DCT

2:22-cv-00455

Cellspin Soft Inc v. Nike Inc

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I. Executive Summary and Procedural Information

  • Parties & Counsel:
  • Case Identification: 2:22-cv-00455, E.D. Tex., 11/23/2022
  • Venue Allegations: Plaintiff alleges venue is proper because Nike maintains a regular and established place of business within the Eastern District of Texas, including Nike retail and outlet stores, and because infringing activities occur in the district.
  • Core Dispute: Plaintiff alleges that Defendant’s Nike Adapt line of smart footwear and the associated mobile applications infringe three patents related to the process of automatically transferring data from a peripheral data capture device to a web service via a mobile device.
  • Technical Context: The lawsuit concerns the field of wearable technology and the Internet of Things (IoT), where smart devices capture data and use smartphones as gateways to sync with internet-based services.
  • Key Procedural History: The complaint notes that the patentability of the asserted patent claims under 35 U.S.C. § 101 has been previously litigated and affirmed by the U.S. Court of Appeals for the Federal Circuit in a case against Fitbit. The complaint also references prior litigation between Cellspin and Nike, alleging that Nike had notice of the patents and argued in that prior case that the now-accused Adapt products were distinct and would require different claim construction.

Case Timeline

Date Event
2007-12-28 Priority Date for ’794, ’752, and ’847 Patents
2014-05-27 U.S. Patent No. 8,738,794 Issued
2014-11-18 U.S. Patent No. 8,892,752 Issued
2017-01-01 Approximate date of prior lawsuit filing, Cellspin v. Nike, giving notice of patents-in-suit
2017-08-29 U.S. Patent No. 9,749,847 Issued
2019-07-17 Federal Circuit decision in Cellspin v. Fitbit confirming § 101 patentability
2021-04-14 N.D. Cal. decision in Cellspin v. Fitbit
2022-11-23 Complaint Filed

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

U.S. Patent No. 8,738,794 - "Automatic Multimedia Upload for Publishing Data and Multimedia Content," Issued May 27, 2014

The Invention Explained

  • Problem Addressed: The patent addresses the cumbersome and time-consuming process of manually transferring multimedia files, such as photos and videos, from a digital capture device (e.g., a camera) to a computer with a cable, and then manually uploading those files to a website ('794 Patent, col. 1:36-48).
  • The Patented Solution: The invention describes a method where a peripheral "digital data capture device" is paired with a Bluetooth-enabled mobile device running a client application. This application can automatically detect when new data is captured on the peripheral, initiate a transfer of that data to the mobile device, and then automatically publish the content to one or more web services with minimal user intervention ('794 Patent, Abstract; col. 2:3-27). The system architecture is illustrated in Figure 2, showing a "Digital Data Capture Device" (201) communicating via Bluetooth with a "Bluetooth Enabled Mobile Device" (203) ('794 Patent, FIG. 2).
  • Technical Importance: The technology aimed to create a more seamless and automated data pipeline from peripheral devices to the internet, using the increasingly ubiquitous smartphone as a central hub or gateway ('794 Patent, col. 1:49-54).

Key Claims at a Glance

  • The complaint asserts independent claim 1 and dependent claims 2, 3, 4, 7, and 9 (Compl. ¶22).
  • Independent Claim 1 of the ’794 Patent is a method claim with the following essential elements:
    • Providing software modules on both a Bluetooth enabled data capture device and a Bluetooth enabled mobile device.
    • Establishing a paired connection between the two devices.
    • Acquiring new data on the data capture device after the connection is established.
    • The software on the capture device detecting the new data and sending a data signal to the mobile device.
    • Transferring the new data from the capture device to the mobile device.
    • The mobile device receiving the new data, applying a user identifier to it, and transferring it to one or more web services.
    • The web service receiving the data and making it available for consumption over the internet.
  • The complaint reserves the right to assert additional claims (Compl. ¶22).

U.S. Patent No. 8,892,752 - "Automatic Multimedia Upload for Publishing Data and Multimedia Content," Issued November 18, 2014

The Invention Explained

  • Problem Addressed: As a continuation of the same patent family, the ’752 Patent addresses the same general problem of streamlining the transfer of data from a peripheral device to an internet service ('752 Patent, col. 2:36-42).
  • The Patented Solution: This patent claims a method focused on establishing a secure paired Bluetooth connection using a cryptographic key. It describes a process where the mobile device can enable "event notifications" on the data capture device, which then signals the mobile device when new data is available. The data is encrypted, transferred to the mobile device, decrypted, and then sent to a remote internet server with a user identifier, an action setting (e.g., RPC or HTTP), and a destination web address ('752 Patent, Claim 1; Abstract).
  • Technical Importance: This patent adds a focus on secure communication and a more detailed "event notification" architecture to the core invention described in the ’794 Patent ('752 Patent, col. 4:55-65).

Key Claims at a Glance

  • The complaint asserts independent claim 1 and dependent claims 2, 4, 5, 12, 13, and 14 (Compl. ¶32).
  • Independent Claim 1 of the ’752 Patent is a method claim performed at the data capture device, with the following essential elements:
    • Establishing a secure paired Bluetooth connection with a mobile device using a cryptographic key.
    • Acquiring new data after the connection is established.
    • Detecting the new data for transfer, which includes receiving a message from the mobile device to enable event notifications.
    • Encrypting the new data using the cryptographic key.
    • Transferring the encrypted data to the mobile device for subsequent processing and upload to a remote internet server.
  • The complaint reserves the right to assert additional claims (Compl. ¶32).

U.S. Patent No. 9,749,847 - "Automatic Multimedia Upload for Publishing Data and Multimedia Content," Issued August 29, 2017

  • Technology Synopsis: Belonging to the same patent family, the ’847 Patent claims a system comprising a Bluetooth-enabled data capture device and a mobile application on a cellular phone. The system is configured to establish a cryptographically authenticated paired connection, transfer new data from the capture device to the phone, and use the phone's cellular data network to transfer the new data to a website via HTTP ('847 Patent, Abstract; Claim 1).
  • Asserted Claims: Independent claim 1 and dependent claims 2 and 3 are asserted (Compl. ¶42).
  • Accused Features: The complaint alleges that the combination of the Nike Adapt Wearable and the Nike Adapt App running on a smartphone constitutes the claimed system (Compl. ¶43-44).

III. The Accused Instrumentality

Product Identification

The accused instrumentalities are the "Nike Adapt shoe line" (referred to as "Nike Adapt Wearable") and the corresponding "Nike Adapt App" for iOS and Android, which are used in combination (Compl. ¶14). The complaint provides a non-exhaustive list of specific shoe models, including the Nike Adapt Auto Max and Nike Adapt BB (Compl. ¶14).

Functionality and Market Context

The complaint alleges that the Nike Adapt Wearables are smart shoes that connect to a user's smartphone via Bluetooth through the Adapt App (Compl. ¶24). The system enables the acquisition and transfer of data from the wearables to Nike's web services. To receive the benefits of the system, users must create an account and sync the wearable to their mobile device via the application (Compl. ¶24). An image on the first page of the complaint depicts the primary components of the accused system: a Nike Adapt shoe, a small electronic module, and a smartphone running the app (Compl., p. 1).

IV. Analysis of Infringement Allegations

The complaint references infringement claim charts in Exhibits A, B, and C but does not include these exhibits in the filing (Compl. ¶¶ 22, 32, 42). A detailed element-by-element analysis is therefore not possible from the provided document. The infringement theory must be summarized from the complaint's narrative allegations.

Plaintiff's general theory of infringement for the method claims of the ’794 and ’752 Patents is based on two grounds:

  1. Direct Infringement by Nike: Nike is alleged to have directly infringed by practicing the claimed methods during its own testing, demonstration, and use of the Nike Adapt Wearables with the Adapt App (Compl. ¶¶ 23, 33).
  2. Joint Infringement by Nike and its Users: Alternatively, Nike is alleged to infringe jointly with its end-users. In this scenario, the end-user performs certain steps (e.g., acquiring data by using the shoes), while Nike performs others (e.g., operating the back-end web service). The complaint alleges Nike directs or controls its users' performance by conditioning the benefits of the Adapt products on users creating an account and syncing the devices according to Nike's process (Compl. ¶¶ 24, 35).

Identified Points of Contention:

  • Scope Questions:
    • A central dispute will likely be whether a "Nike Adapt Wearable" (a smart shoe) falls within the scope of a "digital data capture device" as contemplated by the patents, which primarily use a digital camera as an exemplar ('794 Patent, col. 2:16-18).
    • Another scope question involves the nature of the transferred information. Does the sensor data from a smart shoe (e.g., fit or performance data) constitute "multimedia content" or the type of "new data" covered by the claims?
    • Does the endpoint for Nike's app data sync qualify as a "destination web address of a remote internet server" ('752 Patent, cl. 1), a term the complaint notes Nike previously identified for construction (Compl. ¶18)?
  • Technical Questions:
    • What is the specific mechanism by which the Nike Adapt App becomes aware of new data on the wearable? Does it align with the "detecting and signaling" or "event notification" steps required by the claims?
    • Do the accused products employ a "secure paired Bluetooth connection" that "uses a cryptographic encryption key" in the specific manner required by claim 1 of the ’752 Patent?

V. Key Claim Terms for Construction

For the ’794 Patent:

  • The Term: "digital data capture device"
  • Context and Importance: This term is foundational to infringement. Its construction will determine whether the accused Nike smart shoes can be considered an infringing component. Practitioners may focus on this term because the patent's specification heavily emphasizes examples like digital cameras and video cameras, creating a potential disconnect with the accused footwear technology. Nike has previously identified this term as a basis for non-infringement of its Adapt products (Compl. ¶18).
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: The term itself is generic. Claim 1 does not explicitly limit the device to one that captures images or video. The specification notes the device may be a "digital camera, a video camera, or other digital modular camera systems, or other digital data capturing systems" ('794 Patent, col. 4:3-5), which could be argued to leave room for other types of data capture systems.
    • Evidence for a Narrower Interpretation: The Background section frames the problem to be solved entirely in the context of capturing and publishing images and videos ('794 Patent, col. 1:36-48). The detailed description and figures, such as FIG. 5, consistently use a camera as the primary embodiment.

For the ’752 Patent:

  • The Term: "destination web address of a remote internet server"
  • Context and Importance: This term is critical for claims requiring the transfer of data to a specific, identifiable location. Practitioners may focus on this term because modern apps often communicate with proprietary API endpoints that may not be considered a "web address" in the traditional sense of a user-facing URL. Nike also previously identified this term as requiring construction for the Adapt products (Compl. ¶18).
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: The term could be interpreted functionally to mean any network location identifier for a server that provides an internet service.
    • Evidence for a Narrower Interpretation: The specification provides examples of user-selectable websites like "Flickr™, Picasa™, YouTube™, eBay®" ('752 Patent, col. 8:51-53), suggesting the term refers to public-facing web services or platforms, not necessarily a private, back-end server endpoint for an application.

VI. Other Allegations

  • Indirect Infringement: The complaint alleges induced infringement, stating that Nike provides the Adapt products, software, and instructions that encourage and enable its customers to perform the infringing methods (Compl. ¶¶ 24, 35, 46).
  • Willful Infringement: Willfulness is alleged based on Nike's purported knowledge of the patents-in-suit from at least one prior lawsuit filed by Cellspin against Nike. The complaint argues that any infringement after Nike received notice from this prior case is necessarily willful, wanton, and deliberate (Compl. ¶¶ 26, 36, 47).

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

  1. Definitional Scope: A core issue will be whether the term "digital data capture device", rooted in the patents’ examples of multimedia cameras, can be construed to cover the sensor-equipped Nike Adapt smart shoe. The outcome of this claim construction battle may be determinative for infringement.
  2. Impact of Prior Litigation: A key legal question will be the effect of Nike's statements from a prior case, where it allegedly characterized the Adapt products as "distinct" and operating "differently" from other accused products (Compl. ¶17). This raises the possibility that Cellspin will argue judicial estoppel or that Nike has made a binding admission regarding the technology's operation.
  3. Joint Infringement Liability: For the method claims, a central evidentiary question will be whether Nike's control over its ecosystem—requiring users to create accounts and use the Adapt App to sync their shoes—is sufficient to establish liability for the actions of its end-users under the "direction or control" standard for joint infringement.