Kaldren LLC v. Denbury Resources Inc

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Kaldren LLC (Texas)
  • Defendant: Denbury Resources Inc. (Delaware)
  • Plaintiff’s Counsel: Stamoulis & Weinblatt LLC; Toler Law Group, PC
• Case Identification: 1:17-cv-01265, D. Del., 09/05/2017
• Venue Allegations: Plaintiff alleges venue is proper in the District of Delaware because Defendant is organized under the laws of Delaware and because of its alleged infringing conduct within or directed at the district.
• Core Dispute: Plaintiff alleges that Defendant’s use of a 2D bar code product infringes two patents related to methods and systems for variably formatting digital data into a scannable pattern.
• Technical Context: The technology concerns encoding digital information into two-dimensional patterns on physical substrates, enabling data storage and retrieval using common office equipment like printers and scanners.
• Key Procedural History: The complaint does not reference prior litigation or administrative proceedings. The asserted patents share a specification and originate from the same family of applications, with the later-issued patent being a continuation of the application that led to the first.

Case Timeline

Date	Event
1996-03-01	Earliest Priority Date for ’807 Patent and ’999 Patent
2004-11-23	U.S. Patent No. 6,820,807 Issues
2012-10-09	U.S. Patent No. 8,281,999 Issues
2017-09-05	Complaint Filed

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

U.S. Patent No. 6,820,807 - Variable Formatting of Digital Data into a Pattern, issued November 23, 2004 (’807 Patent)

The Invention Explained

• Problem Addressed: The patent’s background section identifies limitations in prior art methods for placing machine-readable information on paper, such as one- and two-dimensional bar codes. These methods are described as lacking the flexibility needed to optimize data density and reliability for the wide variety of commercially available printers and scanners, often relying on rigid formatting that is inefficient in its use of space and computational resources (’807 Patent, col. 2:34-59).
• The Patented Solution: The invention provides a method for formatting digital data into a pattern using user-selectable parameters, such as the size and spacing of data "spots" and their containing "cells" (’807 Patent, Abstract). This flexibility allows the data pattern to be optimized for the specific capabilities of any given printer-scanner combination (’807 Patent, col. 4:51-62). The system uses guideposts called "markers" for location and a header section called a "metasector" that contains information about the formatting parameters used, which facilitates the decoding of the main data body (’807 Patent, col. 5:1-54).
• Technical Importance: The technology aimed to significantly increase the amount of digital data that could be reliably stored on and retrieved from paper using off-the-shelf consumer and office equipment, thereby better integrating physical media with the digital environment (’807 Patent, col. 2:1-12).

Key Claims at a Glance

• The complaint asserts independent claims 12 and 20 (Compl. ¶14).
• Claim 12 (System) essential elements include:
  • A substrate presenting a machine readable indicia of digital data values formatted into a two dimensional pattern and identifying an information resource presented with human readable indicia;
  • means for extracting the digital data values from the substrate; and
  • means for retrieving the information resource identified by the digital data.
• Claim 20 (Method) essential elements include:
  • scanning a machine readable indicia comprising digital data values formatted into a two dimensional pattern;
  • extracting an address of the information resource from the machine readable indicia; and
  • retrieving the information resource for presentation to a user.

U.S. Patent No. 8,281,999 - Variable Formatting of Digital Data into a Pattern, issued October 9, 2012 (’999 Patent)

The Invention Explained

• Problem Addressed: As the ’999 Patent shares its specification with the ’807 Patent, it addresses the same technical problem: the inefficiency and rigidity of prior art systems for encoding data on physical substrates, which fail to optimize performance for specific hardware combinations (’999 Patent, col. 2:32-68).
• The Patented Solution: The solution is identical to that described in the ’807 Patent, involving a flexible, parameter-driven formatting method to create a data pattern. This includes the use of a "metasector" to store encoding parameters, which enables a decoding device to interpret the main data pattern that has been optimized for the specific printing and scanning hardware being used (’999 Patent, col. 4:53-65; col. 5:30-53).
• Technical Importance: The invention provided a framework for robustly storing large amounts of digital data on paper in a way that was adaptable to the inherent imperfections and variations of common printers and scanners (’999 Patent, col. 2:1-11).

Key Claims at a Glance

• The complaint asserts independent claims 1 and 8 (Compl. ¶21).
• Claim 1 (System) essential elements include:
  • processing means for decoding a machine-readable code containing contact information and digital data for communicating with other computers on a network;
  • imaging means for imaging the code; and
  • networking means for communicating with other computers on the network.
• Claim 8 (System) essential elements include:
  • processing means for decoding a machine-readable code formatted into a two dimensional pattern, where the code contains contact information;
  • imaging means for imaging the code; and
  • communicating means that communicates using the contact information derived from the processing means.

III. The Accused Instrumentality

Product Identification

The complaint identifies the accused instrumentality as an "accused 2D bar code product" (Compl. ¶14, ¶21).

Functionality and Market Context

The complaint alleges that Defendant "used (including testing)" the accused product (Compl. ¶13, ¶20). Its description of the product's functionality mirrors the language of the asserted claims. For the ’807 Patent, the alleged functionality involves scanning a 2D pattern to extract an address and retrieve an information resource (Compl. ¶18). For the ’999 Patent, the alleged functionality is a communication system that decodes a 2D pattern containing contact information and uses that information to communicate (Compl. ¶26). The complaint does not provide further technical details about the accused product's specific operation, nor does it contain allegations regarding its commercial importance or market position.

IV. Analysis of Infringement Allegations

No probative visual evidence provided in complaint.

The complaint references claim charts in exhibits that were not publicly filed (Compl. ¶17, ¶24). The infringement theory is therefore summarized from the narrative allegations in the complaint.

’807 Patent Infringement Allegations

The complaint alleges that Defendant’s use of its 2D bar code product directly infringes claims 12, 20, and 21, either literally or under the doctrine of equivalents (Compl. ¶14). The narrative theory for method claim 20 is that the accused use constitutes a method for retrieving an information resource that includes the steps of scanning a 2D machine-readable pattern, extracting an address from it, and retrieving the resource for a user (Compl. ¶18). The allegations for system claim 12 would correspond to a system configured to perform this method.

’999 Patent Infringement Allegations

The complaint alleges that Defendant's use of its 2D bar code product directly infringes claims 1, 4, 5, and 8, either literally or under the doctrine of equivalents (Compl. ¶21). The narrative theory for system claim 8 describes a communication system that includes processing means to decode a 2D code to derive contact information, imaging means to capture an image of the code, and communicating means to communicate using the derived contact information (Compl. ¶26). The allegations for system claim 1 are similar but focus on communication over a network.

Identified Points of Contention

• Scope Questions: The patent specification focuses heavily on a system of variable formatting using selectable parameters to optimize data density for specific hardware (’807 Patent, col. 4:51-62). A central question may be whether the asserted claims, which do not explicitly recite terms like "variable parameters" or "metasector," can be construed to read on the use of a standard, non-optimized 2D barcode, or if they are implicitly limited to the specific adaptable formatting method described as the invention.
• Technical Questions: The complaint offers conclusory allegations of infringement without providing specific facts about how the accused 2D bar code product operates. A key issue will be what evidence demonstrates that the accused product performs every claimed step or contains every claimed element. For instance, regarding claim 20 of the ’807 Patent, what evidence shows that the product is used to "extract[] an address" and "retriev[e] the information resource" as distinct steps required by the claim?

V. Key Claim Terms for Construction

• The Term: "machine readable indicia comprising digital data values formatted into a two dimensional pattern" (from ’807 Patent, Claim 20)

• Context and Importance: This term is foundational to the asserted claims. Its construction will likely determine whether the claims cover any standard 2D barcode or are limited to the specific, adaptable formatting technology that the patent describes as its core contribution. Practitioners may focus on this term because the defendant could argue that "formatted" implies the novel, parameter-driven optimization that distinguishes the invention from prior art.

• Intrinsic Evidence for Interpretation:

  • Evidence for a Broader Interpretation: The claim language itself does not include explicit limitations requiring variable parameters, optimization, or a "metasector." An argument could be made that any arrangement of data into a 2D pattern meets the plain meaning of "formatted."
  • Evidence for a Narrower Interpretation: The specification repeatedly describes the invention in terms of its "flexibility in formatting" that "allows the person providing data to optimize for any particular combination of encoding device and scanner" (’807 Patent, col. 4:55-59). The abstract and summary also emphasize this optimization aspect, which could support a narrower construction that limits the claim to patterns created through such a flexible process.

• The Term: "processing means for decoding a machine-readable code" (from ’999 Patent, Claim 8)

• Context and Importance: This term is drafted in means-plus-function format pursuant to 35 U.S.C. § 112(f) (or its predecessor, § 112, ¶ 6). Its scope is not limitless but is confined to the specific structures (i.e., algorithms) described in the specification that perform the decoding function, and their equivalents. The dispute will center on identifying those structures and determining whether the accused product contains them.

• Intrinsic Evidence for Interpretation:

  • Evidence for a Broader Interpretation: A party might argue that the corresponding structure is a general-purpose computer or processor running software capable of decoding a 2D pattern.
  • Evidence for a Narrower Interpretation: The specification discloses a specific, multi-step algorithm for decoding. This process involves "finding the landmark," then "finding the metasector," decoding the metasector to learn the formatting parameters, and only then "decoding the main body of data" (’999 Patent, Fig. 17; col. 27:26-41). An argument could be made that this detailed algorithm is the required "structure," thus narrowing the claim's scope to devices that perform this specific landmark-and-metasector-based decoding process.

VI. Other Allegations

Willful Infringement

The complaint alleges that Defendant has known of its infringement of the ’999 Patent since the date it was served with the complaint (Compl. ¶25). This allegation appears to be aimed at supporting a claim for enhanced damages based on post-suit willfulness. There are no facts alleged that would support pre-suit knowledge or willfulness.

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

• A core issue will be one of definitional scope: Will the term "formatted into a two dimensional pattern," which appears in claims rooted in a specification detailing a highly flexible and optimized encoding system, be construed broadly enough to encompass the use of a standard, non-optimized 2D barcode?
• A key evidentiary question will be one of structural correspondence: For the means-plus-function claim terms, what evidence will show that the accused product contains the specific decoding algorithm disclosed in the patent—including the steps of identifying a "landmark" and a "metasector"—or a structure that is legally equivalent?
• A central factual question will be the nature of the accused activity: The complaint’s allegation of infringement by "using" a "2D bar code product" lacks specificity. The case will likely depend on discovering the precise manner in which Defendant, an energy company, allegedly uses 2D barcodes and whether that specific use maps onto every limitation of the asserted claims.