## Facts

- DDR Holdings, LLC owned patents covering e-commerce technology that, when a user clicks a third-party link on a “host” website, generates a “composite” page that keeps the host site’s visual identity while displaying merchant product information.
- The patents targeted a problem in online advertising: conventional hyperlinks direct users away from the host site to the merchant’s site, potentially diverting traffic and revenue from the host.
- National Leisure Group, Inc. and World Travel Holdings, Inc. operated online cruise-booking systems that worked with host travel websites and cruise lines.
- DDR alleged NLG’s systems infringed by presenting booking pages that preserved host-site branding and “look and feel” while providing third-party merchant content.
- A jury found NLG infringed asserted claims of both patents, found the claims not invalid (including under § 101), and awarded $750,000; the district court denied renewed JMOL motions and entered judgment for DDR.

## Issues

1. Whether asserted claims of the ’399 patent are patent-ineligible under 35 U.S.C. § 101 after *Alice Corp. v. CLS Bank*.
2. Whether the ’572 patent is anticipated under § 102 by a prior system (including Digital River’s Secure Sales System).
3. Whether substantial evidence supported infringement of the ’399 patent under the parties’ stipulated claim constructions.
4. Whether the damages award could stand after invalidation of one of the two patents.

## Decision

- Affirmed denial of JMOL as to infringement and invalidity for the ’399 patent; substantial evidence supported the verdict that NLG infringed asserted ’399 claims.
- Held the asserted ’399 claims patent-eligible under § 101 because they addressed a problem specific to computer networks with a computer-technology-based solution.
- Reversed denial of JMOL as to validity of the ’572 patent, holding it anticipated as a matter of law.
- Vacated the damages award and remanded for recalculation limited to infringement of the ’399 patent.
- Dissent (Mayer, J.): would have held the ’399 patent ineligible as an abstract idea implemented on a generic computer.

## Legal Principles

- Under *Alice*, claims that are “necessarily rooted in computer technology” and solve a problem arising specifically in computer networks may supply an inventive concept sufficient for § 101 eligibility.
- Claims are less likely to be patent-eligible when they merely perform a known commercial practice using the Internet as a generic tool, without a specific, nonconventional technological implementation.
- Anticipation invalidates a patent when a single prior art system discloses each limitation of the claimed invention; if anticipation is established as a matter of law, JMOL of invalidity is appropriate.
- When a damages award is based on multiple patents and one is later held invalid, the award must be vacated and recalculated to reflect only the remaining valid and infringed patent rights.

## Conclusion

The Federal Circuit upheld the ’399 patent because its claims recited a specific, computer-network-based method for keeping users on a host website by generating composite pages that alter conventional hyperlink behavior, but invalidated the ’572 patent as anticipated and required damages to be recalculated based solely on the ’399 patent infringement.


DDR Holdings, LLC v. Hotels.com, L.P., 773 F.3d 1245 (Fed. Cir. 2014)