DCT
4:24-cv-00568
Convergent Assets LLC v. Ulta Beauty Inc
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: Convergent Assets LLC (Delaware)
- Defendant: Ulta Beauty, Inc. (Delaware)
- Plaintiff’s Counsel: Direction IP Law
- Case Identification: 4:24-cv-00568, E.D. Tex., 09/26/2024
- Venue Allegations: Venue is based on Defendant maintaining regular and established places of business within the Eastern District of Texas and committing alleged acts of infringement in the district.
- Core Dispute: Plaintiff alleges that Defendant’s website and retail media network infringe a patent related to methods for targeted advertising that analyze and combine data from social networking activity with user browse information.
- Technical Context: The technology operates within the field of programmatic advertising, where algorithms are used to automatically deliver personalized digital content and advertisements to users based on their behavior and inferred interests.
- Key Procedural History: The complaint does not reference any prior litigation or post-grant proceedings involving the patent-in-suit. It does, however, dedicate significant argument to the assertion that the claimed method represents a technological improvement over routine and conventional practices at the time of the invention.
Case Timeline
| Date | Event |
|---|---|
| 2007-04-06 | ’138 Patent Priority Date |
| 2021-06-29 | ’138 Patent Issue Date |
| 2022-05-19 | Ulta Beauty announces launch of its UB Media retail media network |
| 2024-09-26 | Complaint Filing Date |
II. Technology and Patent(s)-in-Suit Analysis
- Patent Identification: U.S. Patent No. 11,049,138, Systems and Methods for Targeted Advertising, issued June 29, 2021.
The Invention Explained
- Problem Addressed: The patent asserts that prior art methods for targeted advertising, which relied on keywords from a user's currently viewed webpage or past browsing history, were often suboptimal (Compl. ¶¶12-13). Such methods could fail to align with a user's current interests, especially when user intent was not obvious from browsing data alone (’138 Patent, col. 1:38-49).
- The Patented Solution: The invention describes a method that integrates data from dynamic sources like social networking sites with a user's browse information (’138 Patent, Abstract). The system obtains data indicating words from social networking activity (e.g., user posts), generates relationships between these words, and ranks these relationships based on the recency of the underlying content. This recency-ranked social data is then combined with a user's browse information to identify and provide relevant content, such as targeted advertisements (’138 Patent, col. 19:4-58, describing Fig. 10).
- Technical Importance: This approach sought to improve advertising relevance by analyzing the "social trending and social momentum" of topics, allowing recommendations to adjust dynamically with public discourse even if a user's direct browsing activity remained unchanged (Compl. ¶19).
Key Claims at a Glance
- The complaint asserts independent claim 28 (’138 Patent, col. 24:22-41; Compl. ¶31).
- The essential elements of independent claim 28 are:
- Obtaining first data indicating words from content associated with social networking activity (including a user post).
- Generating second data indicating a word association ranked by content recency, where associations from more recent content receive a higher ranking.
- Identifying a word in a user's browse information, a related second word determined from the second data, and a content item corresponding to that second word.
- Providing a portion of the content item from a data repository to the user.
- The prayer for relief requests judgment on "one or more claims," which may suggest Plaintiff reserves the right to assert additional claims (Compl. p. 33).
III. The Accused Instrumentality
Product Identification
- The accused instrumentality is Defendant’s website, "www.ulta.com", and its associated systems for personalization and advertising, including its retail media network known as "UB Media" (Compl. ¶31, p. 17).
Functionality and Market Context
- The complaint alleges the accused instrumentality operates by collecting various forms of user data, including "social media profiles, photographs, images, videos, survey responses, comments, [and] product reviews" (Compl. p. 17). This data, combined with tracked user behavior (e.g., browsing history, search terms, purchases), is allegedly used to create advertisements tailored to users' preferences (Compl. ¶¶31-32). The complaint provides a screenshot from a case study alleging Ulta partnered with Facebook to display targeted advertisements based on the "collection of social content from Facebook" (Compl. p. 18). This system is positioned as a way for brand partners to conduct "addressable advertising" to Ulta's loyalty members (Compl. p. 17).
IV. Analysis of Infringement Allegations
Claim Chart Summary
| Claim Element (from Independent Claim 28) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| obtaining first data indicating words in content associated with social networking activity that includes a user post on a social networking site; | Ulta Beauty allegedly collects user-generated content, including "social media profiles," "comments," and "product reviews," and gathers data from users' social media posts mentioning its products or services. | ¶31, p. 17 | col. 24:23-25 |
| generating second data indicating an association between first words ... and indicating a degree of the association, the degree of the association corresponds to a ranking based on a recency of the content ... | The system allegedly analyzes social media mentions and user-generated posts and determines the degree of association based on "how recently the content was created or accessed," prioritizing content for focused advertisements. | ¶32, p. 19 | col. 24:26-30 |
| identifying, at a computing system, a word in browse information of a target user device, a second word determined based on the second data to be related to the word, and a content item having an associated keyword that corresponds to the second word; | Defendant allegedly collects user browsing and search history, uses NLP to identify keywords, and matches these with relevant content items to deliver personalized recommendations. A screenshot of Ulta’s "Beauty Preferences" page shows the collection of user-entered keywords to personalize content. | ¶33, p. 27 | col. 24:31-35 |
| and providing a portion of the content item retrieved from a data repository to the target user device. | Ulta allegedly delivers personalized content and promotions from its centralized data repositories across various channels, including its website and app, based on individual preferences and behaviors. | ¶34 | col. 24:36-41 |
Identified Points of Contention
- Technical Question: The complaint alleges that Ulta determines association based on recency, but a key question will be what evidence demonstrates that this is performed using the specific comparative ranking structure required by the claim (i.e., that a "first ranking" is "greater than a second ranking" because the underlying content is more recent).
- Scope Question: The claim requires identifying a "word in browse information," then finding a "second word" related to it via the social data, and then finding a "content item" matching that second word. A point of contention may be whether the complaint provides sufficient factual allegations to show that this specific, sequential three-part matching process is what the accused system actually performs, as opposed to a more general matching of user interests to products.
V. Key Claim Terms for Construction
The Term: "a ranking based on a recency of the content"
- Context and Importance: This term appears central to the patent's purported novelty over prior art. The construction will determine whether any system that prioritizes newer content infringes, or if a more sophisticated analysis is required. Practitioners may focus on this term because the complaint heavily argues that analyzing "social trending and social momentum" via recency was a key technological improvement (Compl. ¶¶19, 25).
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The plain language of the claim itself does not specify the mechanism of ranking beyond stating it is "based on" recency and involves a greater/lesser comparison.
- Evidence for a Narrower Interpretation: The specification describes using recency to recognize "social trending and social momentum" and allowing "more recent relationships to be given greater weight than older relationships" in a way that reflects "shifting interests and activity trends" (’138 Patent, col. 6:22-35, col. 9:2-9). This may support a construction requiring more than a simple chronological sort.
The Term: "social networking activity"
- Context and Importance: The scope of this term defines the universe of data sources for the first step of the claimed method. Its construction will determine whether infringement requires pulling data from third-party social media platforms (like Facebook) or if it can be satisfied by analyzing user-generated content hosted on the defendant's own site (like product reviews).
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The patent specification describes "social-network data" as including data from "social networking sites, blogs, declared interest sites (for example, digg.com), news and other current event sites" (’138 Patent, col. 5:6-10).
- Evidence for a Narrower Interpretation: The asserted claim specifies the activity "includes a user post on a social networking site," which a party could argue narrows the scope to content posted on traditional social media platforms, as distinct from product reviews or other user-generated content on a commercial website (’138 Patent, col. 24:24-25).
VI. Other Allegations
Indirect Infringement
- The complaint alleges induced infringement, stating that Defendant provides the accused website to its customers and encourages them to use it in an infringing manner. It further alleges that "Defendant's actions have solely caused each of the steps to be performed," which points toward a theory of direct or joint infringement. (Compl. ¶¶35, 32).
Willful Infringement
- The complaint does not contain a separate count for willfulness but alleges that Defendant has had knowledge of the ’138 Patent and its infringement since at least the filing and service of the complaint, and has continued to infringe despite this knowledge, which forms a basis for post-suit willfulness (Compl. ¶35).
VII. Analyst’s Conclusion: Key Questions for the Case
- A key evidentiary question will be one of algorithmic proof: what evidence can Plaintiff produce to demonstrate that Ulta’s advertising platform performs the specific, comparative ranking process recited in Claim 28, where an association based on more recent content is explicitly given a "greater" rank than one based on less recent content?
- A central legal issue will be one of claim scope: can the term "ranking based on a recency of the content" be construed broadly to cover any system that prioritizes new information, or will it be limited by the specification to a more complex analysis of "social momentum," a distinction that appears critical to the patent's assertion of novelty?
- A third pivotal question relates to the locus of infringement: does the accused "social networking activity" require data from third-party platforms like Facebook and Instagram, as some of the complaint's evidence suggests, or can the claim be read to cover the analysis of user-generated content (e.g., product reviews, comments) hosted directly on Ulta's own website?