) The allegedly infringing device is compared to the claims as construed.

The court addresses only part one here in defining the disputed claim terms – result of opinion is a chart of complex technological terms defined by the court.


Discovery Patents v. Amazon.com

MOTION TO STAY: May 27, 2011

This matter comes before the Court on the Joint Stipulation and Motion to Extend Stay. Having reviewed the motion and declaration submitted by the parties, the motion is granted by the Court – all proceedings in this case are to be stayed until June 29, 2011.

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