Venadium LLC v. McMaster Carr Supply Co

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Venadium LLC (Texas)
  • Defendant: McMaster-Carr Supply Company (Illinois)
  • Plaintiff’s Counsel: Rabicoff Law LLC; Corcoran IP Law, PLLC
• Case Identification: 1:17-cv-08164, N.D. Ill., 11/10/2017
• Venue Allegations: Venue is alleged to be proper based on Defendant having a "regular and established place of business" in the Northern District of Illinois, committing alleged acts of infringement in the district, and providing services to residents there.
• Core Dispute: Plaintiff alleges that Defendant’s e-commerce website infringes a patent related to methods for controlling software functionality through digitally signed authorization messages.
• Technical Context: The technology provides a framework for protecting software from unauthorized use, akin to digital rights management (DRM) for shareware, by requiring signed authorization to unlock features.
• Key Procedural History: The complaint does not mention any prior litigation, Inter Partes Review (IPR) proceedings, or licensing history related to the patent-in-suit.

Case Timeline

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

U.S. Patent No. 6,330,549 - "Protected Shareware", issued December 11, 2001

The Invention Explained

• Problem Addressed: The patent addresses the challenge of protecting computer software from unauthorized use, particularly in a "shareware" distribution model where programs are freely copied and distributed. It notes that traditional distribution is costly and that simple copy-protection restricts legitimate users, while encryption is insecure if the decryption key must also be widely distributed ('549 Patent, col. 1:11-2:24).
• The Patented Solution: The invention proposes controlling software functionality through a "digitally signed messaging protocol" ('549 Patent, col. 2:40-41). Protective code embedded in the software allows or denies access to certain features in response to "authorization messages" that are digitally signed by the software supplier. The software contains the supplier's public key, enabling it to authenticate the signed message before unlocking the features ('549 Patent, Abstract; col. 3:25-4:1). The system also includes an "integrity self-checking routine" to ensure the protective code itself has not been altered ('549 Patent, col. 2:50-52).
• Technical Importance: This approach sought to combine the low-cost, viral distribution benefits of shareware with a robust mechanism for enforcing payment and usage rights, a significant commercial problem for software developers in the 1990s ('549 Patent, col. 2:19-35).

Key Claims at a Glance

• The complaint alleges infringement of "one or more claims" but does not specify which ones (Compl. ¶12). Independent claim 1 is the broadest method claim.
• The essential elements of independent claim 1 include:
  • Inhibiting a functional feature of a computer program until an authorization message is received.
  • The authorization message must be digitally signed by an authorized party using a secret key.
  • Providing the program's protective code with access to the corresponding public checking key.
  • Running an integrity self-check on the computer program.
  • Communicating the authorization message to the user computer.
  • Using the public key to authenticate the authorization message.
  • Enabling the functional feature if the message is authenticated and the integrity check confirms the program is in an "anticipated state."
• The complaint reserves the right to modify its infringement theories and assert other claims as the case progresses (Compl. ¶15).

III. The Accused Instrumentality

Product Identification

The accused instrumentality is Defendant's website, located at "https://www.mcmaster.com/" (the "Accused Product") (Compl. ¶10).

Functionality and Market Context

The complaint alleges the Accused Product is used for the "sales and offering for sale of its products and services" (Compl. ¶12). The complaint does not provide sufficient detail for analysis of the specific technical functionality of the website that is alleged to infringe.

IV. Analysis of Infringement Allegations

The complaint alleges that infringement is detailed in an Exhibit B, which was not filed with the complaint and is therefore unavailable for analysis (Compl. ¶12). The narrative infringement allegations are limited to the statement that Defendant infringes by "making and using (including testing)" its website (Compl. ¶12). No probative visual evidence provided in complaint.

Identified Points of Contention

• Scope Questions: A primary issue will be whether the patent's claims, which are described in the context of "shareware" and distributable "computer programs," can be read to cover a remotely-hosted e-commerce website. The dispute may focus on whether the combination of server-side application code and client-side browser activity constitutes a "computer program" with "embedded protective code" as contemplated by the patent ('549 Patent, col. 8:46-51).
• Technical Questions: The complaint provides no information on how the Accused Product's operations allegedly meet the specific claim limitations. This raises the question of what evidence will be presented to show that the website's user access or session management protocols constitute a "digitally signed ... authorization message" that is authenticated using a public/private key pair as recited in the claims ('549 Patent, col. 8:51-54).

V. Key Claim Terms for Construction

The Term: "computer program"

• Context and Importance: The construction of this term is fundamental. The infringement allegation's viability depends on whether a website service can be considered a "computer program" within the meaning of the claims. Practitioners may focus on this term because the patent's disclosure is heavily oriented toward downloadable, executable software.
• Intrinsic Evidence for a Broader Interpretation: The specification refers to "executable computer programs (including informally distributed programs)" ('549 Patent, col. 1:8-10), which a plaintiff might argue is general enough to encompass the code executing on a server and in a user's browser to deliver a web application.
• Evidence for a Narrower Interpretation: The patent repeatedly uses the term "shareware" and discusses its distribution model, suggesting a discrete software package installed and run on a "user's host computer" ('549 Patent, col. 1:49, col. 4:65-66). Figure 1 depicts the "PROTECTED PROGRAM" as a distinct component on "USER A's COMPUTER," which could support a narrower construction limited to client-side applications ('549 Patent, FIG. 1).

The Term: "authorization message that is digitally signed"

• Context and Importance: The core of the patented method is a specific cryptographic process. The infringement analysis will turn on whether the accused website uses a mechanism that meets the definition of a "digitally signed" message.
• Intrinsic Evidence for a Broader Interpretation: The patent describes a system where the authorization message is supplied "directly or indirectly by the shareware supplier" ('549 Patent, col. 2:42-44). A party could argue this broadly covers any secure token or credential passed from the server to the client to grant access.
• Evidence for a Narrower Interpretation: The claims and specification describe a specific public-key cryptography framework where a message is signed with a "secret signing key" and verified with a "public checking key" ('549 Patent, col. 8:51-54). A defendant would likely argue that this requires a specific asymmetric cryptographic signature, which may be distinct from other security mechanisms used in standard web communications like SSL/TLS session establishment or login cookies.

VI. Other Allegations

Willful Infringement

The complaint does not contain an explicit count for willful infringement. However, it alleges that Defendant has had knowledge of its infringement "since at least the date the Defendant was served with a copy of this Complaint" (Compl. ¶16), which may form a basis for post-filing willfulness or enhanced damages. The prayer for relief also requests a finding that the case is "exceptional" under 35 U.S.C. § 285 (Compl. p. 3).

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

• A core issue will be one of definitional scope: can the patent's claims, which are rooted in the technical context of protecting executable "shareware" programs on a user's computer, be construed to cover the functions of a remotely delivered e-commerce website? The resolution will likely depend on the court's construction of "computer program."
• A key evidentiary question will be one of technical mapping: assuming the patent's scope is found to be broad enough, what evidence can Plaintiff produce to demonstrate that the Accused Product’s standard web security and user-access protocols perform the specific cryptographic steps of the patented method, particularly the generation and authentication of a "digitally signed" authorization message?