72lux Inc v. Honey Science Corp

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: 72LUX, INC. d/b/a SHOPPABLE.COM (Delaware)
  • Defendant: Honey Science Corporation (Delaware); Amber.IO, INC. d/b/a Two Tap (Delaware)
  • Plaintiff’s Counsel: Fox Rothschild LLP
• Case Identification: 2:19-cv-04544, C.D. Cal., 05/24/2019
• Venue Allegations: Plaintiff alleges venue is proper because a substantial part of the infringing acts occurred in the Central District of California, and Defendant Honey Science Corporation maintains a regular and established place of business in Los Angeles.
• Core Dispute: Plaintiff alleges that Defendants’ "Two Tap Product," a universal checkout API, infringes a patent related to systems for integrating multi-retailer e-commerce functionality directly onto third-party publisher websites.
• Technical Context: The technology enables content publishers (e.g., blogs, online magazines) to embed a universal shopping cart and checkout process on their own sites, allowing consumers to purchase products from multiple, independent retailers in a single transaction without being redirected away from the publisher's content.
• Key Procedural History: Plaintiff alleges it provided pre-suit notice of infringement to Defendant Amber.IO on October 2, 2017, and to Defendant Honey Science Corporation on April 2, 2019, following Honey's acquisition of Amber. Both defendants allegedly denied infringement but continued selling the accused product.

Case Timeline

Date	Event
2012-09-21	’563 Patent Priority Date (Provisional Application)
2017-07-04	’563 Patent Issue Date
2017-10-02	Plaintiff notifies Defendant Amber.IO of alleged infringement
2019-04-02	Plaintiff notifies Defendant Honey of alleged infringement
2019-05-24	Complaint Filing Date

II. Technology and Patent(s)-in-Suit Analysis

U.S. Patent No. 9,697,563 - System and Method For Providing Electronic Commerce Data

• Patent Identification: U.S. Patent No. 9,697,563, “System and Method For Providing Electronic Commerce Data,” issued July 4, 2017 (Compl. ¶21).

The Invention Explained

• Problem Addressed: The patent’s background section describes a challenge for digital content publishers who recommend products: they cannot easily monetize this content without either building their own complex e-commerce platforms or using affiliate marketing links that redirect users away from their site, thereby losing traffic and control over the user experience (’563 Patent, col. 1:21-38). Existing multi-retailer checkout solutions, like Amazon.com's, require the entire transaction to occur on the retailer's own platform, not the publisher's (’563 Patent, col. 1:39-48).
• The Patented Solution: The invention provides a centralized e-commerce system that acts as a "neutral hub" between merchants and publishers (’563 Patent, col. 3:38-40). The system retrieves and normalizes product data from various merchants, allowing a publisher to curate and embed product listings directly into their website's content via "merchandise frames" (’563 Patent, Abstract; col. 4:51-61). Crucially, it then generates a "universal checkout frame" on the publisher's site, enabling a consumer to purchase items from multiple different retailers in a single transaction without ever leaving the publisher's webpage (’563 Patent, col. 8:21-29).
• Technical Importance: This technology aims to provide publishers with a new monetization path that keeps users engaged on-site, a significant departure from the redirect-based affiliate model prevalent at the time (’563 Patent, col. 1:44-48).
• Analogy: The system works like a "pop-up" food court inside a single store (the publisher's website). A shopper can browse items from various independent food vendors (the merchants), add them all to one tray (the universal shopping bag), and pay for everything at a single register inside that store, rather than having to walk to each vendor's separate restaurant to pay.

Key Claims at a Glance

• The complaint asserts independent claims 1 and 10, along with one or more dependent claims (Compl. ¶26).
• Independent Claim 1 (a method claim) includes the following essential elements:
  • Retrieving merchandise data from a plurality of independent merchants.
  • Consolidating the data into a common format.
  • Storing at least one group of merchandise data formed for a specific publisher's site.
  • Embedding the group of data on the content of the publisher's site.
  • Generating and rendering one or more "merchandise frames" on the publisher's site.
  • Generating an "e-commerce frame" (i.e., a shopping bag) for a user.
  • Generating a "universal checkout frame" that includes a single order with data for at least a first and second merchandise item from different merchants, and an order summary naming both merchants.
  • Rendering the universal checkout frame directly onto the publisher's site.

III. The Accused Instrumentality

Product Identification

• The accused instrumentality is the "Two Tap Product," described as a "universal checkout product" created by Defendant Amber.IO and acquired by Defendant Honey Science Corporation (Compl. ¶¶4, 6). The product is marketed and distributed to publishers throughout the United States (Compl. ¶8). No probative visual evidence provided in complaint.

Functionality and Market Context

• The complaint alleges the Two Tap Product is a "universal checkout API" (Compl. ¶2) that enables "distributed commerce" (Compl. ¶4). The allegations suggest its functionality mirrors the patented technology by allowing consumers to complete a purchase from within a publisher's website (Compl. ¶3). The complaint alleges that the product "co-opted Shoppable's innovations" and is offered to publishers for integration into their websites (Compl. ¶¶4, 8).

IV. Analysis of Infringement Allegations

’563 Patent Infringement Allegations

Claim Element (from Independent Claim 1)	Alleged Infringing Functionality	Complaint Citation	Patent Citation
retrieving, by a processing device, merchandise data from a plurality of independent merchants which is stored in a merchandise database;	The complaint alleges the Two Tap Product provides universal checkout, which implies the retrieval of product data from multiple merchants.	¶¶3-4, 27	col. 13:35-38
consolidating the retrieved merchandise data into a common format;	The complaint alleges the Accused Product co-opted the patented technology, which includes consolidating data.	¶4, 27	col. 13:39-41
making the merchandise database available to multiple publishers;	The complaint alleges the Accused Product is marketed and distributed to multiple publishers.	¶8, 27	col. 13:42-43
embedding, by the processing device, the group of merchandise data on the content of the site of the one of the multiple publishers;	The complaint alleges the patented features include embedding merchandise data on publisher sites, a feature allegedly present in the Accused Product.	¶3, 27	col. 13:48-51
generating, by the processing device, one or more merchandise frames... [and] rendering... the one or more merchandise frames directly onto the site...	The complaint alleges the patented system involves generating a "universal checkout frame," which would be a type of merchandise frame.	¶3, 27	col. 13:52-59
generating an e-commerce frame comprising merchandise data from the group of merchandise data that is selected by a user... wherein the e-commerce frame is a shopping bag of the selected merchandise data;	This functionality is implied by the allegation that the Two Tap Product is a "universal checkout product" that performs each element of Claim 1.	¶4, 27	col. 13:60-65
generating, by the processing device, a universal checkout frame that includes: a single order of multi-merchandise data comprising first merchandise data... from a first independent merchant... and second merchandise data... from a second independent merchant... and an order summary... comprising a name of the first [and] second... merchant;	The complaint alleges the patented features include generating a "universal checkout frame" to enable a consumer to complete a purchase.	¶3, 27	col. 14:1-9

Identified Points of Contention

• Scope Questions: A primary dispute may arise over the definition of "universal checkout frame." The claim requires this frame to contain specific components: a "single order" with items from at least two distinct merchants, and an "order summary" explicitly naming those merchants. The case may turn on whether the Two Tap Product's checkout process meets these specific structural and content requirements.
• Technical Questions: The complaint makes broad allegations that the Two Tap Product "co-opted" the patented technology and "clearly performs each element of Claim 1" (Compl. ¶¶4, 27). A key evidentiary question for the court will be whether the plaintiff can produce evidence demonstrating that the accused product actually performs the internal, server-side steps of the claimed method, such as "consolidating the retrieved merchandise data into a common format."

V. Key Claim Terms for Construction

Term: "universal checkout frame"

• Context and Importance: This term appears in the final, dispositive steps of independent claims 1 and 10 and represents the core user-facing benefit of the invention. Its construction will be critical, as infringement will depend on whether the accused Two Tap Product's checkout interface and data structure fall within the scope of this term.
• Intrinsic Evidence for Interpretation:
  • Evidence for a Broader Interpretation: The specification describes the frame's function broadly as providing "the user the ability to checkout from multiple retailers within a single, universal checkout on the publisher's site" (’563 Patent, col. 8:21-25). This language focuses on the overall user experience rather than a rigid structure.
  • Evidence for a Narrower Interpretation: Claim 1 itself explicitly defines what the "universal checkout frame" must include: "a single order of multi-merchandise data" from at least two different merchants, and an "order summary of the multi-merchandise data comprising a name of the first independent merchant and a name of the second independent merchant" (’563 Patent, col. 14:1-9). Defendants may argue this language acts as a definitional constraint, limiting the term to only those checkout systems that present the order data in this precise manner.

Term: "embedding... the group of merchandise data on the content of the site"

• Context and Importance: This term is key to how the patented system integrates with a publisher's website. Whether the Two Tap Product's method of integration constitutes "embedding" as understood by the patent will be a point of contention.
• Intrinsic Evidence for Interpretation:
  • Evidence for a Broader Interpretation: The specification describes using a JavaScript library and adding an "HTML tag that includes the unique ID of the merchandise frame," which the library then uses to "render the appropriate merchandise frame" (’563 Patent, col. 5:11-24). This suggests a flexible, code-based implementation that could cover various forms of web content integration.
  • Evidence for a Narrower Interpretation: The patent consistently distinguishes its solution from simple affiliate links that redirect users (’563 Patent, col. 1:28-33). Parties may argue that "embedding" requires the data and frames to be rendered as an integral part of the publisher's page, as opposed to a simple overlay or iFrame that is less integrated with the surrounding content.

VI. Other Allegations

Indirect Infringement

• The complaint alleges that Defendants "have induced and continue to induce infringement" by making, using, selling, and offering for sale the Two Tap Product to publishers (Compl. ¶¶11, 26). The alleged inducement is based on Defendants marketing and distributing a product whose intended and ordinary use by publishers and their customers would directly infringe the ’563 Patent (Compl. ¶¶8, 26).

Willful Infringement

• The complaint alleges willful infringement based on Defendants' continued sale of the Two Tap Product after receiving actual notice of the ’563 Patent and the infringement allegations. Specific notice letters to Amber on October 2, 2017, and to Honey on April 2, 2019, are cited as the basis for pre-suit knowledge (Compl. ¶¶28-30).

VII. Analyst’s Conclusion: Key Questions for the Case

• A core issue will be one of evidentiary proof: The complaint's infringement allegations are conclusory. The case will likely depend on whether discovery reveals that the accused Two Tap Product’s backend architecture and frontend display actually perform each specific step of the asserted claims, particularly the internal data handling step of "consolidating... data into a common format" and the user-facing step of generating a "universal checkout frame" with the precise multi-merchant structure required by Claim 1.
• The case will also turn on a question of claim construction: Can the term "universal checkout frame" be interpreted broadly to cover any system allowing a single checkout from multiple retailers on a publisher's site, or will it be narrowly construed to require the specific data structure—a "single order" naming at least two distinct merchants—recited within the claim itself? The resolution of this definitional scope will be central to the infringement analysis.