DCT

6:20-cv-00376

Appliance Computing III Inc v. Redfin Corp

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I. Executive Summary and Procedural Information

  • Parties & Counsel:
  • Case Identification: 6:20-cv-00376, W.D. Tex., 05/11/2020
  • Venue Allegations: Venue is asserted based on Defendant having places of business in the district, including Austin, and having committed alleged acts of infringement within the district.
  • Core Dispute: Plaintiff alleges that Defendant’s 3D virtual home tour services infringe four patents related to the image-based rendering of real spaces.
  • Technical Context: The technology involves creating interactive, navigable, and photorealistic 3D virtual tours of properties from panoramic and other image data, a significant feature in the competitive online real estate market.
  • Key Procedural History: The complaint alleges a complex history where Plaintiff's founder, David Eraker, also co-founded Defendant Redfin. It is alleged that Mr. Eraker contributed to Redfin's early intellectual property in map-based real estate search before leaving to found Surefield. The complaint also alleges that Redfin had pre-suit knowledge of the pending applications and issued patents.

Case Timeline

Date Event
2012-08-01 Plaintiff Surefield founded by David Eraker.
2013-10-25 Earliest Priority Date for all Patents-in-Suit.
2014-04-01 Surefield launches its online 3D home tour service.
2014-08-21 Redfin releases its accused 3D rendering service.
2014-09-01 Redfin allegedly notified of pending patent applications.
2017-12-05 U.S. Patent No. 9,836,885 ('885 Patent) issues.
2018-01-01 Redfin allegedly notified of the issued '885 Patent.
2018-10-16 U.S. Patent No. 10,102,673 ('673 Patent) issues.
2019-05-01 Redfin allegedly became aware of the '673 Patent.
2019-12-17 U.S. Patent No. 10,510,111 ('111 Patent) issues.
2020-03-17 U.S. Patent No. 10,592,973 ('973 Patent) issues.
2020-05-11 Complaint filed.

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

U.S. Patent No. 9,836,885 - “Image-Based Rendering of Real Spaces,” issued December 5, 2017

The Invention Explained

  • Problem Addressed: The patent’s background section identifies the limitations of prior art real estate websites, noting that photo galleries "lack spatial navigation" and non-interactive video tours are restricted to the videographer's viewpoint, thus failing to eliminate the need for physical property visits (Compl. ¶¶ 29-31; '885 Patent, col. 1:30-68).
  • The Patented Solution: The invention is a computer system that creates a "life-like virtual tour" by obtaining photorealistic viewpoints from captured images and generating "synthesized viewpoints" for locations between the capture points ('885 Patent, Abstract; Compl. ¶32). It presents this virtual model in a user interface that concurrently displays the 3D view, a 2D map overlay showing the user's position, and a text overlay identifying the current space, thereby providing crucial spatial context ('885 Patent, col. 7:1-12; FIG. 4).
  • Technical Importance: This technology addressed a key deficiency in online real estate marketing by providing an immersive and navigable virtual experience, intended to give potential buyers a better understanding of a property's layout remotely (Compl. ¶32).

Key Claims at a Glance

  • The complaint asserts independent claims 1 and 10 (Compl. ¶33).
  • Independent Claim 1 requires a computer system with a processor and memory that executes commands to:
    • obtain two or more photorealistic viewpoints from ground truth image data.
    • combine and process image data to create synthesized viewpoints.
    • generate a virtual model of a current space.
    • identify the current space using metadata.
    • visually present the virtual model, a map overlay, and a text overlay on three distinct portions of the user interface.
    • generate a plurality of spatial boundaries.
    • generate ground truth image data by annotating images with labels.
    • functionally link the model, map, and text overlays.
    • identify the current space using labels associated with capture locations.

U.S. Patent No. 10,102,673 - “Image-Based Rendering of Real Spaces,” issued October 16, 2018

The Invention Explained

  • Problem Addressed: The patent shares a common specification with the '885 Patent and addresses the same problem of providing interactive, spatially-aware virtual property tours (Compl. ¶28; '673 Patent, col. 1:30-68).
  • The Patented Solution: The '673 Patent claims a method for image-based rendering. The core of the method involves receiving image data from multiple viewpoints, creating a plurality of panoramas from that data, and rendering a virtual model using those panoramas ('673 Patent, Claim 1). The method further includes defining spatial boundaries for spaces like rooms and, critically, rendering a 3D scene that is generated by determining camera geometry, generating a point cloud, and creating a geometric proxy ('673 Patent, Claim 1; col. 14:1-9).
  • Technical Importance: This patent protects the underlying process of transforming raw image data into a structured and navigable 3D experience, focusing on the specific computational steps required to build the virtual model (Compl. ¶32).

Key Claims at a Glance

  • The complaint asserts independent claims 1, 10, and 13 (Compl. ¶43).
  • Independent Claim 1 requires a method comprising the steps of:
    • receiving image data of a plurality of spaces in a property.
    • creating a plurality of panoramas using the image data.
    • rendering a virtual model of a selected space using the panoramas.
    • causing a device to display the virtual model with a label indicating the location.
    • defining spatial boundaries of the spaces (including rooms) using the image data.
    • wherein rendering the virtual model includes rendering a 3D scene, which itself includes determining camera geometry, generating a point cloud, and generating a 3D model using a geometric proxy.

U.S. Patent No. 10,510,111 - “Image-Based Rendering of Real Spaces,” issued December 17, 2019

  • Patent Identification: U.S. Patent No. 10,510,111, “Image-Based Rendering of Real Spaces,” issued December 17, 2019 (Compl. ¶27).
  • Technology Synopsis: This patent claims a method for creating navigable 3D real estate tours where spatial boundaries (e.g., rooms, floors) are defined from image data. In response to a user indication of a location (e.g., clicking on a floor label), the system renders a virtual model of the corresponding space and displays it on a device ('111 Patent, Claim 1). This focuses on the user-driven navigation between defined spaces within the property.
  • Asserted Claims: Independent claims 1 and 18 are asserted (Compl. ¶52).
  • Accused Features: The accused features are Redfin's "image-based 3D rendering service and 3D Walkthrough," which allegedly practice the claimed methods of defining and navigating between spatial boundaries (Compl. ¶87).

U.S. Patent No. 10,592,973 - “Image-Based Rendering of Real Spaces,” issued March 17, 2020

  • Patent Identification: U.S. Patent No. 10,592,973, “Image-Based Rendering of Real Spaces,” issued March 17, 2020 (Compl. ¶27).
  • Technology Synopsis: This patent, claimed as a computer-readable memory medium, covers program commands for providing image-based rendering. The method is substantially similar to that of the '885 Patent, involving obtaining views, defining spatial boundaries, annotating image data, creating synthesized views, and presenting a virtual model with functionally linked map and text interface elements ('973 Patent, Claim 1).
  • Asserted Claims: Independent claims 1 and 18 are asserted (Compl. ¶58).
  • Accused Features: The accused features are Redfin's "image-based 3D rendering service and 3D Walkthrough," which allegedly embody the claimed set of program commands (Compl. ¶93).

III. The Accused Instrumentality

  • Product Identification: "Redfin's image-based 3D rendering service and Redfin 3D Walkthrough," which the complaint states were released in coordination with Matterport, Inc. (Compl. ¶¶ 67, 70). These are referred to as the "Accused Products and Services" (Compl. ¶70).
  • Functionality and Market Context: The Accused Products allow users to "virtually tour a home in 3D by navigating through a computer's internet-connected user interface" (Compl. ¶67). The complaint alleges the system employs "photorealism and spatial navigation" by compositing images and rendering panoramas (Compl. ¶68). The interface allegedly includes "spatially defined labels, such as navigable text involving different floors," as well as "floor plan views and another 3D aerial projection called 'dollhouse'" (Compl. ¶68). A screenshot of the accused service's user interface shows an interactive 3D view of a home's interior (Compl. p. 18). Another screenshot shows a "dollhouse" view, which is an aerial 3D projection of the home's layout (Compl. p. 19). A third screenshot shows an interactive overlay that allows users to select a different floor to navigate to (Compl. p. 20).

IV. Analysis of Infringement Allegations

'885 Patent Infringement Allegations

Claim Element (from Independent Claim 1) Alleged Infringing Functionality Complaint Citation Patent Citation
obtain two or more photorealistic viewpoints from capture locations in a plurality of spaces of the real property using ground truth image data... The Redfin-Matterport system allegedly uses ground truth image data captured from multiple locations within a property to create the 3D tour (Compl. ¶¶ 69, 76). ¶34 col. 2:54-57
combine and process two or more instances of ground truth image data to create a plurality of synthesized viewpoints. The system allegedly processes and combines captured image data to generate views for locations where no photos were taken, enabling smooth navigation (Compl. ¶68). ¶35 col. 2:57-59
generate a virtual model of a current space...from the perspective of a current viewpoint... The system is alleged to generate and display a virtual 3D model of the property that changes based on the user's navigational input (Compl. ¶67). A visual example is provided in a screenshot (Compl. p. 18). ¶36 col. 2:59-63
visually present the virtual model on a first portion of the user interface, a map overlay on a second portion of the user interface, and a text overlay on a third portion of the user interface... The system allegedly presents the 3D tour (virtual model), a floor plan view (map overlay), and navigable labels for rooms/floors (text overlay) in the same user interface (Compl. ¶68). ¶38 col. 7:1-12
generate a plurality of spatial boundaries of the plurality of spaces... each of the plurality of spatial boundaries defining a parcel outline of a corresponding space... The accused system allegedly uses "spatially defined labels, such as navigable text involving different floors," which the complaint contends are the claimed spatial boundaries (Compl. ¶68). ¶39 col. 8:41-48
the virtual model, the map overlay, and the text overlay "are functionally linked based on the position of the current viewpoint in the real property." The complaint alleges that as a user navigates the 3D view, the corresponding floor plan and location labels update automatically, demonstrating they are functionally linked (Compl. ¶68). ¶41 col. 7:8-12

'673 Patent Infringement Allegations

Claim Element (from Independent Claim 1) Alleged Infringing Functionality Complaint Citation Patent Citation
receiving image data of a plurality of spaces in a property, the image data including a plurality of images captured from a plurality of viewpoints. The complaint alleges the Redfin-Matterport system is built upon image data captured from a "plurality of cameras arrayed and configured to capture panoramas" (Compl. ¶69). ¶44 col. 16:7-11
creating a plurality of panoramas of the plurality of spaces using the image data. The system is alleged to composite images and render panoramas in the user interface to enable photorealism and spatial navigation (Compl. ¶68). ¶45 col. 16:12-14
defining spatial boundaries of the plurality of spaces in the property using the image data, the plurality of spaces including a plurality of rooms in the property. The accused product is alleged to use "spatially defined labels, such as navigable text involving different floors" and includes "floor plan views" which are alleged to constitute defining spatial boundaries of rooms (Compl. ¶68). ¶48 col. 16:21-24
wherein rendering the virtual model of the selected space includes rendering a 3D scene... and wherein rendering the 3D scene includes determining camera geometry... generating a point cloud... determining a geometric proxy... and generating the 3D model using the geometric proxy. The complaint alleges on information and belief that the Redfin-Matterport system "extracts 3D geometry from images and uses the combined geometry to process 3D images to render its own image-based results," which suggests the performance of these steps (Compl. ¶69). ¶¶50-51 col. 16:28-39
  • Identified Points of Contention:
    • Scope Questions: A central question may be whether the integrated user interface of the accused product (Compl. pp. 19-20) meets the '885 Patent's requirement for three distinct portions: a "virtual model," a "map overlay," and a "text overlay." The defense may argue that elements like an interactive floor plan selector are part of a single, integrated model view, not separate overlays as claimed.
    • Technical Questions: For the '673 Patent, a key factual question is what evidence exists to show that Redfin's system performs the claimed back-end method steps of "creating a plurality of panoramas" and "generating a point cloud." The complaint alleges Redfin "directed Matterport to implement features patented by Surefield" (Compl. ¶69), which raises the question of whether Redfin directly infringes by performing these steps itself or is only liable under a theory of indirect infringement based on Matterport's actions.

V. Key Claim Terms for Construction

  • The Term: "spatial boundaries" ('885 Patent, Claim 1; '673 Patent, Claim 1)

    • Context and Importance: This term is foundational to the patents' concept of organizing a virtual space. The infringement theory relies on construing this term to cover elements like the "navigable text involving different floors" in the accused product (Compl. ¶68). Practitioners may focus on this term because its scope—whether it requires a formal geometric definition or can be satisfied by functional labels—will be critical to infringement.
    • Intrinsic Evidence for Interpretation:
      • Evidence for a Broader Interpretation: The specification describes boundaries as defining "the land (perhaps a parcel outline), structure (e.g., house, apartment, office, etc.), structure internals (e.g., bedrooms, kitchens, hallways, etc.) and/or air-space above the land" ('885 Patent, col. 8:41-48), which may support a broad, functional definition.
      • Evidence for a Narrower Interpretation: The patent also describes a process where a "2D floor plan of the rooms of a house can be automatically generated from the 3D data" ('885 Patent, col. 9:54-56). A party could argue this implies that "spatial boundaries" must be derived from geometric data, not just be abstract labels.

  • The Term: "map overlay" ('885 Patent, Claim 1)

    • Context and Importance: Claim 1 requires this element to be presented on a "second portion of the user interface." The plaintiff's case may depend on the small, interactive floor plan shown in its own product marketing (Compl. p. 8) and allegedly present in Redfin's product being construed as a "map overlay".
    • Intrinsic Evidence for Interpretation:
      • Evidence for a Broader Interpretation: The patent's Figure 4 depicts element 404, described as a "two-dimensional (2D) map overlay that displays the relative location in the virtual model of the current viewpoint" ('885 Patent, col. 7:4-7), supporting the idea that a 2D floor plan view qualifies.
      • Evidence for a Narrower Interpretation: The use of "overlay" and "on a second portion" could be argued to require a distinct, non-integrated UI element that is superimposed on the primary view, potentially creating a dispute over whether the accused product's integrated floor plan meets this structural limitation.

VI. Other Allegations

  • Indirect Infringement: The complaint alleges both induced and contributory infringement for all patents. The inducement theory is based on allegations that Redfin "instructs its customers to make and use the patented inventions... by operating and interacting with Redfin's website" (Compl. ¶¶ 76, 82, 88, 94). Contributory infringement is based on allegations that the Accused Products are a material part of the invention, are especially adapted for infringement, and are not staple articles of commerce (Compl. ¶¶ 77, 83, 89, 95).
  • Willful Infringement: Willfulness is alleged based on pre-suit knowledge. The complaint claims that the plaintiff's founder, Mr. Eraker, notified Redfin of the pending applications "at least as early as September 2014" and of the issued '885 Patent specifically "at least as early as January 2018" (Compl. ¶71). It is further alleged that Redfin continues to infringe despite this knowledge (Compl. ¶72).

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

  • A central issue will be one of prior art and inventorship: given the complex history where the plaintiff’s founder also co-founded the defendant and allegedly contributed to its foundational technology, a key question for the court will be how this history affects the validity and scope of the asserted patents.
  • A key infringement question will be one of component definition: can the integrated "dollhouse" and floor-selection elements in the accused Redfin/Matterport user interface be found to meet the requirements of the '885 Patent for a "virtual model," a "map overlay," and a "text overlay" presented on three distinct portions of the interface?
  • A critical evidentiary question will be one of attribution of action: in light of the Redfin-Matterport partnership, does the evidence show that Redfin itself performs the claimed method steps of creating panoramas and defining spatial boundaries, or does it merely provide a platform for content processed entirely by a third party, potentially shifting the infringement analysis from direct to indirect liability?