Contour Ip Holding LLC v. Gopro, Inc.

Case: 22-1654    Document: 66     Page: 1   Filed: 09/09/2024




   United States Court of Appeals
       for the Federal Circuit
                  ______________________

             CONTOUR IP HOLDING LLC,
                 Plaintiff-Appellant

                             v.

                      GOPRO, INC.,
                    Defendant-Appellee
                  ______________________

                   2022-1654, 2022-1691
                  ______________________

    Appeals from the United States District Court for the
 Northern District of California in Nos. 3:17-cv-04738-
 WHO, 3:21-cv-02143-WHO, Judge William H. Orrick, III.
                 ______________________

                Decided: September 9, 2024
                  ______________________

     JOHN R. KEVILLE, Sheppard Mullin Richter & Hampton
 LLP, Houston, TX, argued for plaintiff-appellant. Also rep-
 resented by MICHAEL C. KRILL; RICHARD L. STANLEY, Law
 Office of Richard L. Stanley, Houston, TX.

     SEAN S. PAK, Quinn Emanuel Urquhart & Sullivan,
 LLP, San Francisco, CA, argued for defendant-appellee.
 Also represented by WILLIAM ADAMS, New York, NY;
 NATHAN HAMSTRA, MARC L. KAPLAN, Chicago, IL.
                 ______________________

     Before PROST, SCHALL, and REYNA, Circuit Judges.
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 2                     CONTOUR IP HOLDING LLC v. GOPRO, INC.




 REYNA, Circuit Judge.
     Contour sued GoPro for patent infringement. Accord-
 ing to Contour, several of GoPro’s point-of-view digital
 video camera products infringed its patents. After five
 years of litigation, GoPro sought summary judgment on
 grounds that Contour’s asserted claims were patent ineli-
 gible under 

. The district court agreed with
 GoPro and entered judgment against Contour. We reverse
 and remand for further proceedings.
                         BACKGROUND
                               I
     Contour IP Holding LLC (“Contour”) owns U.S. Patent
 Nos. 8,890,954 (“’954 patent”) and 8,896,694 (“’694 pa-
 tent”). The ’694 patent is a continuation of the ’954 patent,
 and the two patents share virtually identical specifications.
 We thus refer to the ’954 patent specification when discuss-
 ing both asserted patents.
     The asserted patents relate to portable, point-of-view
 (“POV”) video cameras. ’954 patent, 1:14–17. As the name
 suggests, POV video cameras are often used to capture a
 scene from a user’s point-of-view rather than from a third-
 person viewpoint. The patents’ shared specification ex-
 plains that at the time the patents were filed, POV cameras
 were “a relatively new product category,” and even those
 that were not designed to be hands-free were being
 “adapted to capture POV video by action sports enthusiasts
 in a hands-free manner.” 

 at 1:21–23.
      The asserted patents disclose a “hands-free, POV ac-
 tion sports video camera” that is “configured for remote im-
 age acquisition control and viewing.” 

 at 1:15–17. The
 specification explains that often in a sports application, a
 POV camera is “mounted in a location that does not permit
 the user to easily see the camera.” 

 at 19:36–37. A skier,
 for example, may wish to mount a small POV camera to his
 helmet. See 

 at 12:42–45 (“[B]ase mount 130 . . . can be
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 CONTOUR IP HOLDING LLC v. GOPRO, INC.                       3



 attached to a variety of surfaces such as, for example, the
 surfaces of helmets . . . .”), 21:66–22:2. In these instances,
 the user is unable to review what is being recorded in real
 time on the camera or to even see the camera. In addition,
 in these circumstances, it is difficult to adjust recording
 settings or a point of view to better match the user’s record-
 ing preferences. See 

 at 19:35–37 (“[I]n a sports applica-
 tion, digital video camera 10 is often mounted in a location
 that does not permit the user to easily see the camera.”).
     To address these problems, the patents describe imple-
 menting wireless technology in the video camera 10 that
 allows the camera to send real time information to a remote
 device, such as a cell phone. 

 at 19:48–50. From this
 remote device, the user can see what is being recorded by
 the camera. 

 at 20:41–44. The user can also make real
 time adjustments to the recording settings, such as light
 level and audio settings, before or during an activity. 

 at 20:44–47. The skier, for example, can ensure that his
 descent down the ski slope has been recorded to his prefer-
 ences. See, e.g., 

 at 20:41–44 (“This wireless connection
 capability enables a user to configure camera settings in
 real time and preview what digital video camera 10 sees.”);
 see also 

 at 22:66–22:53 (describing procedures for ad-
 justing camera position, lighting level, and color settings
 on the remote device).
     Separate from the use of wireless technology itself, the
 patent also discloses modifications to the camera’s system
 for processing recordings and permitting real time play-
 back. In a key embodiment, the patents disclose that cam-
 era 10 is configured to generate video recordings “in two
 formats, high quality and low quality, in which the lower
 quality file is streamed” to the remote device. Compare 

 at 20:9–11, with 

 at 31:4–11 (limitations recited in
 claim 11 of the ’954 patent). The system thereby achieves
 real time playback on the remote device without exceeding
 wireless connection bandwidth. See, e.g., 

 at 20:13–16
 (explaining that “[f]or streaming implementation, wireless
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 4                     CONTOUR IP HOLDING LLC v. GOPRO, INC.




 connection bandwidth can be monitored to adapt to the
 available bandwidth the resolution, bit rate, and frame
 rate on the secondary [(lower quality)] recording”). Using
 the lower quality recording, the skier gets to see real time
 progress on the remote device and make adjustments ac-
 cordingly. The higher quality version of the recording is
 saved on the camera for later viewing. See 

 at 19:38–41
 (describing using a wireless connection protocol for “remote
 access to image data stored in digital video camera 10”).
     This “dual recording” embodiment is reflected in the
 two claims at issue in this case, claim 11 of the ’954 patent
 and claim 3 of the ’694 patent. The parties agree that
 claim 11 of the ’954 patent may be treated as representa-
 tive for purposes of the § 101 inquiry. See Berkheimer v.
 HP Inc., 

 (Fed. Cir. 2018). Claim 11
 recites:
     11. A portable, point of view digital video camera,
     comprising:
     a lens;
     an image sensor configured to capture light propa-
     gating through the lens and representing a scene,
     and produce real time video image data of the
     scene;
     a wireless connection protocol device configured to
     send real time image content by wireless transmis-
     sion directly to and receive control signals or data
     signals by wireless transmission directly from a
     personal portable computing device executing an
     application; and
     a camera processor configured to:
         receive the video image data directly or indi-
         rectly from the image sensor,
         generate from the video image data a first im-
         age data stream and a second image data
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 CONTOUR IP HOLDING LLC v. GOPRO, INC.                        5



         stream, wherein the second image data stream
         is a higher quality than the first image data
         stream,
         cause the wireless connection protocol device to
         send the first image data stream directly to the
         personal portable computing device for display
         on a display of the personal portable computing
         device, wherein the personal portable compu-
         ting device generates the control signals for the
         video camera, and wherein the control signals
         comprise at least one of a frame alignment,
         multi-camera synchronization, remote file ac-
         cess, and a resolution setting, and at least one
         of a lighting setting, a color setting, and an au-
         dio setting,
         receive the control signals from the personal
         portable computing device, and
         adjust one or more settings of the video camera
         based at least in part on at least a portion of
         the control signals received from the personal
         portable computing device.
 ’954 patent, 30:57–31:24.
                              II
     In 2015, Contour sued GoPro, Inc. (“GoPro”), alleging
 that several GoPro products infringed claims of the ’954
 and ’694 patents. In 2021, Contour filed a second suit
 against newer GoPro products, alleging that those products
 similarly infringed claims of the two asserted patents.
     In 2018, in the first lawsuit, the United States District
 Court for the Northern District of California issued an or-
 der construing disputed claim terms in the asserted pa-
 tents. Contour IP Holding, LLC v. GoPro, Inc., No. 3:17-
 cv-04738-WHO, 

 (N.D. Cal. July 16,
 2018) (“Claim Construction Order”). In particular, the
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 6                      CONTOUR IP HOLDING LLC v. GOPRO, INC.




 district court construed a term of claim 11 of the ’954 pa-
 tent that recites: “generat[ing] from the video image data a
 first image data stream and a second image data stream,
 wherein the second image data stream is a higher quality
 than the first image data stream.” 

. The district
 court construed the word “generate” as “record in parallel
 from the video image data.” 

 (emphasis added). The dis-
 trict court concluded the claim term was limited to record-
 ing in parallel because during inter partes review
 proceedings, Contour asserted that the claims required
 both data streams be generated from the image sensor
 data, or “in parallel.” 

. Contour argued that gen-
 erating streams in parallel distinguished the claims from
 prior art systems with streams created “in sequence,”
 where the high-resolution stream is generated first and
 down-converted to create a low resolution stream. Id.; see
 also GoPro’s Responsive Claim Construction Br. at Exs. J,
 K, Contour IP Holding, LLC v. GoPro, Inc.,
 No. 3:17-cv-04738-WHO (N.D. Cal. May 18, 2018), ECF
 No. 235.
      In 2021, after the district court had granted partial
 summary judgment that GoPro’s accused products infringe
 claim 11 of the ’954 patent in the first lawsuit, GoPro chal-
 lenged claim 11 of the ’954 patent and claim 3 of the ’694
 patent as patent ineligible under 

. GoPro
 raised its § 101 challenge in the second lawsuit, initially as
 a motion for judgment on the pleadings under Federal Rule
 of Civil Procedure 12(c). Contour IP Holding, LLC v. Go-
 Pro, Inc., No. 3:17-cv-04738-WHO, 

, at *6
 (N.D. Cal. Sept. 13, 2021) (“Rule 12(c) Order”). GoPro filed
 the motion soon after this court issued its decision in Yu v.
 Apple Inc., 

 (Fed. Cir. 2021), and relied heavily
 on the analysis in Yu in making its arguments for ineligi-
 bility. See Rule 12(c) Order, 

, at *7. Like
 the claims in this case, Yu involved claims reciting compo-
 nents of a digital camera. Yu, 1 F.4th at 1042. We con-
 cluded in Yu that the claims were “directed to the abstract
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 CONTOUR IP HOLDING LLC v. GOPRO, INC.                      7



 idea of taking two pictures (which may be at different ex-
 posures) and using one picture to enhance the other in
 some way.” Id. at 1043.
      The district court denied the motion. Rule 12(c) Order,
 

, at *6. In its ruling on GoPro’s motion
 for judgment on the pleadings, the district court referred to
 the two-step § 101 inquiry set forth in Alice Corporation
 Pty. Ltd. v. CLS Bank International, 

 (2014).
 It observed,
     Contour pleads[] it came up with an innovative so-
     lution: the camera would stream a low quality
     video to a smartphone so that the user could watch
     what was being recorded removed from the camera;
     it would store a high quality video that would be
     the one ultimately used; and it would receive spec-
     ified control signals from the smartphone so that
     users could control the image removed from the
     camera. This is also reflected in the patents.
 Rule 12(c) Order, 

, at *8 (citations omit-
 ted). Although it denied the motion based on Contour’s al-
 legations, the district court ruled that its decision was
 made without prejudice to GoPro’s raising § 101 patent in-
 eligibility “again at summary judgment based on a factual
 record.” Id. at *6.
      At the summary judgment stage, GoPro again argued
 that the asserted claims were patent ineligible under § 101.
 Contour IP Holding, LLC v. GoPro, Inc., No. 3:17-cv-04738-
 WHO, 

, at *1 (N.D. Cal. Mar. 4, 2022) (“De-
 cision”). This time, the district court agreed with GoPro.
 At Alice step one, the district court characterized repre-
 sentative claim 11 as directed to the abstract idea of “cre-
 ating and transmitting video (at two different resolutions)
 and adjusting the video’s settings remotely.” 

. At
 Alice step two, the district court concluded that the claim
 recites only functional, results-oriented language with “no
 indication that the physical components are behaving in
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 8                      CONTOUR IP HOLDING LLC v. GOPRO, INC.




 any way other than their basic, generic tasks.” 

.
 Following its conclusion that the asserted claims were pa-
 tent ineligible under § 101, the district court entered judg-
 ment for GoPro and against Contour.
     Contour appeals. We have jurisdiction under 

(a)(1).
                    STANDARD OF REVIEW
     We review the grant of a summary judgment under the
 law of the applicable regional circuit, in this case, the Ninth
 Circuit. Synopsys, Inc. v. Mentor Graphics Corp., 

 (Fed. Cir. 2016). The Ninth Circuit reviews
 summary judgment determinations de novo. 

 Summary
 judgment is appropriate in the Ninth Circuit when, draw-
 ing all reasonable inferences in favor of the non-moving
 party, there are no genuine issues of material fact. 

    We review § 101 patent eligibility under Federal Circuit
 law. Smart Sys. Innovations, LLC v. Chi. Transit Auth.,
 

 (Fed. Cir. 2017). Eligibility is ulti-
 mately a question of law that may be based on underlying
 factual findings. Berkheimer, 

.
                          DISCUSSION
                               I
    Section 101 of the Patent Act states, “[w]hoever invents
 or discovers any new and useful process, machine, manu-
 facture, or composition of matter, or any new and useful
 improvement thereof, may obtain a patent therefor, subject
 to the conditions and requirements of this title.”
 

. The Supreme Court has determined that
 certain exceptions to the requirements of § 101 exist such
 that “[l]aws of nature, natural phenomena, and abstract
 ideas are not patentable.” Alice, 573 U.S. at 216 (citation
 omitted). The patentability exception for abstract ideas, at
 issue in this case, embodies “the longstanding rule that
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 CONTOUR IP HOLDING LLC v. GOPRO, INC.                      9



 ‘[a]n idea of itself is not patentable.’” Id. at 218 (quoting
 Gottschalk v. Benson, 

 (1972)).
     To determine whether patent claims are directed to pa-
 tent ineligible subject matter, the Supreme Court has de-
 veloped a two-step test commonly known as the “Alice” test.
 Under Alice step one, we consider whether the claims at
 issue are directed to, in this case, an abstract idea. Id.
 at 217. If the claims are not directed to an abstract idea,
 the Alice inquiry ends. Id. If we conclude that the claims
 are directed to patent ineligible subject matter, the inquiry
 continues to Alice step two, where we ask whether the
 claims recite something “significantly more” than an ab-
 stract idea itself. Id. at 217–18. The court determines
 whether the claims include elements sufficient to trans-
 form them into a patent-eligible application. Id.
                              II
    Citing Yu and other precedent, the district court deter-
 mined at Alice step one that representative claim 11 of the
 ’954 patent is directed to patent ineligible subject matter.
 Decision, 

, at *5. We disagree.
     At Alice step one, we determine whether the claims are
 directed to patent ineligible subject matter. We often ex-
 amine the “focus of the claimed advance over the prior
 art.” Affinity Labs of Tex., LLC v. DIRECTV, LLC, 

 (Fed. Cir. 2016); see also Enfish, LLC v.
 Microsoft Corp., 

 (Fed. Cir. 2016). We
 conduct this analysis by ascertaining the “basic character”
 of the claimed subject matter. Trinity Info Media, LLC v.
 Covalent, Inc., 

 (Fed. Cir. 2023) (cita-
 tions omitted). In doing so, we must avoid describing the
 claims at a high level of abstraction, divorced from the
 claim language itself. Enfish, 

.
    To determine the focus of the claimed advance at Alice
 step one, we look to whether the claims are directed to “a
 specific means or method that improves the relevant
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 10                     CONTOUR IP HOLDING LLC v. GOPRO, INC.




 technology” rather than simply being directed to “a result
 or effect that itself is the abstract idea.” McRO, Inc. v. Ban-
 dai Namco Games Am. Inc., 

 (Fed. Cir.
 2016). An improved result, without more, is not enough to
 support patent eligibility at Alice step one. Koninklijke
 KPN N.V. v. Gemalto M2M GmbH, 

, 1150
 (Fed. Cir. 2019). When a claim “abstractly cover[s] results”
 without regard to a specific process or machinery for
 achieving those results, it creates preemption concerns be-
 cause it “would prohibit all other persons from making the
 same thing by any means whatsoever.” McRO, 

 (quoting Le Roy v. Tatham, 

 (1853)).
     Here, when read as a whole, claim 11 is directed to a
 specific means that improves the relevant technology.
 Claim 11 recites an improved POV camera through its
 combination of claim limitations and requirement that the
 claimed POV camera processor be configured to record low-
 and high-quality data streams in parallel, followed by the
 low-quality data stream’s wireless transfer to a remote de-
 vice. With the claimed POV camera, a user can remotely
 view and adjust the desired recording in real time, with the
 elimination of bandwidth limitations on wireless data
 transfer. See ’954 patent, 20:9–16. The claims thus require
 specific, technological means—parallel data stream record-
 ing with the low-quality recording wirelessly transferred to
 a remote device—that in turn provide a technological im-
 provement to the real time viewing capabilities of a POV
 camera’s recordings on a remote device.
     Importantly, the district court construed “generate” in
 representative claim 11 to require recording multiple video
 streams “in parallel.” Claim Construction Order, 

, at *5. Thus, the claims do not cover other ways
 that a camera processor might generate multiple video
 streams of varying quality for wireless transmission, such
 as streams created “in sequence.” See 

. Rather,
 the claims are drawn to a “specific means or method that
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 CONTOUR IP HOLDING LLC v. GOPRO, INC.                        11



 improves the relevant technology.” McRO, 

; see also CardioNet, LLC v. InfoBionic, Inc, 

 (Fed. Cir. 2020).
      The district court’s decision characterizes the claims at
 an impermissibly high level of generality. As we have
 noted, the practice of “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 swal-
 low the rule.” Enfish, 

 (citations omitted).
 For example, in this case, the district court’s conclusion
 that the claims were “directed to a result or effect that itself
 is the abstract idea” disregards the disclosed technological
 means for obtaining a technological result. Decision, 

, at *4 (internal quotations and citation omit-
 ted). The district court erred in its generalized articulation
 of the claimed advance of the claims, which all but ensured
 the incorrect conclusion that the claims were drawn to an
 abstract idea. Enfish, 

.
     GoPro contends that the claims simply employ known
 or conventional components that existed in the prior art at
 the time of the invention. See, e.g., Appellee’s Br. 25–26.
 Even so, that alone does not necessarily mean that the
 claim is directed to an abstract idea at step one. See, e.g.,
 Core Wireless Licensing S.A.R.L. v. LG Elecs., Inc., 

 (Fed. Cir. 2018) (discussing Thales Vi-
 sionix Inc. v. United States, 

, 1348–49 (Fed.
 Cir. 2017)); see also TecSec, Inc. v. Adobe Inc., 

 (Fed. Cir. 2020).
     We also reject GoPro’s argument that our decisions in
 other cases, particularly Yu, are dispositive in this case.
 Oral Arg. at 32:00–32:35. We characterized the claims in
 Yu as being “directed to the abstract idea of taking two pic-
 tures (which may be different at different exposures) and
 using one picture to enhance the other in some way.”
 1 F.4th at 1043. In Yu, there was no dispute that “the idea
 and practice of using multiple pictures to enhance each
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 12                     CONTOUR IP HOLDING LLC v. GOPRO, INC.




 other has been known by photographers for over a cen-
 tury.” Id. Stated differently, in Yu, we took note of a
 longstanding, fundamental practice in photography, with-
 out conducting a prior art search. Here, GoPro does not
 argue that a camera’s recording two video streams in par-
 allel and wirelessly transferring the lower quality video
 stream to a remote device for real time viewing and adjust-
 ment was a long-known or fundamental practice support-
 ing patent ineligibility at Alice step one.
     We also reject GoPro’s argument that Contour’s claims
 are simply directed to the abstract idea of wireless network
 communication and thus analogous to ChargePoint, Inc. v.
 SemaConnect, Inc., 

 (Fed. Cir. 2019). The
 claims in ChargePoint related to charging stations for elec-
 tric vehicles, and more particularly local charging stations
 connected via a wireless network. 

. We con-
 cluded that the claims were drawn to the abstract idea of
 “communication over a network,” applied to the context of
 electric vehicle charging stations. 

. We explained
 that neither the specification nor the claims supported that
 “the charging station itself is improved from a technical
 perspective, or that it would operate differently than it oth-
 erwise could.” 

.
     Here, claim 11 of the ’954 patent describes more than
 wireless data transfer within a particular technological en-
 vironment. Instead, claim 11 enables the claimed POV
 camera to “operate differently than it otherwise could,” 

 by both recording multiple video streams in parallel and
 wirelessly transferring only one video stream, a lower qual-
 ity stream, to a remote device.
     The claims are directed to a technological solution to a
 technological problem. The written description discloses
 improving POV camera technology through specific means
 of generating high- and low-quality video streams in paral-
 lel and transferring a low-quality video stream to a remote
 device, and the claims reflect this improvement. The
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 CONTOUR IP HOLDING LLC v. GOPRO, INC.                     13



 claims, therefore, recite patent eligible subject matter at
 Alice step one.
     We hold that claim 11 of the ’954 patent and claim 3 of
 the ’694 patent are not directed to patent ineligible subject
 matter. We need not proceed to the second step of the Alice
 inquiry. Alice, 573 U.S. at 217. Because the district court
 erred in concluding the claims were directed to an abstract
 idea, we reverse and remand for further proceedings.
                        CONCLUSION
     We have considered GoPro’s remaining arguments and
 find them unpersuasive. We hold that the asserted claims
 are directed to patent eligible subject matter. We thus re-
 verse the district court’s invalidity determination based on
 subject matter ineligibility under 

 and re-
 mand for further proceedings.
                REVERSED AND REMANDED
                            COSTS
 Costs to Contour.