DCT

1:24-cv-00502

Etison LLC v. HighLevel Inc

I. Executive Summary and Procedural Information

Parties & Counsel:
- Plaintiff: Etison LLC d/b/a ClickFunnels (Idaho)
- Defendant: HighLevel, Inc. (Delaware)
- Plaintiff’s Counsel: Morris, Nichols, Arsht & Tunnell LLP
Case Identification: 1:24-cv-00502, D. Del., 07/01/2024
Venue Allegations: Venue is asserted based on Defendant's incorporation in the State of Delaware.
Core Dispute: Plaintiff alleges that Defendant’s software-as-a-service platform infringes patents related to systems for creating websites with series of directional webpages, commonly known as sales funnels.
Technical Context: The technology relates to software platforms for creating marketing and e-commerce websites that use guided "funnels" to direct user interactions toward a specific goal, such as a sale.
Key Procedural History: This Amended Complaint follows an original complaint that was served on the Defendant on April 23, 2024, a date which Plaintiff uses to anchor its allegations of post-suit willful infringement.

Case Timeline

Date	Event
2014-01-01	Plaintiff's ClickFunnels platform development begins (approximate)
2018-01-25	Earliest priority date for '357 and '047 Patents
2018-01-01	HighLevel founder allegedly obtains ClickFunnels account (approximate)
2020-11-24	U.S. Patent No. 10,846,357 issues
2022-06-14	U.S. Patent No. 11,361,047 issues
2024-04-23	Original complaint served on HighLevel
2024-07-01	Amended Complaint for Patent Infringement filed

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

U.S. Patent No. 10,846,357

Patent Identification: U.S. Patent No. 10,846,357, “Website Creation System for Creating Websites Having at Least One Series of Directional Webpages and Related Methods,” issued November 24, 2020. (Compl. ¶9).
The Invention Explained:
- Problem Addressed: The patent describes the process of creating a commercial website as often being costly and fragmented, requiring the hiring of multiple different companies and leaving the website owner with little ability to make personal edits ('357 Patent, col. 1:15-28). The complaint further notes that conventional e-commerce websites required repeated data transmissions that consumed significant computing power and bandwidth (Compl. ¶18).
- The Patented Solution: The invention is a unified website creation system that enables a user to build a website composed of a "series of directional webpages" (i.e., a funnel) intended to guide a visitor toward a specific action, like a purchase or an opt-in ('357 Patent, col. 2:62-3:3). The system provides a user dashboard, a selection of website types and corresponding templates, and a graphical editor, which streamlines the creation process and reduces the required processing power and data transfer compared to conventional systems (Compl. ¶14, ¶16; '357 Patent, col. 3:18-33).
- Technical Importance: This approach makes creating sophisticated marketing funnels more accessible to non-technical users and improves website performance, particularly on mobile devices, by reducing data and bandwidth usage ('357 Patent, col. 3:29-36).
Key Claims at a Glance:
- The complaint asserts at least independent claim 1. (Compl. ¶48).
- Essential elements of independent claim 1 include:
  - Providing a user dashboard with a selectable option to create a website.
  - Receiving a user's selection to create the website.
  - Providing a plurality of website types for selection, where each type has a "series of directional webpages."
  - Receiving the user's selection of a website type.
  - Providing a plurality of website templates specific to the selected type.
  - Receiving the user's selection of a template.
  - Generating and launching a "generic website" based on the selections and providing a graphical user interface (GUI) to edit it.
  - Receiving a user interaction editing the website via the GUI.
  - Editing the launched generic website to create a "customized website."
- The complaint alleges infringement of "one or more claims," suggesting the right to assert other claims, including dependent claims, is reserved (Compl. ¶45).

U.S. Patent No. 11,361,047

Patent Identification: U.S. Patent No. 11,361,047, “Website Creation System for Creating Websites Having at Least One Series of Directional Webpages and Related Methods,” issued June 14, 2022. (Compl. ¶10).
The Invention Explained: The ’047 Patent is a continuation of the ’357 Patent and shares an identical specification; therefore, the problem, solution, and technical importance are the same as those described above for the ’357 Patent (Compl. ¶11; ’047 Patent, col. 1:9-12).
Key Claims at a Glance:
- The complaint asserts at least independent claim 1. (Compl. ¶56).
- Essential elements of independent claim 1 include:
  - Receiving a selection to create a website.
  - Providing a plurality of website types for selection, each comprising a "series of directional webpages."
  - Receiving a selection of a website type.
  - Providing a plurality of website templates particular to the selected type.
  - Receiving a selection of a website template.
  - In response, generating and launching a website based on the selected type and template.
- The complaint's general allegation of infringing "one or more claims" suggests the potential assertion of additional claims (Compl. ¶45).

III. The Accused Instrumentality

Product Identification: The accused instrumentality is Defendant's "HighLevel" software-as-a-service platform (Compl. ¶48, ¶56).
Functionality and Market Context: The complaint alleges that the HighLevel platform is a direct competitor to the ClickFunnels platform and allows users to create websites (Compl. ¶4). The infringement counts allege that the HighLevel platform performs the steps of the asserted claims, which implies it provides users with tools to select from website types and templates to generate websites that function as marketing funnels (Compl. ¶48, ¶56). The complaint alleges that at least one of HighLevel's founders was a user of the ClickFunnels platform from 2018 to 2022 and that HighLevel employees used software from the ClickFunnels platform in developing the accused HighLevel platform (Compl. ¶41, ¶43).

IV. Analysis of Infringement Allegations

The complaint does not contain claim charts or detailed infringement contentions in its body. Instead, it references external exhibits (Exhibit B for the ’357 Patent and Exhibit D for the ’047 Patent) that were not included with the filed complaint document (Compl. ¶48, ¶56). No probative visual evidence provided in complaint.

Based on the narrative allegations, the infringement theory posits that the HighLevel platform's end-to-end process for website creation maps onto the method steps of the asserted claims. For the ’357 Patent, this includes providing a user dashboard, allowing selection from various website types and templates, generating a base website, and providing an editor for customization (Compl. ¶48). For the ’047 Patent, the theory focuses on the initial creation and launch phase, where the HighLevel platform allegedly allows users to select a website type and template and then generates and launches a website accordingly (Compl. ¶56).

Identified Points of Contention:
- Scope Questions: A central issue may be whether the HighLevel platform's architecture performs the discrete steps in the sequence required by the claims. For Claim 1 of the ’357 Patent, a question is whether the accused system first "generat[es] and launch[es] a generic website" which is then subsequently "edit[ed]... to create a customized website," or if it constructs the final website in a single, integrated process that does not map to this two-stage limitation.
- Technical Questions: The complaint's theory relies on the accused platform providing "a plurality of website types" where each type comprises a "series of directional webpages." A key technical question will be what evidence shows that HighLevel's offerings meet this specific structural and functional requirement, as opposed to being a general-purpose website builder that a user could happen to configure into a funnel.

V. Key Claim Terms for Construction

The Term: "series of directional webpages"
- Context and Importance: This term appears in the asserted independent claims of both patents and is fundamental to the patents' positioning as "funnel" creation tools, distinguishing them from generic webpage builders. The case's outcome may depend on whether the HighLevel platform's features are found to constitute such "series."
- Intrinsic Evidence for a Broader Interpretation: The specification provides an extensive list of over twenty different types of "series" (e.g., squeeze page series, survey series, webinar series) and dozens of page types, suggesting the term is flexible and covers a wide variety of user-guiding sequences ('357 Patent, col. 12:50-15:47).
- Evidence for a Narrower Interpretation: The patents consistently describe these series as "ordered and designed to entice... particular user interaction" and to "funnel" a guest, language which may support a narrower construction requiring a specific, pre-defined marketing or sales objective rather than just any sequence of linked pages ('357 Patent, col. 2:62-3:3, col. 3:18-23).
The Term: "generating and launching a generic website"
- Context and Importance: This phrase from Claim 1 of the ’357 Patent precedes the final step of "editing the launched generic website to create a customized website." The definitions of "generic," "launching," and the separability of this step from the final customization will be critical for the infringement analysis.
- Intrinsic Evidence for a Broader Interpretation: A plaintiff may argue "launching" does not require public internet availability but refers to the system making the base website operative and available to the user for editing within the platform's editor GUI ('357 Patent, col. 16:53-54, act 220). "Generic" could be argued to mean any baseline, functional website based on a selected template.
- Evidence for a Narrower Interpretation: A defendant may argue that "launching" requires making the site publicly accessible and that "generic" implies a distinct, saved state that precedes any customization. If the accused system builds the final website in a single fluid process without creating a discrete "launched generic website," it might fall outside this limitation ('357 Patent, col. 2:5-10).

VI. Other Allegations

Indirect Infringement: The prayer for relief seeks a judgment for both direct and indirect infringement (Compl., Prayer for Relief ¶A, B). However, the complaint lacks specific factual allegations to support the elements of induced or contributory infringement, such as detailing how Defendant allegedly encouraged its customers to perform the claimed infringing methods.
Willful Infringement: The complaint alleges that HighLevel has been aware of the patents-in-suit and its infringement since at least April 23, 2024, the date of service of the original complaint (Compl. ¶51, ¶59). The claim is that infringement continued despite this actual knowledge, forming a basis for post-suit willfulness. The complaint also alleges that a HighLevel founder was a ClickFunnels user and that HighLevel used ClickFunnels software in its development, which may be used to argue pre-suit knowledge of the technology, though pre-suit knowledge of the patents is not explicitly tied to these facts (Compl. ¶41-43).

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

A core issue will be one of definitional scope: can the term "series of directional webpages," described in the context of marketing "funnels," be construed to cover the website structures created by the accused HighLevel platform? The resolution of this claim construction dispute will likely determine the scope of the patents and the viability of the infringement case.
A key evidentiary question will be one of procedural mapping: does the accused HighLevel platform operate in the specific sequence of discrete steps recited in the method claims? For the '357 Patent, this will require proof that the system first creates and "launches a generic website" as a distinct object before it is "edited" into a customized one, a potential point of technical mismatch.
A central question for damages will be the extent of willfulness: while the complaint establishes a basis for post-suit willfulness, the allegations regarding a founder's prior use of the plaintiff's product raise the question of whether pre-suit knowledge of the patents themselves can be proven. An affirmative finding could substantially increase potential damages.