Realtime Data LLC v. Veritas Tech LLC

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Realtime Data LLC d/b/a IXO (New York)
  • Defendant: CenturyLink, Inc. (Louisiana) and Veritas Technologies LLC (Delaware)
  • Plaintiff’s Counsel: Russ August & Kabat; Ward, Smith & Hill, PLLC
• Case Identification: 6:16-cv-00087, E.D. Tex., 02/26/2016
• Venue Allegations: Plaintiff alleges venue is proper in the Eastern District of Texas because Defendants are registered to do business in the state, have transacted business within the district, and have committed the alleged acts of infringement there. The complaint further alleges that Defendant CenturyLink operates physical facilities in Texas.
• Core Dispute: Plaintiff alleges that Defendants’ enterprise backup products and services, namely Veritas NetBackup software and appliances used by CenturyLink to provide its Secure Online Backup service, infringe four patents related to data compression and accelerated data storage.
• Technical Context: The patents relate to methods for efficiently compressing heterogeneous data streams by intelligently selecting between different compression techniques based on the data's content, a technology critical for reducing storage and bandwidth costs in large-scale data backup operations.
• Key Procedural History: The complaint notes that the lead patent, U.S. Patent No. 7,161,506, has been subject to reexamination proceedings, which resulted in the issuance of reexamination certificates. The asserted claim from this patent was added during reexamination, which may focus judicial and expert attention on the prosecution history to determine the scope of the claim.

Case Timeline

Date	Event
1998-12-11	U.S. Patent Nos. 7,161,506; 9,054,728; 8,643,513 Priority Date
1999-03-11	U.S. Patent No. 9,116,908 Priority Date
2007-01-09	U.S. Patent No. 7,161,506 Issue Date
2014-02-04	U.S. Patent No. 8,643,513 Issue Date
2014-12-31	End of year for CenturyLink deployment of 50 accused appliances
2015-06-09	U.S. Patent No. 9,054,728 Issue Date
2015-08-25	U.S. Patent No. 9,116,908 Issue Date
2016-02-26	Complaint Filing Date

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

U.S. Patent No. 7,161,506 - "Systems and methods for data compression such as content dependent data compression"

• Patent Identification: U.S. Patent No. 7,161,506, "Systems and methods for data compression such as content dependent data compression," issued January 9, 2007 (’506 Patent).

The Invention Explained

• Problem Addressed: The patent's background section describes the problem of "data dependency" in lossless data compression, where the effectiveness of a given compression technique is highly contingent on the specific content of the data being compressed (’506 Patent, col. 1:20-24). This makes it difficult to select an optimal compression method for data streams containing varied or unknown data types, and can even lead to "negative compression," where the compressed file is larger than the original (’506 Patent, col. 2:36-39).
• The Patented Solution: The invention proposes a method that first analyzes a block of data to identify its "data type." If a data type is identified, the system applies a "content dependent" compression algorithm tailored for that type. If the data type is not identified, the system applies a default "content independent" or single compression algorithm as a fallback. This two-path approach allows for specialized compression when possible without failing on unrecognized data, creating a more robust system for heterogeneous data streams (’506 Patent, Abstract; Fig. 13A).
• Technical Importance: This method provided a more versatile framework for compressing complex data streams by adaptively selecting an appropriate compression strategy without requiring perfect, unambiguous data type identification, a limitation of certain prior art systems (’506 Patent, col. 3:25-42).

Key Claims at a Glance

• The complaint asserts independent method Claim 104, which was added during reexamination (Compl. ¶14; ’506 Patent, Reexam. Cert. C1).
• The essential elements of Claim 104 are:
  • Analyzing data within a data block of an input data stream to identify one or more data types of the data block, the input stream comprising a plurality of disparate data types;
  • Performing content dependent data compression with a content dependent data compression encoder if a data type of the data block is identified;
  • Performing data compression with a single data compression encoder, if a data type of the data block is not identified;
  • Wherein the analyzing... excludes analyzing based only on a descriptor that is indicative of the data type of the data within the data block.
• The complaint reserves the right to assert other claims, including dependent claims (Compl. ¶20).

U.S. Patent No. 9,054,728 - "Data compression systems and methods"

• Patent Identification: U.S. Patent No. 9,054,728, "Data compression systems and methods," issued June 9, 2015 (’728 Patent).

The Invention Explained

• Problem Addressed: Like the ’506 Patent, the ’728 Patent addresses the challenge that a single lossless compression technique performs inconsistently across different types of data, and that selecting the optimal technique for a given data block is difficult (’728 Patent, col. 1:21-2:51).
• The Patented Solution: The patent claims a system—comprising a processor and at least two types of encoders (content dependent and single)—that implements a solution analogous to the method in the ’506 Patent. The processor is configured to analyze data to identify "parameters or attributes" and, based on that identification, direct the data to either the content dependent encoders or the single encoder, while specifically excluding analysis based solely on a descriptor (’728 Patent, Abstract; col. 17:51-18:13).
• Technical Importance: This patent claims the hardware and processor configuration for implementing an adaptive, two-path compression system, providing a structural basis for the method described in related patents.

Key Claims at a Glance

• The complaint asserts independent system Claim 1 (Compl. ¶32).
• The essential elements of Claim 1 are:
  • A system comprising a processor, one or more content dependent data compression encoders, and a single data compression encoder;
  • Wherein the processor is configured to analyze data within a data block to identify one or more parameters or attributes of the data, excluding analysis based solely on a descriptor;
  • And configured to perform content dependent data compression if the parameters or attributes are identified;
  • And configured to perform data compression with the single data compression encoder if the parameters or attributes are not identified.
• The complaint reserves the right to assert other claims (Compl. ¶38).

U.S. Patent No. 8,643,513 - "Data compression systems and methods"

• Patent Identification: U.S. Patent No. 8,643,513, "Data compression systems and methods," issued February 4, 2014 (’513 Patent).
• Technology Synopsis: The ’513 Patent claims a method for compressing a plurality of data blocks. The method involves analyzing data to recognize when to apply a "content independent" algorithm versus a "content dependent" algorithm. A key feature, similar to the other patents, is the exclusion of analysis based "only on a descriptor" for both the content independent and content dependent recognition steps (Compl. ¶50).
• Asserted Claims: Independent method Claim 1 (Compl. ¶50).
• Accused Features: The complaint alleges that the Veritas NetBackup products' general compression and deduplication functionalities, which it claims involve both content-dependent and content-independent techniques, infringe this patent (Compl. ¶¶51, 52).

U.S. Patent No. 9,116,908 - "System and methods for accelerated data storage and retrieval"

• Patent Identification: U.S. Patent No. 9,116,908, "System and methods for accelerated data storage and retrieval," issued August 25, 2015 (’908 Patent).
• Technology Synopsis: This patent is directed to a system for accelerating data storage and retrieval. It claims a system with a memory device and a "data accelerator" that compresses a first data block with a first compression technique and a second data block with a different, second compression technique. The invention's goal is to ensure that the process of compressing and storing the data blocks is faster than storing them in uncompressed form (Compl. ¶65).
• Asserted Claims: Independent system Claim 1 (Compl. ¶65).
• Accused Features: The complaint alleges that the accused products, which use multiple compression techniques (such as deduplication and LZ compression), constitute an infringing "data accelerator" system that speeds up data storage (Compl. ¶¶66, 67).

III. The Accused Instrumentality

Product Identification

• The accused instrumentalities are the Veritas NetBackup software, Veritas NetBackup 5230 Appliances, and the "Secure Online Backup" service offered by CenturyLink, which is alleged to be provided using the Veritas products (Compl. ¶¶4, 11, 13).

Functionality and Market Context

• The accused products provide large-scale, enterprise-level data backup and recovery services (Compl. ¶¶4, 12). A core feature highlighted in the complaint is "data reduction through deduplication and compression" (Compl. ¶7). The complaint alleges the products use an "intelligent deduplication engine" that analyzes the data stream to identify and store only unique segments of data, a process followed by general-purpose compression, such as Lempel-Ziv (LZ) compression (Compl. ¶¶7, 10, 19). The complaint provides a diagram illustrating how NetBackup separates file metadata from content and logically separates content into unique segments for storage, reducing redundancy (Compl. p. 9). The products are positioned for high-volume environments, with the complaint citing CenturyLink's need to back up 1.5 petabytes of data daily across 52 data centers (Compl. ¶12).

IV. Analysis of Infringement Allegations

7,161,506 Patent Infringement Allegations

Claim Element (from Independent Claim 104)	Alleged Infringing Functionality	Complaint Citation	Patent Citation
analyzing data within a data block of an input data stream to identify one or more data types of the data block...	The accused instrumentality's "intelligent deduplication engine sees into the data stream and accurately identifies files and object boundaries," which the complaint alleges constitutes identifying a data type.	¶16	col. 4:51-54
performing content dependent data compression with a content dependent data compression encoder if a data type of the data block is identified	If a file, object, or data segment is identified as being a duplicate of one already stored, the system performs deduplication by storing a pointer instead of the data, which is alleged to be "content dependent data compression."	¶17	col. 4:55-58
and performing data compression with a single data compression encoder, if a data type of the data block is not identified	For data that is not identified as a duplicate (i.e., is unique), the system allegedly applies a default Lempel-Ziv (LZ) compression algorithm, which functions as the "single data compression encoder."	¶18	col. 4:58-61
wherein the analyzing... excludes analyzing based only on a descriptor that is indicative of the data type...	The "intelligent deduplication engine" is alleged to "see into actual objects in the backup stream," implying an analysis of the data's content rather than just its metadata or file type descriptor.	¶19	col. 6:3-7

9,054,728 Patent Infringement Allegations

Claim Element (from Independent Claim 1)	Alleged Infringing Functionality	Complaint Citation	Patent Citation
a system for compressing data, comprising a processor; one or more content dependent data compression encoders; and a single data compression encoder	The Veritas NetBackup software and appliances are systems containing a processor. The "intelligent deduplication engine" is alleged to be the "content dependent... encoder(s)," and the system's LZ compression module is alleged to be the "single data compression encoder."	¶33, ¶34	col. 17:51-54
wherein the processor is configured: to analyze data within a data block to identify one or more parameters or attributes of the data... wherein the analyzing... excludes analyzing based solely on a descriptor...	The system's processor is configured to execute the deduplication engine, which allegedly "sees into the data stream" to identify files, object boundaries, and duplicate data segments based on content, not just a descriptor.	¶35	col. 17:55-62
to perform content dependent data compression... if the one or more parameters or attributes of the data are identified	When the processor identifies a data block as a duplicate (an identified "attribute"), it is configured to perform deduplication.	¶36	col. 17:63-66
and to perform data compression with the single data compression encoder, if the one or more parameters or attributes of the data are not identified	When the processor does not identify a data block as a duplicate, it is configured to apply the default LZ compression.	¶37	col. 18:1-4

• Identified Points of Contention:
  • Scope Questions: A central dispute may arise over whether the process of "data deduplication" falls within the scope of the claim term "content dependent data compression." The defense may argue that deduplication is a distinct technological process of eliminating redundancy rather than "compressing" data with an "encoder" in the manner described in the patents.
  • Technical Questions: The complaint frames the accused functionality as a bifurcated process that maps to the "if/otherwise" structure of the claims. A factual question for the court will be whether the accused products actually choose between deduplication and LZ compression, or if they perform a serial process (e.g., deduplication followed by universal LZ compression on the remaining unique data), which may not align with the claim language.
  • Scope Questions: The negative limitation "excludes analyzing based only on a descriptor" raises the question of how the accused products actually identify duplicate data. The infringement case will depend on evidence showing that the analysis is based on the substance of the data blocks themselves, not merely on metadata, file headers, or other external "descriptors."

V. Key Claim Terms for Construction

• The Term: "content dependent data compression"

• Context and Importance: This term is critical because the plaintiff's infringement theory equates this term with the accused products' data deduplication feature. The viability of the infringement claims against the '506, '728, and '513 patents hinges on whether this construction is adopted. Practitioners may focus on this term because its definition will determine whether a primary feature of the accused products reads on the claims.

• Intrinsic Evidence for Interpretation:

  • Evidence for a Broader Interpretation: The specification suggests that "content dependent" techniques are applied after a "data type" is identified, and defines "data type" broadly to include "data structure, data block format, file substructure, and/or file types" (’506 Patent, col. 4:40-43). This could support an argument that identifying a data block as a "duplicate" is identifying its "type," and replacing it with a pointer is a form of compression dependent on that identified content.
  • Evidence for a Narrower Interpretation: The patent's detailed description of content-independent compression involves applying a plurality of encoders in parallel and selecting the one with the best compression ratio (’506 Patent, Fig. 2; col. 6:49-67). A party could argue that "content dependent data compression" should be understood in this context of applying alternative algorithmic transformations (like Huffman, Lempel-Ziv, etc.), not the fundamentally different process of eliminating redundant blocks.

• The Term: "analyzing... to identify one or more data types" (from '506 Patent) / "identify one or more parameters or attributes of the data" (from '728 Patent)

• Context and Importance: This phrase defines the trigger for invoking the "content dependent" pathway. The dispute will likely concern whether identifying a data block as a duplicate of a previously seen block qualifies as identifying a "data type" or "attribute," versus identifying an intrinsic format like ASCII text or a JPEG image.

• Intrinsic Evidence for Interpretation:

  • Evidence for a Broader Interpretation: The patents aim to solve the problem of compressing streams of "disparate data types" (’506 Patent, Abstract). An argument could be made that in a backup stream, "unique data" and "redundant data" are functionally disparate types of content, and recognizing this difference is the "analysis" contemplated by the inventor.
  • Evidence for a Narrower Interpretation: The background discusses prior art limitations in identifying "common data types as ASCII, binary, or unicode" and "user defined data types" (’506 Patent, col. 3:28-35). This context may support a narrower definition of "data type" as an inherent format or structure of the data itself, rather than its status as redundant.

VI. Other Allegations

• Indirect Infringement: The complaint alleges induced infringement for all asserted patents. It claims Defendants provide implementation services, technical support, and user manuals that instruct customers to use the accused products in their "normal and customary way," which allegedly includes practicing the claimed methods of deduplication and compression (Compl. ¶¶24, 42, 57, 72).
• Willful Infringement: The complaint does not include a standalone count for willful infringement. However, for each patent, it alleges that Defendants have had knowledge of the patent and their infringement "since at least the filing of this Complaint or shortly thereafter," which could form the basis for a claim of post-suit willful infringement (Compl. ¶¶23, 41, 56, 71).

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

• A core issue will be one of definitional scope: can the patent term "content dependent data compression," which the specification associates with applying different encoding algorithms, be construed to encompass the accused products' process of data deduplication, which identifies and eliminates redundant blocks of data?
• A central question of claim mapping will be whether the accused products' multi-stage data reduction process (e.g., deduplication followed by LZ compression) functionally aligns with the claims' conditional "if/otherwise" structure, which requires selecting between a content-dependent path and a single-encoder path based on an initial data analysis.
• A key evidentiary question will concern the negative limitation: what technical evidence will demonstrate that the accused "intelligent deduplication engine" analyzes the actual content of data blocks, as required to avoid the claims' exclusion of analysis based "only on a descriptor" like a file header or metadata?