Uniloc USA, Inc. et al v. ADP, LLC CAFC

The Federal Circuit has breathed new life into a campaign begun by Uniloc Corporation Pty. Limited in April 2016—before the Australian NPE began ramping up its litigation activity in 2017, before it acquired the large portfolio of patents from Pendrell Corporation in early 2018, and before it transferred control over its patent assets to Fortress Investment Group LLC in May 2018. Throughout 2016 and 2017, Uniloc accused a wide range of defendants of infringing up to four patents, sourced from IBM, through their software licensing and delivery systems. Multiple decisions in the Eastern District of Texas, however, invalidated all four patents under Alice, stopping the campaign in its tracks. Now, in a May 24, 2019 nonprecedential opinion, the Federal Circuit has reversed the district court as to two of those patents while affirming the invalidity of the other two. The case has been remanded back to Texas for further proceedings in the underlying cases, filed against ADP, Big Fish Games, BitDefender, and Kaspersky Lab, but the decision could revive litigation dropped as to other defendants as well.

In October 2017, the Patent Trial and Appeal Board (PTAB) saw the filing of petitions for inter partes review (IPR) against a variety of frequent litigants, including publicly traded NPEs Acacia Research Corporation and Xperi Corporation, as well as privately held Monument Patent Holdings, LLC and Uniloc Corporation Pty. Limited. The Board also instituted trial in October for IPRs against multiple Acacia subsidiaries, Uniloc, and Papst Licensing GmbH & Company Kg. In addition, the PTAB issued an IPR final decision cancelling multiple claims from a data compression patent held by prolific plaintiff Realtime Data LLC, including the single claim that Riverbed Technology (one of the petitioners for the IPR) was found to infringe in a $4.3M verdict in May, with other final decisions issued in campaigns waged by TQ Delta LLC and publicly traded Quarterhill Inc. IPRs against IP Bridge, Inc. and Mobile Telecommunications Technologies, LLC also ended in termination in October after the patent owners requested adverse judgments.

In September 2017, the Patent Trial and Appeal Board (PTAB) saw more than ten petitions filed in NPE campaigns involving networking and related technologies such as cybersecurity, including those waged by publicly traded Finjan Holdings, Inc.; prolific private litigant Realtime Data LLC; and Oyster Optics, LLC. Trial was instituted in September for an inter partes review (IPR) against Finjan and in IPRs against other frequent plaintiffs, including MyMail, Ltd. and Sound View Innovations, LLC. The Board issued final decisions in two covered business method (CBM) reviews against Uniloc Corporation Pty. Limited, the first AIA reviews against the NPE to reach final decisions since March 2016, and only the fourth to date. The PTAB also issued final decisions in IPRs against publicly traded Document Security Systems, Inc. as well as Acceleration Bay, LLC; Mobile Telecommunications Technologies, LLC; and Personalized Media Communications, LLC; among other NPEs.

The case brought by Uniloc USA, Inc. and Uniloc Luxembourg S.A. (collectively, “Uniloc”) against Big Fish Games has been transferred from the Eastern District of Texas (2:17-cv-00172) to the Western District of Washington (2:17-cv-01183) by joint stipulation. Although Uniloc agreed to the transfer in this instance, its overall behavior in the wake of TC Heartland has bucked the general trend in which NPEs have either ridden the wave of transfers from Texas or shifted their efforts elsewhere. Many NPEs have increasingly avoided the Eastern District of Texas in new filings while either conceding to venue challenges or dismissing and re-filing existing cases in other venues, with early favorites including the District of Delaware, the Northern District of Illinois, and the Northern District of California. Uniloc, by contrast, has continued to file litigation in the Eastern District of Texas and has shown a greater willingness to push back against venue motions.

The Patent Trial and Appeal Board (PTAB) continued to see petitions for AIA review filed against prolific litigants in July, including a wave of petitions against Uniloc Corporation Pty. Limited across four separate campaigns, with petitions also brought against General Patent Corporation, Intellectual Ventures LLC (IV), Papst Licensing GmbH & Company Kg, and Quarterhill Inc. Meanwhile, throughout July, the Board instituted trial for inter partes reviews (IPRs) filed in semiconductor campaigns waged by Harvard University and the California Institute of Technology, with trial also instituted in campaigns related to network data compression (Realtime Data LLC), servers and data management (IV), and anti-malware technology (Finjan Holdings, Inc.). Final decisions issued by the Board in July included one that cancelled claims from a patent that has been asserted by Rothschild Connected Devices Innovations, LLC, an NPE controlled by inventor Leigh M. Rothschild, against more than 60 defendants.

A variety of NPEs have reacted to the US Supreme Court’s decision in TC Heartland v. Kraft Foods Group Brands (2016-0341) by either dismissing and re-filing their cases in other districts or simply conceding venue challenges. In contrast, Australian NPE Uniloc Corporation Pty. Limited has further dug its heels into the Eastern District of Texas. Shortly after Uniloc filed a series of new and amended complaints against Google, designed to establish proper venue in the Eastern District, defendants in some of the NPE’s other Texas litigation filed a host of venue motions against it. On June 2, Ubisoft (2:16-cv-00745, 2:16-cv-00781) filed two motions both seeking transfer to the Northern District of California or dismissal for improper venue in litigation targeting its software licensing and notification systems, joined by a similar motion filed by Piriform on June 7 (in a consolidated action against AVG, 2:16-cv-00393) seeking dismissal or transfer to Delaware. Ubisoft filed another such motion in Uniloc’s software update campaign on June 2 (2:17-cv-00175), also seeking transfer to the Northern District of California or dismissal for improper venue, joined by another Northern District transfer/dismissal motion brought by Box (2:17-cv-00173), with campaign co-defendant Zendesk (2:17-cv-00176) filing its own motion to dismiss due to improper venue that same day.

The Patent Trial and Appeal Board (PTAB) saw a decline in petitions for AIA review filed against NPES in April 2017. While the total number of April petitions, 120, was somewhat less than the three-year monthly average of 150, NPEs were hit by 20 petitions in April, a 68.8 percent decline from 64 the previous month. The dip in April PTAB filings comes in the midst of an overall increase in PTAB petitions over the previous year, with the total number of petitions filed so far in fiscal year 2017 nearing 1,200 as of the date of this report (compared to just over 930 petitions during the same period last year). Prolific private litigants remain a regular target for PTAB petitions, with petitions filed in April against IP Edge LLC and Uniloc Corporation Pty. Limited, while Acacia Research Corporation was the only publicly traded NPE named in petitions brought during that month.

RPX took notice, among the USPTO assignment records made available during the latter part of February, of the transfer of patents from operating companies Dongbu, Eastman Kodak, Honeywell, IBM, and Koninklijke Philips to various NPEs. One of those NPEs (Uniloc Corporation Pty. Limited) has already launched a campaign asserting the patents that it received (from IBM). RPX also saw during this time the recordation of the assignment of one two-way radio patent from one litigating NPE to another (the second, an affiliate of IP Edge LLC) and the assignment of two database management patents from a Daniel F. Perez entity that asserted them in litigation back to the Georgia patent monetization firm from which that NPE acquired them.

Uniloc USA, Inc. and Uniloc Luxembourg S.A. (collectively, Uniloc) have expanded their litigation of three families of patents (6,324,578 and 6,728,766; 6,510,466 and 7,069,293; as well as 6,489,974) acquired from IBM. New complaints asserting the first four patents have been filed against ADP (2:15-cv-00741), Concur Technologies (2:15-cv-00743), and Salesforce (2:15-cv-00744), while Uniloc has filed second complaints against Ubisoft (2:15-cv-00745) and Valve (2:15-cv-00746) adding allegations of infringement of the ‘578 and ‘293 patents to April 2016 complaints asserting the ‘766 and ‘466 patents against those same defendants. The defendants’ software licensing and delivery systems (e.g. Concur’s expense management platform and mobile apps, Ubisoft’s gaming platform and apps, etc.) are at issue in the campaign. The NPE has also asserted the ‘974 patent for the first time, in separate complaints against GOG (2:16-cv-00778), Ubisoft (2:16-cv-00781), and Valve (2:16-cv-00782).