Induction Devices LLC v. Penney OpCo LLC

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Induction Devices LLC (Texas)
  • Defendant: Penney OpCo, LLC d/b/a JCPenney (Virginia)
  • Plaintiff’s Counsel: SHEA | BEATY PLLC
• Case Identification: 2:25-cv-00767, E.D. Tex., 08/05/2025
• Venue Allegations: Plaintiff alleges venue is proper in the Eastern District of Texas because Defendant maintains a place of business in Frisco, Texas, and conducts regular business within the district.
• Core Dispute: Plaintiff alleges that Defendant’s branded contactless consumer credit cards induce infringement of five patents related to semiconductor circuit design, secure transactions, and signal processing.
• Technical Context: The patents-in-suit relate to foundational technologies for complex systems-on-a-chip (SoCs), including power management, high-frequency signal integrity, secure memory, and reconfigurable processing, which are integral to modern electronics like contactless payment systems.
• Key Procedural History: The complaint notes that U.S. Patent No. 7,899,145 was previously litigated in the Western District of Texas but that the cases were resolved before any substantive matters were addressed.

Case Timeline

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

U.S. Patent No. 7,449,926 - "Circuit for Asynchronously Resetting Synchronous Circuit"

• Issued: November 11, 2008

The Invention Explained

• Problem Addressed: The patent addresses a conflict in resetting complex synchronous circuits, such as a CPU or RAM. An asynchronous reset (one not timed to the system clock) can cause data loss in a functioning circuit, but an immediate asynchronous reset is required if the circuit is operating abnormally to prevent system failure (’926 Patent, col. 1:36-50, 2:56-62).
• The Patented Solution: The invention is a reset generation circuit that intelligently selects the type of reset signal. It includes an "operation detection circuit" that monitors whether a synchronous circuit (e.g., a CPU) is functioning normally or abnormally. If normal, it generates a reset signal that is synchronous to the system clock, preserving data. If abnormal, it generates an asynchronous reset signal to force an immediate initialization of the system ('926 Patent, Abstract; col. 6:58-7:6).
• Technical Importance: This selective reset mechanism enhances the reliability and stability of complex semiconductor devices by allowing them to handle both normal and abnormal operating states appropriately, a critical feature for systems-on-a-chip (Compl. ¶11).

Key Claims at a Glance

• The complaint asserts independent claim 1 ('926 Patent, col. 13:3-23).
• Essential elements of claim 1 include:
  • An operation detection circuit for detecting whether the synchronous circuit is operating normally or abnormally and for generating an operation detection signal.
  • A signal control circuit, connected to the operation detection circuit, for generating a first reset signal based on a system reset signal, the clock signal, and the operation detection signal.
  • The signal control circuit generates the first reset signal that is synchronous to the clock signal when the synchronous circuit is operating normally.
  • The signal control circuit generates the first reset signal that is asynchronous to the clock signal when the synchronous circuit is operating abnormally.

U.S. Patent No. 7,899,145 - "Circuit, System, and Method for Multiplexing Signals with Reduced Jitter"

• Issued: March 1, 2011

The Invention Explained

• Problem Addressed: The complaint describes the problem of minimizing timing delays and jitter in synchronous systems, which can degrade performance and reliability (Compl. ¶16). However, the text of the asserted ’145 patent addresses a different problem: the poor performance of radio-frequency transponders (like RFID tags) when placed on or near metal components, which can absorb or reflect the signals and disrupt communication ('145 Patent, col. 1:50-58).
• The Patented Solution: The complaint alleges the solution involves distributing logic gates across power domains to reduce crosstalk (Compl. ¶15, 17). In contrast, the asserted '145 patent discloses forming an antenna for a transponder by creating a "recess" (such as a slot or breakthrough) directly in the metal component itself. This allows the metal object to become part of the antenna structure, improving communication in a metallic environment ('145 Patent, Abstract; col. 2:15-24).
• Technical Importance: The technology described in the '145 patent enables the effective integration of RFID tags and other transponders onto metal products such as beverage containers, vehicle parts, or electronic chassis, which was previously a significant technical challenge ('145 Patent, col. 3:36-44).

Key Claims at a Glance

• The complaint asserts dependent claim 10, which incorporates independent claim 1 ('145 Patent, col. 9:1-10:10).
• Essential elements of independent claim 1 include:
  • An arrangement with a transponder and a metal component allocated to the transponder.
  • An aerial for the transponder is formed by means of a recess in the metal component.
  • The arrangement includes a cover allocated to the recess, enclosing a cavity.
  • The cavity is at least partially filled with a dielectric material.
• Claim 10 adds the limitation that "the recess in the metal component has the form of a ring segment."

U.S. Patent No. 8,190,885 - "Non-Volatile Memory Sub-System Integrated with Security for Storing Near Field Transactions"

• Issued: May 29, 2012
• Technology Synopsis: The patent addresses security vulnerabilities in Near Field Communication (NFC) systems by creating an integrated memory module. This module combines a security processor, non-volatile memory, and an NFC radio component to create a secure execution environment where transactions can be processed, memory can be partitioned with enforced access rights, and transaction data can be securely logged (’885 Patent, Abstract; Compl. ¶21-22).
• Asserted Claims: At least independent claims 1 and 3 (Compl. ¶52).
• Accused Features: The integrated circuits within the contactless credit cards that securely manage and store data related to NFC transactions (Compl. ¶52).

U.S. Patent No. 8,370,543 - "Busy Detection Logic for Asynchronous Communication Port"

• Issued: February 5, 2013
• Technology Synopsis: The patent addresses the challenge of synchronizing communications between components operating in different clock domains (e.g., a fast processor accessing a slower memory). It provides a logic system to reliably communicate device resource status, such as a "busy" signal, across these domains without imposing restrictive requirements on signal pulse width or requiring very high-speed clocks, thereby reducing circuit complexity and power consumption (’543 Patent, col. 2:9-19; Compl. ¶25-26).
• Asserted Claims: At least independent claim 16 (Compl. ¶62). Paragraph 63 also references an infringement chart for independent claim 1.
• Accused Features: Circuitry within the accused cards that manages communication and synchronization between internal components operating at different clock speeds (Compl. ¶62).

U.S. Patent No. 8,543,628 - "Method and System of Digital Signal Processing"

• Issued: September 24, 2013
• Technology Synopsis: The patent discloses a dynamically reconfigurable system-on-a-chip for digital signal processing (DSP). Unlike static DSPs, this system allows a microcontroller to load instruction sets that reconfigure a controller and an address-calculation device on the fly. This enables efficient and flexible implementation of various digital filtering algorithms using a compact and scalable architecture (’628 Patent, Abstract; Compl. ¶29).
• Asserted Claims: At least independent claim 1 (Compl. ¶72).
• Accused Features: The programmable processors within the accused cards that perform digital signal processing operations (Compl. ¶72).

III. The Accused Instrumentality

Product Identification

• The "Accused Instrumentalities" are identified as "branded contactless consumer credit cards" that Defendant JCPenney provides and supports (Compl. ¶32, 42).

Functionality and Market Context

• The complaint alleges these are consumer credit cards equipped with contactless payment functionality. Based on the patents-in-suit, the relevant technical functionalities are contained within the semiconductor chips embedded in the cards. These chips are alleged to perform functions including power-on-reset management, secure processing of NFC transactions, communication between internal components, and digital signal processing, all within a single integrated device (Compl. ¶32-34). The complaint alleges these products are marketed and provided to Defendant's customers and partners nationwide, including within the Eastern District of Texas (Compl. ¶34). No probative visual evidence provided in complaint.

IV. Analysis of Infringement Allegations

The complaint references but does not attach claim chart exhibits. The following summary is based on the claim language and the complaint's narrative allegations.

'926 Patent Infringement Allegations

'145 Patent Infringement Allegations

Identified Points of Contention

• Discrepancy in Allegations ('145 Patent): A threshold issue is the significant discrepancy between the technology described in the complaint's narrative for the '145 patent (jitter reduction in clock circuits) and the technology of the patent itself (transponder antennas in metal). This raises questions about the sufficiency of the pleading under federal rules.
• Technical Evidence ('926 Patent): A primary technical question will be evidentiary. Plaintiff will need to provide evidence, likely through reverse engineering or technical discovery, that the accused credit card chips actually implement a dual-mode (synchronous and asynchronous) reset functionality that is conditioned on the operational state of the processor, as specifically required by the claim, rather than a more conventional, single-mode reset circuit.

V. Key Claim Terms for Construction

The Term: "operating normally" / "operating abnormally"

• Source: '926 Patent, Claim 1
• Context and Importance: The claim's core logic depends on the circuit's ability to distinguish between these two states to select the correct type of reset. The definition of these terms will determine the scope of conditions that trigger the claimed functionality, making it central to the infringement analysis.
• Intrinsic Evidence for Interpretation:
  • Evidence for a Broader Interpretation: The patent describes normal operation as the CPU providing a "clear signal" at "predetermined intervals" ('926 Patent, col. 4:29-32). This language may support a construction covering any form of watchdog timer, heartbeat, or regularized processor activity.
  • Evidence for a Narrower Interpretation: The primary embodiment describes abnormal operation as a state where a counter exceeds a predetermined value because the CPU fails to provide the clear signal ('926 Patent, col. 4:38-43). A defendant may argue this limits the term's scope to this specific failure-to-clear mechanism.

The Term: "aerial... formed by means of a recess in the metal component"

• Source: '145 Patent, Claim 1
• Context and Importance: This phrase is the central inventive concept of the '145 patent. Infringement hinges on whether the antenna in the accused card is "formed by means of" a recess. Practitioners may focus on this term because a defendant is likely to argue its product uses a conventional antenna placed near or within a recess, not one "formed by" it.
• Intrinsic Evidence for Interpretation:
  • Evidence for a Broader Interpretation: The phrase "by means of" could be argued to encompass any configuration where the recess is functionally necessary for the antenna's operation, even if it is not the sole radiating element. The abstract states the aerial is "formed by means of a recess," suggesting the recess is the instrument of formation. ('145 Patent, Abstract).
  • Evidence for a Narrower Interpretation: Figures 3 and 4 depict slot-type antennas where the recess itself is the antenna. A defendant could argue the claim is limited to such structures, where the recess defines the primary radiating element, as distinguished from arrangements where a traditional loop antenna is simply placed inside a cutout for spacing or positioning. ('145 Patent, Fig. 3-4).

VI. Other Allegations

Indirect Infringement

• For all five patents, the complaint alleges induced infringement under 35 U.S.C. § 271(b). The factual basis is that Defendant provides the accused credit cards to end users and provides "instruction materials, training, and services" that allegedly encourage and instruct on their infringing use. The required intent is alleged to arise from Defendant's knowledge of the patents (Compl. ¶32, 36-37, 42, 46-47).

Willful Infringement

• The complaint alleges that Defendant's infringement became willful upon receiving notice of the patents, at least as of the filing date of the complaint. The allegation is based on continued inducement after acquiring this knowledge (Compl. ¶35, 38, 45, 48).

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

The resolution of this case may turn on the following central questions:

1. Pleading Validity: A threshold question, particularly for the '145 patent, will be one of pleading sufficiency: can the complaint survive a motion to dismiss given the stark factual mismatch between the technology described in its narrative paragraphs and the actual subject matter of the asserted patent?
2. Evidentiary Proof: For technologies like those in the '926 and '543 patents, which relate to the internal, unobservable operation of a semiconductor chip, a key issue will be one of evidentiary proof: what technical evidence can Plaintiff obtain and present to demonstrate that the accused credit card chips' internal reset logic and inter-domain synchronization methods actually perform the specific, multi-step functions required by the claims?
3. Claim Scope: A core issue for the '145 patent will be one of definitional scope: can the term "aerial... formed by means of a recess," which describes slot-type antennas in the patent's figures, be construed broadly enough to read on a conventional loop antenna that is merely placed within a cutout in a metal layer for positioning?