DCT
2:23-cv-00343
BT Wearables LLC v. Dillards Inc
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: BT Wearables LLC (Texas)
- Defendant: Dillard's Inc. (Delaware)
- Plaintiff’s Counsel: Rozier Hardt McDonough, PLLC
- Case Identification: 2:23-cv-00343, E.D. Tex., 07/21/2023
- Venue Allegations: Plaintiff alleges venue is proper because Defendant Dillard's has maintained established and regular places of business in the Eastern District of Texas, including multiple specified retail store locations.
- Core Dispute: Plaintiff alleges that Defendant’s sale of Citizen CZ Smartwatches infringes five U.S. patents related to wearable monitoring systems, smartwatches, and personal emergency response technology.
- Technical Context: The technology at issue involves smartwatches equipped with sensors for monitoring a user's physical activity and physiological data, a highly competitive and significant segment of the consumer electronics market.
- Key Procedural History: The complaint does not allege any prior litigation, Inter Partes Review (IPR) proceedings, or licensing history related to the asserted patents.
Case Timeline
| Date | Event |
|---|---|
| 2006-06-30 | Earliest Priority Date for ’796, ’520, ’940 Patents |
| 2006-08-30 | Earliest Priority Date for ’336, ’704 Patents |
| 2015-12-18 | U.S. Patent No. 9,204,796 Issued |
| 2017-10-03 | U.S. Patent No. 9,775,520 Issued |
| 2019-07-30 | U.S. Patent No. 10,362,940 Issued |
| 2020-08-04 | U.S. Patent No. 10,729,336 Issued |
| 2021-07-06 | U.S. Patent No. 11,051,704 Issued |
| 2023-07-21 | Complaint Filed |
II. Technology and Patent(s)-in-Suit Analysis
U.S. Patent No. 9,204,796 - Personal Emergency Response (PER) System
The Invention Explained
- Problem Addressed: The patent family describes the challenges of providing continuous, effective health and general care for the growing elderly and disabled population, noting that typical home care is often sporadic and lacks facilities for continuous monitoring in emergencies (U.S. Patent No. 10362940, col. 1:20-43).
- The Patented Solution: The invention proposes a system using one or more sensors on a mobile object (e.g., a person) to detect motion. A processor then classifies sequences of these motions into groups of similar postures, which are represented by a "model," and applies that model to identify the user's specific activity (e.g., walking, running) (’796 Patent, Abstract; ’940 Patent, col. 1:47-53). This allows for automated activity monitoring and analysis.
- Technical Importance: This approach provided a framework for automatically categorizing user movements into specific, identifiable activities, moving beyond simple motion detection to activity classification.
Key Claims at a Glance
- The complaint asserts at least independent claim 1 (Compl. ¶24).
- Essential elements of claim 1 include:
- A system comprising one or more sensors configured to detect movement of a mobile object.
- A wireless transceiver.
- A processor coupled to the sensor(s) and transceiver.
- The processor is configured to classify sequences of movements into groups of similar postures represented by a model.
- The processor is further configured to apply the model to identify an activity of the mobile object.
- The processor identifies each elemental motion of a sequence and matches the sequence of elemental motions with one or more stored sequences to identify the activity.
- The complaint does not explicitly reserve the right to assert dependent claims but refers to infringement of "one or more claims" (Compl. ¶25).
U.S. Patent No. 9,775,520 - Wearable Personal Monitoring System
The Invention Explained
- Problem Addressed: As with the related ’796 Patent, this patent addresses the need for improved systems to monitor personal activity, particularly for health and wellness purposes (’940 Patent, col. 1:20-43).
- The Patented Solution: The invention is a monitoring apparatus worn on the wrist, comprising a housing, an accelerometer, a processor, and a wireless transceiver. The processor analyzes signals from the accelerometer to determine if they are "indicative of a predefined exercise," computes the calories burned based on this determination, and transmits the calorie data to a remote device via the transceiver (’520 Patent, Abstract; ’520 Patent, cl. 1).
- Technical Importance: This patent focuses on a specific, commercially significant application of wearable technology: automatically tracking predefined exercises and calculating caloric expenditure on a wrist-worn device.
Key Claims at a Glance
- The complaint asserts at least independent claim 1 (Compl. ¶40).
- Essential elements of claim 1 include:
- A monitoring apparatus comprising a housing adapted to be worn on a wrist of a person.
- An accelerometer disposed in the housing.
- A wireless transceiver disposed in the housing.
- A processor disposed in the housing.
- The processor analyzes signals from the accelerometer to determine whether the signals are indicative of a predefined exercise.
- The processor computes calories burned by the person based on the signals and the predefined exercise.
- The processor transmits the calories burned to a remote device via the wireless transceiver.
- The complaint refers to infringement of "one or more claims" (Compl. ¶41).
U.S. Patent No. 10,362,940 - Personal Emergency Response (PER) System
- Technology Synopsis: This patent, related to the ’796 and ’520 patents, describes a wearable monitoring apparatus worn on the wrist. It includes a processor, an accelerometer, and a user input device. The user input device is adapted for selecting a "predefined exercise," and the processor then computes "activity data for the selected predefined exercise based on signals from the accelerometer" (’940 Patent, cl. 1).
- Asserted Claims: At least independent claim 1 (Compl. ¶56).
- Accused Features: The complaint alleges that the accused smartwatches possess a wristwatch housing, accelerometer, processor, and a user input device (touchscreen and/or buttons) that enables a user to select a pre-defined exercise and subsequently gathers activity data (Compl. ¶56).
U.S. Patent No. 10,729,336 - Smart Watch
- Technology Synopsis: This patent describes a wristwatch for monitoring body parameters that includes a processor, transceiver, accelerometer, and heart monitoring sensors. The system further includes a telephone with a positioning system wirelessly coupled to the watch, where the telephone can off-load at least a portion of speech-processing from the watch. A remote server is also wirelessly coupled to the watch through the transceiver or telephone (’336 Patent, cl. 1).
- Asserted Claims: At least independent claim 1 (Compl. ¶72).
- Accused Features: The complaint accuses the Citizen CZ Smartwatch Sport and Casual Touchscreen models, alleging they monitor body parameters, include the claimed hardware, and are compatible with smartphones (telephones) that support GPS (positioning system). The complaint further alleges the devices can offload speech processing to the smartphone and connect to remote cloud servers like Amazon Alexa (Compl. ¶72).
U.S. Patent No. 11,051,704 - Smart Watch
- Technology Synopsis: This patent, related to the ’336 patent, describes a wristwatch that tracks at least one body parameter and includes a processor, transceiver, accelerometer, and heart monitoring sensor. A key feature is a processor "capable of detecting a heart problem." The system also comprises a telephone with a positioning system capable of performing speech processing on speech captured by the watch and is coupled to a remote server (’704 Patent, cl. 1).
- Asserted Claims: At least independent claim 1 (Compl. ¶88).
- Accused Features: The complaint alleges the Citizen CZ Smartwatch Sport and Casual Touchscreen models are equipped with software (the "Wellness Application/Citizen YouQ app") that, in conjunction with the watch's sensors, "detects and notifies the user of heart rate changes and problems." The devices are also alleged to perform speech processing via a coupled smartphone and connect to remote cloud servers (Compl. ¶88, ¶23 footnote 2).
III. The Accused Instrumentality
Product Identification
- The Citizen CZ Smartwatch Sport Touchscreen, Citizen CZ Smartwatch Casual Touchscreen, and Citizen CZ Smartwatch Hybrid, collectively referred to as the "Citizen CZ Smartwatch" (Compl. ¶17).
Functionality and Market Context
- The complaint alleges the accused products are smartwatches that include features for calculating calories burned, transmitting data to a remote device, selecting an exercise via a user input, executing speech commands, and identifying user activity (Compl. ¶17). Hardware features alleged to be present include an accelerometer and a heart rate sensor, as well as wireless transceivers for coupling to a mobile telephone (Compl. ¶17). A marketing image from Defendant’s supplier shows the three accused smartwatch models: Sport Touchscreen, Casual Touchscreen, and Hybrid (Compl. p. 4).
- The complaint further alleges that the touchscreen models are equipped with a gyroscope, altimeter, barometer, and SP02 sensor, and run on Google's Wear OS, providing Bluetooth, Wi-Fi, GPS, and NFC connectivity (Compl. pp. 4-5). An internal photograph of an accused product’s circuitry is sourced from an FCC filing (Compl. p. 5). For certain patents, the complaint points to the "Wellness Application/Citizen YouQ app software" as performing the function of detecting and notifying the user of "heart rate changes and problems" (Compl. ¶23 footnote 2).
IV. Analysis of Infringement Allegations
U.S. Patent No. 9,204,796 Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| a system comprising: one or more sensors configured to detect movement of a mobile object; a wireless transceiver; and a processor... | The Accused Products contain sensors (e.g., accelerometer, heart rate sensor), a processor, and a wireless transceiver (e.g., Bluetooth, Wi-Fi). | ¶24; pp. 4-5 | col. 1:47-49 |
| wherein the processor is configured to classify sequences of movements of the mobile object into groups of similar postures represented by a model and to apply the model to identify an activity of the mobile object... | The processor and wireless transceiver allegedly classify sequences of movements into groups of similar postures represented by a model and apply that model to identify user activities like running, walking, and biking. | ¶24 | col. 1:49-53 |
| wherein the processor identifies each elemental motion of a sequence of elemental motions of the mobile object, and identifies the activity of the mobile object by matching the sequence of identified elemental motions with one or more stored sequences of elemental motions... | The processor allegedly identifies each elemental motion in a sequence and matches it against stored sequences to identify the corresponding activity. | ¶24 | col. 10:1-8 |
U.S. Patent No. 9,775,520 Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| a monitoring apparatus, comprising: a housing adapted to be worn on a wrist of a person; an accelerometer disposed in the housing; a wireless transceiver disposed in the housing; and a processor... | The Accused Products have a wristwatch housing, an accelerometer, a processor, and a wireless transceiver. | ¶40; pp. 4-5 | col. 10:29-33 |
| wherein the processor analyzes signals from the accelerometer to determine whether the signals are indicative of a predefined exercise... | The processor allegedly analyzes signals from the on-board accelerometer to determine if the user's movements are indicative of a predefined exercise. | ¶40 | col. 10:34-36 |
| and computes calories burned by the person based on the signals from the accelerometer and the predefined exercise... | The processor allegedly computes calories burned by the user based on the accelerometer signals and the predefined exercise. | ¶40 | col. 10:37-39 |
| and transmits the calories burned to a remote device via the wireless transceiver. | The processor transmits the calculated calorie data to a remote device, such as a coupled smartphone, via the wireless transceiver. | ¶40 | col. 10:40-43 |
Identified Points of Contention
- Scope Questions: For the ’796 Patent, a central question may be the scope of the term "model." The complaint alleges the accused products use a model to classify postures and identify activities, but provides limited technical detail on how this is accomplished (Compl. ¶24). The litigation may explore whether the activity-tracking algorithms in the accused products meet the specific claim requirement of classifying "sequences of movements... into groups of similar postures."
- Technical Questions: For the ’520 Patent, a key technical question may arise from the claim limitation requiring the processor to "analyze[] signals from the accelerometer to determine whether the signals are indicative of a predefined exercise" (Compl. ¶40). The analysis may focus on whether the accused products' processor performs an active analysis to confirm the nature of the exercise, or if it merely records accelerometer data after a user has manually selected an exercise mode, which may not meet the claim's requirement.
V. Key Claim Terms for Construction
The Term: "model" (from ’796 Patent, Claim 1)
Context and Importance: The infringement theory for the ’796 Patent hinges on this term. Whether the accused products infringe may depend on whether their activity-recognition software constitutes a "model" that classifies "sequences of movements... into groups of similar postures" as required by the claim.
Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The patent family specification discusses various sophisticated analytical systems that could be considered a "model," including a "Hidden Markov Model (HMM) recognizer, a dynamic time warp (DTW) recognizer, a neural network, a fuzzy logic engine, a Bayesian network, an expert system, a rule-driven system" (’940 Patent, col. 2:35-39). Plaintiff may argue this broad disclosure supports a non-limiting construction.
- Evidence for a Narrower Interpretation: Defendant may argue that, in the context of the invention's stated goal of providing a "Personal Emergency Response (PER) System," the term "model" should be construed as being limited to systems capable of identifying specific, medically relevant events (like falls) rather than general fitness activities like running or biking.
The Term: "analyzes signals... to determine whether the signals are indicative of a predefined exercise" (from ’520 Patent, Claim 1)
Context and Importance: This phrase is critical because it suggests an active, analytical step. Infringement may turn on whether the accused devices merely record motion during a selected exercise or actively determine that the motion corresponds to the selected exercise.
Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: Plaintiff may argue that any processing of accelerometer data that contributes to exercise-related metrics (like calorie counts) constitutes "analyzing" the signals to "determine" they are indicative of the exercise.
- Evidence for a Narrower Interpretation: The claim language recites "analyzes... to determine whether," which suggests a verification or classification step. Defendant may argue this requires more than passive data collection during a user-initiated exercise mode; it requires the processor to confirm a match between the user's actual movements and the characteristics of the selected exercise type.
VI. Other Allegations
- Indirect Infringement: For each asserted patent, the complaint alleges induced infringement based on Defendant’s advertising, promotion, and distribution of instructions that allegedly guide end-users to use the Accused Products in an infringing manner (Compl. ¶25, ¶41, ¶57, ¶73, ¶89). Contributory infringement is alleged on the basis that the Accused Products have "special features" that are not "staple articles of commerce suitable for substantial non-infringing use" (Compl. ¶26, ¶42, ¶58, ¶74, ¶90).
- Willful Infringement: The complaint alleges willful infringement based on Defendant having knowledge of the asserted patents "at least as of the date when it was notified of the filing of this action" (Compl. ¶28, ¶44, ¶60, ¶76, ¶92). It further alleges willful blindness based on a purported "policy or practice of not reviewing the patents of others" (Compl. ¶29, ¶45, ¶61, ¶77, ¶93).
VII. Analyst’s Conclusion: Key Questions for the Case
- A core issue will be one of technical operation: what is the precise functionality of the software in the Citizen CZ Smartwatches? The case will likely require a deep technical analysis to determine if the devices perform the specific classification and analytical steps recited in the claims (e.g., using a "model" to classify postures; "analyzing signals to determine" an exercise type), or if they utilize more generalized motion-tracking algorithms that fall outside the claim scope.
- A key legal question will be one of claim construction: the dispute may hinge on the interpretation of terms like "model" and "analyzes...to determine." Whether these terms are construed broadly to cover general data processing or narrowly to require specific, sophisticated analytical functions will be critical to the infringement analysis for the lead patents.
- An evidentiary question will be one of proof: Plaintiff will bear the burden of demonstrating, likely through source code review and expert testimony, that the accused products actually perform the functions alleged in the complaint. The current allegations are largely conclusory, and the case will turn on whether specific evidence of the claimed functionality can be adduced.