Torus Ventures LLC v. Pizza Hut LLC

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Torus Ventures LLC (Delaware)
  • Defendant: Pizza Hut, LLC (Delaware)
  • Plaintiff’s Counsel: Rabicoff Law LLC
• Case Identification: 2:25-cv-00128, E.D. Tex., 02/04/2025
• Venue Allegations: Venue is alleged to be proper based on Defendant maintaining an established place of business in the Eastern District of Texas.
• Core Dispute: Plaintiff alleges that unspecified products and services from Defendant infringe a patent related to a recursive security protocol for digital copyright control.
• Technical Context: The technology concerns methods for protecting digital content (such as software or media streams) from unauthorized use or copying through multi-layered encryption.
• Key Procedural History: The complaint asserts that its service, along with accompanying claim charts, constitutes actual knowledge of infringement for the purpose of post-suit infringement allegations.

Case Timeline

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

U.S. Patent No. 7,203,844 - "Method and system for a recursive security protocol for digital copyright control"

• Patent Identification: U.S. Patent No. 7,203,844, "Method and system for a recursive security protocol for digital copyright control," issued April 10, 2007.

The Invention Explained

• Problem Addressed: The patent describes a problem in digital copyright where the ease and low cost of creating perfect digital copies undermines traditional copyright protection. (’844 Patent, col. 1:25-56). Prior art security protocols were often defeated, and they made artificial distinctions between different types of digital data (e.g., software vs. media streams), limiting their flexibility. (’844 Patent, col. 2:23-43).
• The Patented Solution: The invention proposes a "Recursive Security Protocol" where any digital "bitstream" can be protected. The core idea is to encrypt a bitstream and associate it with a decryption algorithm. This combination is then treated as a new bitstream and can itself be encrypted with a second encryption algorithm, creating multiple layers of security. (’844 Patent, Abstract; col. 2:53-65). This allows the security protocol itself to be updated and secured using the same method, a self-referencing behavior the patent terms "recursion." (’844 Patent, col. 2:48-52).
• Technical Importance: The described approach provides a flexible method to secure any form of digital data without altering the underlying content, and allows the security system itself to be updated to address newly discovered vulnerabilities without changing hardware. (’844 Patent, col. 4:11-48).

Key Claims at a Glance

• The complaint asserts infringement of "one or more claims," including "at least the exemplary claims" identified in an attached but unprovided exhibit. (’844 Patent, Compl. ¶11). For this analysis, independent method claim 1 is representative.
• Independent Claim 1:
  • encrypting a bitstream with a first encryption algorithm;
  • associating a first decryption algorithm with the encrypted bit stream;
  • encrypting both the encrypted bit stream and the first decryption algorithm with a second encryption algorithm to yield a second bit stream; and
  • associating a second decryption algorithm with the second bit stream.

III. The Accused Instrumentality

Product Identification

The complaint identifies the accused instrumentalities as the "Exemplary Defendant Products" listed in claim charts provided as Exhibit 2. (Compl. ¶11, 16). This exhibit was not filed with the public version of the complaint.

Functionality and Market Context

The complaint does not provide sufficient detail for analysis of the accused products' specific functionality or market context, as these details are contained within the unprovided Exhibit 2. (Compl. ¶17). The allegations are general, stating Defendant has made, used, sold, and imported infringing products and has its employees internally test and use them. (Compl. ¶11-12).

IV. Analysis of Infringement Allegations

No probative visual evidence provided in complaint.

The complaint incorporates by reference claim charts (Exhibit 2) that were not publicly filed, alleging they demonstrate how the "Exemplary Defendant Products" satisfy all elements of the asserted claims. (Compl. ¶16-17). Without access to these charts, a detailed element-by-element analysis is not possible. The infringement theory is broadly stated: Defendant's products "practice the technology claimed by the '844 Patent." (Compl. ¶16).

Identified Points of Contention

Given the abstract nature of the pleadings, the central disputes are not yet defined. However, analysis will likely raise several questions once the specific accused products are identified:

• Technical Questions: What specific processes within Defendant's systems constitute the "first encryption" and the "second encryption" as claimed? What evidence demonstrates that Defendant's systems encrypt not just a data stream, but also the associated "first decryption algorithm" as a single package?
• Scope Questions: What constitutes a "bitstream" in the context of Defendant's products? How will the plaintiff argue that the alleged infringement embodies the "recursive" nature described as a key feature of the invention?

V. Key Claim Terms for Construction

The Term

"encrypting both the encrypted bit stream and the first decryption algorithm with a second encryption algorithm"

Context and Importance

This limitation is the core of the "recursive" concept in claim 1. The infringement analysis will depend on whether Defendant's accused process can be shown to perform this specific two-part encapsulation. The case may turn on whether a single security wrapper applied to a data file that also contains decryption logic meets this limitation, or if a more distinct, sequential two-step encryption process is required.

Intrinsic Evidence for Interpretation

• Evidence for a Broader Interpretation: The Summary of the Invention describes the process broadly: "the bit stream is encrypted and this result is associated with a decryption algorithm. This combination is in turn encrypted, with the result of this second encryption yielding a second bit stream." (’844 Patent, col. 2:61-65). This language may support an argument that any method that results in a secure package containing both elements meets the limitation, regardless of the precise mechanism.
• Evidence for a Narrower Interpretation: Figure 5, a process flow diagram, depicts distinct encryption steps. For example, an "Application-Specific Key" (M) is encrypted to become P₁(M), which is then combined with other information and re-encrypted to become K₁(P₁(M)). (’844 Patent, Fig. 5). This could support a narrower reading that requires two distinct, sequential encryption operations on a package that explicitly contains both the encrypted data and the first decryption method.

VI. Other Allegations

Indirect Infringement

The complaint alleges induced infringement, stating that Defendant distributes "product literature and website materials inducing end users and others to use its products in the customary and intended manner that infringes." (Compl. ¶14). The basis for this allegation is said to be detailed in the unprovided Exhibit 2. The claim is asserted to be effective "at least since being served by this Complaint." (Compl. ¶15).

Willful Infringement

The complaint does not use the term "willful infringement." However, it explicitly pleads "Actual Knowledge of Infringement" based on the service of the complaint and attached claim charts. (Compl. ¶13). It further alleges that "Despite such actual knowledge, Defendant continues to" infringe, which establishes a basis for alleging post-suit willfulness. (Compl. ¶14).

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

1. An Evidentiary Question of Operation: The immediate question is what the unfiled exhibits will reveal about the accused products. The central evidentiary dispute will be whether Plaintiff can demonstrate that Defendant’s systems technically perform the specific nested encryption required by the claims—namely, encrypting an already-encrypted data stream and its associated decryption algorithm together in a second security layer.

2. A Definitional Question of Recursion: A core legal issue will be the construction of the claim language describing the recursive process. The case will likely depend on whether the term "encrypting both... with a second encryption algorithm" requires two discrete, provable encryption steps, or if it can be read to cover a single, more complex security protocol that functionally encapsulates both data and decryption logic within a secure wrapper.

3. A Question of Knowledge and Intent: For the indirect and potential willfulness claims, a key question will be what knowledge Defendant possessed and when. The complaint currently grounds its allegations of knowledge in the service of the lawsuit itself, raising the issue of whether Defendant’s continued conduct post-filing was objectively reckless.