DCT

1:20-cv-00351

IBM Corp v. Airbnb Inc

I. Executive Summary and Procedural Information

Parties & Counsel:
- Plaintiff: International Business Machines Corporation (New York)
- Defendant: Airbnb, Inc. (Delaware)
- Plaintiff’s Counsel: Shaw Keller LLP; Desmarais LLP
Case Identification: 1:20-cv-00351, D. Del., 06/30/2020
Venue Allegations: Venue is alleged to be proper in the District of Delaware as Defendant Airbnb is a Delaware corporation and conducts business in the state, including offering services through its websites and mobile applications accessible there.
Core Dispute: Plaintiff alleges that Defendant’s websites and mobile applications, which form the core of its online travel and lodging reservation business, infringe six patents related to foundational e-commerce technologies, including user interface design, search functionality, single-sign-on processes, and data processing.
Technical Context: The patents-in-suit relate to fundamental web technologies developed from the late 1980s through the 2000s, covering how online services present information, manage user interactions, and structure data, technologies which are now foundational to modern e-commerce platforms.
Key Procedural History: The complaint details a nearly six-year history of licensing negotiations between the parties, beginning in May 2014. Plaintiff alleges it repeatedly provided Defendant with notice and detailed evidence of infringement for the patents-in-suit on a rolling basis, beginning with the ’849 and ’346 patents in 2014-2015, and concluding with the ’676 and ’760 patents in May 2020. This extensive pre-suit history is asserted as the basis for willful infringement.

Case Timeline

Date	Event
1988-07-15	’849 Patent Priority Date
1988-Late	Prodigy online service, embodying ’849 patent inventions, launched
1999-06-22	’038 Patent Priority Date
2001-02-07	’193 and ’676 Patents Priority Date
2002-10-31	’346 Patent Priority Date
2004-08-17	’193 Patent Issued
2004-08-31	’676 Patent Issued
2005-11-15	’038 Patent Issued
2006-07-04	’849 Patent Issued
2008	Airbnb founded
2009-12-08	’346 Patent Issued
2010-06-29	’760 Patent Priority Date
2014-05	IBM first contacted Airbnb regarding a potential license
2015-03-30	Airbnb allegedly had knowledge of the ’849 and ’346 patents
2017-07-18	’760 Patent Issued
2019-11	Airbnb allegedly had knowledge of the ’193 and ’038 patents
2020-05-28	Airbnb allegedly had knowledge of the ’676 and ’760 patents
2020-06-30	Complaint Filed

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

U.S. Patent No. 7,072,849 - "Method for presenting advertising in an interactive service"

Issued: July 4, 2006

The Invention Explained

Problem Addressed: In the early days of online services (pre-World Wide Web), the "dumb" terminal approach relied heavily on centralized host servers for all processing and storage, which was inefficient, slow, and expensive for delivering interactive graphical content to millions of users (Compl. ¶21; ’849 Patent, col. 1:15-41).
The Patented Solution: The invention solves this problem by structuring applications and advertisements as discrete "objects" of data and code. This allows the system to leverage the computing power of the user's local personal computer (PC) to compose applications "on the fly" from these objects, some of which could be pre-fetched and stored locally (e.g., in a cache), thereby reducing the processing load on the host server and minimizing network traffic (Compl. ¶22; ’849 Patent, col. 3:1-12).
Technical Importance: This object-based, distributed processing architecture was a key technical enabler for one of the first large-scale graphical user interfaces for an online service, Prodigy, making interactive e-commerce viable before the modern internet existed (Compl. ¶23).

Key Claims at a Glance

The complaint asserts at least independent claim 1 (Compl. ¶47).
Claim 1 of the ’849 Patent recites a method for presenting advertising from a computer network that includes:
- Structuring applications for presentation at a first portion of a display screen.
- Structuring advertising in a compatible manner for presentation at a second portion of the display concurrently with the applications.
- This structuring includes configuring the advertising as "objects" that include advertising data.
- Selectively storing the advertising objects at a local store (e.g., a cache) at the user's reception system.
The complaint does not explicitly reserve the right to assert dependent claims.

U.S. Patent No. 6,778,193 - "Customer self service iconic interface for portal entry and search specification"

Issued: August 17, 2004

The Invention Explained

Problem Addressed: Early graphical user interfaces (GUIs) for search systems failed to provide an effective way for users to supply the full range of relevant contextual information (e.g., user preferences, situational variables) needed to fine-tune a search query and obtain accurate results (Compl. ¶24; ’193 Patent, col. 1:20-34).
The Patented Solution: The invention provides an improved GUI that uses a series of distinct "visual workspaces" to manage a search. A first workspace allows a user to enter a query and select high-level context elements (represented by icons). A second workspace visualizes the search results, indicating a "degree of fit." A third workspace allows for detailed modification of context attributes and evaluation criteria to further refine the results (Compl. ¶25; ’193 Patent, col. 4:15-40).
Technical Importance: This multi-workspace approach allows a user to express their context as part of the query itself, enabling more efficient and accurate search and retrieval while reducing server processing steps (Compl. ¶25).

Key Claims at a Glance

The complaint asserts at least independent claim 1 (Compl. ¶65).
Claim 1 of the ’193 Patent recites a graphical user interface comprising:
- A first visual workspace with a query entry field and selectable graphical user context elements.
- A second visual workspace for visualizing the set of resources matching the query, indicating a degree of fit.
- A third visual workspace for selecting and modifying context attribute values to increase specificity and accuracy.
- A mechanism for navigating among the first, second, and third visual workspaces.
The complaint does not explicitly reserve the right to assert dependent claims.

U.S. Patent No. 7,631,346 - "Runtime user account creation operation in a single-sign-on process"

Issued: December 8, 2009
Technology Synopsis: The patent addresses a limitation in conventional single-sign-on (SSO) technology, which required a user to already have an account at a service provider to use SSO. The invention provides a method in a federated computing environment to trigger an SSO operation for a user who does not yet have an account, creating the account "on the fly" as part of the process of accessing a protected resource (Compl. ¶26-27).
Asserted Claims: At least independent claim 1 (Compl. ¶80).
Accused Features: The complaint alleges infringement by Airbnb’s feature that allows a new user to sign up for an Airbnb account using credentials from a third-party system, such as Facebook, as part of a single-sign-on operation (Compl. ¶80).

U.S. Patent No. 6,966,038 - "Improved navigation between file and program locations in a computer network environment using bookmarks"

Issued: November 15, 2005
Technology Synopsis: The patent addresses the difficulty of navigating complex, distributed computer systems with large numbers of files and programs. It describes specialized "bookmarks" in a graphical user interface that can refer to specific locations (e.g., files, views within programs) and allow a user to navigate directly to that resource, bypassing multiple manual navigation steps (Compl. ¶28-29).
Asserted Claims: At least independent claim 7 (Compl. ¶89).
Accused Features: The complaint alleges infringement by Airbnb’s use of "deep links" that function as bookmarks, allowing users to navigate directly to specific resource locations within Airbnb's computer system, such as a particular property listing (Compl. ¶89).

U.S. Patent No. 6,785,676 - "Customer self service subsystem for response set ordering and annotation"

Issued: August 31, 2004
Technology Synopsis: The patent addresses the failure of prior art search systems to use real-time contextual information to rank search results dynamically. The invention describes a system that classifies a user's current context by comparing a query and user-inputted information against the user's interaction history, generating a "user context vector" that is used by an adaptive algorithm to rank and annotate search results in a personalized manner (Compl. ¶30-31).
Asserted Claims: At least independent claim 14 (Compl. ¶105).
Accused Features: The complaint alleges infringement by Airbnb's systems that generate personalized search results, such as the "Similar Listings Carousel." This is alleged to involve receiving a "user context vector" (e.g., user history and type embeddings) and applying an ordering function (e.g., cosine similarity calculation) to rank and present results interactively (Compl. ¶105).

U.S. Patent No. 9,710,760 - "Multi-facet classification scheme for cataloging of information artifacts"

Issued: July 18, 2017
Technology Synopsis: The patent addresses the problem of inaccurate and outdated automatic image classification. It describes a system that iteratively refines its classification scheme by analyzing relationships between labels applied to images in a database, allowing it to learn which features tend to co-occur (e.g., "underwater" and "blue") and which are mutually exclusive (e.g., "outside" and "inside"), thereby continuously improving classification accuracy (Compl. ¶32-33).
Asserted Claims: At least independent claim 1 (Compl. ¶120).
Accused Features: The complaint alleges infringement by Airbnb's image classification model, which is alleged to construct a hierarchical, multi-faceted classification structure. This structure allegedly classifies visual categories (e.g., room types, amenities) into an ontology that accounts for co-occurring features (e.g., pillows, beds) and mutually exclusive features (e.g., bedroom, kitchen) to tag and retrieve images (Compl. ¶120).

III. The Accused Instrumentality

Product Identification: The accused instrumentalities are Defendant’s websites, including at least www.airbnb.com, and its mobile applications running on platforms such as Apple iOS and Google Android (Compl. ¶35, 46).
Functionality and Market Context: The accused products provide an online platform that connects consumers with providers of lodging, tourism, and other travel experiences (Compl. ¶34). The complaint alleges that these products use the patented technologies to perform core functions such as presenting interactive applications and advertisements, enabling contextual search for properties and experiences, managing user authentication, facilitating navigation through deep links, and classifying images to present listings to users (Compl. ¶47, 65, 80, 89, 105, 120). Airbnb is described as having grown rapidly to generate billions of dollars in annual revenue using this platform (Compl. ¶34).

No probative visual evidence provided in complaint.

IV. Analysis of Infringement Allegations

’849 Patent Infringement Allegations

Claim Element (from Independent Claim 1)	Alleged Infringing Functionality	Complaint Citation	Patent Citation
a method of presenting advertising obtained from a computer network...	Airbnb’s platform presents advertising and interactive applications (e.g., reservations) to users over the Internet (Compl. ¶47a).	¶47a	col. 3:1-4
structuring applications so that they may be presented, through the network, at a first portion of one or more screens of display	The Airbnb website and mobile apps structure and present applications like "Stays, Experiences, and Adventures" in a portion of the user's display (Compl. ¶47b).	¶47b	col. 5:28-34
structuring advertising in a manner compatible to that of the applications so that it may be presented... at a second portion... concurrently with applications	Advertising for services like "Stays" is structured to be compatible with the main applications and is presented concurrently on the same webpage (Compl. ¶47c).	¶47c	col. 5:35-42
wherein structuring the advertising includes configuring the advertising as objects that include advertising data	The advertising is configured as objects, such as HTTP Responses that contain image files (e.g., png or jpeg) and associated data (Compl. ¶47c).	¶47c	col. 4:54-58
selectively storing advertising objects at a store established at the reception system	Advertising objects are selectively stored in the user's browser cache, a process allegedly directed by Airbnb through cache control parameters sent from its servers (Compl. ¶47d).	¶47d	col. 5:53-56

Identified Points of Contention:
- Scope Questions: A central question may be whether modern web assets, such as "HTTP Responses containing png or jpeg files," fall within the scope of the term "objects" as it was understood and described in the patent, which originates from the 1980s pre-web Prodigy service.
- Technical/Legal Questions: The complaint alleges that steps performed by third-party systems—such as a user's web browser ("structuring" steps) or a Content Delivery Network ("selectively storing")—are attributable to Airbnb under a theory of direction or control (Compl. ¶48-50). The viability of this divided infringement theory will likely be a key point of dispute.

’193 Patent Infringement Allegations

Claim Element (from Independent Claim 1)	Alleged Infringing Functionality	Complaint Citation	Patent Citation
a first visual workspace comprising entry field enabling entry of a query... and, one or more selectable graphical user context elements...	The initial Airbnb search/query screen, which contains query fields (e.g., destination, dates) and selectable context elements (e.g., number of guests, type of stay) (Compl. ¶65b).	¶65b	col. 13:19-24
a second visual workspace for visualizing the set of resources... said system indicating a degree of fit...	The Airbnb search results page, which displays the listings determined to match the query. The "degree of fit" is allegedly indicated by the sort order of the results (Compl. ¶65c).	¶65c	col. 13:25-32
a third visual workspace for enabling said user to select and modify context attribute values to enable increased specificity...	The "More filters" window, accessed from the results screen, which allows users to modify context attributes (e.g., amenities, "Superhost" status) to refine the search (Compl. ¶65d).	¶65d	col. 13:33-37
a mechanism enabling said user to navigate among said first, second and third visual workspaces...	The "Search" button on the initial query screen and the "More filters" link on the results screen, which enable the user to move between these different interface states (Compl. ¶65e).	¶65e	col. 13:38-40

Identified Points of Contention:
- Scope Questions: The analysis may turn on whether the term "visual workspace" can be construed to cover a sequence of web pages and a modal pop-up window (the "More filters" screen). The defendant may argue that the patent contemplated a more integrated, persistent set of interface panels rather than separate, transient UI states.
- Technical Questions: A factual question is whether the "sort order" of search results on the Airbnb platform performs the claimed function of "indicating a degree of fit" based on the user's full context and the specified evaluation criteria, or if it is based on a different, simpler ranking algorithm.

V. Key Claim Terms for Construction

Patent: ’849 Patent

The Term: "objects"
Context and Importance: The infringement theory for the ’849 patent hinges on equating modern web components like "HTTP Responses containing png or jpeg files" with the "objects" described in the patent's specification. The construction of this term is therefore critical to determining whether current web architecture reads on this pre-web invention.
Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: Practitioners may cite language describing objects functionally as comprising "data and program code" capable of being processed by a user's PC to reduce server load, a description that could arguably apply to modern client-side rendering of web assets (Compl. ¶22; ’849 Patent, col. 4:54-58).
- Evidence for a Narrower Interpretation: Practitioners may point to specific embodiments in the patent tied to the Prodigy system, which describes a more specific architecture of pre-created, interactive text/graphic sessions and object structures, to argue for a narrower definition that does not cover general-purpose web protocols like HTTP (Compl. ¶21; ’849 Patent, Abstract).

Patent: ’193 Patent

The Term: "visual workspace"
Context and Importance: Claim 1 requires three distinct "visual workspaces." The complaint maps these to the main search page, the results page, and the "More filters" pop-up window. The case will likely depend on whether these three different UI states meet the definition of three distinct workspaces.
Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The patent abstractly describes workspaces for different functions (context selection, results visualization, detail specification), which could support an interpretation where any distinct UI view that performs one of these functions qualifies as a "workspace" (’193 Patent, col. 4:15-37).
- Evidence for a Narrower Interpretation: The patent figures (e.g., FIG. 2) and detailed descriptions depict distinct, potentially co-existing interface panels. This may support an argument that the term requires more than just a sequence of different web pages or a temporary modal dialog to constitute separate "workspaces" (’193 Patent, FIG. 2).

VI. Other Allegations

Indirect Infringement: For multiple patents, the complaint alleges that to the extent Airbnb does not perform all method steps, the remaining steps are performed by end users operating their client devices, and that Airbnb induces this infringement by providing the website and mobile applications and instructing users on their use (e.g., Compl. ¶52, ¶57, ¶67). Contributory infringement is also alleged, based on providing computer code (e.g., HTML, JavaScript) that is especially adapted for infringement and has no substantial non-infringing use (e.g., Compl. ¶53-54, ¶68-69).
Willful Infringement: The complaint alleges willful infringement for all six patents based on pre-suit knowledge. It provides a detailed timeline of communications, alleging that Airbnb knew of the ’849 and ’346 patents since March 2015; the ’193 and ’038 patents since November 2019; and the ’676 and ’760 patents since May 2020 (Compl. ¶36-42, 51, 66, 82, 91, 106, 122).

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

This litigation presents several fundamental questions at the intersection of early e-commerce patents and modern web platforms. The outcome may turn on the court's resolution of the following issues:

A core issue will be one of definitional scope and temporal translation: Can claim terms rooted in the 1980s/1990s client-server architectures of services like Prodigy (e.g., "objects," "visual workspace") be construed to read on the functionally analogous but architecturally distinct components of today's distributed web and mobile application environments (e.g., HTTP responses, sequential web pages, modal windows)?
A second central question will be one of divided infringement liability: The complaint's infringement theories for several method claims rely on attributing actions performed by third-party browsers, Content Delivery Networks, and end-users to Airbnb. A key legal battle will be whether the plaintiff can establish the requisite "direction or control" to hold a single entity responsible for all steps of the claimed methods in a modern, multi-actor internet ecosystem.
Finally, a key evidentiary question will be one of technical operation: For patents related to search and classification, the dispute may focus on whether Airbnb’s complex, proprietary algorithms for ranking results and categorizing images actually operate in the specific manner required by the claim limitations, or if there is a fundamental mismatch in their technical function.