Cooperative Entertainment, Inc. v. Kollective Technology, Inc.

NOTE: This disposition is nonprecedential.
United States Court of Appeals
for the Federal Circuit
______________________
COOPERATIVE ENTERTAINMENT, INC.,
Plaintiff-Appellant
v.
KOLLECTIVE TECHNOLOGY, INC.,
Defendant-Appellee
______________________
2024-1550
______________________
Appeal from the United States District Court for the
Northern District of California in No. 5:20-cv-07273-EJD,
Judge Edward J. Davila.
______________________
Decided: December 16, 2025
______________________
WILLIAM PETERSON RAMEY, III, Ramey LLP, Houston,
TX, argued for plaintiff-appellant.
MICHAEL S. DOWLER, Park, Vaughan, Fleming & Dow-
ler LLP, Houston, TX, argued for defendant-appellee.
______________________
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COOPERATIVE ENTERTAINMENT, INC. v. KOLLECTIVE
TECHNOLOGY, INC.
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Before MOORE, Chief Judge, STARK, Circuit Judge, and
OETKEN, District Judge.1
STARK, Circuit Judge.
Cooperative Entertainment, Inc. (“Cooperative”) ap-
peals from the district court’s dismissal of its patent in-
fringement suit against Kollective Technology, Inc.
(“Kollective”) for failure to state a claim. We affirm.
I
This case was before us previously. In 2022, we re-
versed the district court’s judgment dismissing Coopera-
tive’s suit on the basis that the claims of the asserted
patent, U.S. Patent No. 9,432,452 (“’452 patent”), are di-
rected to nonpatentable subject matter under 35 U.S.C.
§ 101. See Cooperative Ent., Inc. v. Kollective Tech., Inc.,
50 F.4th 127, 131 (Fed. Cir. 2022) (“Cooperative I”). In Co-
operative I, we described the ’452 patent, which is entitled
“Systems and Methods for Dynamic Networked Peer-to-
Peer Content Distribution,” as “relat[ing] to systems and
methods of structuring a peer-to-peer (P2P) dynamic net-
work for distributing large files, namely videos and video
games.” Id. at 129. We continued:
In prior art systems, video streaming was con-
trolled by content distribution networks (CDNs),
where content was “distributed directly from the
CDN server originating the content.” [’452 pat.] at
3:35-36, 9:50-52. The ’452 patent, in contrast,
claims methods and systems for a network in which
content distribution occurs “outside controlled net-
works and/or [CDNs],” i.e., outside a “static net-
work of controlled systems.” Id. at 3:40-43
1 The Honorable J. Paul Oetken, District Judge,
United States District Court for the Southern District of
New York, sitting by designation.
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COOPERATIVE ENTERTAINMENT, INC. v. KOLLECTIVE
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(emphasis added), 3:57-58, 5:38-42. It does this
with dynamic P2P networks comprising “peer
nodes,” i.e., nodes consuming the same content con-
temporaneously, that transmit content directly to
each other instead of receiving content from the
CDN. Id. at 3:55-64, 4:52-60, 5:4-10, 6:40-43, 7:43-
46.
To facilitate content distribution, the claimed P2P
networks use “content segmentation” in which a
video file, for example, is segmented into smaller
clips and distributed piecemeal. As a result, view-
ers can obtain individual segments as needed, pref-
erably from other viewers. Id. at 8:10-12, Figs. 2-
9. Content is segmented using several techniques,
including “CDN address resolution, trace route to
CDN and the P2P server manager, dynamic feed-
back from peers reporting traffic rates between in-
dividual peer and its neighbors, round-robin, other
server side scheduling/resource allocation tech-
niques, and combinations thereof.” Id. at 5:51-56
(emphasis added).
50 F.4th at 129.
Among our holdings in Cooperative I was that “[t]here
are at least two alleged inventive concepts in claim 1” of
the ’452 patent, one of which is the “require[ment]” that
“trace routes be used in content segmentation.” Id. at 131
(emphasis added); see also id. at 134 (“Claim 1 requires the
content segmentation to be based on trace route.”) (internal
quotation marks and ellipses omitted). After reversing on
that basis (and others), we remanded to the district court
for further proceedings.
On remand, Kollective moved to dismiss Cooperative’s
first amended complaint (“FAC”), this time for failure to
state a claim of infringement. The district court granted
the motion and dismissed the FAC, as it failed to plausibly
allege that Kollective’s SD ECDN (the “Accused Product”)
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infringed independent claims 1 and 5 of the ’452 patent.
This dismissal was without prejudice, so Cooperative soon
filed a second amended complaint (“SAC”).
The SAC expressly acknowledged that “[t]he ’452 pa-
tent claims all require segmenting the digital content ac-
cording to the trace routes.” J.A. 819-20. The SAC’s only
non-conclusory allegation that Kollective’s Accused Prod-
uct satisfied this trace route limitation was that it
“[u]tiliz[es] pings and traceroutes [to] gather key infor-
mation about the surrounding network by monitoring the
location of other [mesh] agents and constantly gauging how
local area links are performing.” J.A. 823-24, 830.
Kollective moved to dismiss the SAC under Rule
12(b)(6), and the district court granted the motion. It found
that the SAC “fails to allege facts showing that the Accused
Product segments content based on a trace route, and in-
stead includes facts that contradict its own infringement
theory.” J.A. 10. The court added: “absent from [the SAC]
is any allegation that, or explanation how, the Accused
Product segments content based on a trace route, no less
any facts to support that allegation.” J.A. 8-9. This time
the court’s dismissal was with prejudice, “[g]iven that [Co-
operative] was unable to cure the deficiencies [previously]
identified in the Court’s [prior] Order [dismissing the
FAC], [and] that further amendment would be futile.” J.A.
10.
Cooperative timely appealed. The district court had ju-
risdiction pursuant to 28 U.S.C. §§ 1331, 1338(a), and we
have jurisdiction under 28 U.S.C. § 1295(a)(1).
II
We review a district court’s dismissal of a complaint for
failure to state a claim under the law of the applicable re-
gional circuit. See Hawk Tech. Sys., LLC v. Castle Retail,
LLC, 60 F.4th 1349, 1356 (Fed. Cir. 2023). The Ninth Cir-
cuit reviews the grant of a motion to dismiss de novo,
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accepting as true all plausible factual allegations and con-
struing any reasonable inferences in favor of the plaintiff.
See Pyankovska v. Abid, 65 F.4th 1067, 1074 (9th Cir.
2023). “[A] district court’s decision dismissing a complaint
with prejudice, which thereby denies the plaintiff an oppor-
tunity to amend her complaint, is reviewed for abuse of dis-
cretion.” Davidson v. Kimberly-Clark Corp., 889 F.3d 956,
963 (9th Cir. 2018); see also Benavidez v. Cnty. of San Di-
ego, 993 F.3d 1134, 1141-42 (9th Cir. 2021).
“A plaintiff is not required to plead [patent] infringe-
ment on an element-by-element basis.” Bot M8 LLC v.
Sony Corp. of Am., 4 F.4th 1342, 1352 (Fed. Cir. 2021). In-
stead, it is enough that a complaint places the alleged in-
fringer on notice of what activity is being accused of
infringement. See Disc Disease Sols. Inc. v. VGH Sols.,
Inc., 888 F.3d 1256, 1260 (Fed. Cir. 2018). Still, “[t]here
must be some factual allegations that, when taken as true,
articulate why it is plausible that the accused product in-
fringes the patent claim.” Bot M8, 4 F.4th at 1353.
III
Cooperative argues that the district court erred in con-
cluding that the SAC fails to plausibly allege infringement.
In particular, Cooperative now asserts that the ’452 pa-
tent’s “claims are directed to segmenting peer networks,
not data or video files.” Open. Br. at 9; see also id. at 8
(“[S]egmentation of data by traceroute is not what is
claimed. Rather, it is the segmentation of the peers for con-
tent distribution that is claimed.”). Cooperative’s position
in this appeal represents a marked departure from the po-
sition it has advocated at every prior stage of this proceed-
ing. While Cooperative has always previously insisted that
the ’452 patent’s claims require the use of trace routes to
segment content, Cooperative now, for the first time, ar-
gues that “[t]he content segmentation claimed is the seg-
mentation of the peer nodes containing content.” Id. at 13
(emphasis added); see also id. at 18 (“The claims of the ’452
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patent have nothing to do with segmenting video or other
data files. . . . The unconventional segmentation of the
peers containing content . . . by trace route is the claimed
invention.”). Cooperative then adds that the SAC ade-
quately pleads that Kollective’s Accused Product uses trace
routes to segment P2P networks. According to Coopera-
tive, that apparently satisfies the trace route limitation,
even though the SAC “never alleges using trace routes to
segment [content such as] video or other data files.” Id. at
13.
The problems with Cooperative’s appellate arguments
are almost too numerous to count. They begin with Coop-
erative’s characterization of its claims, which is newly
minted on appeal and contradicts what Cooperative itself
previously persuaded this court its claims mean. Coopera-
tive’s arguments to us also conflict with its allegations in
the SAC and the intrinsic patent evidence. The district
court did not err by dismissing the SAC or abuse its discre-
tion by refusing to allow yet another opportunity to amend.
A
“[C]ourts of appeals generally should not consider is-
sues not decided below.” Forshey v. Principi, 284 F.3d
1335, 1355 (Fed. Cir. 2002) (en banc). As we explained
nearly thirty years ago:
This is an appellate court. By and large, it is our
place to review judicial decisions . . . reached by
trial courts. No matter how independent an appel-
late court’s review of an issue may be, it is still no
more than that – a review. With a few notable ex-
ceptions, such as some jurisdictional matters, ap-
pellate courts do not consider a party’s new theories,
lodged first on appeal. If a litigant seeks to show
error in a trial court’s overlooking an argument, it
must first present that argument to the trial court.
In short, this court does not “review” that which
was not presented to the district court.
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Sage Prods., Inc. v. Devon Indus., Inc., 126 F.3d 1420, 1426
(Fed. Cir. 1997) (emphasis added).
These principles of appellate litigation are so well set-
tled, and usually so well understood, that we rarely see
them violated as flagrantly as Cooperative has done so
here. Cooperative’s briefs emphasize its newfound view
that the trace route limitation of claims 1 and 5 pertain to
segmenting networks or peer nodes, rather than segment-
ing content. However, as even Cooperative was forced to
concede, it never presented this theory to the district court.
See Oral Arg. at 13:00-15 (“To that extent, yes, Your Honor,
then they are new arguments.”).2
To the contrary, on remand after Cooperative I, Coop-
erative alleged in its SAC – just as it had in its earlier com-
plaints and first appeal – that “[t]he ’452 patent claims all
require segmenting the digital content according to the
trace routes.” J.A. 819-20; J.A. 192. Nowhere does the SAC
allege that the claims instead require segmenting the net-
works using trace routes.
Cooperative attempts to defend itself by urging us to
view its newly crafted theory as “still consistent with” what
it argued to the district court. Oral Arg. at 13:00-15. Even
if this were true (and it is not, as we explain below, see infra
III.B), “the general rule that new arguments will not be de-
cided in the first instance on appeal” is not limited to argu-
ments that are inconsistent with those that were made to
the trial court. Golden Bridge Tech., Inc. v. Nokia, Inc., 527
F.3d 1318, 1323 (Fed. Cir. 2008); see also Sage Prods., 126
F.3d at 1426.
“Issues not properly raised before the district court are
waived on appeal.” Stauffer v. Brooks Bros. Grp., 758 F.3d
2 Oral argument recording available at
https://www.cafc.uscourts.gov/oral-arguments/24-
1550_12032025.mp3.
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1314, 1322 (Fed. Cir. 2014). Cooperative did not present to
the district court its contention that the trace route limita-
tion requires use of trace routes to segment networks.
Therefore, this argument is waived. Thus, we must affirm.
B
In addition to being waived, Cooperative’s new charac-
terization of the trace route limitation contradicts the posi-
tion it advocated previously, and successfully, in prior
proceedings in this same case. Whereas in Cooperative I,
Cooperative succeeded in persuading us that the trace
route limitation required the use of trace routes to segment
content, now it seeks to persuade us instead that trace
routes do not need to be used to segment content. Cooper-
ative is estopped from pressing this latter position.
As we observed in Cooperative I, “Cooperative asserted
below [in the FAC] and on appeal that ‘[t]he ’452 patent
claims all require segmenting the digital content according
to the trace routes.’” 50 F.4th at 133 (quoting J.A. 192 (FAC
¶ 18)) (emphasis added). We agreed with Cooperative, ex-
pressly concluding that “Claim 1 requires the content seg-
mentation to be based on trace route.” Id. at 134 (emphasis
added; internal quotation marks and ellipses omitted); see
also id. (“[D]istribution of the content in the system must
occur through content segmentation.”). Indeed, this was
one of the bases on which Cooperative prevailed on appeal.
“Where a party assumes a certain position in a legal
proceeding, and succeeds in maintaining that position, he
may not thereafter, simply because his interests have
changed, assume a contrary position.” New Hampshire v.
Maine, 532 U.S. 742, 749 (2001) (internal quotation marks
and brackets omitted). This is the doctrine of judicial es-
toppel. Id.; see also CRV Enters., Inc. v. United States, 626
F.3d 1241, 1248 (Fed. Cir. 2010). Cooperative is judicially
estopped from arguing that its claims do not require use of
trace routes to segment content. Thus, again, we must af-
firm.
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C
Cooperative’s new interpretation of the trace route lim-
itation is also meritless. The claims expressly require that
“content segmentation is based on [among other things]
trace route.” ’452 pat. at 10:49-50; see also id. at 10:42-45
(“wherein the at least one content delivery server computer
is operable to . . . use the trace route to segment requested
content”); id. at 11:14-16 (“the at least one content delivery
server computer segmenting requested content based on
. . . trace route”).
The prosecution history shows the same. In fact, in the
SAC, Cooperative itself unambiguously alleged that “the
patentee argued to the U.S. Patent Office . . . that the
claims use [trace routes] to further segment the actual con-
tent being delivered” and that “using trace route to segment
requested content” was novel. J.A. 817 (emphasis added);
see also Cooperative I, 50 F.4th at 135 (pointing to Cooper-
ative’s statements in prosecution history pertaining to us-
ing trace routes in segmenting content).
The intrinsic evidence, then, confirms what Coopera-
tive has itself argued until this appeal, and what we have
held to be the meaning of the trace route limitation: the
claims of the ’452 patent require the use of trace routes to
segment content.3 Because Cooperative’s newfound
3 We agree with the district court that the SAC fails
to adequately allege that Kollective’s Accused Product
meets the trace route limitation as properly understood,
i.e., as requiring the use of trace routes to segment content.
The closest the SAC comes is a single allegation for each
claim that the Accused Product utilizes trace routes to
“gather key information.” J.A. 823-24, 830 (“The agents in
the mesh are constantly aware of their network surround-
ings. Utilizing pings and traceroutes, they gather key
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characterization of the trace route limitation lacks merit,
we must affirm.
D
Cooperative requests leave to amend to file what would
be its fourth complaint in this matter. The district court
found that Cooperative’s inability to cure previously iden-
tified deficiencies made it appropriate not to offer Cooper-
ative another chance to replead, and that any amendment
would be futile. Neither of those determinations was an
abuse of discretion because, as the Ninth Circuit has often
said, futility and the “repeated failure to cure deficiencies
by amendments previously allowed” justify denying leave
to amend. Leadsinger, Inc. v. BMG Music Pub., 512 F.3d
522, 532 (9th Cir. 2008); see also Cervantes v. Countrywide
Home Loans, Inc., 656 F.3d 1034, 1041 (9th Cir. 2011) (“Alt-
hough leave to amend should be given freely, a district
court may dismiss without leave where a plaintiff’s pro-
posed amendments would fail to cure the pleading deficien-
cies and amendment would be futile.”). We therefore
affirm the district court’s dismissal with prejudice.
IV
We have considered Cooperative’s remaining argu-
ments and find them unpersuasive.4 Accordingly, for the
information about the surrounding network by monitoring
the location of other agents and constantly gauging how lo-
cal area links are performing.”). As the district court cor-
rectly concluded, the mention of “traceroutes” in this
allegation does not relate to “content segmentation” but,
instead, to “gather[ing] key information.” J.A. 8 (internal
quotation marks omitted).
4 The district court additionally held that Coopera-
tive “pled away from its theory that the Accused Product
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foregoing reasons, we affirm the judgment of the district
court.
AFFIRMED
Costs
Costs to Kollective.
infringes on the claimed unconventional method of seg-
menting content based on a trace route,” J.A. 9 (citing Bot
M8, 4 F.4th at 1354), given that the SAC alleged that “Kol-
lective[’s] SD ECDN relies on conventional protocols that
segment video files,” and “segmentation is conventionally
used when streaming video files.” J.A. 825; see also J.A.
817-18. Because we have found the other deficiencies dis-
cussed in this Opinion are dispositive of this appeal, we do
not assess whether this is yet another fatal failing.
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