DCT
3:23-cv-00565
PerformancePartners LLC v. LAZ Parking Texas LLC
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: PerformancePartners LLC (Texas)
- Defendant: LAZ Parking Texas, LLC (Texas)
- Plaintiff’s Counsel: Garteiser Honea, PLLC
- Case Identification: PerformancePartners LLC v. LAZ Parking Texas, LLC, 3:23-cv-00565, N.D. Tex., 03/14/2023
- Venue Allegations: Plaintiff alleges venue is proper because Defendant maintains a regular and established business presence within the Northern District of Texas.
- Core Dispute: Plaintiff alleges that Defendant’s license plate recognition systems for managing parking facilities infringe a patent related to automated vehicle identification and access control.
- Technical Context: The technology concerns automated systems for managing vehicle entry and exit from controlled areas, such as parking lots, by using vehicle characteristics like license plates as identifiers, which serves as an alternative to traditional physical tickets or RFID transponders.
- Key Procedural History: The complaint notes that the patent-in-suit was assigned from the inventor to Performance Partners LLC (of New Hampshire) in 2009, and subsequently from that entity to the current Plaintiff, PerformancePartners LLC (of Texas), in February 2023. The complaint also asserts that the patent is enforceable for past damages even if it expires.
Case Timeline
| Date | Event |
|---|---|
| 2005-08-02 | U.S. Patent No. 7,525,435 Priority Date |
| 2009-04-28 | U.S. Patent No. 7,525,435 Issued |
| 2021-07-16 | "Last Updated" date for Defendant's LPR Policy |
| 2023-03-14 | Complaint Filed |
II. Technology and Patent(s)-in-Suit Analysis
- Patent Identification: U.S. Patent No. 7,525,435, "Method, Apparatus, and System for Securing Areas of Use of Vehicles," issued April 28, 2009.
- The Invention Explained:
- Problem Addressed: The patent identifies a need for more effective systems to identify, monitor, and control vehicle access to secured areas, stating that at the time of invention, "There is nothing currently available which satisfies these needs and objectives" (’435 Patent, col. 2:19-22). The invention aims to improve upon prior art methods that relied on less secure or less reliable identification means.
- The Patented Solution: The invention describes a system that automatically identifies a vehicle upon entry into a secured area by sensing an "Onboard Identity" (OI) or capturing unique "Characteristics Identity" (CI) information, such as a license plate ('435 Patent, col. 3:5-13). The system then creates a unique "Signature" (SI) for that specific entry event and can issue an encoded "Ticket/Tag" to the driver. Upon exit, the system re-captures the vehicle's identity and compares it to the stored entry information to confirm a match before permitting departure, thereby creating a secure link between the entering and exiting vehicle ('435 Patent, Abstract; col. 4:31-65).
- Technical Importance: This approach provided a method for vehicle access control that did not depend solely on physical transponders, which could be moved between vehicles, or on simple tickets that could be lost or swapped ('435 Patent, col. 6:7-24; Compl. ¶16).
- Key Claims at a Glance:
- The complaint asserts at least independent Claim 8 ('435 Patent, col. 12:1-40; Compl. ¶34).
- The essential elements of Claim 8 are:
- monitoring points of access to detect entering and exiting vehicles;
- obtaining and storing an "electronically readable unique repeatable distinguishing characteristic" (e.g., license plate) from each entering vehicle;
- offering the entering vehicle a "security option" which includes creating a unique random code, forming a "Ticket/Tag" with that code, and providing the "Ticket/Tag" to the vehicle's agent;
- obtaining the same distinguishing characteristic from the exiting vehicle;
- comparing the exiting vehicle's characteristic with the stored entering vehicle's characteristic to confirm a match;
- permitting matched vehicles to exit; and
- subjecting non-matched vehicles to a "resolution process."
- The complaint does not explicitly reserve the right to assert dependent claims.
III. The Accused Instrumentality
- Product Identification: The "LAZ Parking License Plate Recognition" system and associated methods ("LPR System") (Compl. ¶30, p. 11).
- Functionality and Market Context: The accused LPR System uses cameras to capture and store digital images of vehicle license plates at facility entrances and exits (Compl. ¶36). Character recognition algorithms identify the license plate characters, which are then stored in a "searchable computerized database" along with time and location data (Compl. p. 11). This system is used to "log the times at which a vehicle enters or exits... in order to determine the fee due upon exit" and may "supplement or replace paper tickets" (Compl. p. 12). A screenshot from Defendant’s website describes the system with the phrase "Open Sesame! Your phone or license plate is your wallet!" (Compl. p. 12). This visual suggests a ticketless system where the vehicle's license plate serves as the primary credential. The complaint alleges the system generates substantial revenue for the Defendant (Compl. ¶33).
IV. Analysis of Infringement Allegations
U.S. Patent No. 7,525,435 Infringement Allegations
| Claim Element (from Independent Claim 8) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| monitoring points of access to an area so as to detect entering and exiting vehicles; | The LPR System uses one or more cameras located at points of ingress and egress of parking facilities to detect entering and exiting vehicles. | ¶36 | col. 9:57-59 |
| obtaining from each said entering vehicle, entering vehicle identification information comprising at least one electronically readable unique repeatable distinguishing characteristic...and storing said...information... | The LPR System's cameras capture images of license plates, and character recognition algorithms derive the license plate data, which is then stored in a database. A screenshot of Defendant’s policy confirms it uses LPR to "capture, analyze, and store digital license plate data." (Compl. p. 11). | ¶38 | col. 12:4-11 |
| offering said entering vehicle a security option comprising: (i) creating a unique random code... (ii) forming a Ticket/Tag incorporating said unique random code; and (iii) providing said Ticket/Tag... | Plaintiff alleges the LPR System assigns a "ticket or transaction number (or code) to each vehicle" and that an "electronic ticket or receipt" is formed and offered to the driver. | ¶39 | col. 12:12-21 |
| obtaining from each said exiting vehicle, exiting vehicle identification information comprising said unique repeatable distinguishing characteristic of said exiting vehicle; | The same LPR cameras and software used for entry are used to monitor exit locations, capture images of exiting vehicles, and derive their license plate data. | ¶40 | col. 12:22-25 |
| comparing the respective said exiting vehicle identification information with the stored said entering vehicle identification information...for matching information... | The LPR System is allegedly configured to compare the license plate data obtained from an exiting vehicle with the stored data from entering vehicles to confirm a match. | ¶41 | col. 12:26-32 |
| permitting exiting vehicles with said matching information to exit; and | If a match is confirmed, the system is allegedly configured to permit the vehicle to exit, for instance by fulfilling the transaction and allowing physical exit. | ¶42 | col. 12:33-34 |
| subjecting exiting vehicles without said matching information to a resolution process. | If a match is not confirmed, the vehicle is allegedly subjected to a resolution process, which may include "the issuance of an invoice for payment." Defendant's LPR policy notes data is used to "collect on an unpaid debt." (Compl. p. 15). | ¶43 | col. 12:35-37 |
- Identified Points of Contention:
- Scope Questions: A primary question is whether a "ticketless" system, where the license plate itself serves as the identifier, can meet the claim limitation of "forming a Ticket/Tag" and "providing said Ticket/Tag to an agent of said entering vehicle." The complaint alleges a "ticket or transaction number" is assigned (Compl. ¶39), but the provided evidence, such as the "license plate is your wallet" marketing, suggests the driver may not receive any separate token (Compl. p. 12). This raises the question of whether the internal assignment of a transaction number, without issuance to the driver, satisfies the claim language.
- Technical Questions: The claim requires "creating a unique random code." The infringement theory appears to rely on the license plate number itself or a system-assigned transaction number to meet this element. A technical question for the court will be whether using a pre-existing, non-random vehicle identifier (the license plate) or a sequentially assigned transaction number constitutes "creating a unique random code" as contemplated by the patent.
V. Key Claim Terms for Construction
- The Term: "Ticket/Tag"
- Context and Importance: The construction of this term appears central to the infringement analysis. If "Ticket/Tag" is construed to require a distinct physical or electronic object that is dispensed to the driver for later presentation, it may be difficult to prove infringement by a system where the license plate is the sole credential and no separate token is issued. Practitioners may focus on this term because the accused system is marketed as a replacement for traditional tickets.
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The claims use the general term "Ticket/Tag," which a party might argue should not be limited to the specific examples in the specification. Claim 8 refers to "forming a Ticket/Tag," which could arguably encompass the creation of a digital record associated with the vehicle.
- Evidence for a Narrower Interpretation: The specification repeatedly describes the "Ticket/Tag" as a separate item provided to the driver. It is described as being "dispensed or issued from a dispensing device" and is used for "later reclaiming of the specific entity" ('435 Patent, col. 6:60-65; col. 7:51-54). The abstract also states it is "issued to an agent of the entering vehicle...for later presentation at exiting," which suggests a physical or electronic token separate from the vehicle itself.
VI. Other Allegations
- Indirect Infringement: The complaint alleges that Defendant induces its customers to directly infringe by providing and marketing the LPR System for its intended use (Compl. ¶30, ¶34). The alleged basis for inducement is the operation of the system by drivers entering and exiting LAZ facilities as instructed.
- Willful Infringement: Willfulness is alleged based on Defendant’s continued infringement after receiving notice of the '435 Patent via service of the complaint (Compl. ¶32, ¶45). Plaintiff further alleges that Defendant has been "willfully blind" by maintaining a "policy or practice of not reviewing the patents of others" (Compl. ¶46-47).
VII. Analyst’s Conclusion: Key Questions for the Case
This dispute will likely focus on fundamental questions of claim scope and technical interpretation.
- A core issue will be one of definitional scope: can the term "Ticket/Tag," which the patent specification describes as a dispensable item presented by a driver at exit, be construed to cover an intangible, internal transaction record in a "ticketless" system where the vehicle's license plate is the sole credential?
- A key evidentiary question will be one of technical function: does the accused system's use of a pre-existing license plate number or an internal transaction identifier satisfy the claim requirement of "creating a unique random code," or is there a mismatch between the system's function and the specific action required by the claim?