DCT
2:25-cv-00868
Alpha Modus Corp v. A2Z Cust2mate Solutions Corp
Key Events
Complaint
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: Alpha Modus, Corp. (Florida)
- Defendant: A2Z Cust2Mate Solutions Corp. (British Columbia, Canada)
- Plaintiff’s Counsel: Prince Lobel Type LLP
- Case Identification: 2:25-cv-00868, E.D. Tex., 08/25/2025
- Venue Allegations: Plaintiff alleges venue is proper in the Eastern District of Texas based on Defendant’s business activities in the state, including offering products for sale, maintaining an ongoing pilot program with a Texas grocery store chain, and referencing the Texas Data Privacy and Security Act in its corporate privacy policy.
- Core Dispute: Plaintiff alleges that Defendant’s smart shopping cart products infringe five patents related to in-store retail technologies, including real-time inventory management, customer behavior analysis, store layout optimization, and streamlined checkout processes.
- Technical Context: The technology at issue involves integrating sensors, cameras, and data analytics into the brick-and-mortar retail environment to create a data-driven, personalized shopping experience similar to that of e-commerce.
- Key Procedural History: The complaint alleges Defendant had knowledge of the patents-in-suit through its business relationship with Wakefern Food Corporation, a company that Plaintiff previously sued for infringement of the same patents. Plaintiff also notes a 2024 intellectual property licensing agreement with GZ6G Technologies Corp. for its patented technology.
Case Timeline
| Date | Event |
|---|---|
| 2013-07-19 | Earliest Priority Date for all Patents-in-Suit |
| 2021-04-13 | ’672 Patent Issued |
| 2021-06-22 | ’890 Patent Issued |
| 2021-06-29 | ’120 Patent Issued |
| 2022-04-12 | ’880 Patent Issued |
| 2024-01-11 | Plaintiff licenses patent portfolio to GZ6G Technologies |
| 2024-01-01 | Approximate filing of Alpha Modus v. Wakefern (2:24-cv-01056) |
| 2025-07-08 | ’121 Patent Issued |
| 2025-08-25 | Complaint Filing Date |
II. Technology and Patent(s)-in-Suit Analysis
U.S. Patent No. 10,977,672 - "Method And System For Real-Time Inventory Management, Marketing, And Advertising In A Retail Store"
- Patent Identification: U.S. Patent No. 10,977,672, “Method And System For Real-Time Inventory Management, Marketing, And Advertising In A Retail Store,” issued April 13, 2021 (Compl. ¶¶20, 23).
The Invention Explained
- Problem Addressed: The patent’s background section describes the challenge brick-and-mortar retailers face from online competitors, particularly the phenomenon of “showrooming,” where customers examine products in-store but purchase them online (’672 Patent, col. 1:47-54). Retailers lack the real-time behavioral data needed to deliver personalized, influential marketing messages at the point of purchase (Compl. ¶¶26-27).
- The Patented Solution: The invention proposes a system within a retail store that uses image recognition to identify the inventory of products at a specific display location. It also uses monitoring devices to gather real-time data about a customer at that location and generates a targeted promotion for the customer based on behavioral analytics, which is then shown on a visual display. (’672 Patent, Abstract; col. 5:1-12; Compl. ¶29).
- Technical Importance: This technology aims to bridge the data gap between physical and online retail by enabling brick-and-mortar stores to analyze consumer behavior and dynamically adjust marketing in real-time. (Compl. ¶27).
Key Claims at a Glance
- The complaint asserts independent Claim 1 (Compl. ¶30).
- Essential elements of Claim 1 include:
- A server system for a retail store.
- Identifying, via image recognition, an inventory of products at a first visual display location.
- Displaying information and real-time pricing for those products on the first visual display.
- Receiving real-time data of a customer at that location using information monitoring devices.
- Generating a promotion for the customer based on behavioral analytics.
U.S. Patent No. 11,042,890 - "Method And System For Customer Assistance In A Retail Store"
- Patent Identification: U.S. Patent No. 11,042,890, “Method And System For Customer Assistance In A Retail Store,” issued June 22, 2021 (Compl. ¶¶31, 34).
The Invention Explained
- Problem Addressed: The patent addresses the need for brick-and-mortar retailers to adapt to digitally-influenced consumer behavior by providing more targeted and effective customer assistance in real-time. (’890 Patent, col. 1:41-49; Compl. ¶37).
- The Patented Solution: The claimed method involves using monitoring devices to gather two specific types of information about a person in a retail store: “object identification information” of a product the person is interested in, and “sentiment information” of the person with respect to that product. This combined information is then analyzed in real-time to manage inventory and provide a response, such as directing the person to a product, providing marketing information, or offering a coupon. (’890 Patent, Abstract; col. 3:1-4:67; Compl. ¶39).
- Technical Importance: The method combines product identification with customer sentiment analysis to create a more nuanced understanding of a shopper's intent, enabling highly personalized, real-time responses. (Compl. ¶38).
Key Claims at a Glance
- The complaint asserts independent Claim 1 (Compl. ¶40).
- Essential elements of Claim 1 include:
- Using monitoring devices to gather information about a person at a retail store.
- The gathering step comprises gathering object identification information of a product of interest.
- The gathering step also comprises gathering sentiment information of the person with respect to the product.
- Analyzing the gathered object and sentiment information in real time to manage inventory.
- Providing a response in real time based on the analyzed information.
U.S. Patent No. 11,301,880 - "Method And System For Inventory Management In A Retail Store"
- Patent Identification: U.S. Patent No. 11,301,880, “Method And System For Inventory Management In A Retail Store,” issued April 12, 2022 (Compl. ¶¶41, 44).
- Technology Synopsis: The patent describes a method to address inventory management challenges in brick-and-mortar retail (Compl. ¶47). It uses video monitoring devices to gather information about shopper interactions with products, specifically tracking when products are picked up and carried away, and analyzes this data to provide real-time inventory management responses, such as re-stocking alerts (Compl. ¶¶49, 51).
- Asserted Claims: Claim 1 (Compl. ¶51).
- Accused Features: The complaint alleges Defendant's smart carts employ systems that use monitoring devices to gather product interaction information to manage inventory and provide real-time responses (Compl. ¶¶130, 133-134).
U.S. Patent No. 11,049,120 - "Method And System For Generating A Layout For Placement Of Products In A Retail Store"
- Patent Identification: U.S. Patent No. 11,049,120, “Method And System For Generating A Layout For Placement Of Products In A Retail Store,” issued June 29, 2021 (Compl. ¶¶52, 54).
- Technology Synopsis: This patent addresses the need for retailers to optimize the physical layout of their stores based on actual consumer behavior (Compl. ¶58). The claimed method uses monitoring devices to gather shopper traffic information (movement, stops, duration) and product interaction information, analyzes this data to generate a "layout analysis," and utilizes that analysis to modify the store's layout (Compl. ¶61).
- Asserted Claims: Claim 1 (Compl. ¶61).
- Accused Features: The complaint alleges that Defendant’s systems use AI and computer vision to analyze customer movement and product interactions to improve store layout and optimize operations (Compl. ¶¶157-158).
U.S. Patent No. 12,354,121 - "Method And System For Shopping In A Retail Store"
- Patent Identification: U.S. Patent No. 12,354,121, “Method And System For Shopping In A Retail Store,” issued July 8, 2025 (Compl. ¶¶62, 64).
- Technology Synopsis: The patent describes a method to create a seamless checkout experience by monitoring products a shopper retains for purchase (Compl. ¶68). The method uses monitoring devices to identify a person, gather shopping information (including traffic and product interactions) to maintain a list of retained products, track the person to a point-of-sale area, and interface with a payment system to complete the transaction (Compl. ¶71).
- Asserted Claims: Claim 1 (Compl. ¶71).
- Accused Features: The complaint alleges Defendant's smart carts track items placed in the cart by customers, enable in-cart payment, and allow users to purchase retained products in point-of-sale areas (Compl. ¶¶72, 182).
III. The Accused Instrumentality
Product Identification
- The accused products are Defendant’s smart shopping carts (the "Accused Products") (Compl. ¶72).
Functionality and Market Context
- The complaint alleges the Accused Products are smart carts offered to retailers that track and recognize items placed in the cart, enable in-cart payment to bypass traditional checkout lines, and allow retailers to deliver in-store promotions (Compl. ¶72). The complaint provides a screenshot showing a user interface on a smart cart that displays a store map, a product list with pricing, and a personalized promotion for a loyalty program member (Compl. p. 22). The products are alleged to use AI and computer vision to analyze customer movement and optimize store operations (Compl. ¶157). The complaint asserts these products provide customers with competitive advantages and have resulted in significant commercial gains for the Defendant (Compl. ¶¶77, 79).
IV. Analysis of Infringement Allegations
’672 Patent Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| identify, via image recognition, an inventory of one or more retail products physically located at the first visual display location... | The Accused Products allegedly use computer vision and cameras to identify products and monitor shelf inventory. | ¶¶84, 157 | col. 21:50-54 |
| display, on the first visual display, information about one or more of the one or more retail products... | The smart cart screen displays product information, such as product names and images. | ¶84; p. 22 | col. 21:55-59 |
| determine, in real-time, current pricing information regarding the one or more retail products... | The Accused Products allegedly determine current pricing information for display. | ¶84 | col. 21:60-63 |
| display, on the first visual display, the current pricing information... | The smart cart screen displays product prices, including original and discounted prices. | ¶84; p. 22 | col. 22:1-4 |
| receive, using one or more information monitoring devices at the first visual display location, real-time data of a customer... | The system allegedly receives real-time customer data via monitoring devices. | ¶84 | col. 22:5-8 |
| generate a promotion... for the customer based on behavioral analytics. | The system allegedly generates personalized promotions, such as a discount offered to a "loyalty friend." | ¶84; p. 22 | col. 22:9-13 |
- Identified Points of Contention:
- Scope Questions: Claim 1 requires several actions to occur "at a first visual display location." A central question may be whether a mobile smart cart, which moves throughout a store, can constitute a "visual display location" in the sense contemplated by the patent, whose specification often depicts stationary, shelf-based displays (’672 Patent, Figs. 4, 11).
- Technical Questions: The complaint alleges the generation of promotions is "based on behavioral analytics." A factual question for the court will be what specific "analytics" are used and whether they meet the claim requirement. The provided visual evidence shows a promotion for a "loyalty friend," raising the question of whether simple membership status constitutes "behavioral analytics." (Compl. p. 22).
’890 Patent Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| using one or more information monitoring devices to gather information about a person at a retail store... | The Accused Products allegedly use monitoring devices, such as the smart cart itself, to gather information about a customer. | ¶106 | col. 21:39-42 |
| ...gathering object identification information of a product that the person is interested in purchasing... | The Accused Products allegedly identify products a customer places in the cart, indicating interest. | ¶107; ¶108 | col. 22:48-52 |
| ...gathering sentiment information of the person with respect to the product... | The complaint alleges the Accused Products perform this function but does not specify how. | ¶107 | col. 22:53-55 |
| analyzing the information in real time... gathered by the information monitoring devices... to manage inventory... | The Accused Products allegedly analyze the gathered information in real time. | ¶108 | col. 22:56-63 |
| providing a response in real time based upon the analyzed information... | The Accused Products allegedly provide responses such as personalized advertisements and coupons on the cart's screen based on the customer's location and cart contents. | ¶108 | col. 22:64-67 |
- Identified Points of Contention:
- Technical Questions: The complaint does not provide factual detail on how the Accused Products perform the claimed step of "gathering sentiment information." The ’890 Patent’s specification and figures explicitly connect "sentiment" to facial analysis detecting emotions like "Happy" or "Anger" (’890 Patent, Fig. 2). A critical question will be whether Plaintiff can provide evidence that the accused carts perform this function, or any function that meets the definition of gathering sentiment information.
- Scope Questions: The construction of "sentiment information" will be paramount. A dispute may arise over whether simple user actions, such as adding an item to a cart, can be construed as "sentiment information," or if the term requires a more direct measurement of a customer's emotional state as suggested by the patent’s intrinsic evidence.
V. Key Claim Terms for Construction
’672 Patent: "at a first visual display location"
- The Term: "at a first visual display location"
- Context and Importance: This term is central to the dispute because the patent specification appears to describe a system with fixed displays, while the Accused Product is a mobile smart cart. The applicability of the claim to a mobile device will depend heavily on the construction of this phrase.
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The claim language itself does not explicitly require the location to be "fixed" or "stationary." Plaintiff may argue that the screen of the smart cart itself constitutes the "visual display location," which is always "at" the location of the cart.
- Evidence for a Narrower Interpretation: The specification repeatedly illustrates the invention with figures showing displays integrated into fixed store infrastructure, such as shelf end-caps (’672 Patent, Fig. 4, Fig. 11). This context may support an interpretation that the "location" is a predetermined, physical point within the store's geography, not a mobile object.
’890 Patent: "sentiment information"
- The Term: "sentiment information"
- Context and Importance: This term is a critical and potentially distinguishing element of Claim 1. The complaint’s infringement theory for the ’890 patent may succeed or fail based on whether the Accused Products can be shown to gather information meeting this definition. Practitioners may focus on this term because the complaint offers no specific facts explaining how this function is performed.
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: Plaintiff may argue that the term should be given its plain and ordinary meaning, which could encompass implicit indicators of a shopper's feelings or attitude, such as the positive sentiment implied by adding an item to a cart or the negative sentiment of removing it.
- Evidence for a Narrower Interpretation: The patent’s specification provides a very specific example of "sentiment information" in Figure 2, which shows an analysis of a person's face resulting in metrics for "Anger," "Happy," "Sad," and "Surprise." Defendant may argue this figure acts as a lexicographical definition or provides a strong basis for limiting the term's scope to explicit emotional state detection via biometric analysis. (’890 Patent, Fig. 2).
VI. Other Allegations
- Indirect Infringement: The complaint alleges induced infringement for all five patents. The allegations are based on Defendant providing the Accused Products to its retail customers, such as Wakefern, and allegedly encouraging and directing them to operate the systems in a manner that practices the patented methods (e.g., Compl. ¶¶95-97, 119-121).
- Willful Infringement: Willfulness is alleged for all five patents. The basis for willfulness is alleged pre-suit knowledge derived from Defendant's business relationship with Wakefern Food Corporation, which was the defendant in a prior infringement suit brought by Alpha Modus on the same patents (e.g., Compl. ¶¶74, 89-90).
VII. Analyst’s Conclusion: Key Questions for the Case
- Definitional Scope: A central issue will be whether the patent claims, which appear grounded in the context of fixed in-store monitoring systems, can be construed to read on the mobile, all-in-one functionality of the accused smart carts. The dispute over the meaning of "at a first visual display location" in the ’672 patent epitomizes this core question.
- Evidentiary Sufficiency: The case may turn on whether Plaintiff can produce evidence to substantiate its more technical infringement allegations. In particular, for the ’890 patent, a key evidentiary question will be what proof exists that the accused smart carts perform the specific function of "gathering sentiment information," especially given the patent's intrinsic evidence linking that term to facial emotion analysis.
- Imputation of Knowledge: The willfulness claims hinge on whether knowledge of the patents-in-suit can be imputed to the Defendant through its customer, Wakefern, which was previously sued. A key legal and factual question will be whether Plaintiff can establish that this business relationship was sufficient to give Defendant actual knowledge of the patents and its alleged infringement, thereby satisfying the standard for willful infringement.