DataCloud Tech LLC v. Wixcom Inc

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: DataCloud Technologies, LLC (Georgia)
  • Defendant: Wixcom, Inc. (Delaware)
  • Plaintiff’s Counsel: Stamoulis & Weinblatt, LLC; Heninger Garrison Davis, LLC
• Case Identification: 1:20-cv-01314, D. Del., 09/29/2020
• Venue Allegations: Plaintiff alleges venue is proper in the District of Delaware because Defendant is incorporated in Delaware and therefore resides in the district.
• Core Dispute: Plaintiff alleges that Defendant’s website building platform, mobile applications, and hosting services infringe four patents related to operating system functions, data management, and network communications.
• Technical Context: The patents address foundational technologies in operating systems, data organization, and network architecture, which are fundamental to modern cloud-based services and website development platforms.
• Key Procedural History: The complaint asserts U.S. Patent No. 6,560,613, including at least Claim 1. Subsequent to the complaint's filing, an Inter Partes Review (IPR) proceeding (IPR2021-00361) resulted in the cancellation of Claim 1, as well as claims 2, 5, 7, 14, and 17, which may significantly impact the viability of the infringement count for this patent. The complaint also references pre-suit notice letters sent to the Defendant.

Case Timeline

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

U.S. Patent No. 6,560,613, Disambiguating File Descriptors, issued May 6, 2003

The Invention Explained

• Problem Addressed: The patent describes a problem in operating systems like UNIX where the same system calls are used to access different types of "files," such as files stored on physical media (e.g., a hard disk) and communication channels (e.g., a network socket). This makes it difficult to selectively intercept system calls for one file type without affecting the other, limiting the ability to create customized security or functionality (e.g., blocking write access to disk files while allowing write access to network communications) (’613 Patent, col. 2:26-61).
• The Patented Solution: The invention proposes a method to distinguish between these different file types. It involves intercepting system calls that create file descriptors and storing an "indicator" in a table that specifies the file's type (e.g., "communication channel"). When a process later attempts to access a file, a "system call wrapper" checks this indicator table to determine the file type and can then apply different rules or execute different code based on that type (’613 Patent, Abstract; col. 3:62-col. 4:44).
• Technical Importance: This method provided a way to add a layer of granular control and security to operating systems at a low level, enabling more sophisticated management of process permissions beyond the default capabilities of the OS (’613 Patent, col. 2:8-24).

Key Claims at a Glance

• Independent Claim 1 (cancelled post-filing) is asserted in the complaint (Compl. ¶24).
• The essential elements of asserted independent claim 1 include:
  • intercepting system calls that establish a file descriptor;
  • storing at least one indicator of a file type associated with the established file descriptor;
  • intercepting system calls that create a copy of a file descriptor;
  • storing an indicator for the created copy; and
  • upon an attempt to access a file, examining the stored indicator(s) to determine the file descriptor's type.
• The complaint reserves the right to assert other claims (Compl. ¶25).

U.S. Patent No. 6,651,063, Data Organization And Management System And Method, issued November 18, 2003

The Invention Explained

• Problem Addressed: The patent addresses the difficulty businesses and consumers face in collecting and organizing information received from various sources, such as product manuals, warranties, and updates. This information is often misplaced or stored in inaccessible ways, making it difficult to retrieve when needed (’063 Patent, col. 1:15-44).
• The Patented Solution: The invention describes a centralized "User Data Repository" where providers can send "Information Packs" to users. These packs are automatically categorized using a "Category Identifier" provided by the sender. The user can then manage this information, create custom categories, and even establish a "Reverse Communication Link" to send data back to the provider, for example, to facilitate automated drug compatibility checks or product updates (’063 Patent, Abstract; col. 3:24-col. 4:67).
• Technical Importance: The system aimed to shift the burden of initial data organization from the recipient to the provider, creating a structured, semi-automated system for managing the lifecycle of product and service information (’063 Patent, col. 2:5-12).

Key Claims at a Glance

• Independent Claim 4 is asserted in the complaint (Compl. ¶33).
• The essential elements of asserted independent claim 4 include a multi-step method of:
  • storing information in an "information pack";
  • associating the pack with a user destination address, a category identifier, and a provider identifier;
  • communicating the pack to a user data repository;
  • locating the pack within the repository based on the category identifier;
  • creating a custom location in the repository;
  • placing the pack in the custom location and associating a custom category identifier; and
  • sending a signal about the custom categorization to a processing station.
• The complaint reserves the right to assert other claims (Compl. ¶34).

Multi-Patent Capsule: U.S. Patent No. 8,607,139, System And Process For Managing Content Organized In A Tag-Delimited Template Using Metadata, issued December 10, 2013

• Technology Synopsis: This patent describes a system for managing web content using templates written in a tag-delimited language (like XML). The system converts a template into a metadata entry form, allowing a user to input data, which is then used to generate a webpage. This separates the content (data) from the structure (template), simplifying content updates (’139 Patent, Abstract; col.2:54-62).
• Asserted Claims: At least Claim 1 (independent) is asserted (Compl. ¶41).
• Accused Features: The complaint accuses the "Website Builder Tool" offered by Wix, alleging it provides a system to display a webpage generated from a template that accepts data, where the template is created based on the nature of that data (Compl. ¶40, ¶42).

Multi-Patent Capsule: U.S. Patent No. 8,762,498, Apparatus, System, And Method For Communicating To A Network Through A Virtual Domain, issued June 24, 2014

• Technology Synopsis: This patent details a method for anonymous network communication through a virtual domain. It uses a "deceiver," "controller," and "forwarder" architecture to mask a client's true IP address from a destination server, routing traffic through a forwarder whose IP is provided to the client as a substitute for the destination's actual IP (’498 Patent, Abstract; col. 2:45-58).
• Asserted Claims: At least Claim 1 (independent) is asserted (Compl. ¶54).
• Accused Features: The complaint accuses Wix's "Website Hosting service," alleging it uses a system that responds to data requests by identifying a virtual namespace destination IP address from categories related to that address to determine a device with a specific forwarder IP address (Compl. ¶53, ¶55).

III. The Accused Instrumentality

Product Identification

• The complaint names several interrelated products and services: "Wix.com's website service" (cloud-based website building and tools using KVM and VMWare), the "Wix App" (an Android application), the "Website Builder Tool," and the "Website Hosting service" (Compl. ¶23, ¶32, ¶40, ¶53).

Functionality and Market Context

• The complaint describes the accused instrumentalities as a comprehensive platform allowing users to "create, design, manage and develop your web page presence exactly the way you want" (Compl. ¶34, ¶40, ¶53). The infringement allegations point to backend technologies like KVM and VMWare virtualization for the '613 patent, the Android application for the '063 patent, the content management and template features for the '139 patent, and the network routing/hosting infrastructure for the '498 patent (Compl. ¶25, ¶34, ¶42, ¶55). The complaint alleges the provision of these services is a "source of revenue and a business focus for Defendant" (Compl. ¶46). No probative visual evidence provided in complaint.

IV. Analysis of Infringement Allegations

’613 Patent Infringement Allegations

Identified Points of Contention

• Viability of Claim: The primary issue is that asserted Claim 1 was cancelled in an IPR proceeding after the complaint was filed. This raises the question of whether this count can proceed, potentially requiring Plaintiff to amend its complaint to assert surviving claims.
• Scope Questions: Should the case proceed on other claims, a key question may be whether the "file descriptors (files/sockets/pipes)" managed by virtualization software like KVM and VMWare in a cloud hosting environment fall within the scope of "file descriptors" as defined in the patent, which focuses its examples on distinguishing disk files from network sockets in a traditional OS context (’613 Patent, col. 2:31-35).

’063 Patent Infringement Allegations

• The complaint does not provide sufficient detail for a full claim chart analysis. It alleges infringement of Claim 4 by the "Wix App" because it provides a "system of hardware and software to allow its customers 'to create, design, manage and develop your web presence exactly the way you want'" (Compl. ¶34). This allegation is conclusory and does not map the accused product's functionality to the specific, multi-step method elements of Claim 4.

Identified Points of Contention

• Evidentiary Questions: A central issue will be whether Plaintiff can produce evidence that the general website-building functionality of the "Wix App" practices the highly specific, multi-party information handling method of Claim 4, which includes distinct "information packs," "user data repositories," "provider identifiers," and signals to a "processing station." The complaint's current allegations do not specify how the accused app performs these discrete steps.

V. Key Claim Terms for Construction

For the ’613 Patent

• The Term: "file descriptor"
• Context and Importance: The entire invention rests on "disambiguating" different types of file descriptors. The patent's specification contrasts descriptors for "a file stored on media" with those for a "communication channel" (’613 Patent, col. 2:31-35). Practitioners may focus on whether this term, as understood in the context of the patent, can be construed to cover the file handles, sockets, or pipes managed by modern hypervisors (KVM, VMWare) in a virtualized cloud environment, as alleged in the complaint (Compl. ¶23, ¶25).
• Intrinsic Evidence for Interpretation:
  • Evidence for a Broader Interpretation: The claims are not explicitly limited to specific types of files, referring generally to "a file type" and "any type of file" (’613 Patent, col. 14:46-56). The term "file" itself is used broadly in the art.
  • Evidence for a Narrower Interpretation: The background and summary repeatedly frame the problem and solution around the specific dichotomy of "files stored on media" versus "communication channels" (’613 Patent, col. 2:55-61, col. 3:15-20). The specific examples given reinforce this narrower context.

For the ’063 Patent

• The Term: "User Data Repository"
• Context and Importance: This term is the central architectural component of the claimed system. Its definition is critical to determining if the Wix App's general content creation and management features constitute infringement. Practitioners may focus on whether a "User Data Repository" requires a specific type of structured, personal data locker for receiving categorized "Information Packs," as the patent seems to describe, or if it can be read more broadly to cover any system where a user manages their own content, such as a website created with the Wix App.
• Intrinsic Evidence for Interpretation:
  • Evidence for a Broader Interpretation: The complaint does not provide sufficient detail for analysis of evidence supporting a broader interpretation.
  • Evidence for a Narrower Interpretation: The patent defines the term as a "personal information storage and retrieval area, in which information is stored in a compartmentalized or categorized format" for managing information from external "Providers" (’063 Patent, col. 2:50-54). The detailed descriptions show a system for receiving and organizing third-party information (like prescriptions or warranties), not necessarily for creating and publishing one's own original content (’063 Patent, FIG. 1, FIG. 2).

VI. Other Allegations

• Indirect Infringement: The complaint alleges inducement of infringement for the '613, '063, and '139 patents. The allegations are based on Defendant instructing its customers on how to use its services through "support and sales activities" and promotional materials available on its website (Compl. ¶26, ¶35, ¶43, ¶45-48). It also alleges customers directly infringe by using the services in an infringing manner (Compl. ¶27, ¶36, ¶44).
• Willful Infringement: The complaint alleges willful infringement of the '139 patent based on Defendant's alleged knowledge of the patent "as early as the date of its receipt of the Notice Letter" on April 16, 2020 (Compl. ¶18, ¶46). The prayer for relief seeks a finding of induced infringement "based upon pre-suit knowledge" for all Patents-in-Suit (Compl. ¶61.B).

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

• Procedural Viability: A threshold question for the '613 patent is whether the case can proceed on that count, given that the specifically asserted independent claim (Claim 1) was cancelled by the USPTO in an IPR proceeding after the suit was filed.
• Definitional Scope: For all patents, a core issue will be one of definitional scope. Can terms rooted in the context of early 2000s technology (e.g., "file descriptor" distinguishing local disk files from network sockets, or a "User Data Repository" for organizing third-party documents) be construed to cover the functionalities of a modern, integrated, cloud-based website creation and hosting platform?
• Evidentiary Sufficiency: A key evidentiary question, particularly for the '063, '139, and '498 patents, will be whether the Plaintiff can demonstrate a technical mapping between the high-level marketing descriptions of the accused platform (e.g., "create, design, manage and develop your web presence") and the very specific, multi-step processes recited in the asserted claims. The complaint currently presents a significant gap between the alleged functionality and the claimed technical steps.