DCT
3:25-cv-05721
TikTok Inc v. AlmondNet Inc
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: TikTok Inc. (California)
- Defendant: AlmondNet, Inc. (Delaware) and Intent IQ, LLC (Delaware)
- Plaintiff’s Counsel: Quinn Emanuel Urquhart & Sullivan, LLP
- Case Identification: 4:25-cv-5721, N.D. Cal., 07/08/2025
- Venue Allegations: TikTok alleges venue is proper in the Northern District of California because Defendants are subject to personal jurisdiction in the district as a result of extensive and repeated patent licensing and litigation activities directed at California-based companies. TikTok further notes that the majority of its U.S. engineers are located in the district.
- Core Dispute: Plaintiff seeks a declaratory judgment that its advertising platform and associated technologies do not infringe three of Defendants' patents related to targeted online advertising and cross-device user profiling.
- Technical Context: The technology at issue involves methods for identifying and targeting users for online advertisements, including calculating the profitability of ad placements and associating user activity across different devices and media platforms.
- Key Procedural History: This declaratory judgment action was filed by TikTok in California following an infringement lawsuit filed by AlmondNet against TikTok in the District of Delaware (the "AlmondNet Delaware Action"). TikTok states its intent to move to dismiss or transfer the Delaware action, arguing improper venue. The complaint details an extensive history of litigation by AlmondNet asserting the patents-in-suit or related family members against numerous technology companies, including Meta, Samsung, Roku, Yahoo!, and LinkedIn, with some of those disputes involving pre-suit negotiations, settlements, and related Inter Partes Review (IPR) proceedings.
Case Timeline
| Date | Event |
|---|---|
| 2006-06-16 | Priority Date for ’822 and ’423 Patents |
| 2007-04-17 | Priority Date for ’398 Patent |
| 2012-06-12 | ’822 Patent Issued |
| 2014-03-18 | ’398 Patent Issued |
| 2019-07-24 | AlmondNet sends notice letter to Facebook (Meta) |
| 2020-11-17 | ’423 Patent Issued |
| 2024-06-01 | AlmondNet and LinkedIn action dismissed following settlement |
| 2025-05-16 | AlmondNet files infringement action against TikTok in Delaware |
| 2025-07-08 | TikTok files this Declaratory Judgment Complaint |
II. Technology and Patent(s)-in-Suit Analysis
U.S. Patent No. 8,200,822 - "Media Properties Selection Method and System Based on Expected Profit from Profile-Based Ad Delivery," issued June 12, 2012
The Invention Explained
- Problem Addressed: The patent addresses the challenge of efficiently targeting advertisements to users based on their online behavior (a "profile") when those users move from a first website to other, unaffiliated "media properties" (e.g., other websites). (’822 Patent, col. 1:40-52). A key difficulty is determining on which of many potential media properties it would be profitable to purchase ad space to reach a specific user. (’822 Patent, col. 5:65-6:6).
- The Patented Solution: The invention proposes an automated system that calculates the expected profit of placing a targeted ad on a second media property for a user with a given profile. (’822 Patent, Abstract). This calculation weighs the expected revenue against the cost of the ad space; if a positive profit is anticipated, the system "authorizes" the ad display and arranges for the user to be "tagged" so the second media property can identify them and serve the ad. (’822 Patent, col. 6:35-51).
- Technical Importance: This approach sought to move beyond simple behavioral retargeting by introducing an automated, profit-based decision engine to optimize media buying in real-time.
Key Claims at a Glance
- The complaint asserts non-infringement of independent claim 1 and notes that claims 18 and 35 are substantially identical. (Compl. ¶23-24).
- Essential elements of independent claim 1 include:
- For visitors to a first media property, receiving profile attribute information.
- Automatically electronically authorizing a third-party second media property to display a correlated advertisement, subject to a visitor-specific condition.
- Automatically electronically authorizing a third-party third media property to display a correlated advertisement for a price charged by that property that is less than a profile-attribute-dependent price an advertiser is willing to pay.
- The complaint seeks a declaration of non-infringement for one or more claims of the patent. (Compl. p. 16).
U.S. Patent No. 10,839,423 - "Condition-Based Method of Directing Electronic Advertisements for Display in Ad Space Within Streaming Video Based on Website Visits," issued November 17, 2020
The Invention Explained
- Problem Addressed: The patent, which shares a specification with the ’822 patent, addresses the problem of targeting ads within streaming video based on a user's prior website visits, while managing how sensitive user profile data is shared between different entities. (Compl. ¶26; ’423 Patent, col. 1:43-2:67).
- The Patented Solution: The invention describes a method where a first computer system records a user's behavioral profile from a website visit. It then causes a separate, second computer system (which controls video ad space) to receive "tag information" that denotes a link to the user's profile, but does so without transferring the underlying behavioral profile data itself. (’423 Patent, col. 14:43-51). The first system also sends a "condition" for ad delivery. Later, when the user views a video, the second system checks if the condition is met and, if so, serves a targeted ad that is based on the original profile information maintained by the first system. (Compl. ¶27).
- Technical Importance: This architecture provides a potentially more privacy-preserving method for cross-party ad targeting, as the entity serving the ad (the second system) acts on a tag and a condition without directly receiving the user's detailed behavioral history.
Key Claims at a Glance
- The complaint asserts non-infringement of independent claim 1 and notes that claims 6 and 11 are substantially identical. (Compl. ¶27-28).
- Essential elements of independent claim 1 include:
- A first computer system recording behavioral profile information from a visit to a first website.
- Causing a second, uncontrolled computer system to have access to "tag information" without transferring the behavioral profile information.
- The tag information denotes a connection between the first profile and a second device used to access video streams.
- Electronically transferring a "condition" for ad delivery to the second computer system.
- Causing a selected ad to be served after the second computer system checks and meets the condition.
- The complaint seeks a declaration of non-infringement for one or more claims of the patent. (Compl. p. 18).
U.S. Patent No. 8,677,398 - "Systems and Methods for Taking Action with Respect to One Network-Connected Device Based on Activity on Another Device Connected to the Same Network," issued March 18, 2014
Technology Synopsis
The patent describes a method for creating an electronic association between two different devices (e.g., a computer and a television set-top box) by recognizing that both have connected to a common local area network (LAN). (Compl. ¶32). Based on this association, online activity on the first device is used to trigger an action, such as displaying a targeted advertisement, on the second device. (Compl. ¶30, ¶32).
Asserted Claims
The complaint recites independent claims 1 and 13 and alleges non-infringement of claims covering the scope of all independent claims (1, 13, 27, 31, 36, and 40). (Compl. ¶31-34, ¶57).
Accused Features
The complaint alleges that TikTok's advertising systems do not generate or store electronic associations between devices based on recognizing a common LAN connection, and therefore do not send electronic transmissions to take actions on a second device based on such an association. (Compl. ¶57-¶59).
III. The Accused Instrumentality
Product Identification
The "Accused TikTok Instrumentalities," which are defined as the TikTok application and its supporting advertising services. (Compl. ¶3).
Functionality and Market Context
The complaint identifies the accused functionality as the "TikTok Ads Manager" and a comprehensive suite of its associated components and features. (Compl. ¶3). These include tools for ad placement ("Automatic Placement"), data collection ("Event API," "TikTok Pixel"), campaign optimization ("Value-Based Optimization"), and cross-platform tracking ("Pangle," "Cross-Channel... measurement"). (Compl. ¶3). Collectively, these components form TikTok's commercial advertising platform, which enables advertisers to manage, deliver, and measure targeted ad campaigns to users of the TikTok application. The complaint provides no technical description of how these instrumentalities operate, but instead makes negative allegations that they do not perform the functions required by the asserted patents. (Compl. ¶43, ¶50, ¶57).
No probative visual evidence provided in complaint.
IV. Analysis of Infringement Allegations
The complaint seeks a declaratory judgment of non-infringement. The following tables summarize TikTok's arguments for why its products do not meet the limitations of the asserted claims.
’822 Patent Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Non-Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| automatically electronically authorizing a third-party second media property to allow display... of an advertisement correlated with the profile-attribute information received about the visitor | The Accused TikTok Instrumentalities do not employ, incorporate, or otherwise make use of the claimed "authorizing a third-party second media property to allow display." | ¶43(1), ¶45 | col. 11:15-21 |
| subject to a visitor-specific condition for display of the advertisement that a price charged by the second media property is less than a profile-attribute-dependent price that an advertiser is willing to pay for display of the advertisement | The Accused TikTok Instrumentalities do not employ or make use of a condition where display is based on a price charged by a media property being less than a profile-dependent price an advertiser is willing to pay. | ¶43(2), ¶44 | col. 11:1-5 |
’423 Patent Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Non-Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| causing a second computer system not controlled by the first entity... to electronically have access to tag information | The Accused TikTok Instrumentalities do not cause a second, uncontrolled computer system to have access to "tag information" as claimed. | ¶50(1), ¶51 | col. 14:37-43 |
| which tag information denotes to the second computer system a connection between (i) the first profile; and (ii) a second computerized device used to access video streams | The Accused TikTok Instrumentalities do not use tag information that denotes the specific two-part connection required by the claim. | ¶50(2), ¶51 | col. 14:48-51 |
| electronically transferring to the second computer system a condition specific to the first profile for allowing delivery of an advertisement | The Accused TikTok Instrumentalities do not transfer a "condition specific to the first profile" to a second computer system for allowing ad delivery. | ¶50(3), ¶52 | col. 14:52-58 |
Identified Points of Contention
- Scope Questions: A primary point of contention for the ’398 patent will be whether TikTok’s methods of cross-device targeting, if any, fall within the patent's specific requirement of recognizing device connection to a "common local area network." The complaint suggests a mismatch, raising the question of whether TikTok's actual methods (e.g., probabilistic or deterministic matching through account logins) are outside the claim scope. (Compl. ¶57-¶58).
- Technical Questions: For the ’822 patent, the analysis may turn on the technical and economic operation of TikTok's "Value-Based Optimization" and other ad-bidding tools. The central question is what evidence exists that these tools perform the specific profit calculation recited in claim 1, which compares a media property's price to a "profile-attribute-dependent price." (Compl. ¶43-44). For the ’423 patent, the dispute is architectural: does TikTok's system use the claimed two-party structure where profile data is segregated, or is it a more integrated system that falls outside the claim's "first computer system" and "second computer system" paradigm? (Compl. ¶50-51).
V. Key Claim Terms for Construction
’822 Patent
- The Term: "automatically electronically authorizing"
- Context and Importance: The meaning of "authorizing" is central to the infringement analysis. TikTok alleges it does not perform this step. (Compl. ¶43). Whether TikTok's system is found to infringe may depend on whether "authorizing" requires a specific, discrete message granting permission from one system to another, or if it can be construed more broadly to cover the outcome of an automated process, such as winning an ad auction, which implicitly "authorizes" display.
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The patent's abstract describes a "behavioral-targeting company" that "calculates expected profit" and then "arranges for the visitor to be tagged." (’822 Patent, Abstract). This could suggest "authorizing" is the internal calculation and decision, with the "arranging" being the external result.
- Evidence for a Narrower Interpretation: The claim language specifies "authorizing a third-party second media property," which may suggest a communication directed to that third party. The specification's description of "cookie matching" involves redirects and inter-system communication, which could support a narrower reading requiring an explicit grant of permission. (’822 Patent, col. 5:44-67).
’423 Patent
- The Term: "tag information"
- Context and Importance: This term is critical because the claim requires it to perform a specific function—"denote... a connection between (i) the first profile; and (ii) a second computerized device"—without actually transferring the profile data. (Compl. ¶27). TikTok's non-infringement argument rests on its systems not using "tag information" in this claimed manner. (Compl. ¶51).
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The specification notes a tag is generally a "unique identifier used to mark a person electronically." (’423 Patent, col. 4:33-35). This could support a broad interpretation where any unique ID, such as TikTok's "TTCLID" (Compl. ¶3), could potentially qualify.
- Evidence for a Narrower Interpretation: The claim requires the tag to "denote" a connection to a specific "first profile" for the purpose of serving an ad "based on the profile information." (Compl. ¶27). This suggests the tag must be more than a generic identifier; it must function as a specific key or pointer that allows the second system to request an ad based on a particular profile held by the first system, potentially narrowing its scope.
VI. Other Allegations
Indirect Infringement
The complaint seeks a declaration that TikTok does not indirectly infringe the asserted patents under 35 U.S.C. §§ 271(b) and (c). (Compl. ¶47, ¶54, ¶61). The pleading does not set forth specific facts to negate the elements of knowledge or intent for indirect infringement, but rather relies on the core allegation that there is no underlying direct infringement by any party.
VII. Analyst’s Conclusion: Key Questions for the Case
- A threshold procedural issue will be jurisdictional priority: will the dispute be adjudicated in AlmondNet's first-filed infringement action in Delaware, or in TikTok's subsequent declaratory judgment action in the Northern District of California? The resolution of TikTok's planned motion to transfer or dismiss the Delaware case will be a critical early determinant for the litigation.
- A core substantive issue will be one of architectural congruence: do TikTok's advertising systems, particularly for cross-device and third-party publisher targeting, operate using the specific multi-party architectures claimed in the patents? The case may turn on whether there is a fundamental mismatch between the patents' descriptions of distinct first and second computer systems (’423 patent) or LAN-based device association (’398 patent) and the actual implementation of TikTok's platform.
- A key evidentiary question will be one of functional operation: does TikTok's ad-bidding and "Value-Based Optimization" technology perform the specific, profit-driven calculation and price comparison required by the ’822 patent? The parties will likely dispute whether TikTok's commercial logic for ad placement is equivalent to the patented method of "authorizing" display based on a defined profitability formula.