DCT

2:16-cv-00980

Intellectual Ventures II LLC v. FedEx Corp

Log In

I. Executive Summary and Procedural Information

  • Parties & Counsel:
  • Case Identification: 2:16-cv-00980, E.D. Tex., 08/31/2016
  • Venue Allegations: Plaintiff alleges venue is proper because Defendants are subject to personal jurisdiction and have committed acts of infringement in the district. The complaint notes that Defendant FedEx Office is headquartered in the Eastern District of Texas and that Defendants operate numerous service centers within the district that allegedly provide infringing services.
  • Core Dispute: Plaintiff alleges that Defendant’s logistics, package tracking, warehouse management, and customer shipping software systems infringe five patents related to mobile workforce management, asset tracking, and bar code data interchange.
  • Technical Context: The technologies at issue relate to the management of mobile assets, inventory, and data flow, which are foundational components of the modern global logistics and shipping industry.
  • Key Procedural History: The complaint alleges that Plaintiff approached Defendant in April 2016 to discuss a license and sent a letter detailing the alleged infringement on August 30, 2016, one day prior to filing suit. The complaint also notes that one of the patents-in-suit was concurrently asserted against another defendant in the same district. Subsequent to the filing of this complaint, Inter Partes Review (IPR) proceedings were initiated against the patents-in-suit, resulting in the cancellation of the specific independent claims asserted in four of the five counts ('900 claim 1, '715 claim 1, '581 claim 1, and '586 claim 7). This will likely be dispositive for the infringement allegations related to those patents.

Case Timeline

Date Event
1999-01-08 '900 Patent Priority Date
2000-09-18 '581 Patent Priority Date
2000-11-03 '356 Patent Priority Date
2001-05-30 '586 Patent Priority Date
2003-01-01 FedEx begins distributing the PowerPad handheld device
2003-10-14 '900 Patent Issue Date
2005-03-01 '715 Patent Priority Date
2005-06-21 '356 Patent Issue Date
2007-04-03 '715 Patent Issue Date
2009-01-01 FedEx launches SenseAware technology
2011-01-01 FedEx begins distributing the Zebra MC9500-K computer
2013-01-01 FedEx launches SenseAware 2000 device
2013-07-23 '581 Patent Issue Date
2015-01-01 FedEx Corporation acquires GENCO
2015-06-02 '586 Patent Issue Date
2016-04-01 Plaintiff allegedly approaches Defendant for a license
2016-08-30 Plaintiff sends notice letter to Defendant
2016-08-31 Complaint Filing Date

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

U.S. Patent No. 6,633,900 - "Mobile Crew Management System For Distributing Work Order Assignments To Mobile Field Crew Units," issued October 14, 2003

The Invention Explained

  • Problem Addressed: The patent describes the challenge faced by businesses like utility companies in communicating work assignments to a large, geographically dispersed field crew. Previous methods relied on voice, fax, or proprietary systems, which were inefficient and often resulted in crews working with outdated information (’900 Patent, col. 1:19-64).
  • The Patented Solution: The invention proposes a system using standard, non-proprietary TCP/IP networking to connect a central enterprise computing system with mobile field units. Each component has a unique IP address, enabling automated, two-way data communication to assign work orders, provide access to current data, and receive status updates from the field with minimal dispatcher intervention (’900 Patent, Abstract; col. 2:21-39; Fig. 1).
  • Technical Importance: The adoption of open, IP-based standards for mobile workforce communication offered a more scalable, maintainable, and interoperable alternative to the closed, proprietary systems that preceded it (’900 Patent, col. 2:15-17).

Key Claims at a Glance

  • The complaint asserts at least independent claim 1 (Compl. ¶40).
  • Claim 1 outlines a multi-step method for distributing work order data: (A) updating a database with a new assignment; (B) notifying the crew; (C) verifying crew identity via login; (D) notifying the crew of successful login; (E) presenting a list of assignments; (F) retrieving detailed data for a selected assignment; (G) displaying that data; and (H) updating the database in response to crew input about actions taken (’900 Patent, col. 15:7-34).
  • The complaint alleges infringement of "one or more claims," reserving the right to assert others (Compl. ¶39).

U.S. Patent No. 6,909,356 - "Method And Apparatus For Associating The Movement Of Goods With The Identity Of An Individual Moving The Goods," issued June 21, 2005

The Invention Explained

  • Problem Addressed: The patent identifies a deficiency in inventory tracking systems, namely the difficulty of reliably associating the movement of a specific item with the identity of the person or entity that moved it, leading to inaccurate records and a lack of accountability (’356 Patent, col. 1:21-52).
  • The Patented Solution: The invention couples access control with inventory monitoring. It describes a system that obtains identity information for an entity entering a "controlled space," monitors the movement of objects within that space using a wireless tracking system, and automatically associates the entity's identity with any changes (e.g., additions, removals). This correlated data is sent to a server, which can then trigger notifications or other actions (’356 Patent, Abstract; col. 2:1-20).
  • Technical Importance: By creating an automated and traceable link between an entity and the physical handling of inventory, the invention aimed to improve the accuracy, security, and overall management of valuable assets (’356 Patent, col. 1:53-65).

Key Claims at a Glance

  • The complaint asserts at least independent claim 1 (Compl. ¶50).
  • Claim 1 recites a method comprising: obtaining identity information of an entity entering a controlled space; monitoring the entity and objects within that space; automatically associating the entity's identity with the movement of objects; and transmitting this information to a server that notifies a user, which results in at least one of the objects being automatically returned or picked up (’356 Patent, col. 8:23-44).
  • The complaint alleges infringement of "one or more claims" (Compl. ¶49).

U.S. Patent No. 7,199,715 - "System And Method For Tracking ID Tags Using A Data Structure Of Tag Reads," issued April 3, 2007

  • Technology Synopsis: This patent seeks to improve the precision of RFID tracking systems, which can suffer from missed reads at various points in a business process (’715 Patent, col. 1:33-41). The invention uses a data structure that aggregates tag reads from successive points to infer missing data, thereby correcting the database to more accurately reflect an item's journey through the supply chain (’715 Patent, Abstract).
  • Asserted Claims: At least independent claim 1 (Compl. ¶60).
  • Accused Features: The complaint accuses GENCO’s Warehouse Management System, which allegedly uses RFID to track items, populates a database with read data from successive points, and uses this information to track tags through the warehousing process (Compl. ¶¶58, 61).

U.S. Patent No. 8,494,581 - "Systems and Methods for Management of Mobile Field Assets Via Wireless Handheld Devices," issued July 23, 2013

  • Technology Synopsis: This patent describes a system for managing mobile field assets through bi-directional communication between enterprise servers and wireless handheld devices (’581 Patent, col. 1:25-41). The system enables a user to access a remote "assessment program" on a handheld device, collect field data for an industry-specific task, determine the device's geographic location, and transmit both the field data and location back to the server (’581 Patent, Abstract).
  • Asserted Claims: At least independent claim 1 (Compl. ¶70).
  • Accused Features: The complaint targets the system comprising FedEx couriers using MC9500-K handheld devices to access the COSMOS tracking software, collect package status data, determine location via GPS, and communicate that information back to FedEx's central computers (Compl. ¶¶68, 71).

U.S. Patent No. 9,047,586 - "Systems For Tagged Bar Code Data Interchange," issued June 2, 2015

  • Technology Synopsis: The patent addresses the problem of data exchange between computer systems with different hardware or software configurations (’586 Patent, col. 2:20-29). It proposes a method of embedding "tagged" bar codes in documents, where the tags provide instructions for how the encoded data should be parsed and input into a receiving application, thereby facilitating interoperability (’586 Patent, Abstract; col. 1:19-27).
  • Asserted Claims: At least claim 7 (Compl. ¶83).
  • Accused Features: The complaint accuses FedEx Ship Manager software, which allegedly allows customers to create shipping labels with multiple bar codes (1D and 2D) that encode "data tags" and "data items" for data interchange purposes (Compl. ¶¶78, 84).

III. The Accused Instrumentality

Product Identification

  • The complaint asserts infringement by several distinct systems and services offered by Defendants, including: the FedEx logistics and package tracking system, comprised of the back-end "COSMOS" computer system and the "PowerPad" and "Zebra Technologies MC9500-K" handheld mobile devices used by couriers (Compl. ¶¶38, 68); the "SenseAware" devices and associated monitoring services (Compl. ¶48); the "Warehouse Management System" used by subsidiary GENCO (Compl. ¶58); and the "FedEx Ship Manager" software provided to customers (Compl. ¶78).

Functionality and Market Context

  • The complaint characterizes the accused instrumentalities as central to Defendants' global logistics operations. The COSMOS system is described as "one of the world's largest computer and telecommunication networks" for real-time package tracking (Compl. ¶37). The handheld devices are alleged to allow couriers to wirelessly receive assignments and communicate transaction information back to FedEx servers "with little to no dispatcher intervention" (Compl. ¶38). SenseAware is presented as a "sensor-based logistics technology" for monitoring shipment location and environmental conditions (Compl. ¶48), while GENCO's system is for supply chain and reverse logistics management (Compl. ¶58). FedEx Ship Manager is a customer-facing tool for creating labels and automating the shipping process (Compl. ¶78). No probative visual evidence provided in complaint.

IV. Analysis of Infringement Allegations

'900 Patent Infringement Allegations

Claim Element (from Independent Claim 1) Alleged Infringing Functionality Complaint Citation Patent Citation
(A) updating a database on the enterprise computing system to indicate an assignment has been assigned FedEx updates its COSMOS database to indicate a package delivery or pickup has been assigned to a courier. ¶41(a) col. 15:10-14
(B) notifying the field crew of the assignment FedEx notifies the courier of the new assignment. ¶41(b) col. 15:15-16
(C) in response to the input of field crew login data, verifying field crew identity In response to courier login data, FedEx's system verifies the courier's identity. ¶41(c) col. 15:17-19
(D) notifying the field crew of successful login FedEx's system notifies the courier of a successful login. ¶41(d) col. 15:20-21
(E) retrieving and presenting a list of assignments to the field crew FedEx's system retrieves and presents a list of package delivery/pickup assignments to the courier. ¶41(e) col. 15:22-24
(F) in response to field crew input selecting an assignment... retrieving detailed assignment data In response to the courier selecting an assignment, the system retrieves detailed data for that assignment. ¶41(f) col. 15:25-28
(G) displaying the detailed assignment data to the field crew The system displays the detailed assignment data on the courier's handheld device. ¶41(g) col. 15:29-30
(H) in response to field crew input... updating the detailed assignment data In response to courier input indicating an action was taken (e.g., package delivered), FedEx's system updates the assignment data. ¶41(h) col. 15:31-34
  • Identified Points of Contention:
    • Validity Question: The primary issue for this count is the validity of the asserted claim. Subsequent to the filing of the complaint, claim 1 of the '900 patent was cancelled in an IPR proceeding (IPR2017-00741). This invalidation presents a dispositive challenge to the infringement allegation.
    • Scope Questions: Assuming the claim were valid, a potential dispute could arise over whether FedEx's system of assigning package deliveries constitutes a "work order assignment" system as that term is used in the patent, which is described primarily in the context of utility field service crews (’900 Patent, col. 1:22-30).

'356 Patent Infringement Allegations

Claim Element (from Independent Claim 1) Alleged Infringing Functionality Complaint Citation Patent Citation
obtaining identity information regarding an entity which enters a controlled space The system obtains the device ID of a SenseAware device, which is an "entity" that enters a "controlled space" defined by a geofence. ¶51(a) col. 2:1-4
monitoring, using a wireless tracking system... locations and movements of the entity and objects within the controlled space FedEx uses a web-based application (e.g., SenseAware.com) to monitor the locations and movements of the SenseAware device and the items being shipped with it. ¶51(b) col. 2:5-9
automatically associating... the identity information regarding the entity with status information regarding additions, removals... of the objects The computer system automatically associates the SenseAware device ID with status information, such as the removal of goods from the geofenced area. ¶51(c) col. 2:9-16
transmitting the status information... to a server... configured to automatically notify a user... wherein at least one of the objects is automatically returned or picked up as a result of such notification The system transmits the associated information to a FedEx server that sends an electronic alert, leading to FedEx automatically picking up or returning the item. ¶51(d) col. 2:16-20
  • Identified Points of Contention:
    • Scope Questions: The infringement theory hinges on whether a "geofence" (a virtual boundary) meets the definition of a "controlled space." This raises a question for the court, as the patent specification primarily describes physical enclosures with locking mechanisms (’356 Patent, Fig. 1A, col. 4:4-6).
    • Technical Questions: The final limitation requires that an object is "automatically returned or picked up as a result of such notification." The complaint makes a conclusory allegation that this occurs (Compl. ¶51(d)), but a key factual dispute may be whether FedEx's accused method actually includes this specific, automated responsive step.

V. Key Claim Terms for Construction

'900 Patent, Claim 1

  • The Term: "work order assignment data"
  • Context and Importance: The patent's specification is heavily grounded in the context of utility field services (’900 Patent, col. 1:22-30). The accused system manages package deliveries. The construction of this term will be critical to determining if the patent's scope can extend from its specific disclosed embodiments to the broader logistics industry. Practitioners may focus on this term to argue for either a narrow, utility-specific meaning or a broader meaning covering any dispatched task.
  • Intrinsic Evidence for a Broader Interpretation: The claim language itself is not explicitly limited to any particular industry, using general terms like "field crew" and "assignment" (’900 Patent, col. 15:7-9).
  • Intrinsic Evidence for a Narrower Interpretation: The background and detailed description of the invention consistently use utility companies as the primary, if not sole, example of the problem and solution, which may suggest the inventors contemplated a narrower scope (’900 Patent, col. 1:19-25, col. 2:10-12).

'356 Patent, Claim 1

  • The Term: "controlled space"
  • Context and Importance: The complaint alleges that a "geofence" is a "controlled space" (Compl. ¶51(a)). The patent's figures and description, however, depict a physical room with a door and a lock (’356 Patent, Fig. 1A-1B, col. 6:2-4). The case may turn on whether this term can be construed broadly enough to cover a virtual, GPS-defined area.
  • Intrinsic Evidence for a Broader Interpretation: The term is not explicitly defined in the patent, leaving open the possibility that it could encompass any area—physical or virtual—where contents and access are monitored and controlled.
  • Intrinsic Evidence for a Narrower Interpretation: The specification's consistent reference to physical structures like "storage room 110" and physical access controls like "locking mechanism 170" provides strong support for an interpretation limited to tangible, securable locations (’356 Patent, col. 4:4-6, 5:1-4).

VI. Other Allegations

  • Indirect Infringement: The complaint alleges indirect infringement only for the '586 patent. It claims induced infringement on the basis that Defendant "actively induces its customers to use FedEx Ship Manager to directly infringe" (Compl. ¶79) and contributory infringement on the basis that the software is a material part of the invention and not a staple article of commerce with substantial non-infringing uses (Compl. ¶80).
  • Willful Infringement: The complaint alleges willful infringement for all five patents, seeking a finding of an exceptional case under 35 U.S.C. § 285 (Compl. ¶¶44, 54, 64, 74, 89). The basis for willfulness is alleged pre-suit knowledge stemming from a notice letter sent by Plaintiff to Defendant on August 30, 2016, the day before the complaint was filed (Compl. ¶¶42, 52, 62, 72, 82).

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

  1. Claim Viability: A threshold and likely dispositive issue for four of the five asserted patents will be the impact of post-filing IPR proceedings. The complaint's infringement counts for the '900, '715, '581, and '586 patents are premised on independent claims that were subsequently cancelled by the USPTO, rendering those counts non-viable.
  2. Definitional Scope: For the '356 patent, whose asserted claim survived post-grant review, a core issue will be one of claim construction: can the term "controlled space," which the specification describes as a physical room with a lock, be interpreted to cover the virtual, GPS-defined "geofence" central to the Plaintiff's infringement theory?
  3. Evidentiary Proof: A key factual question for the '356 patent will be one of functional performance: does the complaint provide sufficient evidence to support the allegation that the accused SenseAware method performs the specific final step of the claim, wherein an object is "automatically returned or picked up" as a direct result of a system-generated notification?