Induction Devices LLC v. Dillard's Inc

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Induction Devices LLC (Texas)
  • Defendant: Dillard's Inc. (Delaware)
  • Plaintiff’s Counsel: SHEA | BEATY PLLC
• Case Identification: 2:25-cv-00776, E.D. Tex., 08/08/2025
• Venue Allegations: Venue is based on Defendant maintaining a place of business in the district and regularly conducting business within the State of Texas, with the Plaintiff's claims allegedly arising from those business contacts.
• Core Dispute: Plaintiff alleges that Defendant’s branded contactless consumer credit cards infringe five patents related to fundamental semiconductor circuit design and functionality.
• Technical Context: The patents-in-suit concern foundational technologies for integrated circuits, including methods for resetting circuits, reducing signal jitter, enabling secure transactions, and performing digital signal processing, all of which are critical to the operation of modern electronics.
• Key Procedural History: The complaint notes that U.S. Patent No. 7,899,145 was previously litigated in the Western District of Texas, but those cases were resolved before any substantive matters were addressed.

Case Timeline

Date	Event
2005-06-01	Earliest Priority Date for U.S. Patent No. 7,899,145
2006-01-26	Earliest Priority Date for U.S. Patent No. 7,449,926
2006-12-21	Earliest Priority Date for U.S. Patent No. 8,190,885
2007-03-09	Earliest Priority Date for U.S. Patent No. 8,370,543
2007-04-17	Earliest Priority Date for U.S. Patent No. 8,543,628
2008-11-11	U.S. Patent No. 7,449,926 Issued
2011-03-01	U.S. Patent No. 7,899,145 Issued
2012-05-29	U.S. Patent No. 8,190,885 Issued
2013-02-05	U.S. Patent No. 8,370,543 Issued
2013-09-24	U.S. Patent No. 8,543,628 Issued
2025-08-08	Complaint Filed

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 describes a dilemma in resetting synchronous circuits like RAM. An asynchronous reset can cause the loss of stored data, but is sometimes necessary to initialize a circuit that is operating abnormally. Conversely, a synchronous reset preserves data but may not be able to correct an abnormal operating state. (’926 Patent, col. 2:36-54).
• The Patented Solution: The invention is a reset signal generation circuit that intelligently chooses the type of reset signal to generate. It includes an "operation detection circuit" to determine if a component like a CPU is functioning normally or abnormally. Based on this detection, a "signal control circuit" generates either a data-preserving synchronous reset signal (during normal operation) or an immediate asynchronous reset signal (during abnormal operation). (’926 Patent, Abstract; col. 6:58-7:6).
• Technical Importance: This selective reset capability enhances the reliability of complex semiconductor devices by allowing them to recover from errors and abnormal states without causing unnecessary data loss. (Compl. ¶11).

Key Claims at a Glance

• The complaint asserts at least independent claim 1. (Compl. ¶32).
• The essential elements of independent claim 1 include:
  • An operation detection circuit for detecting whether a synchronous circuit is operating normally or abnormally.
  • A signal control circuit that generates a first reset signal.
  • The signal control circuit generates a synchronous reset signal when the circuit operates normally.
  • The signal control circuit generates an asynchronous reset signal when the circuit operates abnormally.
• Plaintiff reserves the right to assert additional claims. (Compl. ¶33).

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: In complex synchronous systems, choosing between multiple clock signals using a multiplexer can introduce "crosstalk and power supply noise," which degrades the timing precision (jitter) and reliability of the clock signal. (Compl. ¶16; ’145 Patent, col. 2:60-63).
• The Patented Solution: The patent proposes an improved multiplexer circuit design. The core idea is to use a logic block to actively deactivate one of the input signals before the selection is made, which ensures only one active signal is supplied to the subsequent logic gates, thereby eliminating a primary source of crosstalk. The patent also teaches arranging the logic gates in separate power domains to further isolate the inputs. (’145 Patent, col. 3:13-28).
• Technical Importance: This technique provides a way to maintain high signal integrity in clock networks, a critical requirement for the performance and stability of high-speed digital electronics. (Compl. ¶15-17).

Key Claims at a Glance

• The complaint asserts at least independent claim 10. (Compl. ¶42).
• The essential elements of independent method claim 10 include:
  • Receiving a first signal at a first logic gate.
  • Receiving a second signal at a second logic gate.
  • Deactivating one of the first and second signals with a logic block.
  • Transmitting the other (active) signal with a third logic gate.
• Plaintiff reserves the right to assert additional claims. (Compl. ¶43).

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 the need for heightened security in devices conducting Near Field Communication (NFC) transactions. It discloses a memory module that tightly integrates non-volatile memory, a security processor, and an NFC radio frequency component to create a secure execution environment, preventing unauthorized access and ensuring data integrity. (Compl. ¶19, ¶21-22; ’885 Patent, Abstract).
• Asserted Claims: At least claims 1 and 3. (Compl. ¶52).
• Accused Features: The integrated secure transaction processing systems within the accused contactless credit cards. (Compl. ¶52).

U.S. Patent No. 8,370,543 - *"Busy Detection Logic for Asynchronous Communication Port,"* issued February 5, 2013

• Technology Synopsis: The patent confronts the challenge of synchronizing communications between two components operating in different time domains (e.g., a fast processor and a slow memory port) without the cost, complexity, and power consumption of high-speed clocks. The invention provides systems and methods to synchronize device resource access information between such independent time domains efficiently. (Compl. ¶23, ¶25-27; ’543 Patent, col. 2:9-19).
• Asserted Claims: At least claim 16. (Compl. ¶62).
• Accused Features: The logic for managing communication between asynchronous components within the accused contactless credit cards. (Compl. ¶62).

U.S. Patent No. 8,543,628 - *"Method and System of Digital Signal Processing,"* issued September 24, 2013

• Technology Synopsis: The patent is directed to improving the efficiency and flexibility of digital signal processing (DSP) on a system-on-a-chip. It describes a programmable system where a microcontroller can dynamically reconfigure a controller and address-calculation device to select specific filter-coefficients, which a data path device then uses to perform DSP operations on incoming data. (Compl. ¶28-29; ’628 Patent, Abstract).
• Asserted Claims: At least claim 1. (Compl. ¶72).
• Accused Features: The programmable and reconfigurable digital signal processing systems within the accused contactless credit cards. (Compl. ¶72).

III. The Accused Instrumentality

Product Identification

• The complaint identifies "branded contactless consumer credit cards" provided and supported by Defendant Dillard's as the Accused Instrumentalities. (Compl. ¶32, ¶42).

Functionality and Market Context

• The complaint alleges that these credit cards are complex electronic devices that necessarily incorporate the technologies covered by the patents-in-suit, such as circuits for resetting internal processors, multiplexing signals, and securely processing transaction data. (Compl. ¶10, ¶15, ¶21).
• The complaint asserts that Dillard's markets, provides, and supports these cards for its partners, clients, and customers across the United States, including within the Eastern District of Texas. (Compl. ¶34, ¶44).
• The complaint does not provide specific technical details on the operation of the accused cards or data on their commercial importance. No probative visual evidence provided in complaint.

IV. Analysis of Infringement Allegations

The complaint references preliminary infringement claim charts as exhibits (e.g., Exhibit A-1, B-1) but does not include them in the filing. (Compl. ¶33, ¶43). Therefore, the infringement allegations are summarized in prose based on the complaint's narrative.

'926 Patent Infringement Allegations

• The complaint alleges that the accused credit cards contain synchronous circuits (e.g., CPUs, memory) that require reset functionality. It posits that these cards, when used, directly infringe claim 1 by employing a reset generation circuit that embodies the claimed invention. Specifically, it is alleged that the cards' circuitry detects the operational state (normal vs. abnormal) and, in response, selectively generates either a synchronous or an asynchronous reset signal to enhance reliability, thereby meeting the limitations of claim 1. (Compl. ¶10-11, ¶32-33).

'145 Patent Infringement Allegations

• The complaint alleges that Defendant induces infringement of method claim 10. The theory is that the accused credit cards, as complex electronic systems, must multiplex internal signals. The complaint alleges that during operation, these cards perform the patented method by receiving multiple signals at different logic gates, using a logic block to "deactivate" one of the signals to reduce jitter, and transmitting the other active signal through a third logic gate. (Compl. ¶15-17, ¶42-43).

Identified Points of Contention

• For the ’926 Patent: A primary question will be evidentiary: what proof will be offered that the accused cards' reset circuits perform the specific two-mode (synchronous/asynchronous) switching based on a detected "abnormal" operation, as the claim requires? The dispute may center on whether the cards' actual error-handling or reset mechanisms map onto the specific structure and function recited in claim 1.
• For the ’145 Patent: The analysis will likely focus on whether the signal selection mechanism within the accused cards' multiplexers constitutes the claimed method of "deactivating one of the first and second signals with a logic block." A key question is whether the accused products perform this specific step, or if they use a conventional selection architecture that falls outside the claim's scope.

V. Key Claim Terms for Construction

For the ’926 Patent (Claim 1):

• The Term: "operating abnormally"
• Context and Importance: This term serves as the trigger for switching from a synchronous to an asynchronous reset. The outcome of the infringement analysis depends significantly on whether this term is construed broadly to cover any error state or narrowly to cover only specific failure modes. Practitioners may focus on this term because it defines the condition that activates the core distinguishing feature of the invention.
• Intrinsic Evidence for Interpretation:
  • Evidence for a Broader Interpretation: The specification suggests multiple triggers for an abnormal state, including when a CPU fails to provide a "clear signal" at a required interval or when a low-voltage detection circuit indicates a power supply drop. (’926 Patent, col. 4:37-43, col. 4:46-52). This may support a construction covering a range of error conditions.
  • Evidence for a Narrower Interpretation: The detailed description of the preferred embodiment focuses on the failure of the CPU to provide a clear signal as the indicator of abnormal operation. (’926 Patent, col. 4:37-41). A party could argue the term should be limited to this explicitly described CPU-related failure.

For the ’145 Patent (Claim 10):

• The Term: "deactivating one of the first and second signals"
• Context and Importance: This phrase describes the central, active step of the claimed method for reducing jitter. The infringement case will turn on whether the accused cards' multiplexers can be shown to perform this specific function.
• Intrinsic Evidence for Interpretation:
  • Evidence for a Broader Interpretation: The specification describes the underlying circuit as "ensuring that only one active signal... is supplied to the inputs of the first, second, and third logic gates." (’145 Patent, col. 3:23-26). This functional language could support a construction that covers various mechanisms for achieving single-signal activity.
  • Evidence for a Narrower Interpretation: The claim language requires "deactivating" a signal "with a logic block," suggesting a specific action rather than a generic signal selection. A party may argue that this requires a structure that actively disables an input line, as distinguished from a conventional multiplexer that merely selects one path to connect to the output.

VI. Other Allegations

Indirect Infringement

• The complaint exclusively alleges induced infringement under 35 U.S.C. § 271(b) for all five patents. The basis for this allegation is that Defendant provides the accused credit cards to its customers and partners along with "instruction materials, training, and services," which allegedly encourage and enable the end-users to operate the cards in a manner that directly infringes the asserted claims. (Compl. ¶32, ¶37, ¶42).

Willful Infringement

• Willfulness is alleged for all five patents. The complaint asserts that Defendant had knowledge of the patents and the alleged infringement "at least as early as the filing of this Complaint" and that subsequent inducement is therefore willful. (Compl. ¶35, ¶38, ¶45).

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

• A central issue will be one of technical proof: given that the allegations are based on "information and belief," can the Plaintiff, through discovery and reverse engineering, produce evidence that the highly integrated and proprietary circuits within Defendant's credit cards actually operate according to the specific structures and methods recited in the asserted claims? A mismatch between the claimed functionality (e.g., the two-mode reset of the ’926 patent) and the accused product’s actual operation would present a significant hurdle.
• The case will also likely turn on claim construction: how will key functional terms such as "operating abnormally" (’926 patent) and "deactivating one of the... signals" (’145 patent) be defined by the court? The viability of the infringement theories will depend on whether these terms are construed broadly to cover general electronic functions or are limited more narrowly to the specific circuit implementations disclosed in the patent specifications.