Patent Risk Digest

February 2017

A monthly update on market activity, legal developments, and policy related to patent litigation
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Cross-sector Threat: QR Code Technology

Across virtually all industries, companies that use “QR codes”—“quick response” codes akin to UPC codes seen on product packaging—continue to get assaulted by patent infringement suits. In the past two months alone, plaintiffs accused more than two-dozen companies of patent infringement, bringing the running total to more than 115 sued over the past 12 months for using QR codes in advertising. Defendants range from food, clothing, and other product retailers to financial services companies, hotels, insurance companies, and consumer product manufacturers.

Many companies use QR technology to link customers to information, event and airline tickets, coupons, or merchandise. A campaign of suits by Symbology Innovations, LLC—an affiliate of the prolific patent troll Leigh M. Rothschild—claims infringement of patents involving use of a mobile device to take a picture of an object having “symbology”. In another recent campaign, Reflection Code LLC alleges infringement of three “bar code” patents.

Suits Over Home Security Tech Hit Other Industries

In a campaign ongoing since 2015, an affiliate of patent troll Empire IP LLC—Script Security Solutions LLC—has filed seven new cases. The suits mark Script’s third wave of such litigation, this time accusing home security companies or their suppliers of infringing patents generally related to portable alarm system functionality, wireless communications, and sensors. Other types of companies targeted in earlier waves of suits include not just security system providers but also retailers and communications companies.

Script’s is not the only litigation focused on this hot, Internet of Things (IoT) technology. Leigh M. Rothschild in December added defendants in a similar campaign that has now hit nearly three-dozen companies. Home security system companies, media, and mobile communications and device companies of various sizes have all been accused of infringing a family of patents that generally concern sharing images over a wireless network, photo sharing platforms, and networked cameras.

Mobile, Wireless Patents Continue to Fuel Litigation

For years, the area of mobile communications and mobile devices has provided seemingly endless fodder for patent trolls to sue manufacturers and end users for infringement. That trend appears to be continuing in 2017.

In January alone, 10 litigation campaigns focusing on mobile communications and mobile devices gained momentum. The most notable matters cover a wide range of technologies and products:

A patent monetization company, Seatoun Media LLC brought a single suit over a voice messaging It's just one case for now, but the plaintiff could be testing the waters for further assertion.

  • Display Technologies, LLC brought four new suits targeting makers of WiFi-enabled digital cameras and related image transfer apps.
  • IPA Technologies Inc. brought new litigation over speech recognition
  • Kevique Technology LLC filed another wave in its long-running litigation over technology used in devices with touchscreens and orientation sensors.
  • A wide-ranging campaign targeting digital watermarking technology continued to grow, with Blue Spike LLC adding another defendant in January. The latest suit specifically targets the defendant’s routers and switches, as well as a variety of network management software and services.

Got Software? Get Prepared

The most targeted technologies in patent infringement suits traditionally have been those related to E-commerce and software—comprising 36% of all litigation brought by patent trolls (the rest is spread across more than a dozen other sectors).

But the most prolific patent troll of 2016 (as measured by number of suits filed) seems to have taken particular interest in SaaS (software-as-a-service) companies, targeting makers and providers of CRM (customer relationship management) software and cloud storage and file sharing solutions, to name a few. Some of the most recent activity:

Plaintiff: Mozly Tech LLC

Focus: CRM and Contact Management Software

In 2015 this affiliate of leading patent troll IP Edge sued providers of CRM software in its first wave of litigation. All but one of the nearly dozen defendants settled. Mozly filed a new wave of litigation against CRM software providers in November 2016, but also targeting mobile device manufacturers and wireless carriers with the same patents.

Plaintiff: Serenitiva LLC

Focus: CRM Software

Another IP Edge affiliate, this entity acquired the patent at issue and began a campaign in November 2016, suing various developers of CRM solutions. Unlike Mozly, though, it has also gone after end users—including those in the financial services, entertainment, and healthcare, lifestyle, and medical device sectors.

Plaintiff: Uniloc

Focus: Software Licensing and Delivery

This Australian patent troll began a campaign in April 2016, and has targeted both SaaS providers and well as a variety of desktop software developers of varying size. Most of the cases have ended with companies agreeing to settle.

Plaintiff: Micoba LLC

Focus: Cloud Storage and File Sharing

Again, IP Edge is the parent of this patent troll focusing on large and smaller providers of cloud storage solutions. Micoba began filing litigation toward the end of 2016 and has sued 11 companies over various file sharing services. In this campaign, it’s likely that IP Edge will follow its usual sue-and-settle pattern, with additional defendants in reserve for later waves of litigation. The patents in these cases generally involve file-sharing services.

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