Alpha Modus Corp v. Creative Realities Inc

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Alpha Modus, Corp. (Florida)
  • Defendant: Creative Realities, Inc. (Minnesota)
  • Plaintiff’s Counsel: Prince Lobel Tye LLP; Dickinson Wright PLLC
• Case Identification: 2:25-cv-00931, E.D. Tex., 09/04/2025
• Venue Allegations: Venue is alleged based on Defendant maintaining a regular and established place of business in Plano, Texas, a location within the Eastern District of Texas.
• Core Dispute: Plaintiff alleges that Defendant’s digital signage and content management platforms infringe five patents related to the use of in-store monitoring technologies to analyze consumer behavior in real-time and deliver targeted responses.
• Technical Context: The technology at issue addresses the challenge for brick-and-mortar retailers to compete with e-commerce by bringing data-driven personalization, such as targeted advertising and dynamic customer assistance, into physical retail environments.
• Key Procedural History: The complaint notes that Plaintiff has entered into intellectual property licensing agreements outside of litigation. It also establishes that the five patents-in-suit are related, with four being continuations of the application that led to the first-issued patent, suggesting a shared technical disclosure and potentially overlapping claim construction issues.

Case Timeline

Date	Event
2013-07-19	Earliest Priority Date ('571, '825, '672, '890, '880 Patents)
2019-07-23	'571 Patent Issued
2020-12-01	'825 Patent Issued
2021-04-13	'672 Patent Issued
2021-06-22	'890 Patent Issued
2022-04-12	'880 Patent Issued
2025-09-04	Complaint Filing Date

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

U.S. Patent No. 10,360,571 - "Method For Monitoring And Analyzing Behavior And Uses Thereof"

The Invention Explained

• Problem Addressed: The patent’s background section describes the challenge brick-and-mortar retailers face from online competition, particularly the phenomenon of "showrooming," where customers examine products in-store but purchase them online (’571 Patent, col. 1:40-48). Retailers lack the real-time consumer purchasing data available to their online counterparts, hindering their ability to influence in-the-moment purchase decisions (Compl. ¶19; ’571 Patent, col. 2:9-24).
• The Patented Solution: The invention proposes a method for using "information monitoring devices," such as video cameras, within a physical location to gather real-time information about people, including their demographic, sentiment, and tracking characteristics (Compl. ¶18, ¶21). This information is then analyzed in real-time to provide a response, such as personalized content on a display or a digital coupon, to enhance the shopping experience and influence purchasing decisions (’571 Patent, Abstract; col. 4:1-8, FIG. 1).
• Technical Importance: This technology aims to replicate the data-driven, personalized marketing capabilities of e-commerce within a physical retail environment, providing brick-and-mortar stores with new tools to engage customers directly at the point of decision (Compl. ¶19-20).

Key Claims at a Glance

• The complaint asserts infringement of at least Claim 1 (Compl. ¶83).
• Independent Claim 1 of the ’571 Patent includes the following essential elements:
  • Using information monitoring devices (including video devices) to gather information about persons at a location.
  • Gathering a demographic characteristic (e.g., gender, age).
  • Gathering a sentiment characteristic.
  • Gathering a tracking characteristic (e.g., movement, eye movement).
  • Providing an opt-out option to the persons.
  • Analyzing the gathered information in real time for persons who have not opted out.
  • Providing a real-time response based on the analysis (e.g., engaging the person via a display, sending a communication, providing marketing information, or providing a coupon).

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U.S. Patent No. 10,853,825 - "Method for monitoring and analyzing behavior and uses thereof"

The Invention Explained

• Problem Addressed: The patent addresses the same competitive challenges faced by brick-and-mortar retailers from online shopping and showrooming, highlighting a gap in the ability of physical stores to provide the real-time, personalized experiences common to online retailers (Compl. ¶29-30).
• The Patented Solution: The ’825 Patent claims a method that also uses monitoring devices to gather demographic and tracking data about a person in a retail store (’825 Patent, Abstract). However, the solution focuses on a human-centric response: the real-time analysis of this data is used to "select a sales associate" and then to send a communication to that associate, enabling them to "directly interact with the first person in response to the communication" (Compl. ¶32-33; ’825 Patent, col. 4:35-42).
• Technical Importance: This approach shifts the focus from purely automated digital engagement to data-driven human assistance, aiming to leverage real-time analytics to improve the effectiveness and personalization of in-store customer service (Compl. ¶31-32).

Key Claims at a Glance

• The complaint asserts infringement of at least Claim 1 (Compl. ¶107).
• Independent Claim 1 of the ’825 Patent includes the following essential elements:
  • Using information monitoring devices (including video devices) to gather information about a first person at a retail store.
  • Gathering a demographic characteristic (e.g., gender, age).
  • Gathering a tracking characteristic (e.g., movement, eye movement).
  • Analyzing the gathered information in real time to generate a real-time analysis of the first person.
  • Utilizing the real-time analysis to select a sales associate from a group of sales associates.
  • Sending a communication to the selected sales associate that includes at least a portion of the gathered information or the real-time analysis, so the associate can interact with the person.

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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.
• Technology Synopsis: The patent describes a system to counter the challenges of online retail by integrating inventory management with customer engagement (Compl. ¶40-41). The system uses image recognition to identify the inventory at a visual display, determines and displays pricing information, receives real-time data from a customer at the display, and generates a promotion for that customer based on behavioral analytics (Compl. ¶43-44).
• Asserted Claims: At least Claim 1 (Compl. ¶131).
• Accused Features: Defendant's digital signage products are accused of practicing the claimed system for real-time inventory management, marketing, and advertising (Compl. ¶126).

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.
• Technology Synopsis: The patent describes a method for enhancing customer assistance by analyzing a customer's real-time interaction with products (Compl. ¶50-51). The method involves gathering "object identification information" for a product a person is interested in, as well as "sentiment information" of the person regarding that product. This combined information is analyzed in real-time to manage inventory and provide a targeted response to the customer (Compl. ¶53-54).
• Asserted Claims: At least Claim 1 (Compl. ¶155).
• Accused Features: Defendant's digital signage products are accused of gathering information about customer-product interactions, including object identification and sentiment, to provide real-time responses (Compl. ¶150, ¶153).

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.
• Technology Synopsis: The patent describes a method for real-time inventory management based on direct observation of shopper activities (Compl. ¶60, ¶62). The method involves gathering "product interaction information," which includes tracking when products are "picked up" and "carried away" by persons in the store, along with "object identification information" for those products. This data is analyzed to manage inventory, triggering real-time responses such as a communication to retail staff to check inventory or restock a product (Compl. ¶64-65).
• Asserted Claims: At least Claim 1 (Compl. ¶179).
• Accused Features: Defendant's digital signage products are accused of gathering information about shopping activities, including product interaction and object identification, to manage inventory (Compl. ¶174-177).

III. The Accused Instrumentality

Product Identification

• The accused instrumentalities are Defendant CRI’s digital signage solutions, including a suite of proprietary content management system (CMS) software platforms such as "Clarity™", "ReflectView™", "Reflect Spark™", "Reflect Xperience™", "AdLogic™", and "iShowroom™" (collectively, "the Accused Products") (Compl. ¶67, ¶78).

Functionality and Market Context

• The Accused Products are described as a suite of software platforms that design, develop, deploy, and support digital display networks for a wide range of industries, including retail (Compl. ¶66, ¶69). The complaint alleges that CRI manages around 400,000 active SaaS display licenses for clients including Best Buy, Macy's, and Verizon (Compl. ¶68). Functionally, the complaint alleges these products provide customers with the capability to "utilize digital cameras in order to collect information" about foot traffic, "to analyze impressions and exposure of digital signage," and "to display different content based on demographic information of potential viewers" (Compl. ¶70).

IV. Analysis of Infringement Allegations

U.S. Patent No. 10,360,571 Infringement Allegations

Claim Element (from Independent Claim 1)	Alleged Infringing Functionality	Complaint Citation	Patent Citation
(a) using one or more information monitoring devices to gather information about persons...wherein...the one or more information monitoring devices comprise one or more video image devices	The Accused Products utilize information monitoring devices, including digital cameras, to gather information about persons at a location, such as in retail stores.	¶79	col. 9:15-21
(iv) the step of gathering information...comprises gathering a demographic characteristic of the persons...wherein the demographic characteristic is selected from a group consisting of gender...approximate age...and combinations thereof	The Accused Products collect demographic characteristics of persons in proximity to the monitoring devices. The complaint provides an exemplary image showing the output of such analysis, including gender and age.	¶81; p. 4, FIG. 2	col. 9:52-66
(v) the step of gathering information...comprises gathering a sentiment characteristic of the persons	The Accused Products collect sentiment characteristics of persons. The complaint provides an exemplary image showing the output of such analysis, including a "Happy" score.	¶81; p. 4, FIG. 2	col. 9:56-59
(vi) the step of gathering information...comprises gathering a tracking characteristic of the persons...selected from a group consisting of movement of the persons...eye movement of the persons...and combinations thereof	The Accused Products collect tracking characteristics of persons in proximity to the monitoring devices.	¶81	col. 10:1-8
(b) providing an opt-out option to the persons in the group of persons	The Accused Products provide an opt-out option to persons in proximity to the devices.	¶82	col. 11:36-40
(c) analyzing in real time...the information gathered...of the persons...except for the subset of opt-out persons	The Accused Products include systems operably connected to a server and/or databases which analyze the information of those who have not opted out.	¶80, ¶82	col. 4:6-8
(d) providing a response in real time based upon the analyzed information	Defendant's products display different content based on demographic information of viewers.	¶70	col. 4:2-8

U.S. Patent No. 10,853,825 Infringement Allegations

Claim Element (from Independent Claim 1)	Alleged Infringing Functionality	Complaint Citation	Patent Citation
(a) using one or more information monitoring devices to gather information about a first person...at a retail store...wherein...the one or more information monitoring devices comprise one or more video image devices	The Accused Products utilize information monitoring devices, including digital cameras, to gather information about persons at a location, such as in retail stores.	¶103	col. 8:58-62
(iv) the step of gathering information...comprises gathering a demographic characteristic of the first person... (v) the step of gathering information...comprises gathering a tracking characteristic of the first person...	The Accused Products are alleged to collect demographic and tracking characteristics of persons in retail locations.	¶105	col. 9:1-14
(b) analyzing in real time...the information gathered...to generate a real time analysis of the first person...	The Accused Products include systems operably connected to a server and/or databases which analyze the gathered information.	¶104	col. 9:15-20
(c) utilizing the real time analysis to select a sales associate from a group of sales associates at the retail store	The complaint alleges that Defendant's products practice the patented methods, which include this step.	¶102, ¶107	col. 18:20-24
(d) sending a communication to the sales associate that comprises at least a portion of...the information gathered...or...the real time analysis...wherein the sales representative can then directly interact with the first person	The complaint alleges that Defendant's products practice the patented methods, which include this step.	¶102, ¶107	col. 18:31-42

Identified Points of Contention

• Technical Questions: A primary question will be whether the Accused Products, described in the complaint as displaying content based on demographics (Compl. ¶70), actually perform the specific functions claimed in the later patents. For the ’825 Patent, for example, the complaint does not provide specific factual allegations that the Accused Products perform the claimed steps of "select[ing] a sales associate" and "sending a communication to the sales associate." The analysis may turn on what evidence is produced to show these functions are part of CRI's systems.
• Scope Questions: For the ’571 Patent, a potential point of contention is the "opt-out" limitation. The complaint makes a conclusory allegation that the Accused Products provide this feature (Compl. ¶82) but offers no factual detail as to how this option is implemented or presented to users. The sufficiency of this allegation may be challenged. Similarly, the exact nature of the "sentiment" and "tracking" characteristics collected by the Accused Products compared to those required by the claims will be a central issue.

V. Key Claim Terms for Construction

The Term: "sentiment characteristic" (from ’571 Patent, Claim 1)

• Context and Importance: This term is critical because its scope will define what type of data qualifies as "sentiment." The infringement analysis depends on whether the accused system must perform a specific type of emotional analysis (e.g., facial mood recognition) or if more general metrics like dwell time or product interaction could be construed as indicative of sentiment. Practitioners may focus on this term because the patent’s specification and figures provide a very specific example of sentiment analysis.
• Intrinsic Evidence for Interpretation:
  • Evidence for a Broader Interpretation: The claim language itself does not define the term, simply listing it as one of three characteristics to be gathered. This lack of explicit limitation in the claim itself may support a construction not strictly limited to the disclosed embodiments.
  • Evidence for a Narrower Interpretation: The specification provides a specific example of sentiment as derived from video images, noting it can include "% happy, % sad, % angry, % surprised" (’571 Patent, col. 9:56-59). Further, FIG. 2, which is reproduced in the complaint, explicitly shows an analysis of a person’s face with scores for "Anger," "Happy," "Sad," and "Surprise" (Compl. p. 4, FIG. 2). This may be used to argue that the term should be construed as requiring this type of specific emotional-state analysis via facial recognition.

The Term: "select a sales associate" (from ’825 Patent, Claim 1)

• Context and Importance: This active step is a key differentiator of the ’825 Patent. The construction of this term will determine the degree of intelligence or automation required by the system. The dispute may focus on whether "select" implies an intelligent matching of an associate to a customer based on the real-time analysis, or if it could be met by a simpler system that merely alerts the next available staff member.
• Intrinsic Evidence for Interpretation:
  • Evidence for a Broader Interpretation: The claim language "select a sales associate from a group of sales associates" does not, on its face, require any specific criteria for the selection process. This could support a broader interpretation that covers any non-random assignment or alert.
  • Evidence for a Narrower Interpretation: The detailed description suggests the purpose of the communication to the sales associate is to provide a "profile of the customer" so the associate can "better serve the customer" (’825 Patent, col. 18:41-44). This context suggests the selection is not arbitrary but is part of a system designed to enable a more effective, personalized interaction, potentially supporting a narrower construction that requires the selection to be based on the preceding real-time analysis.

VI. Other Allegations

Indirect Infringement

• The complaint pleads induced infringement for each patent-in-suit, alleging that Defendant knowingly encourages, directs, and aids its customers (e.g., retailers) to use the Accused Products in a manner that practices the patented methods (Compl. ¶93, ¶95). The basis for intent includes Defendant’s "promotions and instructions" for the Accused Products (Compl. ¶97, ¶121).

Willful Infringement

• Willfulness is alleged for all asserted patents. The primary basis alleged for knowledge is post-suit awareness, stating Defendant has been aware of the patents "at least as early as the filing of this Complaint" (Compl. ¶73, ¶87). The complaint also notes that Plaintiff makes its patent portfolio publicly available on its website, which could be used to argue for pre-suit willful blindness, though this connection is not explicitly made in the willfulness allegations (Compl. ¶10).

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

• A core issue will be one of evidentiary proof: For patents beyond the first in the family (e.g., the ’825, ’890, and ’880 patents), can the Plaintiff provide sufficient factual evidence that Defendant's content-display platforms perform the more specific and distinct functions claimed, such as selecting and dispatching sales associates or tracking individual product pick-ups to trigger inventory alerts? The complaint’s functional description of the accused technology focuses on displaying content, raising a potential mismatch with the specific methods claimed in these later patents.
• A key legal question will be one of claim construction: Can the term "sentiment characteristic," which the patent specification and figures strongly link to specific facial emotion analysis, be construed broadly enough to read on more generalized behavioral analytics that may be present in commercial digital signage systems? The outcome of this construction could significantly impact the scope of the ’571 patent and its applicability to the accused products.
• A threshold procedural question may concern the sufficiency of the pleadings: Do the complaint's conclusory allegations for certain claim elements, such as the "opt-out option" (Compl. ¶82), provide enough factual content to survive a motion to dismiss under the Iqbal/Twombly standard, or will the court require more specific details on how the accused systems allegedly meet these requirements?