Torus Ventures LLC v. Lodging Host Hotel Corp

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Torus Ventures LLC (Delaware)
  • Defendant: Lodging Host Hotel Corp. (Texas)
  • Plaintiff’s Counsel: Rabicoff Law LLC
• Case Identification: 2:25-cv-00502, E.D. Tex., 05/06/2025
• Venue Allegations: Venue is asserted based on Defendant maintaining an established place of business in the Eastern District of Texas and allegedly committing acts of infringement within the district.
• Core Dispute: Plaintiff alleges that unspecified products made and sold by Defendant infringe a patent related to a recursive security protocol for digital copyright control.
• Technical Context: The technology concerns methods for protecting digital content through layered encryption, a foundational concept in the field of Digital Rights Management (DRM).
• Key Procedural History: The complaint does not mention any prior litigation, inter partes review (IPR) proceedings, or licensing history related to the patent-in-suit. The complaint alleges that its service provides Defendant with actual knowledge for the purposes of post-suit indirect and willful infringement.

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

• Issued: April 10, 2007

The Invention Explained

• Problem Addressed: The patent’s background section notes that traditional copyright protection, which relied on the difficulty of physically reproducing objects, was undermined by the advent of digital storage that allows for perfect, inexpensive, and widespread copying (’844 Patent, col. 1:25-45). Existing digital security protocols were described as making "artificial distinctions" between different types of data (e.g., media files versus executable code) and lacked the ability to secure themselves (’844 Patent, col. 2:28-49).
• The Patented Solution: The invention proposes a "recursive" security method where a digital bitstream is first encrypted using a first algorithm. This encrypted bitstream is then associated with its corresponding decryption algorithm. This entire package—the encrypted data plus its decryption method—is then treated as a new bitstream and is encrypted again using a second algorithm (’844 Patent, Abstract; col. 2:60-65). This creates a layered security wrapper, where the security protocol itself can be protected and updated using the very methods it is designed to implement (’844 Patent, FIG. 3).
• Technical Importance: This recursive architecture allows a security system to be updated to address newly discovered vulnerabilities by "subsuming" the older, compromised protocol within a new, more secure layer, without requiring changes to the underlying hardware (’844 Patent, col. 4:31-41).

Key Claims at a Glance

• The complaint does not identify any specific claims asserted against the Defendant, referring only to "Exemplary '844 Patent Claims" contained in an external exhibit not provided with the complaint (Compl. ¶11, ¶16). The foundational independent claim of the patent is Claim 1.
• Independent Claim 1 recites a method with the following essential elements:
  • 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;
  • associating a second decryption algorithm with the second bit stream.
• The complaint does not explicitly reserve the right to assert dependent claims.

III. The Accused Instrumentality

Product Identification

The complaint does not identify any accused product, method, or service by name. It refers only to "Exemplary Defendant Products" that are purportedly identified in an external "Exhibit 2," which was not filed with the complaint (Compl. ¶11, ¶16).

Functionality and Market Context

The complaint provides no description of the technical functionality, features, or market context of any accused instrumentality. It makes only conclusory allegations that Defendant makes, uses, sells, and imports infringing products (Compl. ¶11) and that its employees internally use them (Compl. ¶12).

IV. Analysis of Infringement Allegations

The complaint’s infringement allegations are contained entirely within "the claim charts of Exhibit 2," which is incorporated by reference but was not provided with the filed complaint (Compl. ¶17). As the complaint itself contains no factual allegations mapping any accused product feature to any claim element, a claim chart cannot be constructed.

No probative visual evidence provided in complaint.

Identified Points of Contention

• Pleading Sufficiency: An initial legal question is whether the complaint, by failing to identify any accused product or provide any factual basis for infringement beyond reference to an external document, meets the plausibility pleading standards required by federal court procedure.
• Technical Questions: A central technical question for the case will be whether Plaintiff can produce evidence that an accused product performs the specific recursive encryption required by the claims. The analysis will need to distinguish between a system that merely applies multiple, separate layers of encryption and a system that performs the claimed step of encrypting a first-level encrypted bitstream together with its associated decryption algorithm. The complaint provides no facts to suggest the accused products perform this specific function.

V. Key Claim Terms for Construction

• The Term: "bitstream"

  • Context and Importance: The scope of this term is fundamental. A broad definition could cover any digital data, while a narrower one might limit the claims to specific types of content, such as copyrighted media or software. Practitioners may focus on this term because its construction will define the universe of data to which the patented method applies.
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: The specification states that "all binary digital data can be reduced to a stream of 1's and 0's (a bitstream)" and that the intended purpose of the data, whether text or executable code, "is not relevant" (’844 Patent, col. 2:32-41).
    • Evidence for a Narrower Interpretation: The patent is titled for "digital copyright control" and the background focuses on protecting "copyrighted work" and "digital media streams," which may support an interpretation limited to such content (’844 Patent, Title; col. 1:25-45).

• The Term: "associating a... decryption algorithm with the encrypted bit stream"

  • Context and Importance: This term is critical to the recursive nature of the invention. How the decryption method is "associated" with the encrypted data dictates whether the two can be subsequently encrypted together as a single unit, which is the core inventive concept.
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: The summary of the invention describes the "combination" of the encrypted bitstream and decryption algorithm being "in turn encrypted," suggesting any form of bundling or packaging that allows them to be treated as a single object could suffice (’844 Patent, col. 2:63-65).
    • Evidence for a Narrower Interpretation: Embodiments in the patent depict specific data structures, such as the "APPLICATION-SPECIFIC DECRYPTION KEY DATA STRUCTURE" (FIG. 2, 210), which could be argued to define and limit what "associating" means in the context of the patent.

VI. Other Allegations

Indirect Infringement

The complaint alleges induced infringement, asserting that Defendant distributes "product literature and website materials" that instruct end users on how to use its products in an infringing manner (Compl. ¶14). Knowledge for this claim is based on the service of the complaint itself (Compl. ¶15).

Willful Infringement

Willfulness is alleged based on Defendant’s continued infringement after receiving notice of the patent and allegations via the filing of the lawsuit (Compl. ¶13-¶15). No pre-suit knowledge is alleged.

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

• A threshold issue will be one of pleading sufficiency: Does a complaint that fails to name an accused product or articulate a coherent theory of infringement in its own text, instead relying entirely on an un-filed external exhibit, satisfy the plausibility requirements to proceed?
• The primary technical dispute will be a question of functional proof: Assuming the case moves forward, can the Plaintiff provide evidence that Defendant's products perform the specific, two-step recursive encryption central to the patent's claims, or do they merely use conventional, non-recursive multi-layer security?
• A core legal question will be one of definitional scope: The case will likely turn on the construction of the term "associating", which connects the encrypted data to its decryption key. Whether this requires a specific, integrated data structure or allows for a looser connection will be critical to determining both infringement and validity.