DCT
8:18-cv-02054
Uniloc 2017 LLC v. Microsoft Corp
Key Events
Complaint
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: Uniloc 2017 LLC (Delaware)
- Defendant: Microsoft Corporation (Washington)
- Plaintiff’s Counsel: Feinberg Day Alberti Lim & Belloli LLP
- Case Identification: 8:18-cv-02054, C.D. Cal., 11/17/2018
- Venue Allegations: Plaintiff alleges venue is proper because Microsoft has committed acts of infringement and maintains a regular and established place of business in the Central District of California.
- Core Dispute: Plaintiff alleges that Microsoft’s enterprise video service and its software activation system infringe three patents related to filtered message access and software piracy prevention.
- Technical Context: The patents address two distinct technology areas: managing access to shared digital media to reduce information overload, and network-based methods for preventing software piracy by limiting activations.
- Key Procedural History: Post-filing Inter Partes Review (IPR) proceedings at the U.S. Patent and Trademark Office resulted in the cancellation of all claims asserted in this complaint. The IPR certificate for U.S. Patent No. 7,020,252, issued Nov. 15, 2021, cancelled claims 1-5, including asserted claim 2. The IPR certificate for U.S. Patent No. 8,613,110, issued Sep. 27, 2021, cancelled claims 1, 2, and 6, including asserted claim 1. The IPR certificate for U.S. Patent No. 7,024,696, issued Aug. 31, 2021, cancelled claims 1, 3, 4, 9, 15, 20, 24, 25, 27, 30, 31, 36 and 37, including asserted claim 24. These cancellations present a significant, and potentially dispositive, challenge to the viability of the lawsuit, pending any appeals.
Case Timeline
| Date | Event |
|---|---|
| 2000-06-14 | Earliest Priority Date for ’110 and ’696 Patents |
| 2000-09-25 | Earliest Priority Date for ’252 Patent |
| 2006-03-28 | ’252 Patent Issued |
| 2006-04-04 | ’696 Patent Issued |
| 2013-12-17 | ’110 Patent Issued |
| 2018-07-30 | Uniloc sends notice letter to Microsoft re: ’252 and ’110 Patents |
| 2018-08-08 | Uniloc sends notice letter to Microsoft re: ’696 Patent |
| 2018-11-17 | Complaint Filed |
II. Technology and Patent(s)-in-Suit Analysis
U.S. Patent No. 7,020,252 - "Group Audio Message Board," issued March 28, 2006
The Invention Explained
- Problem Addressed: The patent identifies the problem of information overload in contemporary messaging systems like internet chat rooms, where users can be "faced with hundreds or thousands of messages of little or no relevance" ('252 Patent, col. 1:50-53). This necessitates a method for specialization or restriction of content ('252 Patent, col. 1:54-56).
- The Patented Solution: The invention proposes a communal message board where each recorded message is stored with at least one "qualifying parameter," such as the geographical location of the user, time/date, or a user-supplied personal characteristic like a pastime ('252 Patent, Abstract; col. 2:31-38; col. 6:28-32). When another user attempts to access messages, the system checks their corresponding parameter and grants access only to messages with a match, thereby filtering out irrelevant content ('252 Patent, col. 2:6-14).
- Technical Importance: The technology aimed to make the burgeoning field of mobile and remote messaging more relevant and personalized for users by creating virtual communities based on shared context, such as location or interests ('252 Patent, col. 1:20-23).
Key Claims at a Glance
- The complaint asserts independent claim 2 ('Compl. ¶¶15, 17).
- Claim 2 is a method for enabling communal audio message recordal, with the key elements comprising:
- generating and storing at least one qualifying parameter pertaining to access to an audio data recorder;
- determining a qualifying parameter for a subsequent access by a user; and
- enabling access to previously recorded messages having a matching qualifying parameter, otherwise denying access, where the qualifying parameter includes a "user-supplied indication of a personal characteristic."
- The complaint does not explicitly reserve the right to assert other claims.
U.S. Patent No. 8,613,110 - "Software Piracy Prevention Through Remote Enforcement Of An Activation Threshold," issued December 17, 2013
The Invention Explained
- Problem Addressed: The patent describes the significant problem of software piracy at the time of the invention, noting that prior art methods like software access codes included with the packaging or physical "activation plugs" were easily copied and distributed to unlicensed users ('110 Patent, col. 1:52-2:6).
- The Patented Solution: The invention is a network-based method where a remote service system controls software activation. It receives a unique identification code for an authentic copy of software, updates a count of "activation attempts" associated with that code, and transmits an activation code back to the user only if the number of attempts is below a predetermined threshold. If the threshold is met or exceeded, the system "blacklists" the unique ID, prohibiting it from receiving any future activation codes ('110 Patent, Abstract; col. 9:1-24).
- Technical Importance: This approach shifted piracy enforcement from a static, local check to a dynamic, remotely managed system that could actively track and disable pirated copies across a network, making casual piracy more difficult ('110 Patent, col. 2:14-19).
Key Claims at a Glance
- The complaint asserts independent claim 1 (Compl. ¶¶34, 36).
- Claim 1 is a method for preventing software piracy, with the key elements comprising:
- receiving a unique identification code for an authentic copy of software;
- updating a number of activation attempts for the software based on the unique ID;
- transmitting an activation code to the user's computer when the number of attempts is less than a threshold; and
- blacklisting the unique ID when the number of attempts is not less than the threshold, to prohibit it from receiving any future activation codes.
- The complaint does not explicitly reserve the right to assert other claims.
U.S. Patent No. 7,024,696 - "Method and System For Prevention Of Piracy Of A Given Software Application Via A Communications Network," issued April 4, 2006
- Technology Synopsis: Addressing the same software piracy problem as the ’110 Patent, this patent discloses a system where a user must connect to a remote service provider to activate software. The remote provider receives user data, including a unique software identification code, compares it to archived data to detect piracy, and, if the user is legitimate, transmits an activation code to enable the software's functionality ('696 Patent, Abstract).
- Asserted Claims: Independent claim 24 (Compl. ¶¶54, 56).
- Accused Features: The complaint alleges that Microsoft's product activation process for Microsoft Office infringes the ’696 Patent (Compl. ¶55).
III. The Accused Instrumentality
Product Identification
- The complaint names two distinct instrumentalities: (1) "Microsoft Stream" for the ’252 Patent, and (2) "Microsoft Office products" and their associated "product activation process" for the ’110 and ’696 Patents (Compl. ¶¶16, 35, 55).
Functionality and Market Context
- Microsoft Stream: The complaint describes Microsoft Stream as an "Enterprise Video service" that allows users within an organization to "upload, view, organize and share videos securely" (Compl. ¶18, p. 6). Functionally, it allows users to create "groups" and "channels" to manage access. Groups can be set as "companywide" (public) or "private," with private groups requiring an owner to approve members. These settings determine who can view the video content within the group (Compl. ¶¶19-21, pp. 8-12). The complaint provides a screenshot illustrating the distinction between public and private groups. (Compl. p. 9).
- Microsoft Office Activation: The complaint alleges this is a process required to use Microsoft Office products. A user must provide a "product key," which serves as a unique identification code (Compl. ¶38, p. 18). This key is sent to a Microsoft server, which tracks the number of computers the software is installed on against a license limit (Compl. ¶39, p. 18). If the limit is not exceeded, the server sends back an "Office entitlement" that activates the software (Compl. ¶40). If the limit has been reached, activation is denied, and the user is shown an "Install limit reached" message (Compl. ¶41, p. 21).
IV. Analysis of Infringement Allegations
U.S. Patent No. 7,020,252 Infringement Allegations
| Claim Element (from Independent Claim 2) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| A method for enabling communal audio message recordal including a provision of audio data recorder coupled with a communications system configured to enable multiple users to access the audio data recorder and to record respective audio messages | Microsoft Stream is an enterprise service for uploading, viewing, and sharing "audio visual file[s]" (videos) that multiple users in an organization can access and contribute to. | ¶18 | col. 2:62-65 |
| wherein a recordal of each message comprises: generating and storing by said system at least one qualifying parameter pertaining to the access to the audio data recorder | Microsoft Stream allows users to generate and store parameters that control access by creating "groups" or "channels." A screenshot shows the user interface for creating a channel with a name and description. | ¶19 | col. 1:64-2:2 |
| determining a qualifying parameter for a subsequent access to the audio data recorder by a user | The system determines access permissions based on whether a group is "companywide or private" and whether a user is an "owner" or "member." | ¶20 | col. 2:6-8 |
| enabling access by said subsequently accessing user to previously recorded messages having a matching qualifying parameter, otherwise they deny such access | For private groups, "Only group members will be able to see videos within the group," denying access to non-members. | ¶21 | col. 2:8-10 |
| wherein the qualifying parameter includes a user-supplied indication of a personal characteristic. | The complaint alleges that creating groups or channels with user-supplied names (e.g., "Adventure Travel") and descriptions constitutes a user-supplied indication of a personal characteristic. A screenshot shows the "Edit channel" dialog with these fields. | ¶21, p. 13 | col. 6:28-32 |
Identified Points of Contention
- Scope Questions: The patent is titled "Group Audio Message Board" and its claims recite a method for "communal audio message recordal." The accused product, Microsoft Stream, is a "Video service" (Compl. ¶18, p.6). A central dispute will be whether the term "audio message" can be construed to read on the "audio visual file" (i.e., video) functionality of the accused product.
- Technical Questions: The complaint alleges that creating a "group" or "channel" in Stream satisfies the "generating and storing...a qualifying parameter" limitation. A question for the court is whether creating a container for content (a group) is technically the same as generating and storing a parameter that is then matched for access, as described in the patent.
U.S. Patent No. 8,613,110 Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| (a) receiving, using a remote service system, a unique identification code that uniquely identifies an authentic copy of the software; | Microsoft's activation server operates as a remote service system that receives a unique "product key" from the user to identify the software. A screenshot shows the "Enter your product key" dialog. | ¶38, p. 18 | col. 9:4-6 |
| (b) updating, using the remote service system, a number of activation attempts for the authentic copy of the software based on the unique identification code; | Microsoft's product activation system uses the product key to "register the number of activation attempts available," which is displayed to the user as "PC/Mac installs used." | ¶39 | col. 9:7-10 |
| (c) transmitting, using the remote service system, an activation code to the user's computer...when the number of activation attempts is less than a predetermined threshold; | The Microsoft activation process sends an "Office entitlement" (the activation code) to the user's computer, which activates the product if the installation limit has not been reached. A screenshot shows a "Product Activated" status. | ¶40, p. 20 | col. 9:11-16 |
| (d) blacklisting, using the remote service system, the unique identification code when the number of activation attempts is not less than the predetermined threshold, so that the authentic copy of the software is prohibited from receiving any future activation codes from the remote service system. | Microsoft's activation process will not activate the software if the installation limit has been reached, "blacklisting the unique identification code." A screenshot shows an "Install limit reached" dialog box. | ¶41, p. 21 | col. 9:17-24 |
Identified Points of Contention
- Scope Questions: Claim 1 requires "updating...a number of activation attempts." The complaint alleges Microsoft's system tracks the number of "installs used" (Compl. ¶39, p.18). The infringement analysis may turn on whether an "install" is legally and technically synonymous with an "activation attempt."
- Technical Questions: The claim requires "blacklisting" the unique ID to prohibit it from receiving "any future activation codes." The complaint also shows that Microsoft allows users to "deactivate an Office 365 install" to free up an installation slot for use on another device (Compl. p. 22). This raises the question of whether a reversible denial of activation (contingent on deactivation) meets the claim requirement of "blacklisting," which may imply a more permanent prohibition.
V. Key Claim Terms for Construction
For the ’252 Patent:
- The Term: "audio message"
- Context and Importance: Infringement of the ’252 Patent hinges on this term. The accused product is a video service, and a narrow construction limited to audio-only content could be non-infringement dispositive. Practitioners may focus on this term because the patent's title, abstract, and specification consistently emphasize "audio."
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The complaint argues the accused product infringes by recording and sharing an "audio visual file" (Compl. ¶18), implicitly arguing that a video containing an audio track is a type of "audio message." A party might argue that "audio" modifies "message" to require the presence of audio, not the absence of video.
- Evidence for a Narrower Interpretation: The patent is titled "Group Audio Message Board" and the abstract describes an "audio message recordal apparatus" ('252 Patent, title, Abstract). The specification repeatedly refers to "audio messages," "voice messages," and an "audio interface stage" with a "voice synthesis" function, strongly suggesting the invention was conceived for audio-only communications (e.g., ’252 Patent, col. 1:35; col. 5:5-6).
For the ’110 Patent:
- The Term: "blacklisting"
- Context and Importance: The final step of claim 1 requires "blacklisting" an ID to prevent future activations. The accused functionality is an "Install limit reached" message that can be remedied by deactivating another installation. The case may turn on whether this temporary, user-remediable block constitutes "blacklisting."
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The specification describes blacklisting as an event that would "render the identified software void and permanently dysfunctional" because it would be "prohibited from receiving any future activation codes" ('110 Patent, col. 5:5-10). A party could argue that any functional prohibition, even a temporary one, meets this definition.
- Evidence for a Narrower Interpretation: The specification's description of making the software "permanently dysfunctional" suggests an irrevocable status. The accused system allows a user to "deactivate an install" to free up an activation slot (Compl. p. 22), which suggests the unique ID itself is not permanently voided. A party may argue this deactivation feature is inconsistent with the patent's concept of blacklisting.
VI. Other Allegations
Indirect Infringement
- For all three patents, the complaint alleges induced infringement, stating Microsoft "intentionally instructs its customers to infringe through training videos, demonstrations, brochures, installation and user guides" available on its websites (Compl. ¶¶23, 43, 70). The complaint also pleads contributory infringement, alleging the accused devices are "especially made or especially adapted for use in infringement" and are not staple articles of commerce suitable for substantial non-infringing use (Compl. ¶¶24, 44, 71).
Willful Infringement
- The complaint alleges Microsoft had pre-suit knowledge of its infringement of all asserted patents via notice letters dated July 30, 2018, and August 8, 2018 (Compl. ¶¶25, 45, 72). Based on this alleged knowledge, the prayer for relief seeks a finding of an exceptional case and an award of enhanced damages (Compl. p. 39).
VII. Analyst’s Conclusion: Key Questions for the Case
This case faces several fundamental challenges, the most significant of which are procedural and potentially dispositive. The central questions for the court will likely be:
- Viability of the Action: The primary and overarching issue is one of mootness. Post-filing IPR proceedings resulted in the cancellation of every patent claim asserted in the complaint. Can the plaintiff's case survive given that its legal basis—the asserted claims—has been invalidated by the USPTO, pending any appeal of those administrative decisions?
- Definitional Scope: Assuming the claims of the ’252 Patent were valid, a core issue would be whether the term "audio message", which is rooted in the patent’s description of audio-only communications, can be construed broadly enough to cover the "audio visual file" (video) functionality of the accused Microsoft Stream service.
- Functional Mismatch: For the ’110 Patent, a key evidentiary question would be one of technical operation. Does Microsoft's activation system—which counts "installs" and allows users to "deactivate" a copy to free up an activation slot—perform the specific functions required by the claim, namely "updating a number of activation attempts" and "blacklisting" the unique ID in a potentially permanent manner?