DCT
1:19-cv-00292
Cooltvnetworkcom Inc v. Facebook Inc
Key Events
Amended Complaint
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: CoolTVNetwork.com, Inc. (Florida)
- Defendant: Facebook, Inc. (Delaware / California)
- Plaintiff’s Counsel: Devlin Law Firm LLC; Hansley Law Firm, PLLC
- Case Identification: 1:19-cv-00292, D. Del., 05/15/2019
- Venue Allegations: Venue is alleged to be proper in the District of Delaware because Defendant is incorporated in Delaware and has allegedly committed acts of patent infringement in the district.
- Core Dispute: Plaintiff alleges that Defendant’s Facebook and Instagram "Stories Ads" features infringe a patent related to creating and using multifunctional, interactive "hot spots" within digital video and audio content.
- Technical Context: The technology concerns methods for embedding interactive, function-selectable advertising and content links directly into streaming or stored digital media.
- Key Procedural History: The complaint alleges that Defendant had pre-suit knowledge of the patent-in-suit as of at least November 2016, based on communications between Plaintiff's President and Defendant's executives at the 2016 Web Summit in Lisbon. This allegation forms the basis for the willfulness claim.
Case Timeline
| Date | Event |
|---|---|
| 2000-06-08 | ’696 Patent Priority Date |
| 2007-01-09 | ’696 Patent Issue Date |
| 2016-11-16 | Date Plaintiff alleges Defendant gained knowledge of patent |
| 2019-05-15 | Complaint Filing Date |
II. Technology and Patent(s)-in-Suit Analysis
U.S. Patent No. 7,162,696 - Method and System for Creating, Using and Modifying Multifunctional Website Hot Spots
- Issued: January 9, 2007
The Invention Explained
- Problem Addressed: The patent addresses the limitations of prior art hyperlink and hot spot technology in digital media, which it characterizes as being static, inflexible, and not adaptable for a wide variety of functions within audio and video files. (’696 Patent, col. 2:16-27).
- The Patented Solution: The invention describes a system where "hot spots" embedded in digital media (e.g., a video file) are multifunctional. A user can interact with a function-expandable menu bar to select a "mode" (e.g., shop, bid, link, interact), which dictates the action performed when the user clicks on a hot spot. The function of these hot spots can also change automatically based on time stamps within the media file. (’696 Patent, Abstract; col. 3:3-14, 45-50).
- Technical Importance: The technology aimed to deepen user interaction with web-based video and audio, transforming passive media consumption into an interactive experience for e-commerce, communication, and information retrieval. (’696 Patent, col. 2:35-40).
Key Claims at a Glance
- The complaint asserts independent method claim 17. (Compl. ¶12, 21).
- Claim 17 requires the following essential steps:
- defining at least one hot spot by a communication with instructions stored on a tangible retaining medium;
- accessing at least one of the hot spots from a globally accessible network;
- performing at least one of a plurality of predetermined functions executed with the selection of each particular hot spot;
- wherein said hot spots reside on and are accessible from a digital video or audio file;
- wherein said predetermined functions are selected from a mode control;
- wherein the mode control comprises a plurality of modes (shop, bid, interact, entertainment, and link);
- wherein a specific mode is selected by a user through an expandable graphical user interface bar;
- wherein said specific mode further toggles based on time stamps in said digital video or digital audio file;
- wherein said hot spots are visualized by outlines, shading, or illumination...at a predetermined area on the display;
- wherein said Multifunctional Hot Spot apparatus is made to reside on and is executing on a computing system;
- selecting and activating at least one of said predetermined functions by clicking on each particular Multifunctional Hot Spot.
- The complaint does not explicitly reserve the right to assert dependent claims but references infringement of "one or more claims of the ‘696 patent." (Compl. ¶13).
III. The Accused Instrumentality
Product Identification
The accused instrumentalities are "Facebook Stories Ads, Instagram Stories Ads and related functionality." (Compl. ¶12).
Functionality and Market Context
The complaint describes the accused instrumentalities as systems that allow advertisers to create interactive advertisements within the "Stories" feature on Facebook and Instagram. (Compl. ¶22, p. 8). These ads, which can be photos or videos, can contain clickable elements ("hot spots") that allow users to perform various functions, such as visiting an external website ("link mode"), purchasing a product ("shop mode"), or interacting with a poll ("bid mode"). (Compl. ¶¶12, 15). The complaint alleges advertisers use tools like Facebook's "Ads Manager" to configure these functions. (Compl. ¶22, p. 12). A screenshot from the complaint shows an Instagram Stories ad that acts as a "Multifunctional hotspot." (Compl. ¶22, p. 8).
IV. Analysis of Infringement Allegations
’696 Patent Infringement Allegations
| Claim Element (from Independent Claim 17) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| defining at least one hot spot by a communication with instructions stored on a tangible retaining medium; | Defendant provides hot spots via instructions stored on Facebook servers and a user's smartphone. The complaint points to the Instagram API as the "tangible retaining medium (database)." | ¶22, p. 9 | col. 10:40-44 |
| accessing at least one of the hot spots from a globally accessible network; | The hot spots within Instagram Stories ads are provided via the internet, which is a globally accessible network. | ¶22, p. 10 | col. 10:45-48 |
| wherein said hot spots reside on and are accessible from a digital video or audio file; | Defendant provides hot spots that reside on and are accessible from digital video files in the form of "stories ads." A screenshot shows a clickable "Shop Now" cue on a video ad. | ¶22, p. 11 | col. 10:52-54 |
| wherein said predetermined functions are selected from a mode control; | The functions of the ads are selected from a "mode control," which the complaint identifies as Facebook's "Ads Manager" tool for advertisers. | ¶22, p. 12 | col. 10:55-56 |
| wherein the plurality of modes comprise a shop mode, a bid mode, an interact mode, an entertainment mode, and a link mode; | The accused ads provide a plurality of modes, including a "shop mode" for purchases, a "bid mode" for polls, an "interact mode" for chatting, an "entertain mode" for video, and a "link mode" for visiting URLs. | ¶22, p. 15 | col. 10:59-62 |
| wherein a specific mode is selected by a user through an expandable graphical user interface bar; | The complaint alleges that advertisers select specific modes through an expandable graphical user interface bar within the ad creation tools. A screenshot shows a product being selected from an expandable interface. | ¶22, p. 20 | col. 11:1-3 |
| wherein said specific mode further toggles based on time stamps in said digital video or digital audio file; | An Instagram Story is a sequence of screens, with each screen acting as a time stamp. The function of hot spots can vary depending on which screen (time interval) of the Story is being viewed. | ¶22, p. 21 | col. 11:4-6 |
| wherein said hot spots are visualized by outlines, shading, or illumination...at a predetermined area on the display; | The hot spots are visualized by visual cues, such as a "Shop now" or "Learn More" button overlaid on the ad. A screenshot shows a "Learn More" button, identified as a visual cue, on an Instagram ad. | ¶22, p. 25 | col. 11:7-10 |
| selecting and activating at least one of said predetermined functions by clicking on each particular Multifunctional Hot Spot. | Users select and activate the predetermined functions by clicking on the visual cues or hot spots within the Stories ad. | ¶22, p. 27 | col. 11:21-25 |
- Identified Points of Contention:
- Scope Questions: A central question may be whether Facebook's backend "Ads Manager," used by advertisers to create the ad, can be construed as the "mode control" and "expandable graphical user interface bar" recited in the claim. The patent figures appear to depict these as real-time, end-user-facing controls integrated with the media player. (e.g., ’696 Patent, Fig. 3, element 93). The dispute may focus on whether the claim requires the end user or the ad creator to be the one selecting the mode via the specified interface.
- Technical Questions: The complaint alleges that the sequential nature of Instagram Stories, where different screens can have different functions, meets the "toggles based on time stamps" limitation. (Compl. ¶22, p. 21). This raises the question of whether "toggling" requires a single hot spot's function to change within a continuous video file, as the specification suggests ("The function of hot spots may vary during the running of a digital media file based on time stamps"), or if a sequence of separate media segments with different functions suffices. (’696 Patent, col. 3:45-50).
V. Key Claim Terms for Construction
The Term: "mode control"
Context and Importance: This term is critical because the infringement theory identifies Facebook's "Ads Manager"—a tool for advertisers—as the "mode control." (Compl. ¶22, p. 12). The defense may argue this is a mismatch, as the patent appears to describe a control for the end-user. The definition will determine whether the accused system's architecture maps to the claimed method.
Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The claim language itself does not specify who uses the "mode control" or when it is used (i.e., at media creation time vs. playback time).
- Evidence for a Narrower Interpretation: Figure 3 depicts "MODE CONTROL BUTTONS/BAR" (element 93) as part of the end-user's media player interface, displayed contemporaneously with the video area. The specification states, "Clicking an option in the menu bar determines the action to be taken when a user clicks on a multifunctional hot spot." (’696 Patent, col. 3:28-31). This suggests an end-user-facing, real-time control.
The Term: "toggles based on time stamps"
Context and Importance: Plaintiff's theory is that different screens in a Story represent different time stamps, causing the function to "toggle." (Compl. ¶22, p. 21). This interpretation is essential for infringement. Practitioners may focus on whether "toggle" implies a change of state for a single, persistent object, or if it can describe a sequence of different objects with different states.
Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The claim is not explicitly limited to a single, continuous video file. A sequence of time-stamped screens could be argued to constitute a "digital video or audio file" in the aggregate.
- Evidence for a Narrower Interpretation: The specification states, "The function of hot spots may vary during the running of a digital media file based on time stamps... The action of hot spots could be determined by a length of time into a video, or beginning and ending time stamps within the video." (’696 Patent, col. 3:45-50). This language may support a narrower reading where the functional change occurs within a single, continuous media stream.
VI. Other Allegations
- Indirect Infringement: The complaint alleges induced infringement under 35 U.S.C. § 271(b). It asserts that Facebook intentionally encourages infringement by providing advertisers with the tools (e.g., Ads Manager), instructions, and advertising about the benefits of using the accused interactive Stories Ads functionality in a manner that directly infringes the ’696 patent. (Compl. ¶¶ 16-17).
- Willful Infringement: The complaint alleges that Defendant had pre-suit knowledge of the ’696 patent as of November 16 and November 20, 2016, based on alleged in-person and electronic communications with Facebook's CTO, Mike Schroepfer, and another director, Julien Codorniou, at a Web Summit. (Compl. ¶¶ 18, 20). The continuation of the allegedly infringing activity after this notice is the basis for the willfulness claim. (Compl. ¶20).
VII. Analyst’s Conclusion: Key Questions for the Case
- A primary issue will be one of architectural mapping: Does the claimed "mode control" and "expandable graphical user interface bar" read on Facebook's back-end "Ads Manager" tool used by advertisers, or do the claims require a real-time, end-user-facing control interface that is contemporaneous with media playback, as the patent’s figures suggest?
- A key question of functional interpretation will be central: Does the sequential presentation of different interactive screens in a Facebook or Instagram "Story" meet the claim limitation that a mode "toggles based on time stamps in said digital video," or does the claim require the function of a single hot spot to change at different time codes within a single, continuous media file?
- The case will likely involve a temporal scope analysis, examining whether claim terms from a patent with a 2000 priority date, conceived in the context of desktop web browsers and early streaming video, can be properly construed to cover the architecture of a modern, mobile-first, ephemeral social media advertising platform.