Daedalus Group LLC

Two portfolios assigned to entities tied to patent monetization professionals are worth noting this week: one from the same source as that chip packaging portfolio highlighted a couple of weeks ago and one to a recipient with ties that suggest that litigation over the transacted assets is coming.

Daedalus Blue LLC has filed a District of Delaware complaint against Dropbox (1:24-cv-00998), alleging infringement of three former IBM patents through the provision of various products, including the Dropbox API, Magic Pocket storage system, and Nautilus search engine. At issue are features such as the support for file management and OAuth 2.0. The plaintiff pleads that the asserted patents have been licensed to “many companies”, including Amazon, Oracle, and Dropbox itself, but that “that license expired”.

Recorded US patent assignments recently made public include several transfers of former operating company patents worth watching, including a transfer of more than 20 US assets into the hands of a newly-formed Delaware entity tied by an experienced monetization team that has run several litigation campaigns with the backing of third-party litigation funding; a transfer from the same source to another Delaware entity of uncertain management but possible connection to a prolific foreign monetization operation; and a transfer between two active NPEs of a couple of wireless communications patents received by one of them from an operating company back in April 2021. Those USPTO records also contain the divestiture of more than two dozen memory patents from an operating company and its acquired subsidiary to a recipient with suggestive ties.

Last month’s review of notable patent assignments considered the movement of assets from Avaya to Dominion Harbor Enterprises, LLC; from Level 3 Communications to Sandpiper CDN, LLC; from Seiko Epson to IPValue’s 138 East LCD Advancements Ltd. and Lumitek Display Technology Ltd.; from Transaction Security to a “BioCrypt Access”; from Fortress Investment Group LLC’s KIP Prod P1 LP to Prodea Automation LLC; from EMM Patents Ltd. to Empire IP LLC; from Siemens and Abdelsalam Helal to Rokiot USA LLC; and from Proxicom Wireless, LLC to Secure Communication Technologies, LLC. While a couple of these entities again feature prominently, this month’s review extends well beyond them to cover the movement of patents away from other operating companies, as well as within several repeat monetization players.

In August 2022, Daedalus Prime LLC, an entity associated with Daedalus Group LLC, launched its sole litigation campaign with a set of actions, one before the International Trade Commission (ITC) against MediaTek, NXP Semiconductors, certain automakers, and certain automaker suppliers; and three filed in the District of Delaware, one centered around each of MediaTek, NXP, and Qualcomm (but naming as defendants subsets of the proposed ITC respondents). Now, the plaintiff has sued MediaTek (2:24-cv-00235) alone, this time in the Eastern District of Texas. The asserted patents, described in the complaint as “relate[d] to groundbreaking improvements to microprocessor circuitry”, are broadly directed to various aspects of computer circuitry and semiconductor fabrication. The defendant is accused of infringement through the provision of devices containing microprocessors and systems-on-chip (SoCs), including certain Dimensity-series SoCs, that are based on the ARMv8.2 architecture and later.

Recently recorded patent assignments made public by the USPTO contain noteworthy transfers to multiple plaintiffs now in litigation, including a new source of patents for Apex Beam Technologies LLC, a new source of patents for Pantech Corporation, and a familiar source of patent rights for Crystal Leap Zrt, this time assigning patents directly, though. Movement can also be seen from troubled patent monetization firm IP Edge LLC, as well as movement from various sources to patent broker Allied Security Trust. Take a look.

A settlement between Daedalus Prime LLC and TSMC, noticed in mid-October in an action before the International Trade Commission (ITC), has ended the multiple district court cases between these two parties. Eastern District of Texas Chief Judge Rodney Gilstrap posted a heavily redacted order granting a joint motion to dismiss there, with a joint stipulation ending a Delaware declaratory judgment action that TSMC filed last December. TSMC’s departure from the campaign, following Samsung’s this past summer, leaves litigation to continue against Qualcomm, both before the ITC, where post-hearing briefing has gone in, and in district court, where a stay has stopped activity in favor of the ITC action.

As a noticed settlement with Samsung ripples through the campaign of Daedalus Prime LLC over former Intel patents, related litigation matters against Qualcomm and TSMC continues apace. Daedalus Prime has filed a second Eastern District of Texas complaint against TSMC (2:23-cv-00299), targeting the provision of integrated circuits and semiconductor devices that use TSMC’s 16nm and smaller technology nodes (e.g., 12nm, 10nm, 7nm, 6nm, 5nm, and 4nm), as well as products (e.g., smartphones, SoCs, and tablets) incorporating the accused TSMC devices, including those offered by Apple, Qualcomm, and Samsung. The -299 matter adds to the cases between Daedalus Prime and TSMC, including a declaratory judgment (DJ) action filed by TSMC in Delaware (1:22-cv-01647) and an investigation before the International Trade Commission (ITC) (337-TA-1336). The latter has seen a flurry of June filings, as has a separate ITC action, now (in light of the recent grant of a motion to terminate Samsung from it) to continue only against Qualcomm (337-TA-1335).

Daedalus Prime LLC has accused TSMC of infringing four former Intel patents in complaints filed before the International Trade Commission (ITC) and the Eastern District of Texas. Litigation is active before the ITC, with TSMC pursuing a license defense based on what appears to be a springing license agreement between Intel and TSMC, termed the “LOT Agreement” in certain of the parties’ papers. TSMC filed a complaint of its own, this one seeking a declaratory judgment (DJ) from the District of Delaware that would sort out whether the former Intel patents asserted against it were moved to Daedalus Prime in April 2021 (before the date of the LOT Agreement) or June 2022 (after the LOT Agreement). Both Daedalus Prime and Intel have responded to TSMC’s complaint in Delaware, while ITC discovery concerning TSMC’s license defense heats up.

Late last year, TSMC (1:22-cv-01647) filed a declaratory judgment action against Daedalus Prime LLC in the District of Delaware. The suit came in partial response to the complaints that Daedalus Prime had filed against TSMC, together with Samsung, both in September 2022, one before the Eastern District of Texas (now stayed) and another before the International Trade Commission (ITC) (now in claim construction). TSMC’s Delaware complaint was filed under seal, a redacted version of which, together with a responsive motion to dismiss from Daedalus Prime, reveals at least some of the contours of the license defense that TSMC is mounting, including what appears to be the linchpin: whether the assignment of the patents that Daedalus Prime has asserted against TSMC was effective in April 2021, before the date of a key agreement between Intel and TSMC, or thereafter, in June 2022.

This past quarter, US patents continued to spread among NPEs, including to familiar faces in patent monetization, and while some of those recipients have yet to file any litigation, several did launch new campaigns during Q3, targeting players in the Networking market sector, wireless carriers, e-commerce or software companies, and device makers, among others.

A couple of weeks after filing a flurry of complaints in both district court and before the International Trade Commission (ITC), Daedalus Prime LLC has done it again, filing three district court complaints (2:22-cv-00352, 2:22-cv-00353, 2:22-cv-00354) and two ITC complaints (337-TA-3640, 337-TA-3641). Each names Samsung as a defendant/proposed respondent, with Qualcomm named as a proposed respondent in one of the ITC complaints and TSMC, in the other. TSMC is also a district court defendant, while Qualcomm is not, although Qualcomm products are mentioned throughout. The litigation centers around a portfolio that Daedalus Prime acquired from Intel in early June 2022.

Daedalus Prime LLC has filed a complaint before the International Trade Commission (ITC), naming as proposed respondents automakers Mazda and Mercedes-Benz; infotainment system provider Visteon; chipmakers MediaTek, NXP Semiconductors, and Qualcomm; and alleged NXP distribution partners Arrow Electronics, Avnet (Newark), Digi-Key Electronics, Future Electronics, Mouser Electronics, and Rochester Electronics (337-TA-3637). Six patents are asserted in the ITC complaint, as well as in a trio of parallel District of Delaware complaints that cover the same ground, one centered around each of MediaTek (1:22-cv-01108), NXP (1:22-cv-01107), and Qualcomm (1:22-cv-01109) (but naming as defendants subsets of the proposed ITC respondents as well). Daedalus Prime’s “clear statement in plain English” in the ITC complaint of the accused products reads: “semiconductors, printed circuit boards (‘PCBs’), automotive parts including infotainment systems and instrument clusters, and automobiles”.

Recent months have seen a number of patent divestments by operating companies made public, with a range of assignees including frequent filers, publicly traded patent assertion entities, third-party funded plaintiffs, and newly formed NPEs. Divestment size has also varied widely—from a single transacted patent to thousands.

In late 2019, NPE Daedalus Group LLC acquired roughly 600 former operating company patents, moving about 500 of those assets to Daedalus Blue LLC in January 2020. Daedalus Blue immediately filed its first litigation over patents from its received portfolio, suing SZ DJI Technology (a Chinese corporation) and DJI Europe (a “European” corporation) in the Western District of Texas over drones sold in the US under the DJI brand. At that point, it looked like direct assertion might be Daedalus Blue’s primary plan, but outbound assignments throughout 2020-2021 have presented an alternate approach, cutting the NPE’s holdings in half—and a remarkable order from District Judge Alan D. Albright, just unsealed in Daedalus Blue’s drone case, suggests why directly litigating can get . . . dicey.

Earlier this month, RPX reported the launch of new campaigns by apparent IP Edge LLC plaintiffs Noblewood IP LLC, Pixeltide Pathway LLC, and Wikeshire IP LLC—each asserting a former IBM patent. Assignment records made public this week suggest that more such litigation could be coming.

Daedalus Blue LLC has sued Microsoft (6:20-cv-01152) over the provision of a variety of products (i.e., Microsoft SQL Server and Azure-series products) and features (i.e., database shipping, log shipping, etc.) allegedly related to “cloud infrastructure, cloud management, network security, database management, data processing, and data management”. The plaintiff asserts five patents, two new to the litigation and three previously in suit, against Oracle. That case was voluntarily dismissed with prejudice in July, but a third suit is active in the campaign in the Eastern District of Virginia.

Daedalus Blue LLC has sued Oracle (6:20-cv-00428) over the provision of various products related to enterprise access management, storage and backup, and virtualization. The NPE has asserted five patents from among the over 500 US assets that associated entity Daedalus Group LLC acquired from IBM late last year and passed along to Daedalus Blue in late January. This campaign is the third to arise from those divested IBM assets, the second litigated by Daedalus Blue.

The bulk of a large tranche of patents that Daedalus Group LLC picked up from IBM last fall was assigned to Daedalus Blue LLC in late January. A day later, the remainder of those assets—many of them generally related to various aspects of self-driving vehicles—was transferred to Slingshot IOT LLC, a Maryland entity created one week earlier. Daedalus Blue has already begun litigating its portion of that portfolio; given its apparent origins, Slingshot IOT may not lag by much.

The first litigation over a large portfolio of patents transferred last fall from IBM to Daedalus Group LLC has been filed in the Western District of Texas. Plaintiff Daedalus Blue LLC has accused DJI (6:20-cv-00073) of infringing three of those former IBM patents, allegedly received from Daedalus Group “on or about January 24, 2020”. DJI’s accused products are drones, with the asserted patents generally related to navigating unmanned aerial vehicles (UAVs).

According to USPTO records, IBM divested over 500 US patent assets, as well as a number of foreign counterparts in Asia, Europe, and elsewhere, to a single Delaware entity in late September 2019; at least one follow-up assignment, executed in November, has also been made public by the USPTO. The assignee appears to be controlled by a familiar name in patent monetization.