Realtime Data LLC v. Pivot3 Inc

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: REALTIME DATA LLC d/b/a IXO (New York)
  • Defendant: Pivot3, Inc. (Delaware)
  • Plaintiff’s Counsel: Bayard, PA.; Russ August & Kabat
• Case Identification: 1:19-cv-00357, D. Del., 02/21/2019
• Venue Allegations: Venue is alleged to be proper in the District of Delaware because Defendant Pivot3, Inc. is a Delaware corporation.
• Core Dispute: Plaintiff alleges that Defendant’s hyperconverged infrastructure products, which provide data storage and management, infringe patents related to accelerated and efficient data compression.
• Technical Context: The technology concerns methods for compressing data to reduce storage requirements and increase the speed at which data can be written to and retrieved from memory devices.
• Key Procedural History: The complaint notes that Plaintiff has licensed patents in its portfolio to "many of the world's leading technology companies," which may be relevant to future damages arguments or assessments of commercial success. No prior litigation or post-grant proceedings involving the patents-in-suit are mentioned.

Case Timeline

Date	Event
1998-12-11	’825 Patent Priority Date
1999-03-11	’908 Patent Priority Date
2000-10-03	’751 Patent Priority Date
2015-01-13	’825 Patent Issued
2015-08-25	’908 Patent Issued
2017-05-30	’751 Patent Issued
2019-02-21	Complaint Filed

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

U.S. Patent No. 9,116,908 - "System and methods for accelerated data storage and retrieval"

The Invention Explained

• Problem Addressed: The patent’s background section describes the problem that existing memory storage devices, such as magnetic disks, severely limit the performance of computer systems due to their slow read/write data rates, creating a bottleneck compared to the much higher processing speeds of modern CPUs and system buses (’908 Patent, col. 1:20-48).
• The Patented Solution: The invention proposes to solve this problem by compressing an input data stream before it is stored on the memory device. This "accelerated data storage" is achieved when the combined time to compress and store the data is less than the time it would have taken to store the original, uncompressed data, effectively increasing the data storage bandwidth of the device (’908 Patent, col. 2:60-67; Fig. 1).
• Technical Importance: This approach seeks to overcome the physical limitations of storage media by using data compression as a means to increase the effective data transfer rate, thereby improving overall system performance for data-intensive operations (Compl. ¶1).

Key Claims at a Glance

• The complaint asserts independent claim 21 (Compl. ¶8).
• The essential elements of Claim 21 are:
  • A method for accelerating data storage of data, comprising:
  • compressing a first data block with a first data compression technique to provide a first compressed data block;
  • compressing a second data block with a second data compression technique to provide a second compressed data block, wherein the first data compression technique and the second data compression technique are different;
  • storing the first and second data compressed blocks on a memory device wherein the compression and storage occurs faster than the first and second data blocks are able to be stored on the memory device in uncompressed form.
• The complaint reserves the right to assert other claims (Compl. ¶16).

U.S. Patent No. 9,667,751 - "Data feed acceleration"

The Invention Explained

• Problem Addressed: The patent addresses the need to accelerate the transmission of broadcast data, such as financial data and news feeds, over a communication channel. Conventional systems face limitations in bandwidth and latency, which are critical in time-sensitive fields like financial trading (’751 Patent, col. 1:40-48, col. 2:21-28).
• The Patented Solution: The invention proposes a method where the content of a data block is analyzed to identify a parameter or attribute, which then dictates the selection of an appropriate encoder. This content-aware selection, which explicitly "excludes analyzing based solely on reading a descriptor," is performed using a "state machine." The process is designed to be faster than storing the data in uncompressed form, thereby accelerating the data feed (’751 Patent, Abstract; col. 2:50-60).
• Technical Importance: This method provides a more intelligent, content-adaptive approach to compression for data streams, aiming to improve both compression efficiency and speed by moving beyond generic compression or simple descriptor-based methods (Compl. ¶1).

Key Claims at a Glance

• The complaint asserts independent claim 1 (Compl. ¶23).
• The essential elements of Claim 1 are:
  • A method for compressing data, comprising:
  • analyzing content of a data block to identify a parameter, attribute, or value of the data block that excludes analyzing based solely on reading a descriptor;
  • selecting an encoder associated with the identified parameter, attribute, or value;
  • compressing data in the data block with the selected encoder to produce a compressed data block, wherein the compressing includes utilizing a state machine; and
  • storing the compressed data block;
  • wherein the time of the compressing the data block and the storing the compressed data block is less than the time of storing the data block in uncompressed form.
• The complaint reserves the right to assert other claims (Compl. ¶25, ¶32).

U.S. Patent No. 8,933,825 - "Data compression systems and methods"

• Technology Synopsis: The patent addresses the challenge of selecting an optimal compression technique for a given set of input data. The solution involves a method of analyzing a data block to determine a parameter or attribute of its data content—not based solely on a descriptor—and then compressing the block with a pre-associated encoder for that parameter or a default encoder if no specific parameter is identified (’825 Patent, Abstract).
• Asserted Claims: Independent claim 18 is asserted (Compl. ¶38).
• Accused Features: The complaint alleges that Defendant's use of compression and deduplication techniques in its hyperconverged infrastructure products infringes this patent by analyzing data blocks to determine whether they are duplicates and applying different encoders (e.g., a deduplication technique or a default compression technique) based on that analysis (Compl. ¶43, ¶47-48).

III. The Accused Instrumentality

Product Identification

The Accused Instrumentalities include Pivot3’s vSTAC OS software, Pivot3 Acuity Hyperconverged Infrastructure, and associated hardware models (X5-6500, X5-6000, X5-2500, X5-2000) (Compl. ¶7, ¶22, ¶37).

Functionality and Market Context

The complaint alleges the Accused Instrumentalities perform an "inline data reduction function" that "compresses and deduplicates the capacity of the data by stripping common patterns out of the write ingest data stream" (Compl. ¶13). This functionality is described as an "inline pattern match compression and deduplication function that recognizes common patterns in the data stream and immediately strips them at an individual block level" (Compl. ¶14, ¶27). The complaint alleges these features provide significant performance benefits, such as a "7:1 IO reduction" and extending the life of underlying storage hardware (Compl. ¶12, ¶25, ¶42).

IV. Analysis of Infringement Allegations

9,116,908 Infringement Allegations

Claim Element (from Independent Claim 21)	Alleged Infringing Functionality	Complaint Citation	Patent Citation
compressing a first data block with a first data compression technique to provide a first compressed data block;	The Accused Instrumentalities employ an "inline data reduction function [that] compresses... the capacity of the data by stripping common patterns out of the write ingest data stream."	¶13	col. 2:60-62
and compressing a second data block with a second data compression technique to provide a second compressed data block, wherein the first data compression technique and the second data compression technique are different;	The complaint alleges that the Accused Instrumentalities perform a "deduplication technique" in addition to compression. It frames deduplication as a distinct technique that compares incoming blocks with stored data to eliminate duplicates, whereas compression eliminates redundancies within blocks.	¶14	col. 2:62-65
storing the first and second data compressed blocks on a memory device wherein the compression and storage occurs faster than the first and second data blocks are able to be stored on the memory device in uncompressed form.	The complaint alleges that because the data reduction is performed "inline," there is an "immediate capacity reduction benefit" and "no performance penalty." This allegedly results in the total time for compression and storage being less than for storing uncompressed data. A graphic in the complaint shows consumed versus provisioned storage, illustrating the capacity savings. (Compl. Exhibit 2).	¶15, ¶8	col. 2:65-67

Identified Points of Contention

• Scope Questions: A central question may be whether "deduplication," as described in the complaint, qualifies as a "data compression technique" that is "different" from the other "compression technique" under the claim's language. The analysis could turn on whether the patent's specification contemplates deduplication as a form of compression or as a separate process.
• Technical Questions: The complaint asserts that the combined compression and storage is "faster" than uncompressed storage. A technical question will be what evidence demonstrates that Pivot3's specific implementation of inline deduplication and compression meets this performance-based limitation across various operating conditions.

9,667,751 Infringement Allegations

Claim Element (from Independent Claim 1)	Alleged Infringing Functionality	Complaint Citation	Patent Citation
analyzing content of a data block to identify a parameter, attribute, or value of the data block that excludes analyzing based solely on reading a descriptor;	The complaint alleges that the Accused Instrumentalities' deduplication function "compares incoming blocks to identify duplicate data blocks." This is framed as analyzing the content of the block (e.g., via a hash like SHA-1) rather than reading a pre-existing descriptor.	¶27	col. 2:50-53
selecting an encoder associated with the identified parameter, attribute, or value;	The complaint alleges that if a duplicate block is identified, a "deduplication technique" is used; otherwise, a "data compression technique" is used. This implies the selection of an encoder based on the identified attribute of the block (i.e., whether it is a duplicate).	¶28	col. 2:53-55
compressing data in the data block with the selected encoder to produce a compressed data block, wherein the compressing includes utilizing a state machine;	The complaint alleges that compression and deduplication techniques are supported. It recites the "state machine" language from the claim but does not provide specific facts explaining how the accused products utilize one.	¶29	col. 2:55-58
and storing the compressed data block;	The complaint alleges that compressed data blocks are stored on SSD or HDD, providing an "immediate capacity reduction benefit."	¶30	col. 2:58-59
wherein the time of the compressing the data block and the storing the compressed data block is less than the time of storing the data block in uncompressed form.	The complaint alleges that because the data reduction functions are performed "inline," there is "no performance penalty," making the process faster than storing uncompressed data.	¶31	col. 2:59-62

Identified Points of Contention

• Scope Questions: The dispute may focus on whether generating a hash of a data block's content (e.g., SHA-1) and comparing it to an index constitutes "analyzing content... that excludes analyzing based solely on reading a descriptor." A defendant might argue the hash itself functions as a descriptor.
• Technical Questions: The complaint provides no specific factual allegations regarding the accused products' use of a "state machine." What evidence does the complaint provide that the accused deduplication or compression functions are implemented "utilizing a state machine" as required by the claim?

V. Key Claim Terms for Construction

For the ’908 Patent

• The Term: "data compression technique"
• Context and Importance: This term's construction is critical because the infringement theory relies on "deduplication" being considered a "data compression technique" that is "different" from another form of compression. If deduplication is construed to be outside the scope of this term, the claim may not be infringed.
• Intrinsic Evidence for Interpretation:
  • Evidence for a Broader Interpretation: The specification broadly describes the field of the invention as "data compression and decompression" (’908 Patent, col. 1:15-18). The term itself is not explicitly defined, which may support giving it its plain and ordinary meaning, which could arguably include any technique that reduces data size, such as deduplication.
  • Evidence for a Narrower Interpretation: The patent frequently discusses "lossless data compression techniques" in the context of specific algorithms like "run length, Huffman, Lempel-Ziv Dictionary Compression, arithmetic coding," etc., without mentioning deduplication (’908 Patent, col. 7:8-13). A defendant may argue that the term should be limited to these types of intra-block redundancy-reduction algorithms.

For the ’751 Patent

• The Term: "analyzing content of a data block... that excludes analyzing based solely on reading a descriptor"
• Context and Importance: The plaintiff's theory hinges on showing that the accused deduplication process, which involves hashing a block's content, meets this limitation. The case may turn on whether creating and using a hash is considered "analyzing content" or is functionally equivalent to creating and "reading a descriptor."
• Intrinsic Evidence for Interpretation:
  • Evidence for a Broader Interpretation: The patent specification distinguishes its method from prior art that relies on "file type descriptors... appended to file names" (’751 Patent, col. 3:1-4). This suggests "descriptor" may refer to external metadata, supporting an interpretation that any analysis of the data within the block is "analyzing content."
  • Evidence for a Narrower Interpretation: The patent describes its invention in the context of identifying "data types, data structures, and formats within a given file" (’751 Patent, col. 3:4-6). A defendant may argue that this limitation requires a deeper semantic analysis of the data's structure or format, not merely generating a hash value that represents the entire block as a monolithic sequence of bits.

VI. Other Allegations

• Indirect Infringement: The complaint alleges inducement of infringement based on Defendant’s promotional materials, user manuals, product support, and training materials, which allegedly instruct and encourage customers to use the Accused Instrumentalities in their infringing manner (Compl. ¶11-12, ¶25, ¶41-42). Contributory infringement is alleged on the basis that the accused products are especially manufactured for this infringing use and are not staple articles of commerce suitable for substantial non-infringing use (Compl. ¶9, ¶26, ¶39).
• Willful Infringement: Willfulness is not explicitly pleaded as a separate count, but the allegations of knowledge could support a future claim. The complaint alleges that Pivot3 has had knowledge of the patents and its infringement "since at least the filing of the original Complaint in this action, or shortly thereafter" (Compl. ¶10, ¶24, ¶40).

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

• A core issue will be one of definitional scope: can the term "data compression technique," as used in the ’908 patent, be construed to encompass data deduplication as a distinct method from traditional data compression algorithms? The resolution of this question will be central to determining infringement of the claim requiring two "different" techniques.
• A second key issue will be one of functional characterization: does the accused products' process of generating a hash value for a data block to identify duplicates constitute "analyzing content... that excludes analyzing based solely on reading a descriptor" under the ’751 patent, or is the hash itself a form of descriptor?
• A crucial evidentiary question for all asserted patents will be one of performance: what technical evidence will be presented to prove that the accused "inline" compression and deduplication functions, when combined with the act of storage, are demonstrably "faster" than storing the same data in uncompressed form, as required by the claims?