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No. C99-1695P


1999 U.S. Dist. LEXIS 18660

December 1, 1999, Decided
December 1, 1999, Filed

DISPOSITION:  ORDERED that Defendants Barnesandnoble.com LLC and Barnesandnoble.com Inc., their officers, agents, servants, employees and attorneys and those in active concert or participation with them or Defendants RESTRAINED AND ENJOINED from continuing to infringe United States Patent No. 5,960,411.

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On October 21, 1999, Plaintiff Amazon.com filed a complaint in this Court alleging patent infringement by Defendants  Barnesandnoble.com Inc. and Barnesandnoble.com LLC (hereinafter referred to collectively as "Barnesandnoble.com"). The patent in question is United States Patent No. 5,960,411 (the '411 patent), which was issued on September 28, 1999. The '411 patent describes a Method and System for Placing a Purchase Order Via a Communications Network and includes 26 claims.

The '411 patent, in essence, describes a method and system in which a consumer can complete a purchase order for an item via the Internet using only a single action (such as a single click of a computer mouse button) once information identifying the item is displayed to the consumer. This method and system is only applicable in situations where a retailer already has in its files various information about the purchaser (such as the purchaser's address and credit card number) and where the purchaser's client system (e.g., a personal computer) has been provided with an identifier that enables the retailer's server system to identify the purchaser.

Amazon.com alleges that Defendants' "Express Lane" ordering feature infringes various claims of the '411 patent.

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Prior Art

7. Plaintiff's expert Geoffrey Mulligan testified that except for single-action ordering and the implementation of single-action ordering without a shopping cart model, everything in the independent claims of the '411 patent (claims 1, 6, 9, and 11) is in prior art. (Tr. at 180:14-181:3).

8. In support of their arguments that the single-action ordering element of the '411 patent is invalid  on obviousness and anticipation grounds, Defendants offered evidence concerning several prior art references. This evidence of prior art falls into two general categories: systems for ordering tangible items online (such as groceries or computer equipment) and electronic document delivery systems. In the former category were Dr. John Lockwood's Web Basket system, the Netscape Merchant System described in the "Creating a Virtual Store" reference, and the "Oliver's Market" web pages. In the latter category were the CompuServe financial information service represented by Mr. Alexander Trevor's testimony regarding the "Trend" feature, and U.S. Patent No. 5,708,780 (the '780 patent). It is undisputed that these prior art references were not before the PTO when the '411 patent was examined.

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Summary of Prior Art

27. There are key differences between each of the prior art references cited by Defendants and the method and system described in the claims of the '411 patent. The Court finds that none of the prior art references offered by Defendants anticipate the claims of the '411 patent. On the question of obviousness, the Court finds that the differences between the prior art references submitted by Defendants and the '411 patent claims are significant. Moreover, there is insufficient evidence in the record regarding a teaching, suggestion, or motivation in the prior art that would lead one of ordinary skill in the art of e-commerce to combine the references. The Court finds particularly telling Dr. Lockwood's admission that it never occurred to him to modify his Web Basket program to enable single-action ordering, despite his testimony that such a modification  would be easy to implement. This admission serves to negate Dr. Lockwood's conclusory statements that prior art references teach to one of ordinary skill in the art the invention of the '411 patent. (Tr. at 319:5-320:22 (Lockwood)).

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Barnesandnoble.com's Shopping Cart and Express Lane

28. Barnesandnoble.com offers customers two purchasing options. One is called Shopping Cart and the other is called Express Lane. (Ex. 9, Mulligan Decl. at PP 7, 8.i, Ex. H). The two methods are separate and cannot be combined. (Tr. at 429:6-10 (King); Ex. 9, Mulligan Decl. at Ex. I (noting "Express Lane and the Shopping Cart are two different ways to place your order. You can't combine them.")). The Barnesandnoble.com Shopping Cart option includes the steps of a standard shopping cart model, including adding items to a virtual shopping cart and "checking out" to complete the purchase. (Ex. 9, Mulligan Decl. at P 14j).

29. Barnesandnoble.com's Express Lane allows customers who have registered for the feature to purchase items by simply clicking on the Express Lane button shown on the detail or product page that describes and identifies the book or other item to be purchased. (Ex. 9, Mulligan Decl. at Ex. R). The text beneath the Express Lane button invites the user to "Buy it now with just 1 click!" (Id.).

30. Throughout its web site, Barnesandnoble.com consistently describes Express Lane as a one-click ordering method. (Tr. at 463:15-464:10 (Bulkeley)). In its May 1999 prospectus, Barnesandnoble.com consistently described Express Lane as making one-click ordering possible. (See, e.g., Ex. 36 at 6, 44, 47). In its November 1999 10-Q Report to shareholders, Barnesandnoble.com describes Express Lane as a one-click ordering system. (Ex. 39 at 13). It does not appear that Barnesandnoble.com has ever described the Express Lane ordering process as requiring more than one action, other than in the course of this litigation. (Tr. 471:1-4 (Bulkeley)).

31. Barnesandnoble.com began using the Express Lane feature in May of 1998, describing the feature in a press release as "Express Lane (SM) One Click Ordering" and noting that "now, visitors can click one button to order books, software and magazines." (Ex. 37).

32. Clicking on the shopping cart icon on the top of every Barnesandnoble.com page will not show the items that the user has purchased using the Express Lane. (Tr. at 430:14-17 (King)).

33. The strong similarities between the Amazon.com 1-click feature and the Express Lane feature subsequently adopted by Barnesandnoble.com suggest that Barnesandnoble.com copied Amazon.com's feature. (Ex. 10, Johnson Decl., P 13).

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Direct Evidence of Nonobviousness

34. Amazon.com has provided direct evidence of nonobviousness. Jeff Bezos, Amazon.com's founder and an inventor on the '411 patent, testified that because "many customers were tentative and somewhat fearful of on-line purchasing, conventional wisdom was that they had to be slowly and incrementally led to the point of purchase. In addition, consumers were not acclimated to rely without confirmation on stored personal information for correct shipping and billing." (Ex. 11, Bezos Decl. P 9).

35. Professor Eric Johnson of Columbia Business School testified in his declaration that "Amazon.com's 1-Click (R) purchasing was a major innovation in on-line retailing that allows for purchasing without disrupting the consumer's shopping experience; and by eliminating additional confirmation requirements, recasts the default in a way that both maximizes the likelihood that consumers will complete their purchases and minimizes consumer anxiety over real or perceived issues of internet security." (Ex. 10, Johnson Decl. P 12).

36. Moreover, despite their experience with prior art shopping cart models of on-line purchasing, both sides' technical experts acknowledged that they had never conceived of the invention. Mr. Mulligan testified that ordering with one click was "a huge leap from what was done in the past." (Tr. at 190:25). Mr. Mulligan testified further that: "I've been working in electronic commerce for years now. And I've never thought of the idea of being able to turn a shopping cart or take the idea of clicking on an item and suddenly having the item ship- having the complete process done." (Tr. at 199:3-7). Mr. Mulligan also testified that he believed it was "a huge leap of faith for the website and the consumer to implement something like this." (Tr. at 199:12-14). Additionally, as noted above, Dr. Lockwood testified that he never thought of modifying Web Basket to provide single-action ordering. (Tr. at 277:19-23).

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25. Copying of the invention by Barnesandnoble.com and others is additional evidence of nonobviousness. "It gives the tribute of its praise to the prior art; it gives the [invention] the tribute of its imitation, as others have done." Diamond Rubber Co. v. Consolidated Rubber Tire Co., 220 U.S. 428, 441, 31 S. Ct. 444, 55 L. Ed. 527 (1911).

26. The adoption of single-action ordering by other e-commerce retailers following Amazon.com's introduction of the feature, coupled with the need to solve the problem of abandoned shopping carts by e-commerce customers, is additional evidence of nonobviousness. See Hayes Microcomputer Prod, Inc. v. Ven-tel, Inc., 982 F.2d 1527, 1540 (Fed. Cir. 1992) ("The commercial success of the invention, the failure of others to solve the problem addressed by the patented invention, and the fact that the [invention] has become the industry standard is compelling objective evidence of the nonobviousness of the claimed invention.").

27. In light of its consideration of the factors and evidence related to the question of obviousness, the Court finds Barnesandnoble.com is unlikely to succeed in showing by clear and convincing evidence that the claims of the '411 patent were obvious. Barnesandnoble.com's reliance on the simplicity of the invention is unavailing. "Defining the problem in terms of its solution reveals improper hindsight in the selection of the prior art relevant to obviousness." Monarch Knitting Machinery Corp. v. Sulzer Morat GMBH, 139 F.3d 877, 881 (Fed. Cir. 1998).

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Therefore, the Court hereby ORDERS that Defendants Barnesandnoble.com LLC and Barnesandnoble.com Inc., their officers, agents, servants, employees and attorneys and those in active concert or participation with them or Defendants ARE HEREBY RESTRAINED AND ENJOINED from continuing to infringe United States Patent No. 5,960,411, including by continuing to make or use within the United States Defendants' Express Lane feature as currently configured or any other single-action ordering system that employs the methods or systems of the '411 patent, or by inducing others to make  or use within the United States Defendants' Express Lane feature as currently configured or any other single-action ordering system that employs the methods or systems of the '411 patent. Defendants may continue to offer an Express Lane feature if the feature is modified to avoid infringement of the '411 patent in a manner that is consistent with the findings of fact and conclusions of law set forth above.