Arbor Systems LLC v. Solulab Pvt Ltd

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Arbor Systems LLC (New Mexico)
  • Defendant: SoluLab Private Limited (India)
  • Plaintiff’s Counsel: Rabicoff Law LLC
• Case Identification: 2:26-cv-00047, E.D. Tex., 01/22/2026
• Venue Allegations: Venue is alleged to be proper in the Eastern District of Texas because the Defendant is a foreign corporation.
• Core Dispute: Plaintiff alleges that Defendant infringes a patent related to Internet of Things (IoT) devices that utilize blockchain smart contracts for secure and automated operations.
• Technical Context: The technology operates at the intersection of IoT devices, which generate vast amounts of data from physical objects, and blockchain technology, which provides a decentralized and secure ledger for transactions and contract execution.
• Key Procedural History: The patent-in-suit is a continuation of a prior application which has since issued as U.S. Patent No. 10,046,228, a fact which may be relevant to claim construction and prosecution history estoppel analyses. The complaint does not mention any prior litigation or administrative proceedings involving the patent-in-suit.

Case Timeline

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

U.S. Patent No. 10,195,513 - "Smart device"

Issued on February 5, 2019 (the "’513 Patent"). (Compl. ¶¶8-9).

The Invention Explained

• Problem Addressed: The patent background identifies technical challenges associated with the proliferation of IoT devices, including the potential for the volume of generated data to "overwhelm the Internet cloud" and the security risks arising from "hacked IOT devices." (’513 Patent, col. 1:12-18).
• The Patented Solution: The invention is described as an IoT device comprising a processor, sensor(s), and a wireless transceiver, which can utilize "blockchain smart contracts ... to facilitate secure operation." (’513 Patent, Abstract; col. 1:20-23). The system enables IoT devices to autonomously and securely engage in peer-to-peer transactions, enforce agreements, and manage a supply chain or chain of custody for an item. (’513 Patent, col. 5:25-27). This integration of blockchain is proposed as a solution to the data management and security problems identified.
• Technical Importance: The described technology proposes a framework for enabling trustless, peer-to-peer interactions between IoT devices, potentially reducing reliance on centralized cloud servers and enhancing security. (’513 Patent, col. 1:12-18).

Key Claims at a Glance

• The complaint alleges infringement of "one or more claims" of the ’513 Patent, referencing "Exemplary '513 Patent Claims" in an exhibit not attached to the publicly filed complaint. (Compl. ¶¶11, 16). Independent Claim 1 is representative of the invention and includes the following essential elements:
  • An Internet of Things (IOT) device, comprising:
  • a processor;
  • a sensor coupled to the processor;
  • a transceiver; and
  • a module for processing a smart contract in a blockchain with the blockchain address, the processor storing tamperproof events on the blockchain or a side chain, the processor executing terms of the smart contract and a module for forming a contract between the processor and another machine.
• The complaint does not specify whether dependent claims are asserted but incorporates charts by reference that allegedly identify the "Exemplary '513 Patent Claims." (Compl. ¶11).

III. The Accused Instrumentality

Product Identification

The complaint identifies the accused instrumentalities as the "Exemplary Defendant Products," which are detailed in claim charts attached as Exhibit 2. (Compl. ¶11). However, Exhibit 2 was not filed with the complaint, and no specific products are named in the body of the complaint.

Functionality and Market Context

The complaint does not describe the specific functionality of the accused products. It alleges in a conclusory manner that the "Exemplary Defendant Products practice the technology claimed by the '513 Patent" and have been "made, used, sold, imported, and offered for sale by Defendant." (Compl. ¶¶11, 16). No allegations are made regarding the products' specific market positioning or commercial importance beyond the general act of selling them. No probative visual evidence provided in complaint.

IV. Analysis of Infringement Allegations

The complaint references claim-chart exhibits that are not provided with the filing. It alleges that these charts compare the "Exemplary '513 Patent Claims to the Exemplary Defendant Products" and demonstrate that the accused products "satisfy all elements" of those claims. (Compl. ¶¶16-17). In the absence of the charts, the narrative infringement theory is limited to this general assertion without specific factual support.

• Identified Points of Contention: Based on the language of representative Claim 1 and the general nature of the dispute, several points of contention may arise.
  • Scope Questions: A central question may be whether the accused products, once identified, contain a "module for processing a smart contract." The interpretation of this term could determine whether general-purpose firmware that executes automated tasks meets this limitation, or if it requires specific functionality for interacting with a cryptographic, distributed ledger.
  • Technical Questions: The complaint does not provide evidence that any accused product performs the specific functions of "storing tamperproof events on the blockchain" or "forming a contract between the processor and another machine." A point of contention will be whether the accused products' actual operations map onto these claimed technical functions.

V. Key Claim Terms for Construction

The complaint's lack of detail on the accused products makes it difficult to pinpoint specific disputes. However, practitioners may focus on the construction of the following terms from Claim 1, as they are central to the patent's inventive concept.

• The Term: "module for processing a smart contract"

  • Context and Importance: This term appears to be the primary nexus between the IoT device and the blockchain. Its construction will be critical to determining the scope of infringement, particularly whether it is limited to specific blockchain platforms or can read on more generic automated agreement software.
  • Intrinsic Evidence for a Broader Interpretation: The specification describes modules for a wide array of functions, such as code to "determine trade settlement amounts" or "collect insurance based on usage," which could support an argument that any software executing automated transactional rules qualifies. (’513 Patent, col. 4:61-63; col. 5:1-3).
  • Intrinsic Evidence for a Narrower Interpretation: The detailed description includes specific examples and figures related to the Ethereum blockchain platform. (’513 Patent, FIG. 13A). This could support an argument that the term should be construed more narrowly to require functionality associated with established, cryptographically secure blockchain systems.

• The Term: "forming a contract between the processor and another machine"

  • Context and Importance: This limitation defines an automated, machine-to-machine agreement process. The dispute will likely center on what level of technical complexity is required to constitute "forming a contract."
  • Intrinsic Evidence for a Broader Interpretation: The patent states that "IoT machines can negotiate contracts on their own (without human)," suggesting that any automated protocol for agreement between devices could fall within the claim's scope. (’513 Patent, col. 19:6-8).
  • Intrinsic Evidence for a Narrower Interpretation: The specification includes an extensive discussion of formal legal contract principles, including offer, acceptance, consideration, and defenses. (’513 Patent, cols. 80-84). This could support a narrower construction requiring the automated process to mirror these legal formalities, rather than encompassing any simple data handshake protocol.

VI. Other Allegations

• Indirect Infringement: The complaint alleges induced infringement, stating that Defendant sells the accused products to customers and provides "product literature and website materials" that instruct end users on how to use the products in an infringing manner. (Compl. ¶¶14-15). The complaint references Exhibit 2 for extensive details on these materials. (Compl. ¶14).
• Willful Infringement: The complaint alleges that the service of the complaint itself "constitutes actual knowledge of infringement." (Compl. ¶13). It further alleges that Defendant has continued to infringe "Despite such actual knowledge," which may form the basis for a claim of post-suit willful infringement. (Compl. ¶14).

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

1. A core issue will be one of definitional scope: can the claim term "module for processing a smart contract," which is described with reference to specific blockchain technologies like Ethereum, be construed to cover more generic software on an IoT device that automates transactional rules without interacting with a decentralized, cryptographic ledger?
2. A key evidentiary question will be one of factual sufficiency: as the complaint's infringement theory is premised entirely on an unfiled exhibit, the case will turn on what specific evidence Plaintiff can produce to demonstrate that the accused products actually perform the blockchain-related functions required by the claims, such as storing "tamproof events" and "forming a contract" between machines.