DCT
7:25-cv-00187
Adaptive Avenue Associates Inc v. Costco Wholesale Corp
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: Adaptive Avenue Associates, Inc. (Minnesota)
- Defendant: Costco Wholesale Corporation (Washington)
- Plaintiff’s Counsel: Direction IP Law; Padmanabhan & Dawson, PLLC.
- Case Identification: 7:25-cv-00187, W.D. Tex., 04/21/2025
- Venue Allegations: Venue is based on Defendant's regular and established place of business within the Western District of Texas and the commission of infringing acts within the district.
- Core Dispute: Plaintiff alleges that Defendant’s e-commerce website, www.costco.com, infringes two patents related to systems and methods for creating and displaying automated, sequential presentations of web pages, commonly known as "carousel" features.
- Technical Context: The technology concerns server-side and automated methods for generating web-based slideshows, a now-ubiquitous feature in e-commerce and digital advertising for displaying multiple products or promotions in a single space.
- Key Procedural History: The '707 Patent is a continuation-in-part of the application that issued as the '629 Patent. The complaint alleges that during prosecution of the '707 Patent, the patent examiner found the claims allowable over prior art that disclosed manual slideshow composition.
Case Timeline
| Date | Event |
|---|---|
| 2000-10-20 | Earliest Priority Date for '629 and '707 Patents |
| 2007-01-30 | U.S. Patent No. 7,171,629 Issues |
| 2008-09-23 | U.S. Patent No. 7,428,707 Issues |
| 2018-07-01 | Earliest Date of Alleged Infringement via Costco.com |
| 2025-04-21 | Complaint Filed |
II. Technology and Patent(s)-in-Suit Analysis
U.S. Patent No. 7,171,629 - "Customizable Web Site Access System And Method Therefore," issued January 30, 2007
The Invention Explained
- Problem Addressed: The patent describes a need for a website access system that allows for automated presentations of web page sequences without requiring costly reprogramming of site content or the installation of special development tools by site owners or users (Compl. ¶14; ’629 Patent, col. 7:60-67). The prior art method of users manually clicking through pages was seen as inefficient and led to poor visitor retention (Compl. ¶27, ¶36).
- The Patented Solution: The invention is a system, preferably operating on a host server, that uses a "composer" component and a "performer" component ('629 Patent, FIG. 1). The composer is used by a site owner or developer to create a "presentation" which includes a list of URLs, a display sequence, and a display duration ('629 Patent, col. 8:7-10). The performer component then automatically loads and displays this presentation to a website visitor in a slideshow format (Compl. ¶13; '629 Patent, Abstract).
- Technical Importance: The system aimed to replace the "passive site and active visitor" model with an "adaptive presentation model of active site and active visitor," thereby improving user engagement and making it easier for developers to create guided "tours" of web content ('629 Patent, col. 13:35-42).
Key Claims at a Glance
- The complaint asserts independent method claim 11 (Compl. ¶48).
- Essential elements of Claim 11 include:
- Remotely invoking a composer operating on a host server.
- Creating a presentation in the composer by:
- Establishing a list of URLs using methodologies including manual entry or automatic entry from a query-based system.
- Determining a display sequence for the list of URLs.
- Determining a display duration for the list of URLs.
- Remotely invoking a performer operating on the host server to present the created presentation.
- Automatically and locally displaying the presentation in a slide show format, where each URL corresponds to a slide.
U.S. Patent No. 7,428,707 - "Customizable Web Site Access System And Method Therefore," issued September 23, 2008
The Invention Explained
- Problem Addressed: As a continuation-in-part of the '629 Patent, this patent addresses the same general web usability problems but focuses specifically on the composition of the slideshow (Compl. ¶44). The complaint notes that prior art slideshows were composed manually and stored in static files, an inflexible process (Compl. ¶45).
- The Patented Solution: The '707 Patent discloses a method for "auto-composing" a presentation. Instead of requiring a developer to manually create a list of URLs, the system can automatically extract web page details—such as hyperlinks, data from a special text file, or information from a meta tag—from a desired web page to generate the slideshow list ('707 Patent, Abstract; Compl. ¶44, ¶45).
- Technical Importance: The claimed improvement is the "unconventional feature for auto-composing" a slideshow, which automates the creation of the presentation list itself, further reducing the manual effort required by developers (Compl. ¶44).
Key Claims at a Glance
- The complaint asserts independent system claim 1 and independent method claim 7 (Compl. ¶66).
- Essential elements of method Claim 7 include:
- Composing a presentation for a desired web page by creating a list of URLs.
- The composing step comprises one of several methods for automatic extraction, including:
- Automatically extracting a plurality of hyperlinks from the desired web page.
- Automatically extracting a presentation/rendition text file from the desired web page.
- Automatically extracting a meta tag from the desired web page.
- Automatically displaying the presentation in the order of the created list of URLs.
III. The Accused Instrumentality
Product Identification
The accused instrumentalities are the systems and methods used on the Defendant's website, www.costco.com, specifically the "carousel ads" feature presented on the homepage (Compl. ¶48, ¶51).
Functionality and Market Context
The Costco homepage features an interactive element that automatically rotates through a sequence of different promotional panels or "slides" (Compl. ¶51). Each slide links to a different URL. The complaint alleges that this functionality is implemented using a list of URLs contained within the website's HTML source code, which are then displayed in a timed sequence to the user (Compl. ¶53, ¶57). The complaint asserts these carousel ads are an "industry standard" capable of driving significantly higher click-through rates than static advertisements (Compl. ¶46).
IV. Analysis of Infringement Allegations
'629 Patent Infringement Allegations
| Claim Element (from Independent Claim 11) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| remotely invoking a composer operating on a host server | When a user navigates to www.costco.com, a "composer" on Costco's host server is invoked. | ¶52 | col. 14:10-11 |
| creating a presentation in said composer, wherein said step of creating comprises... establishing a list of URLs...by one of a plurality of list establishment methodologies | The complaint alleges a list of URLs is established either manually or automatically by the composer, pointing to the resulting list found in the website's HTML source code. | ¶53, ¶55 | col. 14:14-22 |
| ...determining a display sequence of said list of URLs in said composer | The display sequence is allegedly determined by the defendant and reflected in the order of the panels shown to the user and in the corresponding source code. | ¶56 | col. 14:23-25 |
| ...determining a duration of display for said list of URLs in said composer | The complaint references a video (Exhibit A, not provided) that allegedly shows each slide displaying for a "determined duration." | ¶57 | col. 14:26-28 |
| remotely invoking a performer operating on said host server to present said created presentation | Navigation to www.costco.com is alleged to invoke the "performer" to present the slideshow. | ¶58, ¶59 | col. 14:29-31 |
| automatically locally displaying the created presentation presented by said performer in a slide show format according to said list and said display sequence | The carousel on www.costco.com is alleged to automatically display the sequence of slides to the user. A provided screenshot shows the carousel and its underlying HTML structure. (Compl. p. 16) | ¶60 | col. 14:32-37 |
Identified Points of Contention
- Scope Questions: The patent describes a "composer" and "performer" as distinct components on a "host server" ('629 Patent, FIG. 1). A primary question will be whether the accused system, which delivers HTML and likely client-side JavaScript to a user's browser, can be said to possess these specific, server-side architectural components as claimed.
- Technical Questions: Claim 11 requires "establishing a list of URLs" through specific "methodologies" like manual entry into a composer interface or via a query. The complaint shows the resulting list in the HTML (Compl. ¶53) but does not provide direct evidence of the process by which that list was created, which may raise evidentiary questions about whether the accused method meets this limitation.
'707 Patent Infringement Allegations
| Claim Element (from Independent Claim 7) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| composing a presentation for a desired web page by creating a list of URLs | Defendant is alleged to compose a presentation for the costco.com page by creating the list of URLs that form the carousel. | ¶71, ¶73 | col. 10:7-9 |
| wherein said step of composing comprises automatically extracting a plurality of hyperlinks from the desired web page | The complaint alleges this occurs by extracting the image URLs (which it terms "hyperlinks") from the "desired web page" (www.costco.com). | ¶74, ¶75 | col. 10:13-16 |
| automatically displaying said presentation, wherein the presentation is presented in order of the created list of URLs | The carousel is alleged to automatically display the slides in the order of the created URL list, as shown in a referenced video exhibit. | ¶76 | col. 10:24-27 |
Identified Points of Contention
- Scope Questions: The core of the infringement theory for this patent rests on the claim element "automatically extracting a plurality of hyperlinks from the desired web page." A central dispute may arise over whether this language reads on a system that simply renders a pre-defined list of URLs that is already part of the web page's own source code.
- Technical Questions: The complaint's allegation appears circular: it states the system extracts hyperlinks from www.costco.com to create the list of hyperlinks used on www.costco.com (Compl. ¶74-75). A key factual question will be whether there is any evidence of an "extraction" process, or if the list of carousel URLs is simply hardcoded or configured as part of the page's content, which may not constitute "extracting from" the page in the manner claimed.
V. Key Claim Terms for Construction
Term ('629 Patent): "composer"
- Context and Importance: The patent's architecture appears to separate the "composer" (a tool for creating a presentation) from the "performer" (a tool for displaying it). The viability of the infringement claim will depend heavily on whether Costco's integrated web application, which generates and delivers the carousel, can be mapped onto this claimed architecture. Practitioners may focus on this term to dispute whether a distinct "composer" exists in the accused system.
- Intrinsic Evidence for a Broader Interpretation: The specification broadly refers to a "software program" that creates a presentation, which could be argued to encompass a variety of software architectures ('629 Patent, col. 8:5-7).
- Intrinsic Evidence for a Narrower Interpretation: The patent figures depict the "composer" as a distinct module on a "Host Server" (FIG. 1) and describe its use by a "site owner/developer" to input lists and settings (FIG. 2A), suggesting a specific tool rather than a general-purpose, content-serving function of a web server.
Term ('707 Patent): "automatically extracting a plurality of hyperlinks from said desired web page"
- Context and Importance: This term defines the alleged inventive step of the '707 Patent over the prior art. The infringement case hinges on whether the accused system performs an "extraction" to create the URL list, or if the list is simply pre-defined.
- Intrinsic Evidence for a Broader Interpretation: A party might argue that "extracting from" a web page could include reading a defined data structure (like a JSON object or an HTML list) that is part of the page's data model.
- Intrinsic Evidence for a Narrower Interpretation: The plain meaning of "extracting" suggests a process of discovering and pulling out information (e.g., scraping all
<a>tags on a page) to compose a list, not merely rendering a list that was already composed for the specific purpose of the slideshow. The complaint itself contrasts the invention with prior art where a slideshow was "composed manually and then stored in a file," which may support a narrower construction requiring a dynamic composition step ('Compl. ¶45).
VI. Other Allegations
The complaint does not contain allegations of indirect or willful infringement.
VII. Analyst’s Conclusion: Key Questions for the Case
This case will likely focus on fundamental mismatches between the technology described in the patents, which dates to the early 2000s, and the functionality of the modern e-commerce website accused of infringement. The central questions for the court appear to be:
- A core issue will be one of architectural scope: Can the '629 Patent's claimed system, with its distinct server-side "composer" and "performer" modules, be interpreted to read on the integrated architecture of a modern web application like Costco.com? This raises the question of whether there is a technical and legal mapping between the claimed invention and the accused system.
- A key evidentiary question will be one of functional operation: Does the accused system perform the "automatic extraction" of hyperlinks from a web page to create a presentation list, as required by the '707 Patent? Or does it simply render a pre-composed list of URLs that is already part of the web page's content, which may create a functional mismatch with the patent's core claim.