DCT
4:25-cv-01727
Alpha Modus Corp v. Optisigns Inc
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: Alpha Modus, Corp. (Florida)
- Defendant: OptiSigns Inc. (Delaware)
- Plaintiff’s Counsel: Dickinson Wright PLLC
- Case Identification: 4:25-cv-01727, S.D. Tex., 04/15/2025
- Venue Allegations: Plaintiff alleges venue is proper in the Southern District of Texas because Defendant maintains its principal place of business in the district and has committed the alleged acts of patent infringement there.
- Core Dispute: Plaintiff alleges that Defendant’s digital signage technology infringes five patents related to the use of sensors for real-time analysis of consumer behavior and product interactions within retail environments.
- Technical Context: The technology at issue addresses the challenge faced by brick-and-mortar retailers in competing with online stores by using in-store sensors, such as cameras and RFID, to provide data-driven, personalized customer experiences and inventory management.
- Key Procedural History: The complaint notes that Plaintiff has entered into intellectual property licensing agreements with at least three other companies, suggesting an active licensing program for its patent portfolio. All five patents-in-suit are part of a single patent family, claiming priority to a provisional application filed in 2013.
Case Timeline
| Date | Event |
|---|---|
| 2013-07-19 | Earliest Priority Date for all Patents-in-Suit ('571, '825, '672, '890, '880 Patents) |
| 2019-07-23 | U.S. Patent No. 10,360,571 Issued |
| 2020-12-01 | U.S. Patent No. 10,853,825 Issued |
| 2021-04-13 | U.S. Patent No. 10,977,672 Issued |
| 2021-06-22 | U.S. Patent No. 11,042,890 Issued |
| 2022-04-12 | U.S. Patent No. 11,301,880 Issued |
| 2024-01-11 | Plaintiff licenses patent portfolio to GZ6G Technologies Corp. |
| 2025-04-15 | Complaint Filed |
II. Technology and Patent(s)-in-Suit Analysis
U.S. Patent No. 10,360,571 - “Method For Monitoring And Analyzing Behavior And Uses Thereof”
The Invention Explained
- Problem Addressed: The patent’s background section describes the challenge brick-and-mortar retailers face from online competitors who can offer personalized shopping experiences. This leads to "showrooming," where customers examine products in-store but purchase them online, stressing physical retailers who lack pre-sale consumer data (’571 Patent, col. 1:41-54, col. 2:14-16).
- The Patented Solution: The invention proposes a method for using information monitoring devices, such as cameras, within a physical location to gather real-time data on shoppers, including demographics, sentiment, and movement. This data is then analyzed to provide personalized responses, such as targeted advertisements on displays, coupons, or alerts to staff, with a provision for consumers to opt-out of the monitoring (’571 Patent, Abstract; col. 4:22-34).
- Technical Importance: The technology aims to equip physical retailers with the real-time, data-driven marketing and personalization tools commonly used in e-commerce to influence purchasing decisions directly at the point of sale (Compl. ¶¶19-20).
Key Claims at a Glance
- The complaint asserts at least independent Claim 1 (Compl. ¶22).
- The essential elements of Claim 1 include:
- Using one or more information monitoring devices (including video image devices) to gather information about persons at a location.
- Gathering specific information types: demographic characteristics (gender, age), sentiment characteristics, and tracking characteristics (movement, eye movement).
- Providing an opt-out option to the persons being monitored.
- Analyzing the gathered information in real time for persons who have not opted out.
- Providing a real-time response selected from a group including engaging the person on a display, sending a communication to a second person for interaction, providing marketing information, or providing a coupon.
U.S. Patent No. 10,853,825 - “Method for monitoring and analyzing behavior and uses thereof”
The Invention Explained
- Problem Addressed: Similar to the ’571 Patent, the ’825 Patent addresses the competitive pressures on brick-and-mortar stores from online retail and the phenomenon of showrooming, highlighting a gap in providing personalized, real-time in-store experiences (’825 Patent, col. 1:45-58, col. 2:10-18).
- The Patented Solution: The invention describes a method that also uses monitoring devices to gather demographic and tracking data on a customer. However, the patented response is distinct: the real-time analysis of this data is specifically used to select a sales associate and then send a communication to that associate, enabling them to "directly interact with the first person in response to the communication" (’825 Patent, Abstract; col. 4:36-42).
- Technical Importance: This patented method seeks to bridge digital analytics with direct human sales assistance, leveraging real-time data to facilitate more effective and timely in-person customer engagement (Compl. ¶¶29-31).
Key Claims at a Glance
- The complaint asserts at least independent Claim 1 (Compl. ¶33).
- The essential elements of Claim 1 include:
- Using one or more information monitoring devices (including video image devices) to gather information about a person at a retail store.
- Gathering demographic and tracking characteristics of the person.
- Analyzing this information in real time to generate a real-time analysis.
- Utilizing the real-time analysis to select a sales associate from a group of associates.
- Sending a communication to the selected sales associate that includes at least a portion of the gathered information or the analysis, enabling direct interaction with the customer.
U.S. Patent No. 10,977,672 - “Method And System For Real-Time Inventory Management, Marketing, And Advertising In A Retail Store”
- Patent Identification: U.S. Patent No. 10,977,672, “Method And System For Real-Time Inventory Management, Marketing, And Advertising In A Retail Store,” issued April 13, 2021 (Compl. ¶¶34, 37).
- Technology Synopsis: This patent describes a system that addresses retail challenges by using image recognition to identify the inventory of products at a specific display location. It then receives real-time data about a customer at that location and uses behavioral analytics to generate and display a promotion for one of the identified products (’672 Patent, Abstract; Compl. ¶43).
- Asserted Claims: Independent Claim 1 (Compl. ¶44).
- Accused Features: The complaint accuses Defendant's digital signage system, which allegedly uses sensors to gather customer data and displays targeted content and promotions in retail settings (Compl. ¶¶125, 128).
U.S. Patent No. 11,042,890 - “Method And System For Customer Assistance In A Retail Store”
- Patent Identification: U.S. Patent No. 11,042,890, “Method And System For Customer Assistance In A Retail Store,” issued June 22, 2021 (Compl. ¶¶45, 48).
- Technology Synopsis: This patent details a method for gathering "object identification information" of a product a person is interested in, along with "sentiment information" of the person regarding that product. The system analyzes this data in real time to manage inventory and provide a targeted response to the customer (’890 Patent, Abstract; Compl. ¶53).
- Asserted Claims: Independent Claim 1 (Compl. ¶54).
- Accused Features: The complaint targets Defendant's "Lift & Learn" capability, which uses IoT sensors like RFID to determine when a product has been picked up, and its camera-based systems for analyzing customer interactions with products (Compl. ¶¶68-69, 150, 152).
U.S. Patent No. 11,301,880 - “Method And System For Inventory Management In A Retail Store”
- Patent Identification: U.S. Patent No. 11,301,880, “Method And System For Inventory Management In A Retail Store,” issued April 12, 2022 (Compl. ¶¶55, 58).
- Technology Synopsis: This patent claims a method for inventory management that involves gathering information about product interactions (e.g., products being "picked up" and "carried away") and object identification. This data is analyzed in real time to manage inventory, triggering a response such as sending a communication to retail staff to check inventory, restock, or place an order (’880 Patent, Abstract; Compl. ¶64).
- Asserted Claims: Independent Claim 1 (Compl. ¶65).
- Accused Features: The complaint again targets Defendant's "Lift & Learn" technology, which uses IoT sensors to monitor when items are picked up, alleging this functionality is used for inventory management purposes (Compl. ¶¶68, 174).
III. The Accused Instrumentality
Product Identification
- The accused instrumentalities are Defendant OptiSigns' digital signage technology, products, and services offered to customers in the United States (Compl. ¶¶66, 77). This includes specific capabilities marketed as "Lift & Learn" and products incorporating IoT sensors and digital cameras (Compl. ¶¶67-69).
Functionality and Market Context
- The complaint alleges the accused products provide capabilities to transform digital displays for retailers (Compl. ¶66). This allegedly includes using digital cameras to collect foot traffic information near signage, analyze impressions, and display different content based on demographic information of potential viewers (Compl. ¶69). A specific "Lift & Learn" feature is alleged to use RFID technology to monitor when retail products are picked up, which triggers the system to display information about those products on nearby digital signs (Compl. ¶68). The complaint alleges these features provide competitive advantages and have led to significant commercial gains for OptiSigns and its customers (Compl. ¶¶71, 73, 75). Figure 2 of the patent, included in the complaint, depicts a system performing facial analysis to determine characteristics like gender, age, and sentiment scores (Compl. p. 5, FIG. 2).
IV. Analysis of Infringement Allegations
10,360,571 Patent Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| (a)(iv) the step of gathering information...comprises gathering a demographic characteristic... | The Accused Products allegedly collect demographic characteristics of persons in proximity to monitoring devices. | ¶80 | col. 21:50-55 |
| (a)(v) the step of gathering information...comprises gathering a sentiment characteristic... | The Accused Products allegedly collect sentiment characteristics of persons in proximity to monitoring devices. | ¶80 | col. 21:56-60 |
| (a)(vi) the step of gathering information...comprises gathering a tracking characteristic... | The Accused Products allegedly collect tracking characteristics of persons in proximity to monitoring devices. | ¶80 | col. 21:61-65 |
| (b) providing an opt-out option to the persons in the group of persons... | The Accused Products allegedly provide an opt-out option to persons in proximity to the devices. | ¶81 | col. 22:3-7 |
| (c) analyzing in real time...the information gathered...of the persons...except for the subset of opt-out persons... | The accused systems allegedly analyze the information of those who have not opted out. | ¶81 | col. 22:8-17 |
| (d) providing a response in real time based upon the analyzed information... | The accused system allegedly displays different content based on demographic information of potential viewers. | ¶69 | col. 22:19-22 |
10,853,825 Patent Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| (a)(iv) the step of gathering information...comprises gathering a demographic characteristic of the first person... | The Accused Products allegedly collect demographic characteristics of persons in proximity to monitoring devices. | ¶104 | col. 21:49-56 |
| (a)(v) the step of gathering information...comprises gathering a tracking characteristic of the first person... | The Accused Products allegedly collect tracking characteristics of persons in proximity to monitoring devices. | ¶104 | col. 21:57-64 |
| (b) analyzing in real time...the information gathered...to generate a real time analysis of the first person... | The Accused Products allegedly include systems connected to a server or database that analyze the gathered information. | ¶103 | col. 22:1-6 |
| (c) utilizing the real time analysis to select a sales associate... | The complaint does not provide sufficient detail for analysis of this element. | col. 22:7-9 | |
| (d) sending a communication to the sales associate... | The complaint does not provide sufficient detail for analysis of this element. | col. 22:10-16 |
Identified Points of Contention
- Technical Questions: A primary question will be what evidence demonstrates that the accused products perform the specific data gathering required by the claims. For the ’571 Patent, what evidence shows that OptiSigns' camera-based system, described as analyzing "impressions and exposure," actually gathers "sentiment characteristics" and tracks "eye movement" as claimed, beyond just detecting presence and basic demographics?
- Scope Questions: For the ’825 Patent, the infringement theory appears to face a significant challenge. The complaint does not allege any facts suggesting the accused products perform the core claimed functions of "utilizing the real time analysis to select a sales associate" or "sending a communication to the sales associate." This raises the question of whether there is a fundamental mismatch between the patent's human-assistance-focused method and the accused product's alleged automated advertising and information display functions.
V. Key Claim Terms for Construction
The Term: "sentiment characteristic" (’571 Patent, Claim 1)
- Context and Importance: This term is central to the infringement analysis for the ’571 Patent. The complaint alleges the accused products collect this data, but the technical description of the product focuses on "impressions and exposure." The scope of "sentiment characteristic" will be critical to determining if the accused system's functionality meets this limitation. Practitioners may focus on this term because its definition could either limit the claim to complex emotion detection or broaden it to cover simpler engagement metrics.
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The patent specification does not provide an explicit definition of the term, which may support an argument that it should be given its plain and ordinary meaning, potentially encompassing general reactions or levels of interest.
- Evidence for a Narrower Interpretation: The primary embodiment illustrating this concept is Figure 2, which depicts a system assigning numerical scores to specific emotional states: "Anger," "Happy," "Sad," and "Surprise" (’571 Patent, Fig. 2). A party could argue that this figure limits the term to this type of multi-state emotional analysis rather than a more general metric like viewer attention or dwell time.
The Term: "select a sales associate" (’825 Patent, Claim 1)
- Context and Importance: This active step is a lynchpin of Claim 1 of the ’825 Patent and distinguishes it from the other patents-in-suit. As the complaint lacks factual allegations mapping this element to the accused product's functionality, its construction will be determinative for infringement.
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The specification's description is at a high level. A party might argue that "select" does not require a complex, AI-driven choice but could encompass a simple, rule-based assignment of the nearest or next-available associate.
- Evidence for a Narrower Interpretation: The patent describes the invention as providing an "automated customer assistance at shelf module" that alerts a "nearby employee" to better serve the customer, delivering a "profile of the customer to the sales associate" (’825 Patent, col. 17:51-54, col. 18:41-45). This context suggests an analytical process based on the real-time analysis, not merely a generic "call for help" button, which could support a narrower construction requiring an intelligent selection process.
VI. Other Allegations
- Indirect Infringement: The complaint includes counts for induced infringement for each of the five patents-in-suit. The allegations state that Defendant knowingly "induces, aids, and directs others to use the Accused Products" in an infringing manner through its "promotions and instructions" (e.g., Compl. ¶¶92, 94, 96, 116, 118, 120).
- Willful Infringement: The complaint alleges willful infringement for all five patents. The basis for willfulness is alleged knowledge of the patents and infringement occurring post-suit, stating that Defendant has been aware "at least as early as the filing of this Complaint" (e.g., Compl. ¶¶72, 86, 89, 110, 113).
VII. Analyst’s Conclusion: Key Questions for the Case
- A core issue will be one of evidentiary sufficiency: What specific evidence will be presented to demonstrate that the accused digital signage system, described as analyzing "impressions" and "Lift & Learn" events, performs the highly specific functions required by the claims, such as gathering "sentiment characteristics," tracking "eye movement," and providing an "opt-out" mechanism?
- A key question for the ’825 patent will be one of functional correspondence: Is there a fundamental mismatch between the patent's claimed method, which culminates in selecting and communicating with a human sales associate, and the accused product's function, which is described as automatically displaying content on a digital screen?
- The case may also turn on a question of definitional scope: Can the term "sentiment characteristic," which is illustrated in the patent with multi-state emotional analysis, be construed broadly enough to read on the more general "impression and exposure" data allegedly collected by the accused system?