DCT
2:17-cv-00167
Scanning Tech Innovations LLC v. Toast Inc
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: Scanning Technologies Innovations LLC (Texas)
- Defendant: Toast, Inc. (Massachusetts)
- Plaintiff’s Counsel: Kizzia Johnson, PLLC
- Case Identification: 2:17-cv-00167, E.D. Tex., 02/28/2017
- Venue Allegations: Plaintiff alleges venue is proper because Defendant is deemed to reside in the district and has committed, and continues to commit, acts of infringement within the Eastern District of Texas.
- Core Dispute: Plaintiff alleges that Defendant’s point-of-sale (POS) system infringes a patent related to a mobile device's ability to check for the existence of online product information using a locally stored database without an active network connection.
- Technical Context: The technology addresses the problem of unreliable network connectivity for mobile commerce, enabling a device to quickly inform a user whether online information for a scanned product is available before attempting to connect to a network.
- Key Procedural History: The asserted patent is subject to a terminal disclaimer. It is the third in a chain of continuation applications, claiming priority back to an application filed in 2012. The complaint does not mention any prior litigation or administrative proceedings involving the patent.
Case Timeline
| Date | Event |
|---|---|
| 2012-02-25 | ’498 Patent Earliest Priority Date |
| 2015-06-09 | ’498 Patent Issue Date |
| 2017-02-28 | Complaint Filing Date |
II. Technology and Patent(s)-in-Suit Analysis
U.S. Patent No. 9,053,498 - “System and Method for Network Operation”
The Invention Explained
- Problem Addressed: The patent addresses the user frustration that occurs when a mobile device is used to scan a product's Universal Product Code (UPC) to get more information, but the device cannot connect to the internet, or the connection attempt is slow and ultimately fails because no information is available. (’498 Patent, col. 1:42-54).
- The Patented Solution: The invention proposes a system where a mobile device first downloads and stores a "look-up table" from a server. This local table contains product identification codes (e.g., UPCs) and corresponding "information link indicators." When a user scans a product, the device checks this local table—without needing to access a network—to see if the indicator confirms that a link to online information exists. The device then immediately informs the user, for example, with a visual or audible signal, whether information is accessible online, before any attempt to connect is made. (’498 Patent, Abstract; col. 2:1-32).
- Technical Importance: This offline pre-check provides "instant gratification" by saving the user time and avoiding the effort of a potentially fruitless network connection in environments with poor or nonexistent connectivity. (’498 Patent, col. 1:50-64).
Key Claims at a Glance
- The complaint asserts independent claim 1. (’498 Patent, col. 11:11-49; Compl. ¶13).
- The essential elements of independent claim 1 include:
- A system with a mobile device (containing a processor and a visual input device in a handheld housing), a local database, and a server.
- The server stores a "look-up table" containing "identification codes" and associated "information link indicators."
- The mobile device downloads and stores this look-up table in its local database.
- The visual input device captures and decodes an image of an "article of commerce" to get an identification code.
- The processor looks up this code in the local table to find the corresponding "information link indicator" to determine if a link to more information exists.
- Critically, this determination is made "without accessing the communication network."
- The complaint states infringement of "one or more claims, including at least Claim 1," reserving the right to assert other claims. (Compl. ¶13).
III. The Accused Instrumentality
Product Identification
The accused instrumentality is "The Toast POS system," which includes mobile devices running Toast POS software, associated hardware like scanners, and a backend server. (Compl. ¶14, ¶16, ¶19).
Functionality and Market Context
- The Toast POS system is described as an "online ordering and point of sale system" for commercial use, such as in restaurants. (Compl. ¶13-14).
- The system operates on a mobile device (e.g., a tablet) that can add items to a transaction in an "offline mode." (Compl. ¶18). A server communicates with the handheld device and stores a database containing a "look-up table" with "identification codes (e.g., SKU and/or other codes)" for menu items. (Compl. ¶19). The complaint includes a screenshot of a table showing menu items like "Crab Cakes" associated with SKUs. (Compl. p. 4).
- The system uses the mobile device's processor to look up an item's SKU in a local database to determine from a "link indicator" whether a link exists for online ordering. (Compl. ¶21). This check is allegedly performed "without accessing the communication network." (Compl. ¶22).
- The complaint provides a screenshot of a user interface with a "Yes/No" option for "Order Online," which it alleges functions as the claimed "information link indicator." (Compl. p. 5).
IV. Analysis of Infringement Allegations
’498 Patent Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| a mobile device comprising a portable handheld housing and a communication interface... a signal processing device and a visual input device, the visual input device affixed within the portable handheld housing; | The Toast POS system runs on a mobile device (e.g., tablet) with a housing, communication interfaces (WiFi, Bluetooth), a processor, and a visual input device (camera/scanner). | ¶16, ¶17 | col. 5:1-2; col. 5:19-21; col. 5:45-50; col. 6:65-7:8 |
| a local database associated with the mobile device, the local database configured to store data for use by the mobile device; | The mobile device has an associated local database, for example, to store product information enabling an offline mode. | ¶18 | col. 5:36-37 |
| a server... comprising a server database configured to store a look-up table that includes... a plurality of identification codes associated with a plurality of articles of commerce, the look-up table also storing a plurality of information link indicators... | The Toast system includes a server with a database storing a look-up table that includes identification codes (SKUs) associated with articles of commerce (menu items) and information link indicators ("yes" or "no" options). | ¶19, ¶20 | col. 8:58-9:8 |
| wherein the visual input device is configured to capture an image of an article of commerce and decode the image to obtain an identification code; | The visual input device (scanner/camera) captures an image of an article of commerce and decodes it to get an identification code (SKU). | ¶21 | col. 9:47-54 |
| wherein... the signal processing device is configured to look up the identification code in the look-up table stored in the local database to determine from a respective information link indicator whether or not a link exists... | The mobile device's processor is configured to look up the SKU in the local "item database" to determine from a "yes" or "no" link indicator whether a link exists for accessing information online. | ¶21 | col. 9:50-54 |
| wherein the signal processing device determines whether or not the link exists without accessing the communication network. | The processor determines whether the link exists "without accessing the Internet" by checking the "yes" or "no" indicator in offline mode. | ¶22 | col. 11:1-4 |
Identified Points of Contention
- Scope Questions: The patent’s specification consistently refers to "UPC" symbols on "articles of commerce" in a general retail context. (’498 Patent, Abstract; col. 4:41-43). The complaint alleges infringement by a restaurant POS system using internal "SKU" codes for "menu items." (Compl. ¶19). This raises the question of whether a menu item like "Crab Cakes" qualifies as an "article of commerce" and whether an internal "SKU" meets the "identification code" limitation as contemplated by the patent.
- Technical Questions: Claim 1 requires the "information link indicator" to be a "status signal indicating the existence or absence of a link to information." (’498 Patent, col. 11:32-34). The complaint identifies a "yes" or "no" toggle for "Order Online" as this indicator. (Compl. ¶21, p. 5). It may be disputed whether this toggle's function is to signal the existence of a link, as claimed, or if it serves a different operational purpose, such as enabling or disabling an already-existing ordering pathway for inventory management.
V. Key Claim Terms for Construction
"information link indicator"
- Context and Importance: This term is central to the invention's offline-checking functionality. The dispute will likely focus on whether the accused "Order Online" toggle (Compl. p. 5) performs the function required by this term. Practitioners may focus on this term because its construction will determine whether simply managing an item's online availability is the same as checking for the existence of a data link itself.
- Intrinsic Evidence for a Broader Interpretation: The patent describes the indicator as a "status or check signal indicating that information is available," which could be argued to encompass a simple "yes/no" availability flag. (’498 Patent, col. 4:54-56).
- Intrinsic Evidence for a Narrower Interpretation: The patent repeatedly frames the problem as avoiding a failed attempt to connect to the internet. (’498 Patent, col. 1:50-54). This context suggests the indicator is meant to confirm the validity or existence of a network resource (like a URL), not merely to toggle an internal business logic setting for an item.
"article of commerce"
- Context and Importance: The patent's applicability hinges on whether the accused "menu items" (Compl. ¶19) fall within the scope of this term. A narrow construction focused on pre-packaged retail goods could create a non-infringement defense.
- Intrinsic Evidence for a Broader Interpretation: The term itself is general. The specification provides "clothing, DVDs, groceries, etc." as examples, which could be interpreted to include food items. (’498 Patent, col. 4:38-39).
- Intrinsic Evidence for a Narrower Interpretation: The specification's heavy and consistent emphasis on "Universal Product Codes (UPCs)" and "bar code symbol[s]" suggests the invention was contemplated for standardized, pre-packaged goods found in typical retail environments, not for made-to-order food items identified by internal, non-standard SKUs. (’498 Patent, Abstract; col. 4:41-46).
VI. Other Allegations
Indirect Infringement
The complaint does not plead separate counts for indirect or induced infringement. It alleges that Defendant "sells, offers to sell, and/or uses" the infringing system, focusing the case on direct infringement. (Compl. ¶14).
Willful Infringement
The complaint does not contain allegations of willful infringement.
VII. Analyst’s Conclusion: Key Questions for the Case
The resolution of this case may turn on the following central questions:
- A core issue will be one of definitional scope: can the patent's claim terms, such as "article of commerce" and "identification code", which are described in the context of retail UPCs, be construed broadly enough to read on a restaurant's menu items and their internal SKUs?
- A key evidentiary question will be one of technical function: does the accused "Order Online" toggle in the Toast POS system perform the specific function of an "information link indicator" as claimed—that is, a status signal confirming the existence of a data link—or does it serve a fundamentally different operational role related to inventory or menu management?