DCT
3:18-cv-01720
InVue Security Products Inc v. Mobile Tech Inc
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: InVue Security Products Inc. (Ohio)
- Defendant: Mobile Tech, Inc. d/b/a Mobile Technologies Inc. and MTI (Indiana)
- Plaintiff’s Counsel: Ice Miller LLP; Dority & Manning, P.A.
- Case Identification: 1:18-cv-02653, S.D. Ind., 08/28/2018
- Venue Allegations: Venue is alleged to be proper in the Southern District of Indiana because the Defendant is an Indiana corporation and therefore resides in the district.
- Core Dispute: Plaintiff alleges that Defendant’s retail security systems, which use programmable electronic keys to control anti-theft devices on merchandise, infringe a patent related to programmable security systems.
- Technical Context: The technology concerns electronic anti-theft systems for retail merchandise, which aim to prevent theft while allowing authorized employees to access and sell products.
- Key Procedural History: The complaint alleges that the patent-in-suit is part of a larger family of patents, several of which have been asserted against the same Defendant in a separate litigation in the District of Oregon. Plaintiff also alleges specific instances of pre-suit notice, including a CEO-level meeting and the provision of a copy of the asserted claim while the patent application was still pending.
Case Timeline
| Date | Event |
|---|---|
| 2005-12-23 | Priority Date for U.S. Patent No. 10,062,266 |
| 2016-01-01 | Defendant allegedly began deploying the accused Intellikey 3.0 system |
| 2018-04-11 | CEOs of Plaintiff and Defendant allegedly met |
| 2018-05-31 | Plaintiff allegedly provided Defendant with a copy of pending Claim 1 |
| 2018-08-16 | Patent application published |
| 2018-08-28 | U.S. Patent No. 10,062,266 issued |
| 2018-08-28 | Complaint filed |
II. Technology and Patent(s)-in-Suit Analysis
- Patent Identification: U.S. Patent No. 10,062,266, “Programmable Security System and Method for Protecting Merchandise,” issued August 28, 2018.
The Invention Explained
- Problem Addressed: Conventional security systems for retail merchandise often rely on physical or magnetic keys that, if stolen by shoplifters or dishonest employees, can be used to defeat the same type of security device at any store location (’266 Patent, col. 2:1-17).
- The Patented Solution: The invention describes a security system where a central "programming station" gives a "programmable key" a unique, store-specific Security Disarm Code (SDC). The key uses this SDC to arm and disarm security devices attached to merchandise. The key’s authorization can be time-limited or restricted by a number of uses, requiring it to be periodically "refreshed" by communicating with the programming station, rendering a stolen key useless after a short period or at another retail location (’266 Patent, Abstract; col. 2:32-59).
- Technical Importance: The system adds a layer of dynamic, software-based authorization to retail security, seeking to mitigate the vulnerability posed by the theft or misuse of static, universal keys (’266 Patent, col. 2:20-29).
Key Claims at a Glance
- The complaint asserts at least independent claim 1 (Compl. ¶27).
- Independent Claim 1 requires a security system comprising:
- a programming station comprising a memory;
- a programmable key comprising a memory configured to store a security code;
- a security device comprising an alarm and configured to be attached to an item of merchandise, which activates in response to its integrity being compromised;
- wherein the programmable key is configured to provide the security code to the programming station to be stored in the memory of the programming station;
- wherein the programmable key is configured to wirelessly communicate with the programming station for authorizing the programmable key to control the security device if the security code of the programmable key matches the security code of the programming station.
- The complaint does not explicitly reserve the right to assert dependent claims, but the infringement counts are directed to the patent generally (Compl. ¶¶26, 38, 52).
III. The Accused Instrumentality
Product Identification
- The complaint identifies the accused products as security systems sold by Defendant MTI, which include components named “Intellikey,” “Intellikey 3.0,” “Intellikey 3.0 Gateway,” “Gateway,” and security devices like the “Freedom Micro” and “puck” (Compl. ¶¶13, 15, 29).
Functionality and Market Context
- The accused system is alleged to consist of a programming station (the "Gateway" or "Hub"), at least one programmable key (the "Intellikey"), and at least one security device (the "puck") with an alarm that attaches to merchandise (Compl. ¶¶28-29).
- The complaint alleges the key can be programmed with a security code, can provide that code to the programming station, and can wirelessly communicate with the station to receive authorization to control the security device if the codes match (Compl. ¶¶28, 30-31). It is alleged that Defendant began deploying the "Intellikey 3.0" system with customers, including AT&T, in 2016 (Compl. ¶19).
- No probative visual evidence provided in complaint.
IV. Analysis of Infringement Allegations
’266 Patent Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| a programming station comprising a memory | The accused security system includes a programming station, referred to as a “Gateway” or “Hub,” with a memory (Compl. ¶28). | ¶28 | col. 5:20-27 |
| a programmable key comprising a memory configured to store a security code | The system includes at least one key, referred to as an “Intellikey,” with a memory where a security code can be stored (Compl. ¶28). | ¶28 | col. 7:45-50 |
| a security device comprising an alarm and configured to be attached to an item of merchandise, the security device further configured to activate the alarm in response to the integrity of the security device being compromised | The system includes a security device, referred to as a “puck,” with an alarm that can be attached to merchandise and activates if tampered with or removed (Compl. ¶29). | ¶29 | col. 7:26-34 |
| wherein the programmable key is configured to provide the security code to the programming station to be stored in the memory of the programming station | The programmable key of the accused system is configured to provide the security code to the programming station, and the code can be stored in the station’s memory (Compl. ¶30). | ¶30 | col. 9:41-51 |
| wherein the programmable key is configured to wirelessly communicate with the programming station for authorizing the programmable key to control the security device if the security code of the programmable key matches the security code of the programming station | The accused key is configured to communicate wirelessly with the programming station to authorize the key to control the security device, upon a match of the security code in the key’s memory with the code in the station’s memory (Compl. ¶31). | ¶31 | col. 10:1-11 |
- Identified Points of Contention:
- Scope Questions: Claim 1 requires the key to "provide the security code to the programming station." The patent specification describes an initial process where the station generates a code and provides it to the key (’266 Patent, col. 9:26-35). The claim appears to describe a subsequent authentication or "refresh" cycle where the station verifies the key's code. A central dispute may be whether the accused system performs this specific key-to-station verification step as claimed, and how that aligns with the patent's overall disclosure.
- Technical Questions: The claim requires that wireless communication with the station is "for authorizing the programmable key to control the security device." The complaint alleges this function (Compl. ¶31). A key technical question will be what evidence demonstrates that this specific authorization logic—a code match at the station that grants the key power to control a separate security device—is actually implemented in the accused system, as opposed to a different authorization mechanism (e.g., direct communication between the key and the security device).
V. Key Claim Terms for Construction
- The Term: "provide the security code to the programming station"
- Context and Importance: This phrase defines a specific direction of information flow (key-to-station) that is critical to the infringement analysis. The construction of this term will determine whether the claim covers only authentication/refresh cycles or also initial programming, and practitioners may focus on this term to determine if there is a mismatch between the claim language and the accused system's operation.
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The plain language of the claim does not limit when or why the key provides the code to the station. A party could argue it covers any instance of such a transfer.
- Evidence for a Narrower Interpretation: The patent’s detailed description of initial programming shows the code flowing from the station to the key (’266 Patent, col. 9:26-35, FIG. 12A). The subsequent clause in the claim ties this step to "authorizing" the key based on a match, suggesting this limitation refers specifically to an authentication event, not the initial code transfer. FIG. 12B in the patent depicts a step where the station will "READ KEY SDC," which supports a narrower interpretation tied to authentication.
VI. Other Allegations
- Indirect Infringement: The complaint alleges both contributory and induced infringement.
- Contributory (Count 2): Allegations are based on the assertion that the Accused Products are not staple articles of commerce, are not suitable for substantial non-infringing use, and are especially adapted for use in an infringing manner (Compl. ¶¶40-43).
- Inducement (Count 3): The complaint alleges MTI intended for its customers to infringe by providing instructions, training, and observing customers using the Accused Products in an infringing manner (Compl. ¶¶54-57).
- Willful Infringement: Willfulness is alleged based on both pre-suit and post-suit knowledge. The complaint alleges specific pre-suit knowledge stemming from a meeting between the parties' CEOs, Defendant's alleged admission regarding the product's operation, and Plaintiff providing Defendant with a copy of the asserted claim months before the patent issued (Compl. ¶¶18-20, 36). Knowledge is also alleged based on prior litigation between the parties involving related patents (Compl. ¶39).
VII. Analyst’s Conclusion: Key Questions for the Case
- A core issue will be one of claim scope and sequence: can the phrase "provide the security code to the programming station," as required by Claim 1, be construed to read on the accused system's actual method of operation, particularly in light of the patent's disclosure of a different directional flow for initial programming?
- A key question of law and fact will concern willfulness: given the detailed allegations of pre-suit notice, including a CEO-level meeting and the affirmative sharing of the pending claim language, did the Defendant's continued activities constitute objective recklessness sufficient to support a finding of willful infringement and potential enhanced damages?
- An underlying strategic question relates to the ongoing conflict between the parties: how will the allegations and outcomes in the parallel litigation in Oregon, which involves related patents but different infringement claims, influence the strategy, claim construction, and potential settlement posture in this case?