DCT

4:25-cv-00708

Near Field Electronics LLC v. Foot Locker Inc

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Key Events
Complaint

I. Executive Summary and Procedural Information

  • Parties & Counsel:
  • Case Identification: 4:25-cv-00708, E.D. Tex., 07/03/2025
  • Venue Allegations: Venue is alleged based on Defendant’s operation of retail stores under the Foot Locker, Kids Foot Locker, and Champs Sports brands, constituting regular and established places of business within the Eastern District of Texas.
  • Core Dispute: Plaintiff alleges that Defendant’s Near Field Communication (NFC)-capable credit card readers infringe five patents related to integrated circuit design, multi-protocol communication, configurable bus interfaces, and power management.
  • Technical Context: The patents address foundational challenges in semiconductor design, focusing on creating flexible, efficient, and low-cost integrated circuits for managing communication protocols and power consumption in peripheral devices.
  • Key Procedural History: The complaint asserts five patents, four of which ('201, '071, '350, '727) are expired. For these expired patents, Plaintiff seeks damages only for the six-year period preceding the complaint's filing, as permitted by statute. The '531 patent remains active, and the complaint alleges ongoing direct and indirect infringement.

Case Timeline

Date Event
2000-06-21 '201 Patent Priority Date
2000-07-25 '071 Patent Priority Date
2000-08-28 '727 Patent Priority Date
2002-06-28 '350 Patent Priority Date
2004-02-10 '201 Patent Issue Date
2004-05-25 '071 Patent Issue Date
2005-01-11 '531 Patent Priority Date
2005-10-25 '350 Patent Issue Date
2006-02-07 '727 Patent Issue Date
2008-05-13 '531 Patent Issue Date
2019-07-03 Alleged Damages Period Begins for Expired Patents
2021-11-21 '071 Patent Expiration Date
2022-01-31 '201 Patent Expiration Date
2022-04-14 '727 Patent Expiration Date
2023-08-12 '350 Patent Expiration Date
2025-07-03 Complaint Filing Date

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

U.S. Patent No. 6,691,201 - "Dual Mode USB-PS/2 Device"

  • Patent Identification: U.S. Patent No. 6,691,201, "Dual Mode USB-PS/2 Device", issued February 10, 2004.

The Invention Explained

  • Problem Addressed: The patent describes that conventional peripheral devices (like a computer mouse) wanting to support both the USB and PS/2 communication protocols required costly and space-consuming external components, as well as complex firmware to manage the two different standards (Compl. ¶11; ’201 Patent, col. 1:28-50).
  • The Patented Solution: The invention proposes a single integrated circuit that consolidates the functionality for both protocols. This circuit is capable of automatically detecting which protocol is being used by a connected bus (e.g., USB or PS/2) and configuring itself to operate accordingly, using a single, shared set of input/output pins for communication (’201 Patent, Abstract; col. 2:51-62). This single-chip approach aims to reduce cost, board space, and firmware complexity (Compl. ¶12; ’201 Patent, col. 2:1-8).
  • Technical Importance: This technology offered a streamlined hardware solution for peripheral manufacturers, enabling them to produce a single device that could seamlessly connect to computers with either legacy (PS/2) or modern (USB) ports without modification.

Key Claims at a Glance

  • The complaint asserts independent method claim 14 (Compl. ¶31).
  • Claim 14 requires the steps of:
    • detecting a signaling protocol of a bus connected to an integrated circuit that operates in a plurality of signaling protocols; and
    • configuring said integrated circuit to communicate in one of said plurality of signaling protocols in response to said detected signaling protocol, where the protocols operate over a single set of pins.
  • The complaint reserves the right to amend its analysis and assert other claims (Compl. ¶32).

U.S. Patent No. 6,742,071 - "Real-time I/O Processor Used to Implement Bus Interface Protocols"

  • Patent Identification: U.S. Patent No. 6,742,071, "Real-time I/O Processor Used to Implement Bus Interface Protocols", issued May 25, 2004.

The Invention Explained

  • Problem Addressed: The patent identifies two shortcomings of prior art interfaces. Protocol-specific hardware interfaces were rigid and could not adapt to new or changing communication standards (Compl. ¶16; ’071 Patent, col. 1:22-29). User-programmable interfaces were inflexible, often requiring a fixed number of "wait states" that made implementing complex signaling difficult (’071 Patent, col. 1:39-48).
  • The Patented Solution: The invention discloses a programmable "general-purpose interface" (GPIF), which is a specialized, real-time input/output (I/O) processor. This processor uses a limited instruction set to generate custom, interface-specific waveforms and respond to external events, allowing its control outputs and data path decisions to be changed on every clock cycle (’071 Patent, Abstract; col. 5:5-10; col. 6:4-16). This replaces rigid, protocol-specific hardware with a flexible, programmable solution (Compl. ¶¶15-16).
  • Technical Importance: This architecture provided a higher-speed, more adaptable method for a single device to communicate with various external devices using different or evolving bus protocols, a key advantage as technology standards proliferated.

Key Claims at a Glance

  • The complaint asserts independent method claim 15 (Compl. ¶36).
  • Claim 15 requires the steps of:
    • progressing to a next state based on the current state, an internal control signal, and an input signal from an external bus;
    • driving an output control signal onto the external bus; and
    • updating the current state to the next state.
  • The complaint reserves the right to amend its analysis and assert other claims (Compl. ¶37).

Multi-Patent Capsules

  • U.S. Patent No. 6,959,350: "Configurable USB Interface With Virtual Register Architecture", issued October 25, 2005.

    • Technology Synopsis: The patent addresses the inefficiency of using hard-coded endpoint configurations in USB interface controllers, which required writing and maintaining different Hardware Description Language (HDL) code for each controller version (Compl. ¶20). The invention provides a configurable bus interface controller that uses an HDL-based configuration package to flexibly generate circuitry for various USB endpoint configurations, avoiding the need for separate HDL code for each endpoint (Compl. ¶¶19, 21).
    • Asserted Claims: Independent claim 10 (Compl. ¶41).
    • Accused Features: The NXP PN512 NFC Front-End and similar components within the accused credit card readers (Compl. ¶41).

  • U.S. Patent No. 6,996,727: "Power Supply for Universal Serial Bus Interface with Programmable Bus Pullup Resistor", issued February 7, 2006.

    • Technology Synopsis: The patent addresses the lack of a low-power mode in conventional USB power supplies, which provided a constant voltage (Compl. ¶25). The invention discloses a dual-mode power supply architecture that operates in a standard mode with a regulated voltage and a power-down (standby) mode that reduces current consumption by using a low-power programmable resistor to maintain the necessary pullup function on the bus (Compl. ¶24).
    • Asserted Claims: Independent claim 18 (Compl. ¶46).
    • Accused Features: The NXP PN512 NFC Front-End and similar components within the accused credit card readers (Compl. ¶46).

  • U.S. Patent No. 7,373,531: "Signal Detection Method...and Electronic Apparatus", issued May 13, 2008.

    • Technology Synopsis: The patent describes a method for detecting the state of a signal (e.g., presence, absence, frequency) by monitoring the "through current" in a circuit (Compl. ¶28). By applying a signal to transistor gates, the presence of a through current indicates an active signal, enabling a device to reduce its power consumption by cutting power when no through current is detected, signifying an inactive state (Compl. ¶¶28, 29).
    • Asserted Claims: Independent claim 2 (Compl. ¶51).
    • Accused Features: The NXP PN512 NFC Front-End and similar components within the accused credit card readers (Compl. ¶51).

III. The Accused Instrumentality

Product Identification

The Accused Instrumentalities are identified as "credit card reader device[s] equipped with an NXP PN512 NFC Front-End" and other NFC front-end components with similar functionality (Compl. ¶¶31, 36, 41, 46, 51).

Functionality and Market Context

The devices are NFC-capable credit card readers that Defendant uses in the regular course of its business at its retail stores to process NFC payment transactions (Compl. ¶33). The core of the infringement allegation is the functionality of the NXP PN512 integrated circuit, which serves as the NFC front-end for these payment terminals (Compl. ¶31).

  • No probative visual evidence provided in complaint.

IV. Analysis of Infringement Allegations

The complaint references infringement analysis in exhibits (e.g., Exhibit A-1, B-1) that were not attached to the filed complaint document (Compl. ¶¶32, 37). The narrative infringement theory is presented at a high level.

  • '201 Patent Infringement Allegations: The complaint alleges that when Defendant's stores use the Accused Instrumentalities to process NFC payments, the devices necessarily perform the steps of claim 14 of the ’201 Patent (Compl. ¶33). The theory suggests that the NXP PN512 chip detects the presence of an NFC-enabled card (thereby "detecting a signaling protocol") and configures its circuits to communicate using that protocol to complete the transaction (thereby "configuring said integrated circuit to communicate") (Compl. ¶¶31, 33). A potential point of contention is whether the various NFC communication standards constitute the "plurality of signaling protocols" contemplated by the patent, which focuses on USB and PS/2.

  • '071 Patent Infringement Allegations: The complaint alleges that in the course of processing an NFC payment, the Accused Instrumentalities perform the steps of claim 15 of the ’071 Patent (Compl. ¶38). The infringement theory appears to map the abstract steps of the claim to the general operation of the NXP PN512's processor. The interaction with an NFC card is alleged to be the "input signal received from said external bus" that causes the processor to "progress... to a next state" and "driv[e] at least one output control signal" as part of the payment protocol (Compl. ¶¶36, 38). A key question for the court will be whether this general operation meets the specific functional requirements of the claim as defined by the patent's specification.

V. Key Claim Terms for Construction

  • Term from '201 Patent, Claim 14: "plurality of signaling protocols"

    • Context and Importance: The patent is titled "Dual Mode USB-PS/2 Device", and its specification heavily focuses on these two protocols. Infringement will depend on whether this term can be construed to encompass the various Near Field Communication (NFC) standards supported by the accused NXP chip. Practitioners may focus on this term because its scope is central to whether the patent's teachings can be applied to the accused technology.
    • Intrinsic Evidence for a Broader Interpretation: The claim language itself is not expressly limited to USB and PS/2. A party could argue that the plain and ordinary meaning should apply, covering any two or more distinct communication methods an integrated circuit might use (’201 Patent, col. 5:14-19).
    • Intrinsic Evidence for a Narrower Interpretation: The title, abstract, and background section repeatedly frame the invention as a solution for USB and PS/2 interoperability (’201 Patent, Title; Abstract; col. 1:15-27). A party could argue this context limits the claim term to wired PC peripheral protocols, not wireless communication standards like NFC.

  • Term from '071 Patent, Claim 15: "progressing to a next state based on ... an input signal received from said external bus"

    • Context and Importance: This functional language is the core of the asserted method. Its construction will determine the level of proof required to show infringement. The dispute may center on whether any change in a processor's operation in response to external data suffices, or if a more specific architectural behavior is required.
    • Intrinsic Evidence for a Broader Interpretation: The claim language is abstract. A party may argue it simply requires a processor to change its logical state in response to receiving a signal from an external device, a common feature of all interactive electronics.
    • Intrinsic Evidence for a Narrower Interpretation: The specification describes a specific "general-purpose interface" (GPIF) with a unique instruction set and state machine architecture (’071 Patent, FIG. 6; col. 5:5-10; col. 6:21-36). A party could argue that "progressing to a next state" must be interpreted in light of this specific disclosed embodiment, requiring proof of a similar architectural operation in the accused device.

VI. Other Allegations

  • Indirect Infringement: The complaint alleges induced infringement under 35 U.S.C. § 271(b) for the ’531 patent only. The allegation is based on Defendant actively aiding and abetting infringement by "providing instruction materials, training, and services" to its partners, customers, and end users regarding the Accused Instrumentalities (Compl. ¶¶55-56).
  • Willful Infringement: Willfulness is alleged for the ’531 patent based on knowledge obtained from the filing of the complaint itself (Compl. ¶¶54, 57). The complaint alleges that any infringement occurring after Defendant received notice of the lawsuit is willful.

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

  • A core issue will be one of technological scope: Can the claims of patents originating from the technical context of early 2000s computer peripherals (specifically, managing wired USB and PS/2 connections) be construed to cover the fundamentally different application of modern, wireless NFC payment processing systems? The case may turn on whether the patent specifications can be read broadly enough to support this technological leap.
  • A second central question will be one of evidentiary specificity: Given the complaint’s high-level and functional infringement allegations, can Plaintiff develop sufficient factual evidence during discovery to demonstrate that the accused NXP PN512 chip's internal operations map precisely onto the specific method steps recited in the asserted claims, or will a detailed technical analysis reveal a fundamental mismatch in operation?
  • Finally, a key legal question for the four expired patents will be the calculation of damages. The dispute will likely involve complex arguments over the appropriate reasonable royalty rate for technology that was allegedly used for only a limited period before the patents expired, years before the lawsuit was filed.