RPX Weekly Newsletter

An Update on Patent Litigation, the Patent Marketplace, and New Cases

Monday, April 16, 2018

Patent Litigation Feature

VirnetX Awarded $502.6M in Trial Against Apple over Claims Cancelled by PTAB

A Texas jury has issued a verdict for VirnetX Inc., finding that Apple infringed claims from four patents through certain versions of the FaceTime and VPN on Demand features offered on iOS and macOS devices (6:12-cv-00855). The April 10 verdict also included a damages award of $502.6M, while a second verdict issued on April 12 included a finding of willfulness. However, all of the claims that Apple was found to infringe have been invalidated by the Patent Trial and Appeal Board (PTAB) in inter partes reviews (IPRs) filed by Apple and other parties, with two of the patents also invalided through reexamination. Appeals of those decisions are currently pending before the Federal Circuit.

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Patent Watch

Dominion Acquires Another Portfolio from Intellectual Ventures, This One Originating with NEC

On April 10, the USPTO made public an assignment of over 400 patent assets from Intellectual Ventures LLC (IV) to Vista Peak Ventures, LLC, an affiliate of Dominion Harbor Enterprises, LLC. This transfer appears to be part of a larger transaction announced by Dominion in February, involving over 1,200 US and foreign LCD patents originating with NEC. Last month, Dominion announced that it had acquired from IV a portfolio of nearly 1,000 patents developed by American Express. Also in March, a Dominion affiliate (Monument Peak Ventures, LLC) began a campaign asserting former Kodak patents received from IV.

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Carbon Black Settles with Finjan for $3.9M, Finjan’s CEO Says More Deals Are in the Pipeline

Cybersecurity company Carbon Black filed for an IPO on April 9—the same day that Finjan Holdings, Inc. announced that it had entered into a patent license and settlement agreement with the company. According to an 8-K filed by Finjan, Carbon Black has agreed to pay Finjan $3.9M in license fees; further, upon acquisition of Carbon Black, or acquisitions by the company, additional one-time payments, equal to 8% of the gross revenue of certain qualifying products for the four concluded quarters preceding the acquisition, will be due to Finjan. The agreement resolves a patent infringement suit filed by Finjan against Carbon Black on March 21. It also follows a string of multi-million dollar settlements in Finjan’s anti-malware campaign, including one signed in Q1 with Symantec for up to $110M. Finjan reports having licensed its portfolio to more than 20 companies to date, generating over $350M in licensing fees; it has also indicated to investors that more such deals are in the works.

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March 2018 RPX Acquisitions Update

RPX completed a number of acquisitions on behalf of its patent risk management network in March 2018, obtaining rights to the patents involved either to end litigation against its members or to prevent it in the first place. Acquisitions occurred within the E-Commerce and Software, Semiconductors, and Consumer Electronics and PCs market sectors.

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New Patent Litigation

As ITUS Pivots to Cancer Diagnostics, Its Sub Continues Legacy Patent Assertion Against Cisco and Microsoft

In the summer of 2015, publicly traded NPE ITUS Corporation, announced executive changes and a new focus for the company’s future business: cancer diagnostics. This past November, ITUS continued its apparent pivot away from patent assertion, forming a new subsidiary to develop “immuno-therapy drugs against cancer”, revealing an initial focus on ovarian cancer, and indicating that the company will remain engaged in “limited patent licensing activities in the area of encrypted audio/video conference calling” only as part of its “legacy operations”, which would not “require material financial resources or attention of senior management”. Nevertheless, this past week, ITUS subsidiary Meetrix IP, LLC filed separate lawsuits against Cisco (1:18-cv-00309) and Microsoft (1:18-cv-00310), targeting the defendants’ WebEx and Skype (and Skype for Business) products, respectively, each with three patents from its “encrypted audio/video conference calling” portfolio.

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New NPE Asserts Former Customedia Patent Against Retailers Using Contactless Payment Systems

Vindolor, LLC has launched a new litigation campaign, filing four separate suits against retailers Buc-ee’s (6:18-cv-00104), Euromarket Designs (d/b/a Crate & Barrel) (6:18-cv-00105), Retail Services & Systems (d/b/a Total Wine & More) (6:18-cv-00108), and Spec’s Family Partners (d/b/a Spec’s Wine, Spirits & Finer Foods) (6:18-cv-00107) over their use of NFC-enabled point-of-sale terminals offering contactless payments. The NPE alleges infringement through the accused terminals’ compatibility with “Microsoft Wallet, Wells Fargo Wallet, Masterpass, Samsung Pay, Android Pay, Google Pay, Google Wallet, Apple Pay, and PayPal mobile” as used with various Android, iOS, and/or Windows smartphones and related mobile apps.

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Microsoft Games, Game Engines, Gaming Consoles, and Gaming Computers Now Targeted in Wake of Apparent EA Settlement

Infernal Technology, LLC, as exclusive licensee, and Terminal Reality Inc., as patent owner, have sued Microsoft (2:18-cv-00144) over the same two patents at issue in the case that the two Texas plaintiffs brought against Electronic Arts (EA) in September 2015. The asserted patents generally relate to lighting and shadowing in computer graphics, with the plaintiffs accusing Microsoft of infringement through the provision of Xbox consoles and Surface computers, along with a variety of games and game engines used to develop them. EA filed a motion to change venue (on which the district court never ruled), objections to an order construing disputed claim terms (which the district court overruled), and multiple petitions for inter partes review (IPR) (which resulted in final written decisions that did not cancel any of the challenged claims), all before the case against it was dismissed with prejudice, in light of apparent settlement, in January 2018.

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Fractus Sues US Wireless Carriers over Base Station Antennas

Barcelona-based Fractus SA has opened up a new litigation campaign, suing US wireless carriers AT&T (AT&T Mobility) (2:18-cv-00135), SoftBank (Sprint) (2:18-cv-00136), Deutsche Telekom (T-Mobile) (2:18-cv-00137), and Verizon (Cellco Partnership d/b/a Verizon Wireless) (2:18-cv-00138) in separate cases filed in the Eastern District of Texas. Each complaint asserts the same ten patents, seven from a family that Fractus characterizes as the “Fractus Multiband Array Patents” and three from a family characterized as the “Fractus Slim Triple Band Patents”. At issue in the cases are high-performance antennas sourced from “manufacturers like Amphenol, Kathrein, CommScope, and RFS” and allegedly incorporated into cellular base stations deployed throughout the carriers wireless networks.

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Korean Plaintiff Sues Apple and Samsung over Mobile Device Touchscreen Activation in New California Campaign

Inventor-controlled Firstface Co., Ltd., an entity formed and based in the Republic of Korea, has launched a US litigation campaign, suing Apple (5:18-cv-02245) and Samsung (5:18-cv-02243) in the Northern District of California. The complaint against Apple asserts three related patents, broadly concerning mobile devices with touch screen displays that can be turned on and off by, for example, authentication of a fingerprint or pressing an “activation button” separate from both the power button and the display itself, while only one of those three patents is asserted in the complaint filed against Samsung. The accused products are various smartphones and tablets made and sold by the defendants.

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Monument Affiliate Pivots from Apple’s Siri to Microsoft’s Cortana

Portal Communications, LLC, an affiliate of monetization firm Dominion Harbor Enterprises, LLC, has filed suit against Microsoft (2:18-cv-00140), accusing the company of infringing three patents generally related to returning search results responsive to both spoken prompts and location information. The accused products are “mobile phones, fitness devices, tablets, and/or other computing devices” that use Microsoft’s Cortana digital assistant for, among other things, “voice-searching”. This new case follows short-lived litigation of the same three patents, asserted against Apple in a case that was filed on March 8, 2018 and dismissed without prejudice five days later.

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Uniloc Launches Two More Campaigns, Targeting Software Update and Anti-Theft Measures in Apple Products

Uniloc Corporation Pty. Limited’s barrage of litigation against Apple continues unabated. Its subsidiaries Uniloc Luxembourg S.A. and Uniloc USA, Inc. (collectively, Uniloc) have filed two new cases against the tech giant, one (1:18-cv-00293) asserting a patent generally related to blocking the normal operation of a “mobile radiotelephony device” under certain circumstances, and the other (1:18-cv-00296) to managing the reconfiguration of an electronic device. Uniloc acquired both patents from publicly traded NPE Pendrell Corporation, which sold hundreds of patent assets from its “Pendragon” portfolio (held by subsidiary Pendragon Wireless LLC) to Uniloc earlier this year. The transaction appears to be the divestiture that Pendrell described in a February SEC filing as comprising “patents related to cellular and digital wireless devices and infrastructure” from multiple sources, including Electronics and Telecommunications Research Institute (ETRI), IBM, and Philips.

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Cypaleo Keeps Campaign Alive After Recent Entry of Default Judgment

Cypaleo LLC, an affiliate of prolific patent monetization firm IP Edge LLC, has kept its sole litigation campaign alive with a suit filed against VOXX (1:18-cv-00537) in the District of Delaware. The complaint asserts the same former Xerox patent, generally related to a networked device for monitoring a machine, the device having multiple communication interfaces, at issue throughout this campaign. VOXX is accused of infringement through the provision of “interactive communication devices”, with Cypaleo calling out the Jensen VM9216BT in-dash multimedia receiver.

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