[00:00:00] Speaker 00:
So the first case for argument is 23-1302, Epic Systems versus Decapolis Systems.

[00:00:10] Speaker 00:
Don't sit down, Mr. Fuller.

[00:00:11] Speaker 00:
We're ready whenever you are.

[00:00:14] Speaker 00:
Good morning.

[00:00:14] Speaker 00:
Please proceed.

[00:00:15] Speaker 01:
Good morning, Your Honors.

[00:00:16] Speaker 01:
If it pleases the court, Scott Fuller on behalf of the declaratory judgment defendant, appellant in this case to Capitalist Systems LLC.

[00:00:26] Speaker 01:
This case comes to you on a familiar note, I'm sure.

[00:00:32] Speaker 01:
12b6, motion to dismiss eligibility arguments from the Southern District of Florida, Judge Middlebrooks.

[00:00:40] Speaker 01:
All respect to Judge Middlebrooks.

[00:00:42] Speaker 01:
He made a number of errors which this court, in its de novo review, should correct.

[00:00:48] Speaker 01:
This case should be reversed.

[00:00:49] Speaker 01:
It should be remanded for further proceedings consistent with the order that your honors will craft.

[00:00:57] Speaker 01:
The errors we think are clear and really trace the entire history of this case and all of the issues pertinent to 101.

[00:01:07] Speaker 00:
Well, you started off by saying this case has a familiar note.

[00:01:11] Speaker 00:
And I would agree with that.

[00:01:12] Speaker 00:
And one of the things that seems familiar to me is we've had

[00:01:15] Speaker 00:
a number of years of jurisprudence on 101.

[00:01:18] Speaker 00:
And while people have complained that the standards and the words like abstract are ambiguous, we've got a lot of data points in our cases.

[00:01:26] Speaker 00:
And you can tell me why I'm wrong, but it seems to me that the limitations and the claims here trace very closely to the kinds of things we've been issuing and affirming 12b6's on.

[00:01:40] Speaker 00:
of the kind of information sharing and all of that stuff.

[00:01:43] Speaker 00:
This seems to be in that bucket.

[00:01:45] Speaker 00:
So why is this not in the bucket of all of those cases where we've said information retrieving, receiving, putting together information falls under the abstract idea under step one?

[00:01:56] Speaker 01:
Well, thank you, Your Honor.

[00:01:57] Speaker 01:
And these claims are more than just information sharing.

[00:02:03] Speaker 01:
We have to go back again to the time of the invention, which is now almost 25 years ago.

[00:02:08] Speaker 01:
The specification makes clear, and this was pled affirmatively in the pleadings, which is one of the issues on appeal, is that the district court failed to credit the claims, the specific facts that were set forth in the pleading by Decapolis, specifically with regard to the state of the art in this particular health care area.

[00:02:31] Speaker 01:
At the time, there was a grave deficiency, a life or death deficiency

[00:02:37] Speaker 01:
in the way health care records were available.

[00:02:39] Speaker 01:
They weren't available in a way that the claims allow.

[00:02:44] Speaker 02:
And so this is... But we're not here on an obviousness finding.

[00:02:49] Speaker 02:
We're here on a 101 challenge.

[00:02:52] Speaker 02:
So why aren't you telling me why that this report was wrong in finding the claim language only presented an abstract idea?

[00:03:01] Speaker 01:
Well, with regard to the abstract idea, the district court failed to properly conduct the abstract idea analysis in the first place.

[00:03:09] Speaker 01:
We must look, as this court has said many times, we must look to the focus of the invention, the focus of the specification, reading the specification in sum and looking... So what do you think this claim is directed to?

[00:03:23] Speaker 01:
These claims are directed to a very specific

[00:03:26] Speaker 01:
technical solution to the existence the problem that existed at the time namely a protocol for facilitating the access to medical records by health care professionals and the specific timely real-time delivery of that information to the patient which was very unusual at the time and was the technical solution and

[00:03:51] Speaker 01:
That is a technical solution, correct, because the system... But isn't this claim just simply automating prior pen and paper methodologies?

[00:04:01] Speaker 03:
I mean, we've said many times that automating some type of method of organizing human activity, yes, maybe things can be faster, yes, maybe things can be more accurate, because you erase human error from the equation, but nevertheless,

[00:04:18] Speaker 03:
That's still just doing an abstract idea on a computer, on generic components, just transferring data back and forth.

[00:04:27] Speaker 03:
And we've said that many, many times.

[00:04:29] Speaker 03:
I mean, we've got the University of Florida case versus GE, if you're aware of that.

[00:04:35] Speaker 03:
We have a non-prec case called Inrei-Salwan that looks really, really close to this case.

[00:04:39] Speaker 03:
It's non-prec, but nevertheless, I think

[00:04:42] Speaker 03:
There's nothing in that opinion that's inaccurate.

[00:04:46] Speaker 03:
And so when I look at your claims here, just the fact that there are some advantages to automation of doing manual processes is something time and again we've said alone is not an inventive concept or is not something that makes an otherwise abstract idea a non-abstract idea.

[00:05:09] Speaker 03:
So what else do you have for us?

[00:05:11] Speaker 01:
Well, with regard to that, Your Honor, the pen and paper analogy fails here because the claims specifically require the real-time transmission from the physician records to the person of the patient.

[00:05:26] Speaker 03:
We've said before this notion of real time because thanks to computers and computer networks we can make things faster is of no moment.

[00:05:37] Speaker 03:
That's just something that's part and parcel that comes with putting something on a computer, putting something on a computer network.

[00:05:46] Speaker 03:
end result or consequence that some information is getting to a person faster than it could otherwise with if just done merely manually again is not good enough.

[00:05:58] Speaker 03:
So what else do you have for us?

[00:06:00] Speaker 01:
Well, even if we accept the fact, if there is an abstract idea, there's still the step two analysis which the district court failed to properly conduct.

[00:06:09] Speaker 01:
And specifically, as I mentioned, the complaint in this case sets forth facts which must be accepted as true at the 12-B-6 stage.

[00:06:19] Speaker 01:
These facts come directly from the specification itself.

[00:06:23] Speaker 01:
And the specification makes clear that at the time, the state of the art was such that

[00:06:30] Speaker 01:
The way in which health care records were collected was deficient.

[00:06:36] Speaker 01:
the doctors at the time would take questionnaires from patients at the time.

[00:06:41] Speaker 01:
These are necessarily incomplete and inconsistent.

[00:06:44] Speaker 01:
So the solution that is advanced overcame the deficiencies in the state of the art, as expressed in the specification, in the form of this real-time transfer of the data directly to... Did you just say that the real-time transmission

[00:07:02] Speaker 02:
which is an abstract idea, is also the technological improvement?

[00:07:08] Speaker 01:
The technological improvement is the modification of the typical paradigm by which physicians collected information from patients.

[00:07:19] Speaker 01:
Now instead of collecting from a patient's memory on a form, the patient has a complete, accurate, up-to-date, up-to-the-minute record

[00:07:30] Speaker 01:
to share.

[00:07:30] Speaker 01:
And it takes away the inaccuracies and the inefficiencies of the prior systems.

[00:07:36] Speaker 03:
Even if that were all true, I don't see that in the claim, this notion of whatever you just described.

[00:07:46] Speaker 01:
The claims are very clear.

[00:07:48] Speaker 01:
And I'll speak of claims.

[00:07:49] Speaker 03:
The claims are very broad.

[00:07:50] Speaker 03:
They're just about collecting information, processing information, transmitting information.

[00:07:57] Speaker 03:
But there is information, I mean, all in the context of patient health care records.

[00:08:04] Speaker 03:
But what you just described is maybe an embodiment encompassed by the claims, but the claims themselves don't recite what you just said.

[00:08:14] Speaker 01:
Claim 20, for example, of the 048, Your Honor, does specifically reside a temporal aspect where it says that the transfer is conducted at the time, during the period of time in which the modification to the health care record is being made.

[00:08:31] Speaker 01:
So there is a real time component.

[00:08:33] Speaker 01:
To coin a term to these claims that that is the specific advancement over the art and the specific Improvement over the state of the art as was made clear in the specification the real-time transmission of information to a person

[00:08:53] Speaker 03:
That's your technical advance.

[00:08:58] Speaker 01:
The technical advance is in the system as a whole.

[00:09:00] Speaker 01:
Claim must be read as a whole.

[00:09:02] Speaker 01:
The system specifically describes a protocol by which the system has access credentials that are checked in the first instance.

[00:09:11] Speaker 01:
The system creates a new message that incorporates not only the access credential information, but also a component of the updated information

[00:09:23] Speaker 01:
and creates a new message that is transmitted to the patient in real time.

[00:09:30] Speaker 01:
So all of those steps combine to comprise the advancement of the art.

[00:09:37] Speaker 01:
It's not just a claim that says, hey, send some data.

[00:09:41] Speaker 00:
Can I ask you, you started by talking about the age of this patent.

[00:09:45] Speaker 00:
Is this patent still, is it expired?

[00:09:48] Speaker 00:
It is expired, yes or no?

[00:09:51] Speaker 03:
Are there other patents off this specification circulating out there?

[00:09:57] Speaker 01:
There are other patents.

[00:09:58] Speaker 01:
Are you asking about pending applications?

[00:10:03] Speaker 03:
Well, it should be expired.

[00:10:04] Speaker 03:
There are no pending applications.

[00:10:06] Speaker 03:
I'm just wondering if there's other patents that may be also expired due to the early filing date that are still, I don't know, in litigation or something like that.

[00:10:17] Speaker 01:
None that are non-expired.

[00:10:21] Speaker 01:
None that are not described.

[00:10:24] Speaker 01:
So again, the complaint here sets out facts, which must be taken as truth.

[00:10:31] Speaker 01:
This is a 12b6 motion.

[00:10:33] Speaker 01:
The facts of the matter are that at the time, the conventional state of the art was deficient in many respects.

[00:10:42] Speaker 01:
The claims recite a specific advancement, a specific solution to those shortcomings in the art at the time.

[00:10:51] Speaker 01:
And those specific advancements are, as I indicated just a moment ago, in the sequence of events and the specific timing and the combined ability to provide a patient with current, up-to-date health care information, which did not exist at the time and wasn't advanced.

[00:11:10] Speaker 01:
And of course, now everyone does it.

[00:11:12] Speaker 01:
But at the time, 25 years ago,

[00:11:16] Speaker 01:
is a completely different story.

[00:11:17] Speaker 01:
At the time, this was very unusual, very unconventional approach.

[00:11:22] Speaker 01:
And if I might briefly, we think these deficiencies in the step one, step two analysis and the failure to credit the facts to the non-moving party are dispositive.

[00:11:35] Speaker 01:
However,

[00:11:36] Speaker 01:
If the court reaches a secondary component of the appeal, which is the abuse of discretion issue, we believe that the judge did abuse his discretion in failing to allow the calculus and opportunity to supplement the record with this evidence that did not exist until the evidence existed, but the declaration didn't exist.

[00:12:02] Speaker 01:
And as soon as the declaration came to existence, the capitalists moved very quickly to try to get it in front of the judge, to try to get it into the record.

[00:12:12] Speaker 01:
There was no prejudice because the case had been stayed at the time.

[00:12:16] Speaker 01:
There was no, it wasn't done for a dilatory motive.

[00:12:22] Speaker 01:
There is nothing dilatory about trying to have a complete record and a complete factual basis upon which the court should

[00:12:28] Speaker 03:
uh... records one of the fact witness it was it was an expert report right is an expert report yet different litigation it was but that's just curious why didn't you just go to this expert and develop a declaration soon after the motion to dismiss was filed here back in may

[00:12:50] Speaker 01:
There are a lot of things that could have been done differently, Your Honor, admittedly.

[00:12:54] Speaker 01:
But the fact still remains that the declaration to.

[00:12:57] Speaker 03:
Well, the fact remains there's a scheduling order that has a deadline for amending claims and counterclaims.

[00:13:03] Speaker 03:
And your motion for leave to amend came several months after that deadline passed.

[00:13:11] Speaker 03:
It did.

[00:13:12] Speaker 03:
And under the rules.

[00:13:13] Speaker 03:
So under abuse of discretion, you're asking us to say that there was

[00:13:17] Speaker 03:
that the district court got it wrong in concluding that you failed to show good cause when you had several months of time passed after the deadline.

[00:13:27] Speaker 03:
I really don't know what we can do with you for that.

[00:13:31] Speaker 01:
To find an absence of failure

[00:13:47] Speaker 01:
I'm struggling with my words, of course.

[00:13:51] Speaker 01:
There was no dilatory motive.

[00:13:54] Speaker 01:
There was a delay.

[00:13:55] Speaker 01:
True.

[00:13:56] Speaker 01:
However, there was no prejudice to any party because of the fact that the case had been stayed

[00:14:03] Speaker 01:
Additional facts in the record simply would go into the analysis.

[00:14:09] Speaker 01:
It wouldn't have necessarily required full-blown additional briefing.

[00:14:14] Speaker 01:
It could have been supplemental, of course.

[00:14:16] Speaker 01:
I'm just curious.

[00:14:16] Speaker 03:
Is there a motion for attorney's fees that's been filed below?

[00:14:21] Speaker 03:
That I'm not positive of.

[00:14:23] Speaker 00:
You're well into your rebuttals, so why don't we hear from the other side.

[00:14:26] Speaker 00:
Thank you.

[00:14:47] Speaker 04:
Good morning, and may it please the court.

[00:14:51] Speaker 04:
Kristen Graham-Mowell from Quarles and Brady, appearing on behalf of the Apele Epic Systems Corporation.

[00:14:58] Speaker 04:
Your Honor's questions previewed many of the points I intend to make in our response.

[00:15:06] Speaker 04:
But in brief, the patents at issue present a classic case of implementing an abstract

[00:15:15] Speaker 04:
idea on a generic computer which is not eligible under Section 101.

[00:15:22] Speaker 04:
As the patents themselves recognize, people have been communicating with their doctors, and doctors have been keeping medical records and submitting insurance claims for a long time using traditional methods of

[00:15:39] Speaker 00:
I think you can glean that the panel understands that.

[00:15:43] Speaker 00:
Let me just ask you about one of the arguments pressed by your friend, which is that the district court had to take everything as true and all inferences in his favor.

[00:15:54] Speaker 00:
And therefore, why wasn't there enough to get over the line, at least on a 12b6?

[00:15:59] Speaker 04:
Sure, Your Honor.

[00:16:01] Speaker 04:
Well, of course, the standard is a little more precise than that.

[00:16:04] Speaker 04:
The court needs to accept all well-pled facts.

[00:16:09] Speaker 04:
and not conclusory legal allegations such as the patents are patent eligible.

[00:16:22] Speaker 04:
The recitations in the brief about what was pledged in the counterclaims are found at paragraphs 14 through 16 of the counterclaims.

[00:16:35] Speaker 04:
I will summarize that paragraph 14 and 15

[00:16:39] Speaker 04:
refer to the prior art, that there were pen and paper systems and problems in the art where doctors would talk to patients using questionnaires and have summary interviews, and that there were clerical errors, and that thousands of people may have died because of these clerical errors.

[00:17:09] Speaker 04:
And then paragraph 16, and again, I'm paraphrasing, says that the inventions, by using computers and a central server, alleviate these errors.

[00:17:25] Speaker 04:
But that is nothing more than taking the abstract idea and using a computer, a conventional computer, and making it

[00:17:38] Speaker 04:
more accurate and faster.

[00:17:41] Speaker 04:
The phrase real time appears.

[00:17:44] Speaker 00:
What if he had just alleged that this procedure that was used on the computer was, at the time of the patent, non-routine and non-conventional?

[00:17:54] Speaker 00:
Is that sufficient?

[00:17:56] Speaker 00:
Or it's kind of hard to prove a negative, right?

[00:18:00] Speaker 00:
I mean, I don't know how he would prove that it was non-conventional.

[00:18:04] Speaker 00:
Maybe he could.

[00:18:05] Speaker 00:
But we're only at a 12-by-6 day.

[00:18:07] Speaker 04:
Right.

[00:18:09] Speaker 04:
He would have to point to a routine found in the claims, something in the claims being non-routine and non-conventional.

[00:18:18] Speaker 04:
And Judge Chen, I believe, kind of hit the nail on the head.

[00:18:21] Speaker 04:
What is it in the claims that's actually claimed here?

[00:18:27] Speaker 04:
And the response was real-time communication.

[00:18:32] Speaker 04:
And this court has ruled several times.

[00:18:35] Speaker 04:
And it has been in the context

[00:18:38] Speaker 04:
of where it's been claimed.

[00:18:42] Speaker 04:
Cases such as ChargePoint, the SEMA Connect.

[00:18:47] Speaker 04:
Cases such as Electric Power Group, the Alstrom.

[00:18:51] Speaker 04:
Cases such as Credit Acceptance versus Westlake Services.

[00:18:58] Speaker 04:
I believe Your Honor mentioned University of Florida Research Foundation versus General Electric.

[00:19:05] Speaker 04:
That wasn't real time, but it was

[00:19:07] Speaker 04:
I believe, much faster and automatic generation, where the technology of using computers renders a abstract idea, automatic, much faster, and in certain times, real-time.

[00:19:26] Speaker 04:
And in many cases, that is in the claim, either express or implicit.

[00:19:33] Speaker 04:
And in here, I don't believe the

[00:19:35] Speaker 04:
claims actually say real time.

[00:19:37] Speaker 04:
I believe it is a natural consequence that they are really alleging.

[00:19:42] Speaker 04:
If you perform the elements of the steps of the claim, it's close to real time.

[00:19:49] Speaker 04:
Cases like Trinity, which was just passed down by this court last year, where it's a matter of a nanosecond.

[00:19:57] Speaker 04:
And this court said that is the inherent benefit of applying an abstract idea

[00:20:05] Speaker 04:
on a computer and just applying an abstract idea on a computer, even if you have wonderful benefits like saving lives, as was the case of University of Florida Research Foundation versus General Electric, that doesn't elevate an abstract idea to something inventive and eligible.

[00:20:32] Speaker 04:
Even if it's done, the Trinity Court found

[00:20:36] Speaker 04:
for the very first time.

[00:20:41] Speaker 00:
Anything further?

[00:20:42] Speaker 04:
Yes.

[00:20:42] Speaker 04:
If I could speak to the second appeal claim, just very brief.

[00:20:47] Speaker 04:
And I believe Judge Chen hit the nail on the head.

[00:20:51] Speaker 04:
You don't get to the rule 15 factors, such as prejudice.

[00:20:57] Speaker 04:
And the district court, for the record, did have prejudice and did note prejudice to Epic.

[00:21:04] Speaker 04:
of the long delay.

[00:21:07] Speaker 04:
But you don't get to Rule 15 if you don't get past Rule 16.

[00:21:13] Speaker 04:
And under the 11th Circuit jurisprudence, which is what governs in this case, you must show good cause for the delay, for this nearly five-month delay past the scheduling order deadline.

[00:21:30] Speaker 04:
And in the 11th Circuit, good cause means

[00:21:34] Speaker 04:
And under the cases we cited in our brief, it is not an abuse of discretion for a district court to do that.

[00:21:44] Speaker 00:
Well, his answer to diligence, I guess, is that as soon as he got the expert report and the southern litigation, he moved forward with it.

[00:21:52] Speaker 00:
So he acted diligently in the context of when he received the expert report and when it was provided or he attempted to provide it to the court.

[00:22:02] Speaker 04:
He hired the expert.

[00:22:05] Speaker 04:
It was entirely, as the district court acknowledged, it was entirely within Decapolis's control when they decided to hire an expert.

[00:22:18] Speaker 04:
Because they sat in their hands, that is not diligence.

[00:22:23] Speaker 04:
That is the exact opposite.

[00:22:25] Speaker 04:
For these reasons, we respectfully submit.

[00:22:28] Speaker 04:
that the district court should be affirmed.

[00:22:30] Speaker 03:
Thank you.

[00:22:31] Speaker 03:
Is there a motion for attorney's fees pending below?

[00:22:34] Speaker 03:
There is, Your Honor.

[00:22:37] Speaker 04:
OK.

[00:22:37] Speaker 04:
Thank you.

[00:22:38] Speaker 04:
Thank you.

[00:22:43] Speaker 00:
We'll restore two minutes of republic.

[00:22:47] Speaker 01:
Very briefly, I'll just address one point that my friend made about well-pled facts are required to be considered by the district court.

[00:22:56] Speaker 01:
Of course, the facts must be well-pled.

[00:22:58] Speaker 01:
There's no argument that the facts here were not well-pled.

[00:23:03] Speaker 01:
The facts here were taken directly from the intrinsic record, the specification itself, which lays out the factual basis for the follow-up argument that the

[00:23:13] Speaker 01:
that the approach and the solution as claimed was non-conventional at the time.

[00:23:19] Speaker 01:
So I just want to address that one point.

[00:23:21] Speaker 01:
Thank you.

[00:23:21] Speaker 01:
Thank you.

[00:23:22] Speaker 01:
If we thank both sides, the case is submitted.