O2 Media, LLC v. Narrative Science Inc., No. 15 C 5129, Slip Op. (N.D. Ill. Jan. 3, 2017) (Tharp, J.).

Judge Tharp denied prevailing defendant Narrative Science’s 35 U.S.C. §285 motion to make exceptional and for attorney’s fees in this patent dispute after granting Narrative Science’s motion to dismiss which held plaintiff O2 Media’s patents invalid as unpatentable pursuant to 35 U.S.C. §101. O2 Media’s patents were directed to methods of generating financial reports and news stories based upon selected data.

Noting that some courts had held cases exceptional based upon a plaintiff’s assertion of computer-based claims that were held invalid pursuant to §101, the Court found that O2 Media’s suit was not frivolous. In light of the five “innovative concepts” that O2 Media identified in its defense to §101, the Supreme Court’s Alice decision did not require that O2 Media never bring its claims.’

Having granted Narrative Science’s motion to dismiss at an early stage, the Court declined to consider Narrative Science’s other defenses on an “under-developed” record. Also, O2 Media’s $1M+ settlement demand did not make the case exceptional. All it did was show that O2 Media placed a high value on its patents. Furthermore, O2 Media filed against only one entity and showed no evidence of a large campaign based upon the patents.

Finally, O2 Media’s decision not to appeal was evidence of reasonableness, choosing not to cost both sides more resources in prosecuting an appeal that O2 Media felt unlikely to win.