4:24-cv-00450
Consolidated Transaction Processing LLC v. RTG Furniture Corp
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: Consolidated Transaction Processing LLC (Nevada)
- Defendant: R.T.G. Furniture Corp. (Florida)
- Plaintiff’s Counsel: Shea | Beaty
- Case Identification: 4:24-cv-00450, E.D. Tex., 05/17/2024
- Venue Allegations: Plaintiff alleges venue is proper because Defendant maintains an established place of business in the district, specifically citing an R.T.G. store location in Denton, Texas.
- Core Dispute: Plaintiff alleges that Defendant’s e-commerce website and associated back-end computer systems infringe patents related to processing data from multiple distributors and customers to generate and send targeted product offerings.
- Technical Context: The patents address early e-commerce systems that aggregate product data from multiple suppliers and customer data to create personalized shopping experiences, a foundational concept for modern online retail.
- Key Procedural History: The complaint does not mention any prior litigation, inter partes review (IPR) proceedings, or specific licensing history concerning the patents-in-suit.
Case Timeline
| Date | Event |
|---|---|
| 1999-06-30 | Earliest Priority Date for ’846 and ’743 Patents |
| 2013-03-12 | U.S. Patent No. 8,396,743 Issues |
| 2014-04-29 | U.S. Patent No. 8,712,846 Issues |
| 2024-05-17 | Complaint Filed |
II. Technology and Patent(s)-in-Suit Analysis
U.S. Patent No. 8,712,846 - "Sending Targeted Product Offerings Based on Personal Information"
- Patent Identification: U.S. Patent No. 8,712,846, “Sending Targeted Product Offerings Based on Personal Information,” issued April 29, 2014.
The Invention Explained
- Problem Addressed: The patent describes the state of commerce in the late 1990s, noting the significant disadvantages of both traditional brick-and-mortar retail and early e-commerce models (Compl. ¶13; ’846 Patent, col. 2:63-3:14). These prior art systems were limited by physical inventory costs, geographic constraints, and the use of the internet as a mere "advertising medium" akin to a static print catalog, which prevented dynamic, personalized customer experiences (Compl. ¶20; ’846 Patent, col. 3:1-5).
- The Patented Solution: The invention claims to solve these problems with a centralized computer system that receives and processes two distinct data streams: product data from a "plurality of distributors" and customer data (including personal and location information) from a "plurality of customers" (’846 Patent, col. 3:44-52). By combining these data sets, the system can dynamically generate "user-specific product offerings" and deliver them via automated messages, creating a more efficient and personalized e-commerce backbone without requiring the central merchant to hold inventory (’846 Patent, Abstract; Fig. 1).
- Technical Importance: This approach represented a shift from a single-merchant, inventory-based model to a distributed, data-driven model that could offer a wider variety of products and tailor the shopping experience to individual users (’846 Patent, col. 5:7-20).
Key Claims at a Glance
- The complaint asserts independent claim 1 and dependent claims 3 and 4 (Compl. ¶32).
- Independent Claim 1 requires:
- Receiving product data for a plurality of products from a plurality of distributors via a communications network.
- Receiving customer data from a plurality of customers, where the data includes location information derived from a customer's IP address.
- Generating, based at least in part on the customer data, user-specific product offerings.
- Sending, by a computer, automated messages containing the user-specific product offerings to the customers.
- The complaint does not explicitly reserve the right to assert other claims.
U.S. Patent No. 8,396,743 - "Sending Targeted Product Offerings Based on Personal Information"
- Patent Identification: U.S. Patent No. 8,396,743, “Sending Targeted Product Offerings Based on Personal Information,” issued March 12, 2013.
The Invention Explained
- Problem Addressed: As a parent to the ’846 Patent, the ’743 Patent addresses the identical technical problem: the inflexibility and high overhead of prior art retail models that relied on single-source inventory and static, non-personalized advertising (’743 Patent, col. 1:22-2:20).
- The Patented Solution: The solution is functionally identical to that described in the ’846 Patent. It describes a computer-implemented method for aggregating product information from multiple distributors and personal information from customers to generate targeted offers (’743 Patent, Abstract). The system is designed to enable a merchant to offer a broader range of products by acting as an intermediary rather than a direct stockist, using customer data to personalize the offerings (’743 Patent, col. 5:51-6:16).
- Technical Importance: The invention provided a method to improve the relevance of e-commerce by moving beyond one-size-fits-all online catalogs toward dynamically generated, personalized user interfaces and product selections (’743 Patent, col. 4:50-58).
Key Claims at a Glance
- The complaint asserts independent claim 1 and dependent claim 4 (Compl. ¶37).
- Independent Claim 1 requires:
- Receiving product data for a plurality of products from a plurality of distributors via a communications network.
- Receiving customer data from a plurality of customers, where the data includes location information derived from the customer's IP address.
- Generating, based at least in part on personal information about a customer's location, a user-specific product offering.
- Sending, by a computer, an automated message containing the user-specific product offering to one or more customers.
- The complaint does not explicitly reserve the right to assert other claims.
III. The Accused Instrumentality
Product Identification
The "Accused Instrumentalities" are identified as the R.T.G. Furniture Corp. website (www.roomstogo.com) along with its associated hardware and software, including back-end servers and related computer systems that work in conjunction with the website (Compl. ¶9).
Functionality and Market Context
The complaint alleges that these instrumentalities constitute an e-commerce platform for selling furniture and other goods (Compl. ¶5, ¶9). The functionality is broadly described as making, using, selling, and offering for sale products and services to customers in Texas and throughout the United States (Compl. ¶5, ¶9). The complaint frames the accused technology as central to how modern businesses "distinguish themselves by the extent of automation and user-specific customization they provide during the online shopping experience" (Compl. ¶22). No specific technical features of the website are detailed beyond its general operation as an e-commerce system.
IV. Analysis of Infringement Allegations
The complaint references preliminary claim charts in Exhibits 3 and 4, which were not available for this analysis (Compl. ¶32, ¶37). The following summary is based on the narrative allegations. No probative visual evidence provided in complaint.
’846 Patent Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| receiving product data for a plurality of products from a plurality of distributors for the products via a communications network | The Accused Instrumentalities allegedly receive product data (e.g., furniture specifications, pricing, availability) from multiple suppliers or manufacturers. | ¶9, ¶32 | col. 5:26-34 |
| receiving customer data from a plurality of customers, the customer data comprising location information associated with customers, the location information derived from an IP address associated with one or more of the customers | The Accused Instrumentalities allegedly receive data from website visitors, including location information derived from their IP addresses. | ¶9, ¶32 | col. 5:7-14 |
| generating, at least in part from the customer data, user-specific product offerings from the plurality of products | The Accused Instrumentalities allegedly use the collected customer data to generate targeted advertisements, promotions, or product recommendations on the website. | ¶9, ¶32 | col. 5:61-6:6 |
| sending, by a computer, automated messages comprising the user-specific product offerings to the one or more of the customers | The Accused Instrumentalities allegedly send automated emails or other electronic messages, such as order confirmations or promotional offers, to customers. | ¶9, ¶32 | col. 9:15-24 |
- Identified Points of Contention:
- Factual Specificity: A primary question is whether the complaint provides sufficient factual detail to plausibly allege that the RTG website performs each claimed step. The allegations are stated at a high level of generality, referencing the "Accused Instrumentalities" as a whole rather than identifying specific software modules or processes.
- Scope Questions: Does the term "distributor", as used in the patent, read on the relationship RTG has with its furniture suppliers? The patent appears to contrast its multi-distributor model with a traditional single merchant, raising the question of whether RTG operates as the former or the latter.
’743 Patent Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| receiving product data for a plurality of products from a plurality of distributors for the products via a communications network | The Accused Instrumentalities allegedly receive product data from multiple distinct suppliers or manufacturers that provide furniture to RTG. | ¶9, ¶37 | col. 9:11-14 |
| receiving customer data from a plurality of customers, the customer data comprising location information associated with customers, the customer location information derived from an IP address associated with the customer | The Accused Instrumentalities allegedly collect data from users of the www.roomstogo.com website, including location data inferred from their IP address. | ¶9, ¶37 | col. 11:15-18 |
| generating, at least in part from the personal information concerning a customer location, at least one user-specific product offering from the plurality of products | The Accused Instrumentalities allegedly use a customer's location data to generate personalized offers, such as regional promotions or targeted product displays. | ¶9, ¶37 | col. 11:21-25 |
| sending, by a computer, automated messages comprising the at least one user-specific product offering to the one or more customers | The Accused Instrumentalities allegedly send automated electronic communications (e.g., emails) to customers that contain the generated product offerings. | ¶9, ¶37 | col. 11:26-30 |
- Identified Points of Contention:
- Technical Questions: What evidence does the complaint provide that the accused website's functionality rises to the level of the claimed "generating...user-specific product offering"? The analysis will question whether standard e-commerce features like "recently viewed items" or generic sale emails meet the specificity suggested by the patent's disclosure, which includes rule-based algorithms and dynamically generated catalogs for different user types (e.g., students vs. businesses) (’743 Patent, col. 5:61-6:16).
V. Key Claim Terms for Construction
The Term: "a plurality of distributors"
Context and Importance: This term is foundational to the architecture of the claimed invention, which is distinguished from prior art single-merchant systems. The viability of the infringement claim may depend on whether R.T.G. Furniture Corp.'s business model—a single retail entity that sources products from various manufacturers—can be said to involve a "plurality of distributors" in the manner contemplated by the patents.
Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The claims themselves do not define "distributor," potentially allowing for a broad definition that includes any third-party supplier or manufacturer providing product data to a retailer’s e-commerce system.
- Evidence for a Narrower Interpretation: The patent’s background explicitly contrasts the invention with "store-based retailers" who "maintain inventories in warehouses" (’846 Patent, col. 3:8-10). The specification describes the invention as connecting a customer to multiple distributors who can each independently fill an order, suggesting that "distributors" are distinct, order-fulfilling entities rather than simply manufacturers supplying a single retailer's inventory (’846 Patent, col. 9:7-14).
The Term: "user-specific product offering"
Context and Importance: This term captures the "targeted" nature of the invention. Its construction will determine the required level of personalization. Practitioners may focus on this term because generic e-commerce features might not meet a more stringent definition, while a broad definition could cover nearly any modern retail website.
Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The term itself is not explicitly defined, and dependent claims add specific types of offerings like "a coupon" or "promotional offer," which could suggest the independent claim is broad enough to cover common marketing practices (’846 Patent, cl. 2).
- Evidence for a Narrower Interpretation: The specification provides examples of highly specific offerings, such as generating different catalogs and pricing for a student versus a business person (’846 Patent, col. 5:61-6:16). It also describes using "an intelligent rule-based algorithm" to generate competitive pricing, suggesting a more complex and dynamic process than showing a static advertisement (’846 Patent, col. 6:17-29).
VI. Other Allegations
- Indirect Infringement: The complaint does not contain allegations of indirect infringement (inducement or contributory infringement).
- Willful Infringement: The complaint does not plead a formal count for willful infringement or allege pre-suit knowledge by the Defendant. The prayer for relief includes a request for a declaration that the case is "exceptional under 35 U.S.C. § 285" to recover attorneys' fees, but does not state the factual basis for this request (Compl. p.9, ¶C).
VII. Analyst’s Conclusion: Key Questions for the Case
A central issue will be one of factual plausibility: are the complaint’s high-level and conclusory allegations that the "Accused Instrumentalities" perform the claimed methods sufficient to survive a motion to dismiss, or will the court require more specific factual detail linking features of the RTG website to the elements of the asserted claims?
The case may turn on a question of definitional scope: can the term "plurality of distributors", which the patents use to distinguish the invention from single-merchant retailers, be construed to cover a single retail company (R.T.G. Furniture) that sources its inventory from multiple manufacturers?
A key evidentiary question will be one of technical implementation: does the functionality of the accused RTG website embody the specific, data-driven system for "generating...user-specific product offerings" described in the patents, or does it merely employ generic e-commerce features that fall short of the claimed invention?