DCT

4:17-cv-05931

Cellspin Soft Inc v. Nike Inc

I. Executive Summary and Procedural Information

Parties & Counsel:
- Plaintiff: Cellspin Soft, Inc. (California)
- Defendant: Nike, Inc. (Oregon)
- Plaintiff’s Counsel: Collins Edmonds Schlather & Tower, PLLC
Case Identification: 4:17-cv-05931, N.D. Cal., 03/02/2018
Venue Allegations: Plaintiff alleges venue is proper because Defendant Nike has regular and established places of business within the district, such as Nike retail stores, and because infringing activities occur within the district.
Core Dispute: Plaintiff alleges that Defendant’s fitness tracking devices and associated mobile applications infringe three patents related to the automatic transfer of data from a peripheral capture device to a web service via an intermediary mobile device.
Technical Context: The technology addresses a system architecture for connecting non-Internet-capable data capture devices to web services using a smartphone as a bridge, a foundational concept for the modern wearable technology and Internet of Things (IoT) markets.
Key Procedural History: This Amended Complaint was filed while motions challenging the patents under 35 U.S.C. § 101 were pending. Plaintiff notes the amendment is made in light of recent Federal Circuit decisions concerning the factual pleadings required to overcome § 101 challenges at the motion to dismiss stage, suggesting patent eligibility is a central, pre-existing issue in the case.

Case Timeline

Date	Event
2007-12-28	Priority Date for ’794, ’752, and ’847 Patents
2014-05-27	U.S. Patent No. 8,738,794 Issued
2014-11-18	U.S. Patent No. 8,892,752 Issued
2017-06-15	Plaintiff sends first notice letter to Nike regarding ’794 and ’752 Patents
2017-08-29	U.S. Patent No. 9,749,847 Issued
2017-08-31	Plaintiff sends notice letter to Nike regarding ’794, ’752, and ’847 Patents
2017-10-16	Original Complaint Filed
2018-03-02	Amended Complaint Filed

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

U.S. Patent No. 8,738,794 - "Automatic Multimedia Upload for Publishing Data and Multimedia Content," Issued May 27, 2014

The Invention Explained

Problem Addressed: At the time of the invention, the process of transferring data, such as images from a digital camera, to the Internet was described as "cumbersome and time consuming," typically requiring a physical cable or memory card transfer to a personal computer for a manual upload ('794 Patent, col. 1:37-47; Compl. ¶ 10).
The Patented Solution: The patent describes a method where a "digital data capture device" (e.g., a camera) establishes a wireless paired connection with a "mobile device" (e.g., a smartphone). Software on the capture device determines when "new data" exists and signals the mobile device. The mobile device then receives this data and uses its own Internet connection to publish it to one or more web services, applying a user identifier in the process ('794 Patent, Abstract; col. 4:22-54). This architecture offloads processing and internet connectivity requirements from the capture device to the more capable mobile device (Compl. ¶ 6).
Technical Importance: This approach aimed to conserve battery life on smaller capture devices and enable "real time" data publishing from devices that lacked their own native Internet connection, thereby improving the user experience (Compl. ¶¶ 16, 18).

Key Claims at a Glance

The complaint asserts independent claim 1 and dependent claims 2, 3, 4, 7, and 9 (Compl. ¶ 27).
The essential elements of independent claim 1 include:
- Providing software modules on both a Bluetooth enabled data capture device and a Bluetooth enabled mobile device.
- Establishing a paired connection between the two devices.
- Acquiring new data in the data capture device.
- Determining the existence of new data by the software module on the data capture device and sending a corresponding data signal to the mobile device.
- Automatically transferring the new data from the capture device to the mobile device.
- At the mobile device, receiving the new data, applying a user identifier, and transferring the data with the identifier to a web service.
- At the web service, receiving the data and user identifier and making the data available.

U.S. Patent No. 8,892,752 - "Automatic Multimedia Upload for Publishing Data and Multimedia Content," Issued November 18, 2014

The Invention Explained

Problem Addressed: The patent builds on the same problem of inefficient data transfer but adds considerations for security and communication efficiency between the capture device and the mobile device.
The Patented Solution: This invention details a method using a secure paired Bluetooth connection established with a "cryptographic encryption key." It specifies an "event notification" protocol where the mobile device can enable notifications on the capture device. When new data exists, the capture device sends an event notification, for which the mobile device is configured to "listen." The capture device then transfers the encrypted data to the mobile device, which decrypts it and sends it to a remote internet server with user identifiers and a specified protocol (e.g., HTTP) ('752 Patent, Abstract; col. 12:2-34).
Technical Importance: This method enhances the core data transfer architecture by adding a layer of security through encryption and improving power efficiency by using an event-driven communication model rather than continuous polling (Compl. ¶ 19.e).

Key Claims at a Glance

The complaint asserts independent claim 1 and dependent claims 2, 4, 5, 12, 13, and 14 (Compl. ¶ 38).
The essential elements of independent claim 1 include:
- Establishing a secure paired Bluetooth connection using a cryptographic encryption key.
- Acquiring new data in the capture device.
- Detecting new data for transfer, which includes receiving a message from the mobile device to enable event notification and then sending an event notification to the mobile device, which listens for it.
- Encrypting the new data at the capture device.
- Transferring the encrypted data to the mobile device.
- At the mobile device, obtaining the new data from the encrypted data and sending it to a remote internet server with an attached user identifier, an action setting (e.g., HTTP), and a destination web address.

U.S. Patent No. 9,749,847 - "Automatic Multimedia Upload for Publishing Data and Multimedia Content," Issued August 29, 2017

Technology Synopsis: This patent claims a system comprising two main components: a Bluetooth enabled data capture device and a mobile application on a cellular phone. The capture device is configured to acquire new data, store it, and send an "event notification" along with the data over a paired connection. The mobile application is configured to listen for the notification, receive and store the data, and use HTTP to transfer the data and user information to a website over a cellular network ('847 Patent, Abstract; col. 12:11-13:9).
Asserted Claims: Independent claim 1 and dependent claims 2 and 3 (Compl. ¶ 48).
Accused Features: The complaint accuses the combination of Nike’s Bluetooth enabled fitness tracking devices (e.g., Nike+ Fuelband) and Nike's mobile applications (e.g., Nike+ Running Club) of infringing the claimed system (Compl. ¶¶ 48-49).

III. The Accused Instrumentality

Product Identification: The accused instrumentalities include Defendant’s Bluetooth enabled fitness tracking devices, specifically the "Nike+ Fuelband" and "Nike+ Fuelband SE," as well as other "smart watches, wearables, [and] fitness bands" (Compl. ¶¶ 27, 38). These devices are accused of infringing when used in conjunction with Nike's mobile software, including "Nike+, Nike+ FuelBand, Nike+ Running Club, and Nike+ Training Club" applications, which connect to Nike's web services at www.nike.com (Compl. ¶ 27).
Functionality and Market Context: The complaint alleges the accused Nike devices are designed to monitor a user’s biological and fitness metrics, such as heart rate and steps (Compl. ¶ 28). These devices allegedly establish a Bluetooth paired connection with a user's computing device (e.g., a smartphone) to automatically transfer "new tracking data." The Nike application on the computing device then receives this data and transfers it, along with user account information, over the Internet to Nike's web services for consumption (Compl. ¶¶ 28, 39, 49).
No probative visual evidence provided in complaint.

IV. Analysis of Infringement Allegations

'794 Patent Infringement Allegations

| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|:-----------------------------------------------------------------------------------------------------------------|:-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------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|
| acquiring new data in the Bluetooth enabled data capture device... after the paired connection is established | Acquiring new tracking data, such as heart rate and steps, in the Nike device after establishing a paired connection with the user's computing device. | ¶28 | col. 4:22-25 |
| determining the existence of new data for transfer, by the software module on the Bluetooth enabled data capture device | The accused Nike methods comprise... determining the existence of new tracking data... in the Nike device. | ¶28 | col. 12:61-65 |
| sending a data signal to the Bluetooth enabled mobile device, corresponding to existence of new data... automatically, over the established paired Bluetooth connection | Sending a notification along with the new data to the Nike application over the paired connection. | ¶28, ¶11 | col. 4:55-63 |
| transferring the new data from the Bluetooth enabled data capture device to the Bluetooth enabled mobile device automatically over the paired Bluetooth connection | Transferring the new data from the Nike device to the user's computing device automatically over the paired connection. | ¶28 | col. 4:34-39 |
| applying, using the software module on the Bluetooth enabled mobile device, a user identifier to the new data | Nike applications on the user's computing device apply the user's account information to the new data. | ¶28, ¶11 | col. 12:21-27 |
| transferring the new data received... along with a user identifier to the one or more web services | The Nike application sends the new data, along with a user identifier, to the Nike web service. | ¶11 | col. 12:28-33 |
| making available, at the one or more web services, the new data received from the Bluetooth enabled mobile device | The Nike web service receives and makes available the new data received from the user's computing device over the Internet. | ¶28 | col. 12:35-41 |

'752 Patent Infringement Allegations

| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|:------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------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|
| establishing a secure paired Bluetooth connection between the Bluetooth enabled data capture device and the Bluetooth enabled mobile device using a cryptographic encryption key | The accused Nike methods comprise establishing a secure paired Bluetooth connection between the Nike device and the user's computing device using a Bluetooth encryption key. | ¶39 | col. 11:51-55 |
| sending an event notification to the Bluetooth enabled mobile device, corresponding to existence of new data for transfer, over the established secure paired Bluetooth connection | The Nike device sends an event notification to the user's computing device over the paired connection, corresponding to the existence of new data for transfer. | ¶39 | col. 12:4-12 |
| wherein the Bluetooth enabled mobile device is configured to listen for the event notification | The user's computing device is configured to listen for the event notification. | ¶39 | col. 12:10-12 |
| transferring the encrypted data from the Bluetooth enabled data capture device to the Bluetooth enabled mobile device | The encrypted data is transferred from the Nike device to the user's computing device over the paired connection. | ¶39 | col. 12:16-19 |
| wherein the Bluetooth enabled mobile device sends the obtained new data with an attached user identifier, a... hypertext transfer protocol method, and a destination web address to a remote internet server | The user's computing device sends the obtained new data along with the user's account information, a... hypertext transfer protocol operation, and a destination web address to the Nike web server. | ¶39 | col. 12:20-34 |

Identified Points of Contention:
- Scope Questions: A central question may be whether the term "digital data capture device," described in the patents primarily with examples of digital cameras capturing "multimedia content," can be construed to encompass fitness trackers capturing biological data like step counts ('794 Patent, col. 1:37-47; Compl. ¶ 28). While some dependent claims broaden "data" to include "digital data," the focus on "multimedia" in the specification could be a point of dispute ('794 Patent, cl. 7).
- Technical Questions: A key technical question for the '794 patent revolves around the limitation requiring that the capture device "determin[es] the existence of new data." The patent specification describes both a "push" mode consistent with this and a "pull" mode where the mobile device polls the capture device to make the determination ('794 Patent, col. 4:29-67). Whether the accused Nike system operates according to the specific "push" method required by the claim language will likely be a significant factual dispute.

V. Key Claim Terms for Construction

The Term: "data capture device" ('794 Patent, cl. 1; '752 Patent, cl. 1)
- Context and Importance: This term's construction is fundamental to the scope of infringement. The patents were drafted with digital cameras as a primary example. The accused products are fitness trackers. Defendant may argue that the term, in the context of the specification's focus on "multimedia content," does not cover devices that exclusively capture biometric or motion data.
- Intrinsic Evidence for Interpretation:
  - Evidence for a Broader Interpretation: The specification states the device "may, for example, be a digital camera, a video camera, digital modular camera systems, or other digital data capturing systems" ('794 Patent, col. 4:35-38). The catch-all phrase "other digital data capturing systems" may support a construction not limited to traditional multimedia devices.
  - Evidence for a Narrower Interpretation: The patents' shared title, "Automatic Multimedia Upload for Publishing Data and Multimedia Content," and the repeated use of camera-based examples in the background section could be used to argue the invention is situated in and limited to the field of multimedia content, not general-purpose data logging ('794 Patent, col. 1:37-47).
The Term: "determining the existence of new data for transfer, by the software module on the Bluetooth enabled data capture device" ('794 Patent, cl. 1)
- Context and Importance: This term defines which component in the system has the intelligence to initiate a transfer. Its construction is critical because infringement requires showing that the Nike fitness tracker itself, not the Nike mobile app, performs this "determining" step. Practitioners may focus on this term because the specification discloses an alternative "pull mode" where the mobile device polls the capture device, which may not meet this claim limitation ('794 Patent, col. 4:31-34).
- Intrinsic Evidence for Interpretation:
  - Evidence for a Broader Interpretation: A party might argue that in a "push" system, the capture device inherently "determines" it has new data before sending a signal, and the claim language simply describes this logical sequence, regardless of the precise software implementation. The patent describes a "push mode" where the "BT communication device 201a sends a signal to the client application 203 on creation of a new file" ('794 Patent, col. 4:55-58).
  - Evidence for a Narrower Interpretation: The plain language appears to place the "determining" function squarely on the capture device. This could be contrasted with the specification's description of a "pull mode," where "the client application 203 periodically polls the digital data capture device 201 to determine the creation of a new file," suggesting the inventors understood this as a distinct, and potentially unclaimed, mode of operation ('794 Patent, col. 4:31-34).

VI. Other Allegations

Indirect Infringement: The complaint alleges Nike induces infringement by providing its fitness devices and mobile applications along with instructions, and by requiring users to perform the claimed steps (e.g., creating an account and syncing the device) to receive the benefits of the service (Compl. ¶¶ 29, 41, 51). The complaint also pleads joint infringement in the alternative, alleging Nike directs and controls its users' performance of steps in the claimed methods (Compl. ¶ 29).
Willful Infringement: The complaint alleges willful infringement based on Nike’s alleged continued infringement after receiving actual notice of the patents-in-suit via letters dated June 15, 2017, and August 31, 2017 (Compl. ¶¶ 31, 40, 50).

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

A threshold legal question, highlighted by the case's procedural history, will be one of patent eligibility: are the claims directed to a patent-ineligible abstract idea of collecting, transferring, and publishing data, or do they, as the complaint argues, recite a specific, unconventional technological improvement to the functioning of computer networks and mobile devices?
A core issue will be one of definitional scope: can the term "data capture device," rooted in the patents' context of cameras capturing "multimedia content," be construed to cover modern fitness trackers that acquire and transmit biological and motion data?
A key evidentiary question will be one of technical operation: does the accused Nike system perform the specific signaling protocol required by the asserted claims—particularly, whether the peripheral device itself "determines the existence of new data" as required by claim 1 of the '794 patent, or whether the mobile application makes that determination by polling the device, a distinction for which the patent specification provides support for both interpretations.