Backertop Licensing LLC v. Exaktime Innovations Inc

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Backertop Licensing, LLC (Texas)
  • Defendant: Exaktime Innovations, Inc. (California)
  • Plaintiff’s Counsel: Murthy Patent Law Inc
• Case Identification: 2:22-cv-08571, C.D. Cal., 02/03/2023
• Venue Allegations: Venue is alleged to be proper because the Defendant is a California corporation that resides in, maintains its principal place of business in, and has committed alleged acts of infringement in the Central District of California.
• Core Dispute: Plaintiff alleges that Defendant’s Mobile-Time clock mobile application infringes patents related to using wireless beacons to detect a mobile device's physical location and conditionally grant network access based on the disabling of specified applications.
• Technical Context: The technology concerns location-based access control, where an entity can enforce policies on mobile devices—such as disabling certain software—as a prerequisite for allowing those devices to connect to a local network.
• Key Procedural History: The complaint highlights the prosecution history of the parent ’385 Patent, noting a November 5, 2015 non-final rejection where the patent office allegedly found that the prior art did not disclose the key step of authorizing network access in response to an application being disabled. The Plaintiff presents this as evidence of the patents' inventive concept and validity.

Case Timeline

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

U.S. Patent No. 9,332,385 - "Selectively providing content to users located within a virtual perimeter," issued May 3, 2016

The Invention Explained

• Problem Addressed: The patent's background describes a growing disparity in user engagement between mobile applications and mobile web browsers, noting that native applications typically provide a superior experience by storing resources locally and avoiding the lag time of web servers (Compl. ¶26; ’385 Patent, col. 1:12-24). This context sets up the problem of how to provide and control network services in a location-specific, application-centric environment.
• The Patented Solution: The invention proposes a system for controlling network access at a specific physical location. It uses wireless beacons to identify a mobile device's presence within a "virtual perimeter" (’385 Patent, Fig. 1). Upon detection, a server sends a message to the mobile device, instructing it to disable at least one application. Only after the mobile device sends a response confirming that the application has been disabled does the system authorize the device to "establish presence on a network maintained for the physical location" (’385 Patent, Abstract; col. 2:1-8).
• Technical Importance: The described method allows a location owner (e.g., a business) to enforce device-level policies as a condition for granting network access, thereby controlling the software environment of devices using its local network (’385 Patent, col. 9:8-21).

Key Claims at a Glance

• The complaint asserts independent method claim 1 and independent system claim 8 (Compl. ¶¶14, 24-25).
• Independent Claim 1 (Method): The essential elements include:
  • identifying a mobile device's physical location based on wireless communication with a beacon;
  • communicating a message to the device specifying at least one application to be disabled;
  • responsive to receiving a response from the device indicating the application is disabled;
  • authorizing the device to establish presence on a network for that physical location.
• Independent Claim 8 (System): Recites a system with a processor programmed to perform the steps of method claim 1.

U.S. Patent No. 9,654,617 - "Selectively providing content to users located within a virtual perimeter," issued May 16, 2017

The Invention Explained

• Problem Addressed: As a continuation of the '385 Patent, the '617 Patent addresses the same technical problem of providing location-based, application-aware network access control (’617 Patent, col. 1:12-28; Compl. ¶44).
• The Patented Solution: The invention is embodied as a computer program product on a non-transitory storage medium. The stored program code, when executed by a processor, performs the same core method as the '385 Patent: identifying a device’s location via a beacon, sending a command to disable an application, receiving confirmation, and then authorizing network presence (’617 Patent, Abstract; Compl. ¶43).
• Technical Importance: This patent protects the software implementation of the access-control method described in the parent patent, covering the program code itself rather than just the method or system (’617 Patent, col. 2:30-47).

Key Claims at a Glance

• The complaint asserts independent claim 1, which is a computer program product claim (Compl. ¶¶33, 43).
• Independent Claim 1 (Computer Program Product): The essential elements comprise program code executable to perform a method of:
  • identifying a mobile device's physical location based on wireless communication with a beacon;
  • communicating a message to the device specifying at least one application to be disabled;
  • responsive to receiving a response from the device indicating the application is disabled;
  • authorizing the device to establish presence on a network for that physical location.

III. The Accused Instrumentality

Product Identification

The accused instrumentality is Defendant's "Mobile-Time clock mobile application" ("the Accused Product") (Compl. ¶11).

Functionality and Market Context

• The complaint alleges the Accused Product is a mobile application for time-keeping, available on platforms like the Google Play store and the Apple App store (Compl. ¶11).
• The complaint does not provide sufficient detail for analysis of the Accused Product's specific technical operation. The infringement theory implies that the application uses location-detection to enable or disable functionality (e.g., clocking in or out) based on whether an employee is at a designated job site.

IV. Analysis of Infringement Allegations

The complaint alleges that the Accused Product infringes the '385 and '617 Patents but does not include claim charts or map specific product features to claim limitations within the body of the complaint. Instead, it references Exhibits B and E, which are described as exemplary claim charts but were not filed with the complaint provided for analysis (Compl. ¶¶14, 33). No probative visual evidence provided in complaint.

Based on the complaint's narrative, the infringement theory appears to be that the Defendant's system (server and mobile app) performs the patented method. This raises several points of potential contention that will likely be central to the dispute.

Identified Points of Contention

• Technical Question: The claims require identifying location based on communication with a "beacon." The patent specification primarily discusses this in the context of dedicated hardware like a Bluetooth Low Energy (BLE) transmitter (’385 Patent, col. 3:62-65). A key question is whether the Accused Product’s location-detection method, which may rely on GPS or Wi-Fi-based geofencing rather than dedicated beacons, falls within the scope of this term.
• Scope Question: The claims require communicating a message "specifying at least one application to be disabled" and receiving a response that it "is disabled" as a prerequisite for network authorization (’385 Patent, cl. 1). It is unclear from the complaint how a single time-clock application performs this step. A central dispute may be whether enabling one feature (e.g., clock-in for Site A) while other features are unavailable (e.g., clock-in for Site B) can be construed as "disabling" an "application."
• Scope Question: The claims culminate in "authorizing... to establish presence on a network maintained for the physical location" (’385 Patent, cl. 1). The patent specification provides examples of this, such as gaining access to a local Wi-Fi network (’385 Patent, col. 5:25-35). It raises the question of whether the Accused Product’s functionality—which may only involve authorizing communication with its own backend server—satisfies this limitation, or if the claim requires a broader grant of network connectivity.

V. Key Claim Terms for Construction

"at least one beacon"

• Context and Importance: This term's construction is fundamental to the infringement analysis. If construed narrowly to require specific hardware, it may be difficult for the Plaintiff to prove infringement if the Accused Product uses general-purpose technologies like GPS or Wi-Fi for location.
• Evidence for a Broader Interpretation: The claims do not define "beacon." Plaintiff may argue that any wireless signal source used to define a virtual perimeter for location detection meets the term's plain and ordinary meaning.
• Evidence for a Narrower Interpretation: The specification provides a specific example: "the beacon 120 can include a Bluetooth® low-energy (BLE) transmitter or transceiver" (’385 Patent, col. 3:63-65). A defendant may argue this exemplary embodiment limits the term to dedicated, short-range hardware transmitters.

"at least one application to be disabled"

• Context and Importance: Practitioners may focus on this term because the Accused Product is a single application, and it is not apparent from the complaint that it disables itself or other applications. The viability of the infringement claim may depend on whether disabling a feature within an application satisfies this limitation.
• Evidence for a Broader Interpretation: The claim language recites "at least one application" and does not explicitly require it to be a separate application from one that might be granted access or enabled.
• Evidence for a Narrower Interpretation: The specification provides examples of disabling distinct applications, such as "image/video capture applications" or "media playback applications (e.g., YouTube™)" (’385 Patent, col. 10:60-64, col. 10:25-30). This suggests the invention was conceived to control separate programs on a device, not internal features of a single program.

"establish presence on a network"

• Context and Importance: The definition of this term will determine what type of network access the accused system must provide. This is critical for comparing the Accused Product's function to the claimed invention.
• Evidence for a Broader Interpretation: Plaintiff may argue that authorizing communication with any network, including the Defendant's own proprietary server network for time-tracking data, meets this limitation.
• Evidence for a Narrower Interpretation: The specification repeatedly frames the invention in the context of providing access to a general-purpose network at a physical location, such as a "local area network (LAN)" or a "WiFi™ network," which could then provide a user with an "Internet connection" (’385 Patent, col. 5:25-35; col. 9:36-40). This may support a narrower construction requiring more than just application-specific server communication.

VI. Other Allegations

Indirect Infringement

The complaint includes boilerplate allegations of induced and contributory infringement, stating Defendant induces "users and retailers" and contributes to infringement through the "use and/or importation" of the Accused Product (Compl. ¶¶15-16, 34-35). The complaint does not plead specific facts to support the knowledge and intent elements of these claims, such as referencing user manuals or marketing materials that instruct on infringing use.

Willful Infringement

The complaint does not use the word "willful" but requests damages under 35 U.S.C. § 284 and attorneys' fees under § 285, which are remedies associated with findings of willful infringement and exceptional cases (Compl. ¶¶18, 37; Prayer for Relief ¶¶d, g). No specific facts alleging pre- or post-suit knowledge of the patents are pled to support willfulness.

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

• A core issue will be one of definitional scope: can the term "beacon," exemplified in the patent as a specific BLE hardware device, be construed to cover the GPS or Wi-Fi-based geofencing systems commonly used in modern mobile applications for location detection?
• A key evidentiary question will be one of functional equivalence: does the Accused Product, a single time-tracking application, perform the claimed step of "disabling" an "application" as a precondition for network access, or is there a fundamental mismatch between its operation and the patent's disclosure, which contemplates disabling distinct, separate software programs?
• The outcome may also hinge on claim construction: does the phrase "establish presence on a network" require granting broad access to a local network (e.g., Wi-Fi) as described in the patent's embodiments, or is it satisfied by the more limited act of authorizing an application to communicate with its own backend server?