DCT
1:25-cv-21966
Global IP Holdings LLC v. AYR Wellness Inc
Key Events
Complaint
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: Global IP Holdings, LLC (California)
- Defendant: AYR Wellness, Inc. (Canadian corporation with U.S. headquarters in Florida)
- Plaintiff’s Counsel: DNL Zito
- Case Identification: 1:25-cv-21966, S.D. Fla., 04/29/2025
- Venue Allegations: Plaintiff alleges venue is proper because Defendant maintains a regular and established place of business in the district and has committed acts of infringement there.
- Core Dispute: Plaintiff alleges that Defendant’s process for producing cannabis extracts infringes patents related to methods that use super-cooled ethanol-based solvents to reduce the co-extraction of undesirable compounds like chlorophyll.
- Technical Context: The technology addresses a key challenge in the cannabis and hemp industry: efficiently producing high-purity cannabinoid extracts for consumer and medical products while avoiding contamination from compounds that affect quality and require further purification.
- Key Procedural History: The complaint does not mention any prior litigation, inter partes review proceedings, or licensing history concerning the patents-in-suit. U.S. Patent No. 10,814,248 is a continuation-in-part of the application that matured into U.S. Patent No. 10,507,407, indicating a shared specification and a direct developmental lineage.
Case Timeline
| Date | Event |
|---|---|
| 2016-04-14 | Earliest Priority Date ('407 & '248 Patents) |
| 2019-12-17 | U.S. Patent No. 10,507,407 Issued |
| 2020-10-27 | U.S. Patent No. 10,814,248 Issued |
| 2024-08-01 | Alleged Start of "AYR Massachusetts" Operations |
| 2025-04-29 | Complaint Filed |
II. Technology and Patent(s)-in-Suit Analysis
U.S. Patent No. 10,507,407 - "Methods to reduce chlorophyll co-extraction through extraction of select moieties essential oils and aromatic isolates," Issued December 17, 2019
The Invention Explained
- Problem Addressed: The patent's background describes challenges with conventional cannabis extraction methods, noting that while effective, they often co-extract undesirable constituents like plant lipids and chlorophyll, which then require costly and complex post-extraction purification. It also highlights the volatility and safety risks associated with hydrocarbon solvents like butane ('407 Patent, col. 1:21-56).
- The Patented Solution: The invention proposes a method using a super-cooled solvent, specifically ethanol, to extract cannabinoids and terpenes from plant material. By lowering the temperature of the solvent to a range of -30°C to -50°C, the process selectively dissolves the desired compounds while leaving the less-soluble chlorophyll and lipids behind in the plant substrate, yielding a cleaner initial extract ('407 Patent, Abstract; col. 2:6-10). The overall system for performing these steps is illustrated in Figure 1 ('407 Patent, col. 2:30-33).
- Technical Importance: This approach provided a method to create high-purity cannabis extracts that was potentially safer and more efficient than methods using volatile hydrocarbons or complex supercritical CO2 systems ('407 Patent, col. 1:60-64).
Key Claims at a Glance
- The complaint asserts independent Claim 1 (Compl. ¶32).
- Essential elements of Claim 1 include:
- A safer and more reliable extraction process for extracting a plant substrate, comprising in combination:
- pre-processing comprising lowering the temperature of a solvent to a range of -30°C and -50°C;
- contacting at -30°C and -50°C for a time sufficient to create an emulsion;
- evaporating the emulsion by means of atmospheric evaporation of the solvent;
- recovering the solvent from the emulsion; and
- purging the resulting extract so it is substantially free of any lipids and chlorophyll.
- The complaint alleges infringement of "one or more claims," preserving the right to assert dependent claims (Compl. ¶33).
U.S. Patent No. 10,814,248 - "Methods to reduce chlorophyll co-extraction through extraction of select moieties essential oils and aromatic isolates," Issued October 27, 2020
The Invention Explained
- Problem Addressed: The patent addresses the same technical problem as its parent '407 patent: the undesirable co-extraction of chlorophyll and waxes during cannabinoid extraction, which complicates the production of pure concentrates ('248 Patent, col. 2:29-48).
- The Patented Solution: The '248 Patent refines the cold extraction method by explicitly broadening the types of solvents covered. While still centered on a process involving a pre-cooled solvent and extraction at -30°C to -50°C, its claims expressly exclude liquid carbon dioxide and provide optional claim scope for various solvent compositions, such as a 95% ethanol mixture or other solvents like heptane and hexane ('248 Patent, col. 2:49-62; col. 24:2-29).
- Technical Importance: This patent expands the proprietary scope of the cold extraction technique to cover a wider range of commercially relevant solvent formulations beyond the pure grain ethanol emphasized in the parent patent ('248 Patent, col. 2:50-58).
Key Claims at a Glance
- The complaint asserts independent Claim 1 (Compl. ¶37).
- Essential elements of Claim 1 include:
- A safer and more reliable extraction process for cannabinoids from cannabis or hemp, which excludes the use of liquid carbon dioxide;
- pre-processing by lowering a solvent's temperature to a range of -30°C to -50°C;
- contacting the solvent and plant substrate at -30°C to -50°C to create an emulsion;
- evaporating the emulsion via atmospheric evaporation;
- recovering the solvent;
- purging the extract under vacuum until it is substantially free of lipids and chlorophyll;
- wherein the solvent is optionally a 95% ethanol mixture or another material such as heptane or hexane.
- The complaint alleges infringement of "one or more claims," preserving the right to assert dependent claims (Compl. ¶38).
III. The Accused Instrumentality
Product Identification
The "Accused Method" is an extraction process allegedly used by Defendant AYR Wellness and its subsidiaries (Compl. ¶21). The complaint states this process is performed using an "ExtractionTek (formerly Delta Separations) Cup 15 Ethanol Extraction System" (Compl. ¶21). No probative visual evidence provided in complaint.
Functionality and Market Context
The complaint alleges the Accused Method is used to extract cannabinoids from hemp and cannabis plant material to create commercial products (Compl. ¶¶ 4-5, 20). The alleged technical steps of the method include using an ethanol or ethanol-based solvent, pre-chilling the solvent to a range of -30°C to -50°C, contacting the solvent with plant matter, using atmospheric evaporation (e.g., via a rotary evaporator) to reduce the resulting emulsion, recovering the solvent for reuse, and purging the final extract under vacuum with a wiped film distillation system (Compl. ¶¶ 24-29).
IV. Analysis of Infringement Allegations
'407 Patent Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| pre-processing comprising lowering the temperature of a solvent to a range of -30 degrees C. and -50 degrees C. | The Accused Method includes pre-processing by lowering the solvent temperature to a range of -30°C to -50°C. | ¶25 | col. 2:6-8 |
| contacting at -30 degrees C. and -50 degrees C...to create an emulsion | The cooled solvent is brought into contact with the plant substrate at a temperature between -30°C and -50°C to create an emulsion. | ¶26 | col. 2:11-13 |
| evaporating for reduction of the emulsion by means of atmospheric evaporation of the solvent | The process includes atmospheric evaporation of the solvent using a rotary or falling film evaporator. | ¶27 | col. 2:19-20 |
| recovering for recovery of the solvent from the emulsion | The process includes recovering solvent from the emulsion, with equipment advertising that alcohol may be reused. | ¶28 | col. 2:21-23 |
| purging whereby a resultory extract is substantially free of any lipids and chlorophyll | The process includes purging under vacuum with a wiped film distillation system to yield an extract free of lipids and chlorophyll. | ¶29 | col. 2:24-26 |
'248 Patent Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| A safer and more reliable extraction process...wherein the process excludes use of liquid carbon dioxide | The accused process excludes the use of liquid carbon dioxide. | ¶24 | col. 24:5-6 |
| pre-processing comprising lowering the temperature of a solvent to a range of -30 degrees C. to -50 degrees C. | The Accused Method includes pre-processing by lowering the solvent temperature to a range of -30°C to -50°C. | ¶25 | col. 2:40-43 |
| contacting at -30 degrees C. to -50 degrees C...to create an emulsion | The cooled solvent is brought into contact with the plant substrate at a temperature between -30°C and -50°C to create an emulsion. | ¶26 | col. 2:43-45 |
| evaporating for reduction of the emulsion by means of atmospheric evaporation of the solvent | The process includes atmospheric evaporation of the solvent using a rotary or falling film evaporator. | ¶27 | col. 2:45-47 |
| recovering for recovery of the solvent from the emulsion | The process includes recovering solvent from the emulsion for reuse. | ¶28 | col. 2:47-48 |
| purging under vacuum to remove remaining solvent from the extract whereby a resultory extract is substantially free of any lipids and chlorophyll | The process includes purging under vacuum with a wiped film distillation system to yield an extract substantially free of lipids and chlorophyll. | ¶29 | col. 2:48-50 |
| wherein optionally, (a) the solvent is 95% ethanol and 5% of a solvent that is another solvent that does not comprise ethanol... | An AYR subsidiary allegedly uses an ethanol solvent comprised of 95% ethanol and 5% of a non-ethanol solvent. | ¶30 | col. 3:30-41 |
Identified Points of Contention
- Evidentiary Questions: The complaint's allegations closely mirror the claim language. A central issue will be evidentiary: what proof will be offered to demonstrate that the Defendant's process, as actually practiced on a commercial scale, consistently operates within the specific -30°C to -50°C temperature range required by both patents?
- Technical Questions: What evidence will support the allegation that the resulting extract is "substantially free" of lipids and chlorophyll? The defense may challenge whether the accused process achieves the level of purity required by the claims.
V. Key Claim Terms for Construction
Term: "solvent" (in '407 Patent, Claim 1)
- Context and Importance: Independent Claim 1 of the '407 Patent recites the general term "solvent," while dependent Claim 2 specifies "100% grain ethanol." The complaint alleges infringement by a process that may use a 95/5 ethanol blend (Compl. ¶30). Practitioners may focus on this term because if "solvent" is construed narrowly to mean only pure ethanol, it could provide a direct path to a non-infringement argument for the '407 patent.
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The use of the general term "solvent" in an independent claim, followed by a specific solvent in a dependent claim, can be an argument for applying the doctrine of claim differentiation to support a broader meaning for the independent claim.
- Evidence for a Narrower Interpretation: The '407 patent specification contains an explicit definition: "The term solvent as used herein should be understood to describe 100% grain ethanol" ('407 Patent, col. 2:4-5). Such a clear statement of lexicography in the specification is often given significant weight and may be used to argue for a definition limited to pure ethanol.
Term: "substantially free of any lipids and chlorophyll" (in '407 Claim 1 and '248 Claim 1)
- Context and Importance: This term of degree defines the required purity of the final extract produced by the claimed processes. Its definition is critical because infringement will depend on whether the Defendant's actual output meets this standard. The term's potential ambiguity makes it a likely subject for claim construction.
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The parties may argue the term should be understood from the perspective of one of ordinary skill in the art, meaning an extract that is sufficiently pure for its intended commercial purpose without needing a precise quantitative limit.
- Evidence for a Narrower Interpretation: The abstract of the '407 Patent states that "according to embodiments methods provides 100% grain ethyl alcohol extract with a concentration of chlorophyll that is below 1%." A party could argue this statement provides a quantitative benchmark for what the inventors considered "substantially free," at least with respect to chlorophyll.
VI. Other Allegations
- Willful Infringement: The complaint alleges willful infringement of the '248 Patent (Compl. ¶41). The allegation is based on post-suit knowledge, stating that infringement has been willful "since at least the date of the filing of this complaint" (Compl. ¶41). This serves to put the Defendant on notice for potential enhanced damages for any infringing acts that occur after the lawsuit was initiated.
VII. Analyst’s Conclusion: Key Questions for the Case
- A core issue will be one of claim construction and lexicography: For the '407 Patent, will the court find that the patentee's explicit definition of "solvent" as "100% grain ethanol" in the specification limits the scope of Claim 1, potentially excusing the accused 95/5 ethanol blend from infringement?
- A central dispute will likely be one of evidentiary proof: Beyond the pleadings, can the Plaintiff demonstrate through discovery that the Defendant's large-scale commercial extraction process consistently operates within the specific temperature and purity parameters recited in the patent claims?
- The outcome may also depend on the definitional scope of relative terms: How will the court define "substantially free"? Will the "below 1%" chlorophyll concentration mentioned in the '407 Patent's abstract be treated as a binding limit, and can the accused process be proven to meet this standard?