DCT

2:25-cv-00516

Valtrus Innovations Ltd v. FedEx Corp

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I. Executive Summary and Procedural Information

  • Parties & Counsel:
  • Case Identification: 2:25-cv-00516, E.D. Tex., 08/11/2025
  • Venue Allegations: Plaintiff alleges venue is proper in the Eastern District of Texas based on Defendant NetApp’s regular and established places of business in the district, including a physical office in Plano, properties owned or leased in Collin County, and the home offices of its employees. Allegations also cite business activities such as hiring employees required to reside in the district, partnerships with local entities, and contracts for manufacturing and supply chain operations in Texas.
  • Core Dispute: Plaintiff alleges that Defendant’s data storage and management products infringe six patents related to clustered computing systems, data security, performance monitoring, profile migration, and application deployment.
  • Technical Context: The technologies at issue pertain to the management, security, and performance of large-scale, clustered data storage systems, which are foundational to modern enterprise IT and cloud computing infrastructures.
  • Key Procedural History: The complaint alleges that Defendant had pre-suit knowledge of several of the patents-in-suit. For the ’416 and ’571 Patents, this knowledge is alleged to stem from Defendant citing the patents’ families during the prosecution of its own patent applications. For other patents, knowledge is alleged based on correspondence and claim charts sent by Plaintiff to Defendant prior to the lawsuit. These allegations form the basis for claims of willful infringement.

Case Timeline

Date Event
2001-09-27 U.S. Patent No. 7,120,832 Priority Date
2006-04-26 U.S. Patent No. 8,370,416 Priority Date
2006-10-10 U.S. Patent No. 7,120,832 Issues
2006-12-27 U.S. Patent No. 7,640,332 Priority Date
2007-03-30 U.S. Patent No. 7,856,488 Priority Date
2008-05-13 U.S. Patent No. 7,904,686 Priority Date
2009-04-08 U.S. Patent No. 8,370,571 Priority Date
2009-12-29 U.S. Patent No. 7,640,332 Issues
2010-12-21 U.S. Patent No. 7,856,488 Issues
2011-03-08 U.S. Patent No. 7,904,686 Issues
2013-02-05 U.S. Patent No. 8,370,416 Issues
2013-02-05 U.S. Patent No. 8,370,571 Issues
2015-11-10 Alleged Knowledge Date of ’571 Patent
2015-12-15 Alleged Knowledge Date of ’416 Patent
2021-05-28 Alleged Knowledge Date of ’832 Patent
2022-04-27 Alleged Knowledge Date of ’488 Patent
2025-08-11 Complaint Filing Date

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

U.S. Patent No. 8,370,416 - "Compatibility Enforcement in Clustered Computing Systems"

(Issued February 5, 2013)

The Invention Explained

  • Problem Addressed: The patent describes the technical challenge of ensuring hardware, software, and licensing compatibility among various components within a "clustered computing system," particularly when constructing new systems or modifying existing ones. (’416 Patent, col. 1:25-34).
  • The Patented Solution: The invention proposes a method for creating and managing a cluster by storing license information that includes a "bundle-type parameter." This parameter defines overarching characteristics of the cluster, such as its permissible size range or functional purpose. The system then initializes the cluster, allows for the addition of new computing "nodes," and only "activates" the cluster once the number and type of nodes comply with the rules defined by the bundle-type parameter. (’416 Patent, Abstract; col. 2:35-44).
  • Technical Importance: This approach aimed to automate and enforce complex licensing and compatibility rules in scalable computing environments, preventing misconfigurations that could lead to operational or compliance issues. (’416 Patent, col. 5:45-54).

Key Claims at a Glance

  • The complaint asserts independent claim 1. (Compl. ¶32).
  • Claim 1 Elements:
    • storing license information for a computing cluster in a memory module associated with a computing node,
    • wherein the licensing information includes a bundle-type parameter that identifies a size of the cluster and at least one additional bundle-type characteristic of the cluster, and one or more node license parameters that identifies a characteristic of a computing node;
    • initializing the computing cluster in a first computing node;
    • adding one or more available computing nodes to the computing cluster; and
    • activating the computing cluster when the computing cluster includes a number of nodes that complies with the bundle-type parameter.
  • The complaint does not explicitly reserve the right to assert dependent claims for the ’416 Patent.

U.S. Patent No. 8,370,571 - "Transfer Control of a Storage Volume Between Storage Controllers in a Cluster"

(Issued February 5, 2013)

The Invention Explained

  • Problem Addressed: In asymmetric storage clusters, one specific controller is designated as the "owner" or "optimal" controller for a given storage volume. If client requests are routed through non-optimal controllers due to network changes or failures, performance degrades because the requests must be forwarded internally to the owner. (’571 Patent, col. 1:44-52; col. 3:24-34).
  • The Patented Solution: The invention provides a mechanism for a storage controller to automatically transfer ownership of a volume. The current owner-controller monitors the requests it processes, distinguishing between direct "client requests" and forwarded "proxy requests" from other controllers. If it determines that another controller is the source of a higher number of proxy requests than the client requests it is receiving directly, it infers that the other controller has a more optimal path and initiates a transfer of ownership to it. (’571 Patent, Abstract; col. 4:1-5).
  • Technical Importance: This automated ownership transfer mechanism allows a storage cluster to self-optimize in response to changing network conditions or workloads, improving I/O performance without manual intervention. (’571 Patent, col. 2:5-12).

Key Claims at a Glance

  • The complaint asserts independent claim 12. (Compl. ¶50).
  • Claim 12 Elements:
    • receiving, by a first of the storage controllers that is currently an owner of the storage volume, client requests from one or more client computers and proxy requests from one or more other storage controllers in the cluster;
    • based on numbers of the client requests and the proxy requests, determining that a transfer of ownership is to be performed from the first storage controller to a second storage controller in the cluster, wherein the determining comprises determining that the second storage controller has provided a higher number of proxy requests for the storage volume than the number of the client requests; and
    • performing the transfer of ownership of the storage volume from the first storage controller to the second storage controller in response to the determining.
  • The complaint does not explicitly reserve the right to assert dependent claims for the ’571 Patent.

U.S. Patent No. 7,904,686 - "Data Security for Use with a File System"

(Issued March 8, 2011)

  • Technology Synopsis: The patent describes a data security method for file systems. It involves applying a mapping function to the data block numbers associated with a file, such that the actual storage addresses (mapped data block numbers) on the storage device are different from the logical block numbers stored in the file's index node, thereby obscuring the physical location of the data. (’686 Patent, Abstract).
  • Asserted Claims: At least independent claim 1. (Compl. ¶66).
  • Accused Features: Defendant's use of the Apache Hadoop Distributed File System (HDFS). (Compl. ¶¶ 65-67).

U.S. Patent No. 7,856,488 - "Electronic Device Profile Migration"

(Issued December 21, 2010)

  • Technology Synopsis: The patent discloses a system for migrating a "profile" that uniquely identifies an electronic device on a network (e.g., MAC addresses, Fibre Channel World Wide Names) from a first device to a second device. After migration, the first device is no longer associated with the profile, and the profile uniquely identifies the second device, allowing it to assume the network identity of the first. (’488 Patent, Abstract).
  • Asserted Claims: At least independent claim 1. (Compl. ¶81).
  • Accused Features: Defendant's NetApp ONTAP systems, which allegedly migrate SAN LIF (Logical Interface) configuration information, including WWPNs, between nodes in a cluster. (Compl. ¶¶ 82-84).

U.S. Patent No. 7,120,832 - "Storage Device Performance Monitor"

(Issued October 10, 2006)

  • Technology Synopsis: The patent describes a method for monitoring storage device performance by intercepting communications between a computer and the device, analyzing those communications (e.g., access time, failure reports), and reallocating data on the device to enhance performance based on the analysis. (’832 Patent, Abstract).
  • Asserted Claims: At least independent claim 25. (Compl. ¶96).
  • Accused Features: Defendant's NetApp SANtricity software and systems that implement Apache Kafka Streams, Apache Cassandra, and/or Apache HBase. (Compl. ¶¶ 95-96).

U.S. Patent No. 7,640,332 - "System and Method for Hot Deployment/Redeployment in Grid Computing Environment"

(Issued December 29, 2009)

  • Technology Synopsis: The patent discloses a method for updating applications in a grid computing environment without downtime ("hot deployment"). The system adds a new version of an application to a repository, determines which grid nodes are running the old version, notifies a "client application manager" on those nodes, and then uses a plug-in to deploy the new version to the affected application servers. (’332 Patent, Abstract).
  • Asserted Claims: At least independent claim 1. (Compl. ¶126).
  • Accused Features: Defendant's NetApp systems that use and integrate Kubernetes for rolling updates, including NetApp ONTAP and NetApp Trident. (Compl. ¶¶ 125-127).

III. The Accused Instrumentality

Product Identification

NetApp's Cluster Management ONTAP is accused of infringing the ’416 Patent. NetApp SANtricity on E-Series controllers is accused of infringing the ’571 Patent. (Compl. ¶¶ 31, 49).

Functionality and Market Context

  • NetApp ONTAP: The complaint describes ONTAP as NetApp's operating system for creating and managing clustered computing systems. Its features include initializing clusters, managing node and feature licenses through a "System Manager" interface, and scaling clusters by adding or removing nodes. (Compl. ¶¶ 33-34, 38). A screenshot provided in the complaint shows the interface for initializing and configuring a cluster. (Compl. p. 12).
  • NetApp SANtricity on E-Series Controllers: The complaint identifies SANtricity as the operating system for NetApp's E-Series storage arrays, which are often deployed in cluster environments. A key accused feature is "Automatic Load Balancing" (ALB), which is alleged to dynamically monitor I/O workload and automatically transfer ownership of storage volumes between controllers to optimize performance and balance resource utilization. (Compl. ¶¶ 51, 53-54). A diagram from NetApp's documentation illustrates the system's "I/O shipping" mechanism, where requests to a non-owning controller are forwarded to the owning controller. (Compl. p. 23).
  • The complaint alleges these products are part of NetApp's portfolio for "intelligent data infrastructure," positioning them as central to enterprise data management. (Compl. ¶6).

IV. Analysis of Infringement Allegations

’416 Patent Infringement Allegations

Claim Element (from Independent Claim 1) Alleged Infringing Functionality Complaint Citation Patent Citation
storing license information for a computing cluster in a memory module associated with a computing node NetApp ONTAP stores license files and keys using System Manager or the ONTAP CLI. ¶34 col. 2:36-38
wherein the licensing information includes a bundle-type parameter that identifies a size of the cluster and at least one additional bundle-type characteristic of the cluster... ONTAP licenses include "Capacity license" types that define the amount of data to be managed, which allegedly identifies a size, and licensed packages with features that allegedly identify other characteristics. ¶35 col. 2:38-41
...and one or more node license parameters that identifies a characteristic of a computing node. The System Manager allegedly identifies license packages and features available for each computing node in the cluster. ¶36 col. 2:41-43
initializing the computing cluster in a first computing node ONTAP provides an "Initialize and configure the cluster" function through its System Manager or a command line interface. ¶37 col. 2:43-44
adding one or more available computing nodes to the computing cluster ONTAP allows clusters to be scaled by adding compatible nodes after initial provisioning. ¶38 col. 2:44-46
activating the computing cluster when the computing cluster includes a number of nodes that complies with the bundle-type parameter. ONTAP allegedly activates licensed functionality for the cluster when at least one node is licensed for that functionality, which requires compliance with the license terms. ¶39 col. 2:46-49
  • Identified Points of Contention:
    • Scope Questions: The analysis may focus on whether ONTAP's "Capacity license" or feature packages meet the specific definition of a "bundle-type parameter" as described in the patent, which emphasizes characteristics like cluster size and type. A question for the court could be whether a license based on data terabytes constitutes a parameter identifying a "size of the cluster" in terms of node count as contemplated by the patent.
    • Technical Questions: A potential issue is the meaning of "activating the computing cluster." The complaint alleges this occurs when licensed functionality is used, whereas the patent may be interpreted to describe a discrete, one-time event that enables the entire cluster's operation once a node count threshold is met.

’571 Patent Infringement Allegations

Claim Element (from Independent Claim 12) Alleged Infringing Functionality Complaint Citation Patent Citation
receiving, by a first of the storage controllers that is currently an owner of the storage volume, client requests from one or more client computers and proxy requests from one or more other storage controllers in the cluster NetApp E-Series controllers receive direct I/O requests from clients as well as "shipped IO requests" (proxy requests) forwarded from non-owning controllers in the cluster. ¶52 col. 8:14-20
based on numbers of the client requests and the proxy requests, determining that a transfer of ownership is to be performed... wherein the determining comprises determining that the second storage controller has provided a higher number of proxy requests for the storage volume than the number of the client requests The E-Series' Automatic Load Balancing (ALB) feature determines whether to transfer volume ownership based on I/O workload. The complaint alleges an event is logged when more than 75% of I/O to a volume is sent to the non-owning controller, which constitutes proxy requests. ¶¶ 53-54 col. 8:20-28
performing the transfer of ownership of the storage volume from the first storage controller to the second storage controller in response to the determining Upon determining a need to rebalance the workload, NetApp controllers execute the transfer of volume ownership to another controller. ¶55 col. 8:28-31
  • Identified Points of Contention:
    • Scope Questions: A central question may be whether the ALB feature's determination is "based on numbers of the client requests and the proxy requests" as required by the claim. The complaint describes ALB as using a broader "workload" analysis that considers factors like IOPS, bandwidth, and cache utilization, which may or may not satisfy the specific comparison recited in the claim. (Compl. p. 25).
    • Technical Questions: What evidence does the complaint provide that the ALB determination specifically involves "determining that the second storage controller has provided a higher number of proxy requests... than the number of the client requests"? The complaint points to an event log for when over 75% of I/O is shipped (proxy), but it is not explicit that this is compared directly against the client request count to trigger the transfer. (Compl. p. 26).

V. Key Claim Terms for Construction

For the ’416 Patent:

  • The Term: "bundle-type parameter"
  • Context and Importance: This term is the central mechanism for enforcing compatibility and licensing. Its construction will determine whether NetApp's modern licensing schemes, such as capacity-based licenses, fall within the scope of the claims. Practitioners may focus on this term because the infringement theory hinges on mapping ONTAP's "Capacity license" and feature packages to this specific limitation.
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: The claim language itself is broad, defining the parameter as one that "identifies a size of the cluster and at least one additional bundle-type characteristic." This could arguably encompass any parameter that correlates with cluster size or function, such as total storage capacity. (’416 Patent, col. 9:58-61).
    • Evidence for a Narrower Interpretation: The specification repeatedly frames the concept in the context of a "sales bundle," a "product category," or a specific "SKU," suggesting a commercial package rather than just a technical capacity metric. (’416 Patent, col. 5:55-62).

For the ’571 Patent:

  • The Term: "based on numbers of the client requests and the proxy requests"
  • Context and Importance: This phrase defines the specific logic for triggering an ownership transfer. The infringement case depends on whether NetApp's ALB workload analysis performs the comparison required by this limitation.
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: The term "based on" could be argued to mean that the request numbers are merely inputs into a more complex balancing algorithm, not necessarily the sole or dispositive factors. The patent states the goal is to move ownership to a controller that can access the volume "more optimally." (’571 Patent, col. 2:10-12).
    • Evidence for a Narrower Interpretation: Claim 12 contains a specific "wherein" clause clarifying that the determination "comprises determining that the second storage controller has provided a higher number of proxy requests... than the number of the client requests." This suggests a direct comparison is a required part of the determination, not just one of many possible factors in a general "workload" analysis. (’571 Patent, col. 8:23-28).

VI. Other Allegations

  • Indirect Infringement: For all asserted patents, the complaint alleges induced infringement. The allegations state that NetApp provides customers and end-users with instructions, user manuals, websites, and product literature on how to operate the accused products in a manner that directly infringes the patent claims. (Compl. ¶¶ 43, 59, 74, 89, 120, 136).
  • Willful Infringement: The complaint alleges willful infringement for all asserted patents. For the ’416 and ’571 Patents, the basis for willfulness includes allegations that NetApp had pre-suit knowledge because it cited the asserted patent families during the prosecution of its own patent applications. (Compl. ¶42, fn 23; ¶58, fn 35). For the ’488 and ’832 Patents, knowledge is alleged based on pre-suit correspondence including claim charts sent from Plaintiff to Defendant. (Compl. ¶88, fn 74; ¶119, fn 126). The complaint further alleges that Defendant adopted a policy of not reviewing the patents of others, constituting willful blindness. (Compl. ¶¶ 42, 58, 73, 88, 119, 135).

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

  • A core issue will be one of definitional scope: can the specific terminology of the patents, such as the ’416 Patent's "bundle-type parameter" rooted in sales and SKU concepts, be construed to cover the more abstract, technically-defined licensing models like "capacity licenses" used in NetApp's modern ONTAP system?
  • A key evidentiary question will be one of functional operation: does NetApp's Automatic Load Balancing feature in SANtricity, which performs a holistic "workload" analysis, meet the ’571 Patent's specific requirement of determining an ownership transfer based on a comparison between the number of "client requests" and "proxy requests"?
  • A central legal question for willfulness will be whether citing a patent family in an Information Disclosure Statement (IDS) during patent prosecution is sufficient to establish the knowledge and subjective intent required to prove willful infringement of an issued patent from that family.