DCT
1:25-cv-00611
AlmondNet Inc v. ByteDance Inc
Key Events
Amended Complaint
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: AlmondNet, Inc., and Intent IQ, LLC (Delaware)
- Defendant: Bytedance Inc., TikTok, LLC, TikTok, Inc., and TikTok U.S. Data Security Inc. (Delaware/California)
- Plaintiff’s Counsel: Farnan LLP; Russ August & Kabat
- Case Identification: 1:25-cv-00611, D. Del., 07/16/2025
- Venue Allegations: Venue is alleged to be proper in the District of Delaware because Defendants are incorporated or qualified to do business as a foreign corporation in Delaware.
- Core Dispute: Plaintiff alleges that Defendant’s TikTok advertising platform and related systems infringe three patents related to profile-based, cross-platform, and condition-based online advertising methods.
- Technical Context: The patents address methods for targeting digital advertisements to users based on their online behavior, such as website visits or search history, in a manner that aims to ensure the profitability of the ad placement.
- Key Procedural History: The filing is a First Amended Complaint. The complaint references prior docket entries and Congressional testimony regarding Defendant's data handling practices, suggesting these may be relevant to discovery or arguments regarding the operation of the accused systems.
Case Timeline
| Date | Event |
|---|---|
| 2006-06-16 | Earliest Priority Date for ’822 and ’423 Patents |
| 2007-04-17 | Earliest Priority Date for ’398 Patent |
| 2012-06-12 | ’822 Patent Issued |
| 2014-03-18 | ’398 Patent Issued |
| 2020-11-17 | ’423 Patent Issued |
| 2025-07-16 | Complaint Filing Date |
II. Technology and Patent(s)-in-Suit Analysis
U.S. Patent No. 8,200,822 - "media properties selection method and system based on expected profit from profile-based ad delivery"
The Invention Explained
- Problem Addressed: The patent describes the process of targeting ads based on a user's profile on one site for delivery on another site as "inefficient" because media properties' ad space prices vary, and different user profiles are worth different amounts to advertisers, making it difficult to guarantee a profitable ad placement (’822 Patent, col. 5:48-61).
- The Patented Solution: The invention proposes an automated system that, after receiving a user's profile information, calculates the "expected profit" of delivering a targeted ad. It then selects one or more media properties for which a positive profit is anticipated and arranges for a "tag" to be stored that is associated with the user, enabling future ad delivery on those selected, profitable properties (’822 Patent, Abstract; col. 8:10-21; Fig. 1).
- Technical Importance: This approach seeks to introduce an automated, profit-driven decision gate into the process of behavioral ad targeting, aiming to avoid spending money to "tag" users for retargeting in situations where the expected return is less than the cost of the ad space.
Key Claims at a Glance
- The complaint asserts independent method claim 1 (Compl. ¶19).
- Essential elements of claim 1 include:
- For a multitude of electronic visitors to a first media property, receiving information about profile attributes.
- Automatically authorizing a second media property to allow display of an advertisement correlated with the profile-attribute information.
- The authorization is subject to a condition that the price charged by the second media property is less than a "profile-attribute-dependent price that an advertiser is willing to pay."
U.S. Patent No. 10,839,423 - "condition-based method of directing electronic advertisements for display in ad space within streaming video based on website visits"
The Invention Explained
- Problem Addressed: The patent addresses the general challenge of efficiently targeting advertisements based on a user's browsing history (profile) for delivery on a different media platform, specifically within streaming video (’423 Patent, col. 1:33-40).
- The Patented Solution: The invention describes a method where a "first computer system" records a user's behavioral profile from a visit to a "first website." This first system then causes a "second computer system" (which controls ad space in video streams) to gain access to "tag information" that connects the user's profile to a second device used for video streaming. Crucially, the first system transfers a "condition" to the second system, which later checks if this condition is met while the user is watching a video stream, and only then serves the targeted advertisement (’423 Patent, Abstract; col. 13:26 - col. 14:14).
- Technical Importance: The claimed method provides a specific logical framework for triggering a behaviorally targeted ad during video playback, tying the ad-serving decision to a pre-defined "condition" linked to the user's prior web browsing activity.
Key Claims at a Glance
- The complaint asserts independent method claim 1 (Compl. ¶29).
- Essential elements of claim 1 include:
- A first computer system recording behavioral profile information from a first computerized device's visit to a first website.
- At a first time, causing a second computer system (controlling ad space in video streams) to have access to tag information, without transferring the behavioral profile itself.
- Electronically transferring a "condition specific to the first profile" to the second computer system.
- At a second, later time, while a second device is displaying a video stream, the second computer system checks the condition and, if met, causes a selected advertisement to be served.
U.S. Patent No. 8,677,398 - "systems and methods for taking action with respect to one network-connected device based on activity on another device connected to the same network"
The Invention Explained
- The patent describes a method for delivering targeted television advertisements to a set-top box based on the online behavior observed on a different device, such as a computer. The system electronically associates the IP addresses of the two devices, which are connected to the same local network, allowing for cross-device ad targeting without using personally identifiable information (’398 Patent, Abstract).
Key Claims at a Glance
- Asserted Claims: Independent method claim 13 (Compl. ¶38).
- Accused Features: The complaint alleges that TikTok's advertising systems, including features for "Attribution Analytics, Cross-Channel and/or Cross-media measurement," infringe by taking action on one device based on activity on another device connected to the same network (Compl. ¶36).
III. The Accused Instrumentality
Product Identification
- The "Accused Instrumentalities" are identified as TikTok's computer systems that implement and provide the "TikTok Ads Manager" (Compl. ¶16, ¶26, ¶36).
Functionality and Market Context
- The complaint lists specific components of the TikTok advertising platform as infringing, including "Automatic Placement, Select Placement, Event API, TikTok Pixel, Value-Based Optimization, Smart Performance Campaign, Advanced Matching, and Pangle" (’822 Patent, Compl. ¶16; ’423 Patent, Compl. ¶26).
- Additional accused components related to cross-device targeting include "Attribution Analytics, Cross-Channel and/or Cross-media measurement, Mobile Measurement Partner Tracking," and others (’398 Patent, Compl. ¶36).
- These features collectively allow advertisers to place, manage, and track advertising campaigns on the TikTok platform, including targeting users based on their on- and off-platform activities and measuring ad performance across multiple devices. The complaint does not provide sufficient detail for analysis of the precise technical operation of these named features. No probative visual evidence provided in complaint.
IV. Analysis of Infringement Allegations
The complaint references, but does not include, claim chart exhibits detailing its infringement theories (Compl. ¶19, ¶29, ¶38). The narrative allegations are summarized below.
- ’822 Patent Infringement Allegations: The complaint alleges that TikTok's advertising systems, particularly features like "Value-Based Optimization" and "Smart Performance Campaign," perform the claimed method of selecting media properties for ad delivery based on an "expected profit" calculation (Compl. ¶15-16). The core of this theory appears to be that TikTok’s system evaluates where to place an ad (e.g., across its "Pangle" ad network) based on a determination of which placement will be most profitable or valuable, thereby meeting the limitations of claim 1.
- ’423 Patent Infringement Allegations: The infringement theory for the ’423 Patent is that TikTok’s systems target ads within its streaming video service based on users' prior website visits, which are tracked via tools like the "TikTok Pixel" and "Event API" (Compl. ¶26). The complaint suggests that TikTok's ad server (the "second computer system") is given a "condition" based on this tracked off-platform behavior, and it checks this condition before serving a targeted ad into a user's video feed, thereby infringing claim 1.
- Identified Points of Contention:
- Scope Questions: A central question for the ’822 Patent may be whether TikTok's "Value-Based Optimization" calculates "expected profit" in a manner consistent with the patent's definition, or if it uses a more general performance metric that falls outside the claim scope. For the ’423 Patent, a question may arise as to whether the "TikTok App" and its associated ad servers constitute the "second computer system" controlling "ad space in a plurality of video streams" as contemplated by the patent.
- Technical Questions: For the ’423 Patent, the analysis may focus on the timing and mechanism of the "checking the condition" step. The claim requires this check to occur "while the second computerized device is causing display of the one of the plurality of video streams." A key question will be what evidence demonstrates that TikTok’s ad-serving logic performs this specific, timed check, as opposed to a more general pre-selection of an ad for a user's profile.
V. Key Claim Terms for Construction
The Term: "a condition specific to the first profile" (’423 Patent, Claim 1)
- Context and Importance: This term is central to the infringement analysis for the ’423 Patent. The plaintiff's theory depends on showing that TikTok's system transfers and checks such a "condition" before serving an ad in a video stream. The defendant may argue that its system simply targets users based on audience segments derived from profile data, without transferring or checking a discrete "condition" in the manner required by the claim.
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The specification does not appear to provide an explicit, narrow definition of "condition," which may support an interpretation that it covers any rule or logic (e.g., "user is in 'interested in shoes' segment") derived from the profile that is used to trigger an ad.
- Evidence for a Narrower Interpretation: The claim language distinguishes between the "behavioral profile information" itself (which is not transferred) and the "condition" (which is transferred). This may support a narrower interpretation that the "condition" must be a distinct piece of data or instruction, separate from the raw profile, that is sent to the second computer system for the specific purpose of being checked during video playback.
The Term: "price charged by the second media property is less than a profile-attribute-dependent price that an advertiser is willing to pay" (’822 Patent, Claim 1)
- Context and Importance: This limitation defines the core decision-making logic of the claimed invention. Infringement requires showing that the accused system makes its authorization decision by comparing these two specific values: the cost of the ad space and the expected revenue from an advertiser for a given profile. Practitioners may focus on this term because modern ad auction systems involve complex bidding logic (e.g., "Value-Based Optimization") that may not perform this direct, two-part comparison.
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The specification describes the concept in economic terms, stating the goal is to arrange for tagging when the "calculated profit is positive (i.e., not a loss)" (’822 Patent, col. 6:47-49). This could support a view that any optimization routine that effectively ensures profitability meets this limitation.
- Evidence for a Narrower Interpretation: The claim language is specific, requiring a comparison of a "price charged" against a "price that an advertiser is willing to pay." This could support a narrower reading that requires the system to explicitly calculate or access these two distinct monetary values and compare them, rather than relying on a more abstract quality score, conversion probability, or generalized bid value.
VI. Other Allegations
- Indirect Infringement: The complaint alleges that Defendants "direct and control use of the Accused Instrumentalities" (Compl. ¶17, ¶27, ¶37). This suggests a theory of direct infringement by the Defendants, rather than indirect infringement by third parties.
- Willful Infringement: Willfulness is alleged based on knowledge of the patents "at least" from the filing and service of the complaint (Compl. ¶18, ¶28). This is a claim for post-suit willfulness.
VII. Analyst’s Conclusion: Key Questions for the Case
- A core issue will be one of operational mechanics: Can the plaintiff demonstrate through evidence that the complex, high-speed bidding and optimization algorithms within the TikTok Ads Manager perform the specific, sequential steps required by the asserted claims, particularly the profit-comparison of the ’822 Patent and the timed "condition check" of the ’423 Patent?
- A second key issue will be one of definitional scope: Will the term "condition" from the ’423 Patent be construed broadly to cover any targeting rule derived from a user's profile, or will it be limited to a specific, transferable data instruction that is distinct from the profile itself? The outcome of this construction could be dispositive.
- A third question will relate to cross-device association: For the ’398 Patent, the case may turn on evidence showing how TikTok's systems "electronically associate" devices on the same network, and whether that method reads on the claim limitations requiring actions on one device to be based on activity from another.