Zillow Patent Suit

Case 2:12-cv-01549-JLR Document 22 Filed 01/21/13 Page 1 of 31
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ZILLOWS OPPOSITION TO TRULIAS MOTION TO DISMISS COMPLAINT FOR PATENT INFRINGEMENT
Case No. 2:12-cv-01549-JLR
Honorable James L. Robart
UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT SEATTLE ZILLOW, INC., Plaintiff, v. TRULIA, INC. Defendant. NOTED ON THE MOTION CALENDAR: January 25, 2013 Case No. 2:12-cv-01549-JLR ZILLOWS OPPOSITION TO TRULIAS MOTION TO DISMISS COMPLAINT FOR PATENT INFRINGEMENT
Susman Godfrey LLP 1201 Third Avenue, Suite 3800 Seattle WA 98101-3000
Case 2:12-cv-01549-JLR Document 22 Filed 01/21/13 Page 2 of 31 TABLE OF CONTENTS I. II. III. The 674 Patent ................................................................................................................... 2 Motions to Dismiss on Patent Eligibility Are Disfavored and Rarely Granted .................. 5 The 674 Patent Covers Patentable Subject Matter Because it Passes the Machineor-Transformation Test and Does not Preempt the Basic Tools of Scientific or Technological Work ............................................................................................................ 7 A. The 674 Patent Meets the Machine-or-Transformation Test Because it Is Tied to a Particular Machine ................................................................................. 10 1. 2. 3. Zillows Claimed Invention Imposes Meaningful Limits ......................... 11 Zillows Claims Do Not Patent Meaningless Post-Solution Activity ....... 12 The Cases Trulia Cites are Distinguishable: They all Involve Attempts to Patent Broad Concepts That Were Only Incidentally Tied to Computers ..................................................................................... 13
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 VI. B. V. IV. B.
The 674 Patent Does not Preempt any Basic Tools of Scientific or Technological Work .............................................................................................. 16
The Court Should Not Stay This Case Pending the Federal Circuits Resolution of CLS Bank ................................................................................................................... 18 A. B. The Federal Circuit CLS Bank Opinion ............................................................... 18 Trulia Has Failed to Justify a Stay ........................................................................ 19
Zillow Adequately Pled Contributory Infringement and Inducement .............................. 20 A. Zillows Complaint Satisfies the Elements of Indirect Infringement ................... 21 1. 2. 3. Knowledge and Specific Intent ................................................................. 21 Direct Infringement by a Third Party ........................................................ 22 Lack of Noninfringing Uses ...................................................................... 23
Zillows Complaint Need Not Recite the Formal Legal Elements of a Claim ..... 24
Conclusion ....................................................................................................................... 24
ZILLOWS OPPOSITION TO TRULIAS MOTION TO DISMISS COMPLAINT FOR PATENT INFRINGEMENT Page i
Case 2:12-cv-01549-JLR Document 22 Filed 01/21/13 Page 3 of 31 TABLE OF AUTHORITIES Cases Alvarez v. Hill, 518 F.3d 1152 (9th Cir. 2008)............................................................................................ 24 Ashcroft v. Iqbal, 556 U.S. 662 (2009) ..................................................................................................... 23, 24 Bancorp Services, L.L.C. v. Sun Life Assur. Co. of Canada (U.S.), 687 F.3d 1266 (Fed. Cir. 2012) ...................................................................................... 6, 14 Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) ..................................................................................................... 20, 24 Bilski v. Kappos, 130 S. Ct. 3218 (2010) ................................................................................................ passim Cal. Inst. of Computer Assisted Surgery, Inc. v. Med-Surgical Servs., Inc., No. 10-05067-CW, 2011 WL 672709 (N.D. Cal. Feb. 16, 2011) ..................................... 22 Carolina Cas. Ins. Co. v. Ott, No. 09-cv-5540-RJB, 2010 WL 1286821, (W.D. Wash. Mar. 26, 2010) .................... 19, 20 CLS Bank Intl v. Alice Corp. Pty. Ltd., 685 F.3d 1341 (Fed. Cir. 2012) ................................................................................ 2, 18, 19 Conley v. Gibson, 355 U.S. 41 (1957) ............................................................................................................. 20 Cook, Perkiss & Liehe, Inc. v. N. Cal. Collection Serv. Inc., 911 F.2d 242 (9th Cir. 1990).............................................................................................. 24 Crull v. GEM Ins. Co., 58 F.3d 1386 (9th Cir. 1995).............................................................................................. 24 CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d 1366 (Fed. Cir. 2011) .............................................................................. 14, 15, 18 Dealertrack, Inc. v. Huber, 674 F.3d 1315 (Fed. Cir. 2012) ................................................................................ 8, 13, 18 Diamond v. Chakrabarty, 447 U.S. 303 (1980) ............................................................................................................. 7 Diamond v. Diehr, 450 U.S. 175 (1981) ....................................................................................................... 9, 17 DSU Med. Corp. v. JMS Co., Ltd., 471 F.3d 1293 (Fed. Cir. 2006) .......................................................................................... 22 Global-Tech Applicances, Inc. v. SEB S.A., 131 S. Ct. 2060 (2011) ....................................................................................................... 21 Gottschalk v. Benson, 409 U.S. 63 (1972) ............................................................................................. 8, 10, 16, 18 Hall v. City of Santa Barbara, 833 F.2d 1270 (9th Cir.1986)............................................................................................... 5 In re Bill of Lading Transmission and Processing Sys. Patent Litig., 681 F.3d 1323 (Fed. Cir. 2012) .............................................................................. 21, 22, 23 In re Bilski (Bilski I), 545 F.3d 943 (Fed. Cir. 2008) ................................................................................ 10, 11, 14
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J.E.M. Ag Supply, Inc. v. Pioneer HiBred Int'l, Inc., 534 U.S. 124 (2001) ............................................................................................................. 7 Keniston v. Roberts, 717 F.2d 1295 (9th Cir.1983)............................................................................................... 5 Landis v. N. Am. Co., 299 U.S. 248 (1936) ..................................................................................................... 19, 20 Lockyer v. Mirant Corp., 398 F.3d 1098 (9th Cir. 2005)............................................................................................ 20 Lucent Techs., Inc. v. Gateway, Inc., 580 F.3d 130 (Fed. Cir. 2009) ............................................................................................ 22 Mayo Collaborative Servs. v. Prometheus Labs., 132 S. Ct. 1289 (2012) ............................................................................................. 8, 10, 17 Medtrica Solutions, Ltd. v. Cygnus Med., LLC, No. 12-cv-538-RSL, 2012 WL 5726799 (W.D. Wash. Nov. 15, 2012) ............................ 22 Metro-Goldwyn-Mayer Studios, Inc. v. Grokster, Ltd., 545 U.S. 913 (2005) ........................................................................................................... 22 MySpace, Inc. v. GraphOn Corp., 672 F.3d 1250 (Fed. Cir. 2012) ............................................................................................ 7 Nw. Coal. for Alts. to Pesticides v. U.S. Envtl. Prot. Agency, 2012 WL 2343279 (W.D. Wash. June 20, 2012) ............................................................... 20 OIP Tech. v. Amazon, 2012 WL 3985118 (N.D. Cal. Sept. 11, 2012) .................................................................. 15 O'Reilly v. Morse, 56 U.S. 62 (1853) ......................................................................................................... 16, 18 Parker v. Flook, 437 U.S. 584 (1978) ......................................................................................... 12, 13, 16, 18 Regal W. Corp. v. Grapecity, Inc., 2011 WL 4102088 (W.D. Wash. Sept. 14, 2011) ................................................................ 5 Research Corp. Technologies, Inc. v. Microsoft Corp., 627 F.3d 859 (Fed. Cir. 2010) .............................................................................................. 8 SiRF Tech., Inc. v. Intl Trade Commn, 601 F.3d 1319 (Fed. Cir. 2010) .......................................................................................... 11 Symantec Corp. v. Veeam Software Corp., No. 12-cv-00700-SI, 2012 WL 1965832 (N.D. Cal. May 31, 2012) ................................. 21 Turner Broad. Sys., Inc. v. Tracinda Corp., 175 F.R.D. 554 (D. Nev. 1997) .......................................................................................... 20 Ultramercial, LLC v. Hulu, LLC, 657 F.3d 1323 (Fed. Cir. 2011) ............................................................................................ 6 Weiland Sliding Doors and Windows, Inc. v. Panda Windows and Doors, LLC, No. 10-cv-677-JLS, 2012 WL 202664 (S.D. Cal. Jan. 23, 2012) ................................ 21, 23 WildTangent, Inc. v. Ultramercial, LLC, 132 S. Ct. 2431 (2012) ......................................................................................................... 6 Statutes 35 U.S.C. 101 ....................................................................................................................... passim
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Rules Federal Rule of Civil Procedure 12.................................................................................................. 5
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Plaintiff Zillow, Inc. (Zillow) respectfully submits the following arguments and authorities in opposition to Trulia, Inc.s (Trulia) Motion to Dismiss (Dkt. No. 19) (Motion). Trulia principally argues the Court should dismiss Zillows complaint because the patent-
4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 analysis violates clear Supreme Courts Section 101 precedent dictating that the Court examine 19 20 21 22 23 24 25 26 demonstrates that the 674 Patent fits within the wide scope of patent-eligible subject matter. 27 28
ZILLOWS OPPOSITION TO TRULIAS MOTION TO DISMISS COMPLAINT FOR PATENT INFRINGEMENT Page 1
in-suit, U.S. Patent No. 7,970,674 (the 674 Patent), claims an abstract idea ineligible for patent protection under Section 101 of the Patent Act. But Trulias arguments commit three basic errors that the Supreme Court and Federal Circuit have warned against expressly. First, Trulia brings its motion as a 12(b)(6) motion to dismiss, attempting an end-around of discovery and claim construction proceedings. In doing so, Trulia conveniently ignores the Federal Circuits express warnings that: (1) such early resolution of Section 101 issues is unusual and often impossible; (2) claim construction can enlighten, or even answer, questions about subject-matter abstractness; and (3) courts should resolve the validity of a patent by looking at concrete prior art rather than eligibility questions. Second, Trulias analysis of the subject matter claimed by the 674 Patent consists of parsing and dissecting the various components of the claimed invention and making conclusory assertions that the particular components could not, on their own, satisfy Section 101. This
claimed inventions as a whole. Third, Trulia fails to heed the Supreme Courts recent holding in Bilski that the machineor-transformation test is not dispositive and ignores repeated holdings from the Supreme Court emphasizing the concept of preemption and the degree to which claimed patents foreclose innovation and the basic tools of scientific or technological work. Thus, even overlooking the fact that the 674 Patent passes the machine-or-transformation test, the preemption analysis

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Additionally, Trulias request for a stay in light of the CLS en banc hearing fails to meet the substantial burden required to justify a delay in competitor Zillows infringement suit. And Trulias request for dismissal of Zillows claims for indirect and contributory infringement ignores precedent and Zillows factual allegations.
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I. The 674 Patent Prior to Zillow and its imitators, real estate professionals, buyers, and sellers, estimated the value of real estate by using professional appraisals or automatic valuations that were based
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solely on information in a public database. Dkt. No. 1-1 (674 Patent) at 1:24-56. These appraisals were generally expensive, significantly inaccurate, or both. Id. Zillows introduction of its patented Zestimate service, and Zillows ensuing meteoric rise, fundamentally challenged these traditional methods by offering automatic real estate valuations that solicited and relied on input from homeowners, through a specific computer program and method. Dkt. No. 1 7-8. The 674 Patent discloses Zillows innovative computer program and method, and
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provides Zillow constitutionally conferred protection against competitors seeking to copy or

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employ Zillows technology. Dkt. No. 1 (Complaint) 8. Zillow applied for the 674 Patent on February 3, 2006, more than four years before Trulia launched its version of Zestimates, called Trulia Estimates, and the United States Patent and Trademark Office (PTO) issued the 674 Patent on June 28, 2011, after the Bilski v. Kappos decision. Id. 8-9.1 The 674 Patent recites three independent claims and thirty-seven dependent claims. 674 Patent at 19:28-24:47. Claim 1 recites a specific sixteen-step method for automatically refining a
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home valuation in response to owner input. See Motion at 3-4 (citing 674 Patent at 19:29-67).
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In fact, the PTO issued its Notice of Allowance of the 674 Patent almost one year after Bilski and nine months after the PTO issued its interim guidance on 101 eligibility to patent examiners in view of Bilski. See Declaration of Jordan Connors, Exh. 1 (April 18, 2010 PTO Notice of Allowance); and Exh. 2 (July 27, 2010 PTO Interim Guidance for Determining Subject Matter Eligibility for Process Claims in View of Bilski v. Kappos).
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Claim 2, an independent medium claim, recites: 2. A computer readable medium for storing contents that causes a computing system to perform a method for procuring information about a distinguished property from its owner that is usable to refine an automatic valuation of the distinguished property, the method comprising: displaying at least a portion of information about the distinguished property used in the automatic valuation of the distinguished property; obtaining user input from the owner adjusting at least one aspect of information about the distinguished property used in the automatic valuation of the distinguished property; and displaying to the owner a refined valuation of the distinguished property that is based on the adjustment of the obtained user input. Id. at 20:18-32. Claim 15 is a third independent claim, which discloses a method in a computing system. 674 Patent at 21:49-59. Claim 15 contains similar language to claim 2, except that the capabilities of the computer readable medium for storing contents of claim 2 are presented as steps to the method in a computing system disclosed in claim 15.
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All three claims require a computer display that presents particular information. Claim 2 discloses displaying at least a portion of information about the distinguished property used in the automatic valuation of the distinguished property and, following the calculation of a refined valuation, displaying a refined valuation of the distinguished property that is based on the adjustment of the obtained user input. 674 Patent at 20:23-25. Both claim 1 and claim 15 require that the method in a computing system include various steps in which information is
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display[ed] or present[ed]. Id. at 19:29-20:17; 21:49-59. The thirty-seven dependent claims of the 674 Patent disclose further components of Zillows invention, including particular methods and displays used to obtain input from homeowners, specific types of input to obtain, and ways in which the inputs refine the automatic valuation of the distinguished property. See, e.g., 674 Patent at 20:63-21:12. For example: 11. The computer-readable medium of claim 8, the method further comprising displaying a map showing properties in a geographic region surrounding the distinguished property, and wherein the owner identifies the recent sales of nearby properties regarded by the owner as similar to the distinguished property by

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selecting them on the displayed map. 12. The computer-readable medium of claim 8, the method further comprising displaying a map showing properties in a geographic region surrounding the distinguished property, and wherein the owner identifies each recent sale of a nearby property regarding by the owner as similar to the distinguished property by selecting a control in a popup balloon associated with its location on the displayed map. 13. The computer-readable medium of claim 8, the method further comprising displaying a table comprising rows each containing textual information about a different one of a plurality of recent sales of nearby properties, and wherein the owner identifies each recent sale of a nearby property regarded by the owner as similar to the distinguished property by interaction with the row containing information about the sale. 20. The method of claim 18 wherein the geographically-specific home valuation model is a linear regression model constructed from information about recent sales of homes near the distinguished home. 21. The method of claim 18 wherein the geographically-specific home valuation model is a hybrid model, utilizing both a forest of classification trees and a linear regression-derived function, both constructed from information about recent sales of home near distinguished home. The specification explains that the 674 Patent pertains to the narrow field of electronic
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commerce techniques relating to real estate. Id. at 1:9-13. The specification also describes
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various embodiments of the invention, including embodiments of the computer display, which comprises a limitation on the computer-medium claims. Id. at 13:29-16:62. The specification even includes screenshots from Zillows Zestimate feature on Zillow.com, which is one embodiment of the 674 Patent. See, e.g., Id. at Sheet 10, 14:

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The 674 Patent is not an idea, it is a computer program, computer display, and interface that displays to homeowners inputs used in an automatic valuation of their homes, solicits and obtains revised inputs from homeowners, calculates a refined valuation based on those inputs, and then displays the refined valuation. This computer program, computer display, and interface has
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given Zillow a significant advantage over its competitors, as it has been used to refine the valuations of more than 33 million homes in Zillows database, which has made Zillows database substantially more useful and accurate and has played a major role in Zillows success and growth into the largest real estate website, and most popular suite of mobile real estate applications for smartphones and tablet computers. Complaint 7. II. Motions to Dismiss on Patent Eligibility Are Disfavored and Rarely Granted Trulias motion to dismiss, brought prior to any discovery or claim-construction proceedings in this case, argues that the Court should dismiss Zillows complaint under Federal Rule of Civil Procedure 12(b)(6). Motion at 5. In ruling on such a motion, [m]aterial
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allegations are taken as admitted and the complaint is construed in the plaintiff's favor. Regal W.
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Corp. v. Grapecity, Inc., 2011 WL 4102088, at *1 (W.D. Wash. Sept. 14, 2011) (citing Keniston v. Roberts, 717 F.2d 1295 (9th Cir.1983)). Moreover, [i]t is axiomatic that the motion to dismiss for failure to state a claim is viewed with disfavor and is rarely granted. Hall v. City of Santa Barbara, 833 F.2d 1270, 1274 (9th Cir.1986) (internal quotation and citation omitted). The crux of Trulias motion argues that the subject matter of the 674 Patent is not patenteligible under Section 101 of the Patent Act. While Trulia is correct that patent eligibility is a
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question of law, the Federal Circuit has advised that district courts should ordinarily resolve questions of patent eligibility after claim construction proceedings: it will ordinarily be
desirableand often necessaryto resolve claim construction disputes prior to a 101 analysis, for the determination of patent eligibility requires a full understanding of the basic character of

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the claimed subject matter. Bancorp Services, L.L.C. v. Sun Life Assur. Co. of Canada (U.S.), 687 F.3d 1266, 1273-74 (Fed. Cir. 2012); see also Ultramercial, LLC v. Hulu, LLC, 657 F.3d 1323, 1325 (Fed. Cir. 2011) ([C]laim meaning may clarify the actual subject matter at stake in the invention and can enlighten, or even answer, questions about subject matter abstractness.),
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vacated on other grounds by WildTangent, Inc. v. Ultramercial, LLC, 132 S. Ct. 2431 (2012). Claim construction in this case will not only shed light on the basic character of the claimed subject matter, but it will illuminate limitations of the asserted claims that further demonstrate the 674 Patent meets the requirements of Section 101. For example, Zillow intends to propose the following construction of the term automatic valuation, which is present in independent claims 2 and 15: a valuation generated by a computer program without the need for human intervention.2 Such a construction finds support in the specification (see, e.g., 674
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Patent at 1:33-51; 1:63-65; 5:37-65; 13:47-51), and clarifies the reliance of the disclosed invention on a particular machinea computer that is programmed to calculate a valuation and then facilitate the display interface described by the claims. This Court has adopted local patent rules specifically so the parties could identify the terms that require construction. Local Patent Rule D. Trulias effort to short-circuit this thoughtful approach is not supported by the case law. The Federal Circuit recently advised district courts to defer questions of Section 101
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patentability, even when presented at a much later stage of a case: Adopting this practice would also preclude 101 claims from becoming the next toss-in for every defendant's response to a patent infringement suit, particularly in business method litigation. . . . More often, when the question of abstractness is presented in its usual abstract terms, the trial court could as a matter of case management summarily put aside the 101 defense on whatever grounds seem applicable in the case. The litigants will then be left to address the invalidity defenses of 102, 103, and 112, as the statute provides, and the litigants, the trial court, and this court on review would have some semblance of a chance at arriving at a predictable and understandable result. This proposed construction is preliminary and is subject to change during the course of the Courts claim construction proceedings, which have not yet begun. See Local Patent Rule D.

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MySpace, Inc. v. GraphOn Corp., 672 F.3d 1250, 1261-62 (Fed. Cir. 2012) (refusing to reach 101 issue even following claim construction and summary judgment and instead affirming summary judgment on 102 and 103 grounds). This Court should follow the Federal Circuits guidance and defer the Section 101 question until after it determines whether the case can be resolved on other grounds. At this early stage in the case, the Court should only grant Trulias motion if it meets an extremely steep burden. As the Federal Circuit recently explained, even at the summary
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judgment stage, only if it is clear and convincing beyond peradventurethat is, under virtually any meaning of abstractthat the claim at issue is well over the line, then a case could be made for initially addressing the 101 issue in the infringement context. MySpace, 672 F.3d at 1261. Trulias motion falls well short of this steep burden. If the Court has any doubt about the patentability of the claimed subject matter, it should follow the Federal Circuits directive and defer resolution of Trulias motion until after claim construction and discovery are complete.
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III. The 674 Patent Covers Patentable Subject Matter Because it Passes the Machine-orTransformation Test and Does not Preempt the Basic Tools of Scientific or Technological Work The Patent Act defines patent-eligible subject matter broadly: Whoever invents or
discovers any new and useful process, machine, manufacture, 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. 35 U.S.C. 101. Section 101 is a dynamic provision designed to encompass new and unforeseen inventions. J.E.M. Ag Supply, Inc. v. Pioneer HiBred Int'l, Inc., 534 U.S. 124, 135 (2001). As the Supreme Court has recognized, Congress plainly
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contemplated that the patent laws would be given wide scope, as Congress intended statutory subject matter to include anything under the sun that is made by man, Diamond v.
Chakrabarty, 447 U.S. 303, 308-09 (1980) (citing S.Rep. No. 821979, at 5 (1952); H.R.Rep. No.

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821923, at 6 (1952)). The Supreme Court has articulated only three exceptions to the Patent Acts broad patenteligibility principles: laws of nature, physical phenomena, and abstract ideas. Bilski v. Kappos, 130 S. Ct. 3218, 3225 (2010). The Court cautioned that too broad an interpretation of these
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exceptions could eviscerate the patent law. For all inventions at some level embody, use, reflect, rest upon, or apply laws of nature, natural phenomena, or abstract ideas. Mayo Collaborative Servs. v. Prometheus Labs., 132 S. Ct. 1289, 1293 (2012). Moreover: any invention within the broad statutory categories of 101 that is made by man, not directed to a law of nature or physical phenomenon, and not so manifestly abstract as to preempt a fundamental concept or idea is patent eligible. . . . The vast number of claims pass this coarse eligibility filter. Their patentability is properly measured against other provisions of Title 35. Dealertrack, Inc. v. Huber, 674 F.3d 1315, 1331 (Fed. Cir. 2012) (emphasis added) (citations
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omitted). The Supreme Court has further explained that a principle, in the abstract, is a fundamental truth; an original cause; a motive; these cannot be patented, as no one can claim in either of them an exclusive right. Id. (quoting Gottschalk v. Benson, 409 U.S. 63, 67 (1972)) (quotation marks omitted). The Federal Circuit, following the Supreme Courts most recent discussion of the abstract idea exception in Bilski, further clarified:
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[T]his court also will not presume to define abstract beyond the recognition that this disqualifying characteristic should exhibit itself so manifestly as to override the broad statutory categories of eligible subject matter and the statutory context that directs primary attention on the patentability criteria of the rest of the Patent Act. Research Corp. Technologies, Inc. v. Microsoft Corp., 627 F.3d 859, 868 (Fed. Cir. 2010) (emphasis added) (reversing district courts grant of summary judgment on Section 101 grounds, following claim construction and discovery). Trulias motion concerns the Supreme Courts abstract ideas exception to patent
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eligibility. But Trulias presentation of the legal standard and analysis of the issue (Motion at 612) is misleading and incomplete. Trulias motion has two chief failings with regard to the law: (1) it fails to consider the claims of the 674 Patent as a whole and instead improperly dissects the claims into old and new elements and then ignores the presence of the old elements, and (2) it
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wholly ignores Supreme Court holdings about the preemption test for patent eligibility and the purpose of the abstract idea exception to the broad categories of patent-eligible subject matter. First, Trulias motion breaks the 674 Patent into old and new components, and then disregards any old components that existed in the prior art in order to conclude that the 674 Patent only claims the idea of allowing a homeowner to input information about a house that is considered in the valuation of the property. Motion at 4. This approach violates the clear dictate of the Supreme Court:
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In determining the eligibility of respondents' claimed process for patent protection under section 101, their claims must be considered as a whole. It is inappropriate to dissect the claims into old and new elements and then to ignore the presence of the old elements in the analysis. This is particularly true in a process claim because a new combination of steps may be patentable even though all the constituents of the combination were well known and in common use before the combination was made. The novelty of any element or steps in a process, or even of the process itself, is of no relevance in determining whether the subject matter of a claim falls within the 101 categories of possibly patentable subject matter. Diamond v. Diehr, 450 U.S. 175, 188-89 (1981) (emphasis added). Trulias failure to consider the 674 Patent as a whole pervades its motion and dooms its analysis, as it argues in succession that (1) merely applying an abstract idea to a particular field does not render an invention patent eligible, (2) merely utilizing an algorithm does not render an invention patent eligible, (3) merely
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including steps whereby an invention obtains and organizes data does not render an invention patent eligible, and (4) merely identifying general machine elements does not render an invention patent eligible. Motion at 7-11. These general principles may be true in isolation, but Trulias analysis fails to consider the 674 Patent as a wholewhich discloses an invention that includes

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all of these various components as steps in its method patent and capabilities in its computer medium patent, and discloses a particular programmed computer and display. Second, while Trulia employs a conclusory and incorrect analysis of the Federal Circuits machine-or-transformation test, it also fails altogether to consider the concept of preemption,
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which the Supreme Court has repeatedly and recently emphasized in its Section 101 analysis. Trulia notes that the Supreme Court, in Bilski v. Kappos, found that the Federal Circuits machine-or-transformation test was not dispositive (Motion at 10), but then Trulia confines its analysis to this non-dispositive issue (which favors Zillow) and fails to acknowledge the substantial body of Supreme Court and Federal Circuit law that emphasizes preemptionnamely, supporting patent eligibility unless the patent would inhibit further discovery by improperly tying up the future use of laws of nature, Mayo Collaborative Servs. v. Prometheus Labs., Inc.,
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132 S. Ct. 1289, 1301 (2012), or preempt the basic tools of scientific and technological work. Bilski, 130 S. Ct. at 3231 (quoting Benson, 409 U.S. at 67). Applying the Supreme Courts holdings to the multiple steps involved in the 674 Patent as a whole, the patent meets the requirements for eligibility under Section 101, satisfies the machine-or-transformation test, and does not implicate any of the preemption concerns the Supreme Court has articulated. A. The 674 Patent Meets the Machine-or-Transformation Test Because it Is Tied to a Particular Machine Trulia correctly acknowledges that the Supreme Court in Bilski held that, while the machine-or-transformation test is not the sole test for deciding whether an invention is a patenteligible process, it is a useful and important clue, an investigative tool, for determining whether some claimed inventions are processes under 101. 130 S. Ct. at 3227. Under the test,
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an invention is a process only if: (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing. Id. at 3225 (quoting In re Bilski (Bilski I), 545 F.3d 943, 954 (Fed. Cir. 2008)) (emphasis added).

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The 674 Patent meets the first prong of this test, as it is tied to a particular machine or apparatusa computer and display programmed to solicit information from the home owner and automatically refining the valuation as displayed through that interface to the home owner and other users. The Federal Circuit has defined a machine as a concrete thing, consisting of
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parts, or of certain devices and combination of devices. This includes every mechanical device or combination of mechanical powers and devices to perform some function and produce a certain effect or result. SiRF Tech., Inc. v. Intl Trade Commn, 601 F.3d 1319, 1332 (Fed. Cir. 2010). In analyzing whether the reliance on a computer satisfies this test, the Federal Circuit has articulated two considerations: (1) [T]he use of a specific machine or transformation of an article must impose meaningful limits on the claims scope to impart patent-eligibility and (2) the involvement of the machine or transformation in the claimed process must not merely be
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insignificant extra-solution activity. Bilski I, 545 F.3d at 961-62 (citation omitted)(quotation marks omitted). Under both of these considerations, the programmed computer, display, and revised valuation based on user input disclosed by the 674 Patent satisfies this test. 1. Zillows Claimed Invention Imposes Meaningful Limits The programmed computer, display, and refined automatic valuation, imposes meaningful limits on the 674 Patent, as it limits the invention to a particular computer program and display
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interface that can perform a series of steps. The 674 Patent does not cover the abstract idea of allowing a homeowner to adjust information regarding a house that is subsequently factored into a refined valuation of the home, as Trulia suggests. Motion at 8. If a real estate agent were to solicit information from homeowners of a property, and then use that information to refine his estimate of the value of a home, he would not violate the 674 Patent, even if he calculated the refined valuation on a general purpose computer, unless he used the particular display interface described by the patent. See, for example, 674 Patent, Claim 1 requiring presenting a display

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that solicits input from the owner that updates one or more of the indicated attributes; receiving first input from the owner; applying by a computer the tailored valuation model to the updated attributes and displaying the fifth valuation based on the application of the tailored valuation model. Thus, the machine at issue is not simply a computer used for no more than its basic
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functionmaking calculations or computations, Motion at 11, it is a programmed computer with a particular display interface, as exemplified by the screenshots of Zillows Zestimates included in the specification. Id. at Sheet 10, 14. Zillows patented method presents a unique interface for users to update the facts about their homes and generate a refined valuation for themselves and others. In other words, Zillow is suing Trulia for copying and infringing Zillows programmed computer with the capacity to provide the same disclosed display interface to generate a refined valuationnot merely the idea of soliciting information from homeowners.
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2. Zillows Claims Do Not Patent Meaningless Post-Solution Activity Zillows computer, display interface, and revised valuation based on user input also satisfy the second consideration: they are not meaningless post-solution activity. The postsolution activity consideration derives from Parker v. Flook, in which the Supreme Court ruled that a patent disclosing a particular algorithm used to update alarm limits did not meet the requirements of patentable subject matter. 437 U.S. 584, 585-86, 595-96 (1978). The Court
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described the patent at issue as follows: All that it provides is a formula for computing an updated alarm limit. Although the computations can be made by pencil and paper calculations, the abstract of disclosure makes it clear that the formula is primarily useful for computerized calculations producing automatic adjustments in alarm settings. Id. at 586. The Court relied on earlier precedents that invalidated patents covering mathematical formulas, and held that postsolution activity, such as using a computer to calculate an adjustment to the alarm limit, cannot transform an unpatentable principle into a patentable process. Id. at 590. Here, the display

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interface is not post-solution activity that Zillow is attempting to use in order to patent a mathematical algorithm or formulathe display interface incorporating user input to produce a revised valuation is the solution. If Zillow were merely seeking to patent an algorithm or a mathematical principle to use to calculate a Zestimate, the post-solution addition of a computer
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might implicate Flook. But the 674 Patent discloses more than the performance of a calculation; it discloses and describes a particular user interface that requires a specifically programmed computer and a computer display. Thus, the 674 Patent passes the machine prong of the Federal Circuit test, and does not implicate the narrow abstract idea exception. 3. The Cases Trulia Cites are Distinguishable: They all Involve Attempts to Patent Broad Concepts That Were Only Incidentally Tied to Computers Trulia cites several cases purportedly supporting its argument that the 674 Patent fails the machine prong of the machine-or-transformation test. But the patents-in-suit in these cases are all distinguishable from the 674 Patent, as they attempted to patent extremely broad concepts (e.g., processing information through a clearinghouse, detecting credit card fraud over the Internet,
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hedging risk, and price optimization), and their use of computers or the Internet was only
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incidental to these broad, field preempting concepts. In Dealertrack, Inc. v. Huber, cited by Trulia, the patent-in-suit claimed the concept of processing data through a clearinghouse. Dealertrack, Inc., 674 F.3d at 1333 (quoting Bilski, 130 S. Ct. at 3231). The Federal Circuit affirmed a grant of summary judgment (following claim construction and discovery) based on Section 101 because [n]either Dealertrack nor any other entity is entitled to wholly preempt the clearinghouse concept. Id. Moreover, while the claims
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purported that the method was computer aided, the claims were silent as to how the computer aids the method, the extent to which a computer aids the method, or the significance of the computer to the performance of the method. Id. The 674 Patent, to the contrary, claims concrete steps requiring a computer display and interface to accept the user input to generate the

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revised valuation, rather than a broad concept tied incidentally to a general-purpose computer. Likewise, in CyberSource Corp. v. Retail Decisions, Inc., 654 F.3d 1366 (Fed. Cir. 2011), the asserted claims were broad and essentially purport[ed] to encompass any method or system for detecting credit card fraud which utilize[d] information relating credit card transactions to
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particular Internet address. CyberSource, 654 F.3d at 1368. The plaintiffs purported link to a machine was simply that it would not be necessary or possible without the Internet. Id. at 1370. The Federal Circuit affirmed a grant of summary judgment (following the parties
submission of a joint claim-construction statement) invalidating the patent under Section 101. Id. at 1372 (holding that claims method steps can be performed in the human mind, or by a human using a pen and paper.)3. In contrast, the steps of the 674 Patent cannot be performed in the human mind, because some of the steps involve a particular interface on a computer display that
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solicits user input and then displays the revised valuation to the home owner and to the public. Also, while the patent at issue in CyberSource failed to disclose particular fraud-detection algorithms in the specification that would explain how the patent intended to accomplish the broad fraud-detection idea disclosed, id., the 674 Patent includes detailed descriptions of techniques for using the obtained user inputs to refine home valuations in the dependent claims. See, e.g., Claim 9 (The computer-readable medium of claim 8 wherein the adjustment of the
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obtained user input further includes identifying a scoring of the properties sold in the identified sales reflecting the relative level of similarity of the sold properties to the distinguished property, and wherein the displayed refined valuation is based at least in part on a repetition of the automatic valuation of the distinguished property in which the influence of the identified sales is Accord, Bilski I, 545 F.3d at 965 (finding patent claiming mental process of hedging without aid of a computer or any other device to fail the machine-or-transformation test); Bancorp Services, L.L.C. v. Sun Life Assur. Co. of Canada (U.S.), 687 F.3d 1266, 1278 (Fed. Cir. 2012) (affirming grant of summary judgment invalidating patent, under Section 101, that claimed the use of the abstract idea of managing a stable value protected life insurance policy, using a computer merely to perform calculations).
3

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magnified in a manner consistent with the identified scores.).4 And in the final case cited by Trulia, OIP Tech. v. Amazon, the plaintiff attempted to patent price optimization, as the patent disclosed the business method of sending sale offers over emails to potential customers, recording statistics generated by the response of the
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customers, and then using those statistics to determine an optimized pricing strategy. 2012 WL 3985118, at *1 (N.D. Cal. Sept. 11, 2012). The plaintiff argued that the computer used to calculate the optimized pricing strategy caused the patent to meet the Federal Circuits machineor-transformation test. Id. at *12-16. The district court disagreed, stating that: While running a particular process on a computer undeniably improves efficiency and accuracy, cloaking an otherwise abstract idea in the guise of a computer-implemented claim is insufficient to bring it within section 101. Id. at *15 (quotation marks and citations omitted). Here, the 674 Patent is
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not aimed at an abstract concept such as price optimization and the use of a computer is not merely to perform calculations. While the 674 Patent in fact uses a computer to perform calculations, it also discloses a particular display interface that the computer must be programmed and equipped to perform. Accordingly, the 674 Patent claims patentable subject matter because it passes the machine prong of the machine-or-transformation test. Unlike patents that have been invalidated
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using this test, the programmed computer and display interface of the 674 patent is not incidental to a broad concept claimed by the patent. Rather, the display interface soliciting user input to generate a revised valuation, as limited by the steps and capabilities that make up the claims, and The specification adds further technical detail and further distinguishes the 674 Patent from the patent invalidated in CyberSource. See, e.g., 674 Patent at 12:35-61 (In some embodiments, the facility constructs and applies compound valuation models to one or more geographic areas. A compound valuation model includes two or more separate classification tree forests, some or all of which may be applied to the attributes of a particular home in order to value it. As one example, in some embodiments, the facility constructs a compound model including both a forest constructed as described above . . . as well as a separate high-end forest constructed from basis sales having a selling price above the 97.5 percentile selling price in the geographic area. In these embodiments, the compound model is applied as follows. . . .).
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as embodied by the further detailed descriptions in the specification and Zillows Zestimate feature, is integral to the claimed invention itself. B. The 674 Patent Does not Preempt any Basic Tools of Scientific or Technological Work Trulias motion neglects to include any discussion of the Supreme Courts analysis of preemption, which the Court frequently emphasizes to determine patent subject matter eligibility under Section 101. There is an obvious explanation for Trulias omissionthe Supreme Courts preemption analysis demonstrates that the 674 Patent claims patent-eligible subject matter. The
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patent is a directed solution in a narrow field, not a broad concept that would preempt innovation or any basic tool of scientific or technological work. The Supreme Court has frequently emphasized the concept of preemption in analyzing whether a patent claims patent-eligible subject matter. In cases where the Court has found patentineligible subject matter, the Court has held that the claims improperly limit innovation in a field because they preempt the use of basic tools of scientific or technological work. For example, in
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O'Reilly v. Morse, 56 U.S. 62, 112-13 (1853), the Supreme Court held that a claim to
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electromagnetism was not eligible for patent protection because it would effectively shut [ ] the door against inventions of other persons . . . in the properties and powers of electro-magnetism because it matters not by what process or machinery the result is accomplished. Again, in Gottschalk v. Benson, 409 U.S. 63, 93 (1972), the Supreme Court emphasized the concept of pre-emption, holding that a claim directed to a mathematical formula with no substantial practical application except in connection with a digital computer was directed to an
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unpatentable abstract idea because the patent would wholly pre-empt the mathematical formula and in practical effect would be a patent on an algorithm itself. Id. at 71-72. See also Parker v. Flook, 437 U.S. 584, 591 (1978) (emphasizing importance of claims not preempting basic tools of scientific and technological work). In contrast, in Diehr, the Court held that the claims

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at issue did not preempt the use of a particular equation used for curing rubber because the claims only foreclose[d] from others the use of that equation in conjunction with all of the other steps in the [ ] claimed process. Diamond v. Diehr, 450 U.S. 175, 187 (1981). The Court emphasized preemption again in Bilski II when it held that the Federal Circuits
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machine-or-transformation test was not dispositive in determining whether claimed subject matter was patent eligible. The Court explained: Allowing petitioners to patent risk hedging would preempt use of this approach in all fields, and would effectively grant a monopoly over an abstract idea. 130 S.Ct. at 3231. The Court recently described the policy interests involved in the determination of patent subject matter eligibility, stating: [T]here is a danger that the grant of patents that tie up their use will inhibit future innovation premised upon them, a danger that becomes acute when a patented process amounts to no more than an instruction to apply the
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natural law, or otherwise forecloses more future invention than the underlying discovery could reasonably justify. Mayo Collaborative Servs., 132 S. Ct. at 1301. Analyzing the 674 Patent with these principles in mind, the Courts concern about foreclosing innovation in a broad field and preempting basic tools of scientific and technological work are not implicated by the 674 Patent. The 674 Patent applies expressly to the narrow field of electronic real estate commerce (see 674 Patent at 1:10-13), claiming a particular
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solution, in the form of a specific computer display interface, to solve a concrete problem in that field: incorporating home owner input to generate and display a revised valuation. The 674 Patent does not claim a basic tool or algorithm. Truliaor anyone elsecan display automatic valuations of properties without a license to the 674 Patent; they are only precluded from the concrete steps of the Zillow claims. Zillows targeted and precise solution is not remotely similar to the broad concepts and scientific tools that would be foreclosed and preempted by the patents found to be ineligible under Supreme Court and Federal Circuit precedent, such as

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electromagnetism (Morse), hedging (Bilski), detecting credit-card fraud (CyberSource), processing data through a clearinghouse (Dealertrack), managing a stable value protected life insurance policy (Benson), or particular algorithms or equations (Benson, Flook). Accordingly, even if the Court were to find that the 674 Patent fails the machine prong of
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the machine-or-transformation test (it doesnt), the Court should still find that the 674 Patent claims patent eligible subject matter because the preemption analysisconsistently emphasized by the Supreme Court, but omitted from Trulias motiondemonstrates that the 674 Patent does not claim a broad, abstract idea and would not stifle or preempt innovation. IV. The Court Should Not Stay This Case Pending the Federal Circuits Resolution of CLS Bank As an alternative to outright dismissal of Zillows complaint, Trulia asks the Court to stay the case pending the Federal Circuits en banc decision in CLS Bank Intl v. Alice Corp. Pty. Ltd., 685 F.3d 1341 (Fed. Cir. 2012), vacated. Motion at 13. A. The Federal Circuit CLS Bank Opinion The Federal Circuit panel in CLS Bank dealt with the question of patent eligibility under 35 U.S.C. 101 of an invention implemented by computers. CLS Bank Intl, 685 F.3d at 1343.
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The asserted claims in CLS Bank were directed generally to the exchange of obligations between parties using a computer. Id. at 1353. In reviewing the district courts summary judgment ruling, the Federal Circuit concluded: [T]his court holds that whenafter taking all of the claim recitations into considerationit is not manifestly evident that a claim is directed to a patent ineligible abstract idea, that claim must not be deemed for that reason to be inadequate under 101. Id. at 1352. While the claimed invention used a general-purpose computer merely to implement the steps of exchanging obligations, the Federal Circuit found that the asserted
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claims satisfied the machine prong of the machine-or-transformation test because the claim language and the patent specification indicated that the patent required computer implementation.

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Id. at 1353-54. The court also analyzed similar preemption jurisprudence presented in Section III.B., supra, to conclude that the patent did not appear to preempt much in the way of innovation. Id. at 1355-56. The Federal Circuit panels CLS Bank opinion was vacated pending an en banc review, which is scheduled for February 8.
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While the Federal Circuits en banc opinion may set forth relevant and useful standards in this area, the Court can resolve Trulias motion to dismiss without waiting for the Federal Circuit. As Part III of this brief makes clear, the 674 Patent satisfies the applicable tests for patent eligibility regardless of the outcome in CLS Bank. Even if the Federal Circuit were to find the asserted claims in CLS Bank ineligible for patent protection, the 674 Patent would still be distinguishable because it requires a particular computer display and interface, while the asserted claims in CLS Bank merely disclose a general purpose computer used to conduct transactions, and
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the 674 Patent is directed to a targeted solution in a narrow field. Nevertheless, should the Court decide that awaiting the Federal Circuits en banc ruling in CLS Bank would aid its consideration of Trulias Motion to Dismiss, the appropriate course is merely to defer ruling on the instant motion, not to stay the entire case, as Trulia requests. B. Trulia Has Failed to Justify a Stay District courts consider three primary factorsfactors Trulia has failed to explain or
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satisfyin determining whether a stay is appropriate: (1) possible damage resulting from the stay; (2) hardship to parties if the suit goes forward; and (3) delivering justice in an efficient manner. Carolina Cas. Ins. Co. v. Ott, No. 09-cv-5540-RJB, 2010 WL 1286821, at *3 (W.D. Wash. Mar. 26, 2010) (citing Landis v. N. Am. Co., 299 U.S. 248, 254 (1936)). A brief review of these factors shows that a stay would be completely unwarranted in this case. First, Zillow and Trulia are direct competitors. Trulias ongoing and unlicensed use of Zillows patented innovation is a blatant attempt to ride Zillows coattails and seek Zillows hard-

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earned profits and market share. In the face of this continued harmfor which Zillow has sought injunctive reliefa stay would only exacerbate Zillows injuries. See Lockyer v. Mirant Corp., 398 F.3d 1098, 1112 (9th Cir. 2005) (rejecting defendants request for stay where plaintiff sought injunctive relief against ongoing and future harm).
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Second, the party seeking the stay must make out a clear case of hardship or inequity in proceeding with the case. See id. (quoting Landis, 299 U.S. at 255). Trulia fails to allege any hardship in the event a stay is denied, and being required to defend a suit, without more, does not constitute a clear case of hardship or inequity. Id.; see also Turner Broad. Sys., Inc. v. Tracinda Corp., 175 F.R.D. 554, 556 (D. Nev. 1997) ([A] pending Motion to Dismiss is not ordinarily a situation that in and of itself would warrant a stay . . . .). Finally, a stay of proceedings would not improve the orderly course of justice. Landis,
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299 U.S. at 254. This Court has rejected similar requests for stays pending appellate decisions, correctly reasoning that such stays have a negligible impact on case efficiency: To the extent that conservation of judicial resources favors a continued stay, resources will only be conserved if the Court of Appeals decides in Defendants favor. In the event that the Court of Appeals decision is adverse to the Defendants, there would be no conservation of judicial or litigant resources. Nw. Coal. for Alts. to Pesticides v. U.S. Envtl. Prot. Agency, 2012 WL 2343279, at *5 (W.D.
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Wash. June 20, 2012). In light of the foregoing, the Court should deny Trulias request for a stay. V. Zillow Adequately Pled Contributory Infringement and Inducement Trulia moves to dismiss Zillows indirect infringement claims, arguing that the claims are conclusory and threadbare. Motion at 13. To the contrary, Zillows complaint easily
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satisfies Federal Rule of Civil Procedure 8(a), which requires only a short and plain statement of the claim showing that the pleader is entitled to relief, in order to give the defendant fair notice of what the . . . claim is and the grounds upon which it rests. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)).

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A. Zillows Complaint Satisfies the Elements of Indirect Infringement To properly allege inducement of infringement, Zillows complaint must merely allege facts plausibly showing that [defendant] specifically intended [a third party] to infringe the [674] patent, and knew that the [third partys] acts constituted infringement. In re Bill of
Lading Transmission and Processing Sys. Patent Litig., 681 F.3d 1323, 1339 (Fed. Cir. 2012). In
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addition, to show contributory infringement, Zillows complaint need only include facts that allow an inference that the defendants accused product has no substantial non-infringing use. Id. at 1377. Zillows complaint contains ample factual matter to satisfy these requirements. 1. Knowledge and Specific Intent The Federal Circuit recently held that post-filing knowledge of the patent satisfies the knowledge element of a claim for inducement. See In re Bill of Lading, 681 F.3d at 1345. Thus, Zillow has, at the very least, adequately pled knowledge of alleged inducement as of the date of
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the complaint in this case. See Symantec Corp. v. Veeam Software Corp., No. 12-cv-00700-SI, 2012 WL 1965832, at *4 (N.D. Cal. May 31, 2012) (same). Moreover, Zillows complaint explains that Zillow and Trulia are direct competitors and that Zillows Zestimate innovation helped drive its very public success. Complaint 7, 9. This direct competition establishes a likelihood that Defendants had knowledge of existing patents in that industry, including [Plaintiffs]. Weiland Sliding Doors and Windows, Inc. v. Panda
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Windows and Doors, LLC, No. 10-cv-677-JLS, 2012 WL 202664, at *4 (S.D. Cal. Jan. 23, 2012) (holding that plaintiff satisfied knowledge element of indirect-infringement claim); see also Global-Tech Applicances, Inc. v. SEB S.A., 131 S. Ct. 2060, 2070-71 (2011). Zillow has also pled specific intent. Specific intent to encourage anothers infringement is demonstrated by any active steps taken to encourage direct infringement, such as advertising an infringing use or instructing how to engage in an infringing use . . . . DSU Med. Corp. v. JMS

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Co., Ltd., 471 F.3d 1293, 1305 (Fed. Cir. 2006) (quoting Metro-Goldwyn-Mayer Studios, Inc. v. Grokster, Ltd., 545 U.S. 913, 936 (2005)); see also Cal. Inst. of Computer Assisted Surgery, Inc. v. Med-Surgical Servs., Inc., No. 10-05067-CW, 2011 WL 672709, at *5 (N.D. Cal. Feb. 16, 2011) (denying defendants motion to dismiss, stating one can infer from information on
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[Defendants] website, publicizing the technologies, [and] offering brochures describing the products that defendants had specific intent to encourage anothers infringement.). Indeed, as this Court has explained, the Court may infer specific intent here from the allegations regarding [Defendants] website and marketing materials . . . . Medtrica Solutions, Ltd. v. Cygnus Med., LLC, No. 12-cv-538-RSL, 2012 WL 5726799, at *2 (W.D. Wash. Nov. 15, 2012). Zillows complaint includes detailed quotations from Trulias website and blog, as well as Trulias representations to the Securities and Exchange Commission, all of which actively
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advertise, publicize, and instruct users to utilize the Trulia Estimates feature. demonstrate an obvious intent on the part of Trulia to induce infringement. 2. Direct Infringement by a Third Party
These facts
Trulia also argues that Zillow fail[s] to allege direct infringement by any third party. Motion to Dismiss at 15. To state a claim for indirect infringement, a plaintiff need not identify a specific direct infringer if it pleads facts sufficient to allow an inference that at least one direct infringer exists. In re Bill of Lading, 681 F.3d at 1336 (citing Lucent Techs., Inc. v. Gateway,
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Inc., 580 F.3d 1301, 1318 (Fed. Cir. 2009)). To the extent that Trulia will argue that Zillows claims are indirect infringement as opposed to direct infringement by Trulia, Zillows complaint alleges that Trulias website also highlights agents, buyers and owners who infringe Zillows patent by claim[ing] their homes and enhanc[ing] the profiles for those homes on Trulia. Complaint at 3, 4 (quoting Trulias website). While Zillows complaint does not allege a specific direct infringer, its identification of an entire class of homeowners using Trulia Estimates makes

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plain that at least one direct infringer exists. In re Bill of Lading, 681 F.3d at 1336. Apart from Trulias direct infringement, to the extent that the user input renders infringement indirect, these users have been identified by Zillows Complaint. 3. Lack of Noninfringing Uses
Finally, Trulia argues that Zillow has failed to allege that Trulia Estimates have no
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substantial noninfringing use. Motion to Dismiss at 15. But so long as the complaint supports the reasonable inference that there is no noninfringing use, it need not explicitly allege the same. [N]either party directly addresses whether Defendants products are capable of substantial noninfringing uses. Accepting as true the allegations of the [complaint], however, the Court infers that because Defendants products are identical to the products protected by the patents, they are not capable of any noninfringing use. Weiland Sliding Doors, 2012 WL 202664, at *4 n.6 (denying defendants motion to dismiss). In this case, Zillows Complaint alleges that Trulia copied Zillows Zestimate feature, and that the resulting Trulia Estimates feature looks like exactly the same thing as a Zestimate. Complaint at 4. The only use of the patented feature is to obtain and utilize homeowner input
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regarding recent sales of similar homes and home facts like number of bedrooms and bathrooms, square footage, and more in order to refine an automatic valuationuses protected by Zillows patent. Because the complaint alleges that Trulia Estimates are identical to Zillows patented
Zestimates, and because Trulia offers no argument to the contrary, the Court can easily infer that Trulia Estimates have no substantial noninfringing use. Based on the foregoing, Zillows complaint contains factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged. Ashcroft
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v. Iqbal, 556 U.S. 662, 678 (2009).
The complaint includes detailed quotations from
[Defendants] websites, advertising, and industry publications to demonstrate Trulias blatant infringementthe exact factual material approved by the Federal Circuit in indirect infringement pleadings. In re Bill of Lading, 681 F.3d at 1330. Trulias motion should thus be rejected.

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B. Zillows Complaint Need Not Recite the Formal Legal Elements of a Claim Because Trulias challenge to the complaints factual allegations falls flat, Trulia creatively argues the complaint is deficient for failing to recite the elements required to state a claim for indirect infringement. Motion to Dismiss at 14 (emphasis added). But neither the
Federal Rules of Civil Procedure nor binding case law requires such a formal recitation.
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As the Ninth Circuit has reiterated after Twombley and Iqbal, [n]otice pleading requires the plaintiff set forth in his complaint claims for relief, not causes of action, statutes or legal theories. Alvarez v. Hill, 518 F.3d 1152, 1157 (9th Cir. 2008). Indeed, in this circuit, a plaintiffs complaint need not identify any particular legal theory under which recovery is sought. Crull v. GEM Ins. Co., 58 F.3d 1386, 1391 (9th Cir. 1995) (emphasis added). Because Zillows complaint provides ample factual matter supporting a claim to relief
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without an unnecessary recitation of formal elements, the Court should reject Trulias attempted return to the hyper-technical, code-pleading regime of a prior era. Iqbal, 556 U.S. at 678.5 VI. Conclusion For the foregoing reasons, Zillow respectfully requests that the Court deny Trulias
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5
Motion to Dismiss. Dated this 21st day of January, 2013. By: /s/ Jordan Connors Brooke A. M. Taylor, WA Bar No. 33190 E-Mail: btaylor@susmangodfrey.com Jordan Connors, WA Bar No. 41649 E-Mail: jconnors@susmangodfrey.com Jordan Talge, WA Bar No. 45612 E-Mail: jtalge@susmangodfrey.com If the Court finds deficiencies in Zillows pleadings, however, Zillow seeks leave to amend its complaint. See Cook, Perkiss & Liehe, Inc. v. N. Cal. Collection Serv. Inc., 911 F.2d 242, 247 (9th Cir. 1990).

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SUSMAN GODFREY L.L.P. 1201 Third Ave, Suite 3800 Seattle, WA 98101 Telephone: (206) 516-3880 Facsimile: (206) 516-3883 Counsel for Zillow, Inc.
5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 ZILLOWS OPPOSITION TO TRULIAS MOTION TO DISMISS COMPLAINT FOR PATENT INFRINGEMENT - Page 25
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CERTIFICATE OF SERVICE I hereby certify that on January 21, 2013, I electronically filed the foregoing with the Clerk of the Court using the CM/ECF system, which will send notification to counsel of record.
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ZILLOWS OPPOSITION TO TRULIAS MOTION TO DISMISS COMPLAINT FOR PATENT INFRINGEMENT Page 1
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Honorable James L. Robart

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Rules Federal Rule of Civil Procedure 12.................................................................................................. 5

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provides Zillow constitutionally conferred protection against competitors seeking to copy or

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v. Iqbal, 556 U.S. 662, 678 (2009).

The complaint includes detailed quotations from

Case 2:12-cv-01549-JLR Document 22 Filed 01/21/13 Page 29 of 31

Case 2:12-cv-01549-JLR Document 22 Filed 01/21/13 Page 30 of 31

Case 2:12-cv-01549-JLR Document 22 Filed 01/21/13 Page 31 of 31

By: /s/ Jordan Connors

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