Soverain IP LLC v. Datapipe Inc

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Soverain IP, LLC (Texas)
  • Defendant: Datapipe, Inc. (Delaware)
  • Plaintiff’s Counsel: Capshaw Derieux, LLP; Berger & Hipskind LLP
• Case Identification: 2:17-cv-00292, E.D. Tex., 04/12/2017
• Venue Allegations: Plaintiff alleges venue is proper in the Eastern District of Texas because Defendant is registered to do business in Texas, operates datacenters and has facilities in Texas, and has committed acts of infringement in the district.
• Core Dispute: Plaintiff alleges that Defendant’s cloud hosting and security services infringe three patents related to network management, data extraction, and user authorization technologies developed in the early commercial internet era.
• Technical Context: The technology relates to foundational methods for managing user sessions, securing transactions, and integrating data from disparate sources over networks, which were critical for the growth of e-commerce in the mid-1990s.
• Key Procedural History: The complaint notes that all claims of the ’447 patent were subject to an inter partes reexamination, in which the original claims were confirmed patentable and 83 new claims were added and found patentable. The complaint also highlights an extensive history of licensing the asserted patent families to major technology companies, including a $40 million license to Amazon.com.

Case Timeline

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

U.S. Patent No. 7,191,447 - Managing Transfer of Information in a Communications Network, issued March 13, 2007

The Invention Explained

• Problem Addressed: The patent’s background describes challenges in the early World Wide Web, including managing queries for new or changed information across many servers, implementing security protocols, and extracting data from sources of network-based information for use in other applications (e.g., spreadsheets) (Compl. ¶24; ’447 Patent, col. 1:10-50).
• The Patented Solution: The invention provides a system for extracting data using an "object embedding program" (such as OLE or OpenDoc) implemented within a compound document (e.g., a spreadsheet). This program locates a separate "script program" via a link and applies that script to a source of network-based information (e.g., a web page) to extract specific data and embed it into the compound document (’447 Patent, Abstract; col. 1:35-45). This is illustrated in Figure 6 of the patent, where a script extracts a stock price from a financial data page and embeds it into a spreadsheet cell.
• Technical Importance: This technology offered a method to dynamically link and integrate data from web sources directly into user applications, automating a process that would otherwise require manual copying and pasting, and predating modern, standardized APIs for such tasks (Compl. ¶24, ¶41).

Key Claims at a Glance

• The complaint asserts at least claim 5, which depends on independent claim 1 (Compl. ¶64).
• Essential elements of Independent Claim 1:
  • A system for extracting data from network-based information sources.
  • A script program structured to extract data.
  • An object embedding program that is implemented on a computer and comprises a link to the network-based information and a link to locate the script program.
  • The object embedding program is structured to apply the script program to the network-based information to extract the data and embed it within a compound document.

U.S. Patent No. 8,606,900 - Method and System for Counting Web Access Requests, issued December 10, 2013

The Invention Explained

• Problem Addressed: The patent describes the difficulty of controlling access and tracking usage on Internet servers in an open, stateless environment. Information providers needed a way to manage access to confidential or subscription-based content and to understand user behavior without compromising the security of private networks (’900 Patent, col. 2:40-67).
• The Patented Solution: The invention describes a method where a server, upon an initial client request for a controlled resource, generates and appends a session identifier (SID) to the request URL. This SID, which can contain user, domain, and authorization information, is then used for subsequent requests within a session, allowing the server to track a user's activity and count access requests while excluding repeated requests from the same client to avoid distorting usage metrics (’900 Patent, Abstract; col. 3:9-24). The complaint references early user interface screens from the "Transact" product, which embodied these concepts, showing server status monitoring and account validation settings (Compl. p. 8, Fig. 2, 4).
• Technical Importance: This technology provided a mechanism for state management in the otherwise stateless HTTP protocol, a foundational building block for e-commerce, user authentication, and website analytics (Compl. ¶43).

Key Claims at a Glance

• The complaint asserts at least independent claims 1 and 5 (Compl. ¶85).
• Essential elements of Independent Claim 1 (Method):
  • Generating a plurality of session identifiers at a web server.
  • Storing the session identifiers at client web browsers.
  • Receiving web page requests at the web server, where each request includes a session identifier.
  • Storing information about the requests (including the web page and SID).
  • Tracking requests by counting them, exclusive of repeated requests from a particular client.
• Essential elements of Independent Claim 5 (Method):
  • Similar to Claim 1, but specifies that the counting step "excludes repeated requests from a particular client that occur during a predetermined period of time, and thereafter counts a repeated request for the same web page from the particular client."

U.S. Patent No. 6,212,634 - Certifying Authorization in Computer Networks, issued April 3, 2001

Technology Synopsis

The patent addresses the need to authorize specific actions over a network, moving beyond simple user identification. It discloses a system where an "authorizing computer" creates a temporary public/private key pair and an associated "authorization certificate" that certifies a holder is permitted to perform a specific, defined action (Compl. ¶45; ’634 Patent, Abstract, col. 2:36-45). The certificate has a file structure with "critical components" that must be recognized by the receiving computer to be accepted, preventing misuse (’634 Patent, col. 2:3-18).

Asserted Claims

At least claim 4 (Compl. ¶105).

Accused Features

The Datapipe Stratosphere Elastic Cloud is accused of infringing by creating and transmitting authorization certificates that have file structures supporting critical and extension components to certify authorizations between computers (Compl. ¶94, ¶96-102).

III. The Accused Instrumentality

Product Identification

The complaint names three sets of accused products/services:

1. Datapipe Stratosphere Elastic Cloud (accused of infringing the ’447 and ’634 patents) (Compl. ¶49, ¶94).
2. Datapipe Managed Security, including its Web Application Firewall and Event Management functionality (accused of infringing the ’900 patent) (Compl. ¶73).

Functionality and Market Context

• The complaint alleges that the "Stratosphere Elastic Cloud" includes technology for extracting data from network-based information sources using script and object embedding programs (Compl. ¶51-52, ¶55-56) and for creating and managing authorization certificates (Compl. ¶97-99). The complaint does not provide specific technical details on how these cloud services operate.
• The "Managed Security" services are alleged to track webpage requests by generating, storing, and receiving session identifiers to identify series of requests between a client and server (Compl. ¶75-76, ¶79). The complaint further alleges these services include website analytics to track the number of webpage requests while excluding multiple requests from the same computer (Compl. ¶82). A visual from the reexamination of the ’447 patent is included to demonstrate the patentability of the original claims was confirmed by the USPTO (Compl. p. 14).

IV. Analysis of Infringement Allegations

U.S. Patent No. 7,191,447 Infringement Allegations

U.S. Patent No. 8,606,900 Infringement Allegations

Identified Points of Contention

• Scope Questions: A central question for the ’447 patent will be whether the terms "object embedding program" and "compound document," which are rooted in the context of 1990s technologies like OLE and OpenDoc (’447 Patent, col. 1:40-45), can be construed to read on the functionalities of a modern cloud hosting platform as alleged in the complaint.
• Technical Questions: The complaint's infringement allegations are highly general and often mirror the claim language without providing specific details of the accused products' operation. A key question will be whether the general allegation that Datapipe's security products perform "website analytics" (Compl. ¶82) is sufficient to meet the specific counting and exclusion steps required by the claims of the ’900 patent, such as excluding requests within a "predetermined period of time" (as required by claim 5).

V. Key Claim Terms for Construction

U.S. Patent No. 7,191,447

The Term

"object embedding program"

Context and Importance

This term is the core of claim 1 of the ’447 patent. Its construction will be critical to determining infringement, as the dispute will likely focus on whether Datapipe’s modern cloud infrastructure utilizes anything that can be considered an "object embedding program." Practitioners may focus on whether this term is limited to technologies for creating "compound documents" or can be read more broadly to cover other forms of data integration.

Intrinsic Evidence for Interpretation

• Evidence for a Broader Interpretation: The claims themselves do not explicitly limit the term to a specific technology. The specification describes the program's function—locating a script and applying it to extract data—which could arguably be performed by various software tools.
• Evidence for a Narrower Interpretation: The Background section explicitly names "OLE (Object Linking and Embedding) and OpenDoc" as known tools used to "build compound documents" and contains a link to an object embedded within a document like a "word-processor document or a spreadsheet" (’447 Patent, col. 1:40-48). This could support an interpretation limiting the term to client-side compound document technologies prevalent at the time of invention.

U.S. Patent No. 8,606,900

The Term

"session identifier"

Context and Importance

This term is fundamental to all asserted claims of the ’900 patent. The case will likely hinge on whether the data strings used by Datapipe's security products meet the specific functional and structural requirements of a "session identifier" as described in the patent.

Intrinsic Evidence for Interpretation

• Evidence for a Broader Interpretation: The term is not explicitly defined in a standalone definition. A party could argue for a plain and ordinary meaning covering any token used to maintain a session state.
• Evidence for a Narrower Interpretation: The detailed description provides a very specific structure for a preferred SID, stating it "encodes 96 bits of SID data" and includes a "32-bit digital signature, a 16-bit expiration date," a key identifier, a domain identifier, and a user identifier (’900 Patent, col. 5:48-55). This detailed embodiment may be used to argue for a narrower construction that requires a similarly structured and cryptographically generated identifier, not just any cookie or session token.

VI. Other Allegations

Indirect Infringement

The complaint alleges induced infringement for all three patents. The theory is that Datapipe provides products with the capability to infringe and provides "documentation and training materials that cause customers and end users... to utilize the products in a manner that directly infringe" (Compl. ¶67, ¶88).

Willful Infringement

The complaint alleges willfulness based on both post-suit and, implicitly, pre-suit knowledge. It pleads knowledge "since at least service of this Complaint" (Compl. ¶66, ¶87), but also asserts the patents are "well-known within the industry" due to extensive citation and licensing history, and that infringement was "willful, wanton, malicious... characteristic of a pirate" (Compl. ¶68, ¶89, ¶106). This suggests an argument that Datapipe was willfully blind to its infringement even before the lawsuit was filed.

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

• Technology Translation: A primary issue will be whether the specific methods disclosed in patents from the mid-1990s, aimed at solving problems like data extraction for compound documents ('447 patent) and stateless HTTP session management ('900 patent), can be mapped onto the functionality of a modern, sophisticated cloud hosting and security platform. The court will have to determine if there is a fundamental mismatch between the claimed inventions and the accused technology.
• Claim Scope and Construction: The case will likely turn on the construction of foundational terms. A key question of definitional scope will be whether "object embedding program" (’447 patent) is limited to the client-side, compound-document context of its era or can be construed to cover modern server-side data integration processes. Similarly, the scope of "session identifier" ('900 patent) will be contested—is it any session token, or must it meet the specific cryptographic and structural features detailed in the patent's specification?
• Sufficiency of Allegations: A procedural question is whether the complaint's high-level, conclusory infringement allegations, which often track the claim language without providing detailed technical correlations, meet the plausibility standard required for patent pleadings. Defendant may challenge whether Plaintiff has provided sufficient factual matter to show how the accused cloud and security products actually perform the claimed steps.