Cooperative Entertainment Inc v. Cloudflare Inc

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Cooperative Entertainment Inc (North Carolina)
  • Defendant: Cloudflare Inc (Delaware)
  • Plaintiff’s Counsel: Ramey LLP
• Case Identification: 7:25-cv-00392, W.D. Tex., 09/02/2025
• Venue Allegations: Plaintiff alleges venue is proper because Defendant has committed acts of infringement and maintains a regular and established place of business in the district.
• Core Dispute: Plaintiff alleges that Defendant’s content distribution and load balancing services infringe a patent related to dynamic peer-to-peer content distribution networks.
• Technical Context: The technology at issue involves methods for distributing large data files, such as streaming video, by creating temporary networks among end-users to offload traffic from centralized servers, thereby reducing costs and improving performance.
• Key Procedural History: The complaint states that Plaintiff is a non-practicing entity and that it and its predecessors have entered into prior settlement licenses. The complaint includes extensive pre-emptive arguments that these licenses did not create a patent marking requirement under 35 U.S.C. § 287(a) because they were not for the production of a patented article.

Case Timeline

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

U.S. Patent No. 9,432,452 - "Systems and Methods For Dynamic Networked Peer-To-Peer Content Distribution"

• Patent Identification: U.S. Patent No. 9,432,452, "Systems and Methods For Dynamic Networked Peer-To-Peer Content Distribution," issued August 30, 2016.

The Invention Explained

• Problem Addressed: The patent's background section identifies a failure in the prior art to provide effective video streaming over peer-to-peer (P2P) networks that operate "outside the structure and control of" traditional Content Distribution Networks (CDNs) (Compl. Ex. A, '452 Patent, col. 3:34-36). This reliance on centralized CDNs can lead to high bandwidth costs and delivery inefficiencies.
• The Patented Solution: The invention describes a system where a central server orchestrates the creation of "dynamic" P2P networks among end-users (peers) who are all consuming the same content simultaneously ('452 Patent, col. 4:56-61). Instead of each user pulling content directly from a CDN, the server identifies peers in close network proximity and instructs them to share segments of the content with each other ('452 Patent, col. 10:25-52). This peer discovery and content segmentation is based on network data, including trace routes, to optimize the P2P sharing process ('452 Patent, col. 5:47-54; Fig. 1).
• Technical Importance: This approach aims to significantly reduce the load and associated costs on central CDN servers by leveraging the bandwidth of the end-users themselves, a critical consideration for scalable distribution of large media files.

Key Claims at a Glance

• The complaint asserts infringement of one or more of claims 1-15 (Compl. ¶8). Independent claims 1 and 5 are foundational.
• Independent Claim 1 (System):
  • At least one content delivery server computer.
  • At least one peer-to-peer (P2P) dynamic network with multiple peer nodes consuming the same content.
  • The P2P network is based on at least one trace route and has peer nodes distributed "outside controlled networks and/or content distribution networks (CDNs)."
  • The server is operable to use a trace route to segment content, find peers, and return client-block pairs for P2P sharing.
  • Content segmentation is based on factors including CDN address resolution, trace route to the CDN, and dynamic feedback from peers.
• Independent Claim 5 (Method):
  • Providing a content delivery server and a P2P dynamic network.
  • The server receives a content request from a client.
  • The server segments the requested content based on techniques like CDN address resolution and trace routes.
  • The system automatically identifies a peer node that has a content segment and is in "close network proximity to the client."
  • The identified peer node shares the content segment with the requesting client.
• The complaint states that Plaintiff reserves the right to amend its infringement allegations (Compl. ¶9).

III. The Accused Instrumentality

Product Identification

• The complaint accuses "systems, products, and services that facilitate peer-to-peer network content distribution," specifically identifying Defendant's "Load Balancing" products and services (Compl. ¶¶8, 10).

Functionality and Market Context

• The complaint alleges that Defendant "maintains, operates, and administers" the accused systems (Compl. ¶8). It provides a URL to a marketing page for Cloudflare Inc's Load Balancing services as exemplary of the infringing instrumentality but does not describe the specific technical operation of these services (Compl. ¶10). The complaint asserts that these services cause the claimed invention "as a whole to perform" (Compl. ¶8).

IV. Analysis of Infringement Allegations

The complaint references a claim chart attached as Exhibit B to support its infringement allegations (Compl. ¶9). However, this exhibit was not provided with the complaint document. The narrative infringement theory alleges that Defendant's systems, including its Load Balancing services, perform the methods and embody the systems for dynamic P2P content distribution claimed in the ’452 Patent (Compl. ¶¶8, 10). The complaint does not contain specific factual allegations detailing how the accused services meet the technical limitations of the asserted claims.

No probative visual evidence provided in complaint.

Identified Points of Contention

• Scope Questions: A primary point of contention may be whether Defendant’s "Load Balancing" service, which typically involves distributing client requests across multiple servers within a CDN, constitutes a "peer-to-peer (P2P) dynamic network" where nodes are "outside controlled networks and/or content distribution networks (CDNs)" as recited in the claims. The infringement theory appears to equate a server-centric CDN architecture with a peer-based network.
• Technical Questions: The complaint does not specify how the accused services perform key technical steps of the claims, such as using a "trace route to segment requested content." A central question will be whether Plaintiff can produce evidence that Defendant’s systems actually perform these specific functions, or if there is a fundamental operational mismatch between the accused services and the claimed invention.

V. Key Claim Terms for Construction

• The Term: "peer-to-peer (P2P) dynamic network ... wherein the multiplicity of peer nodes is distributed outside controlled networks and/or content distribution networks (CDNs)" (from Claim 1).

• Context and Importance: The definition of this term is fundamental to the dispute. The infringement case appears to depend on whether Defendant's own CDN infrastructure can be considered a P2P network that is "outside" a CDN. Practitioners may focus on this term because Defendant is a leading CDN provider, making the "outside CDNs" limitation a significant potential hurdle for the Plaintiff's case.

• Intrinsic Evidence for Interpretation:

  • Evidence for a Broader Interpretation: The patent states that the invention "easily integrates with existing websites and Apps that provide for content distribution and/or delivery over the Internet or other CDN," which could be argued to support application within a CDN environment ('452 Patent, col. 6:7-10).
  • Evidence for a Narrower Interpretation: The patent explicitly contrasts the invention with the prior art's failure to provide streaming "outside the structure and control of CDNs" ('452 Patent, col. 3:34-36). This language suggests the invention is intended to be an alternative to, rather than a component of, a traditional CDN.

• The Term: "use the trace route to segment requested content" (from Claim 1).

• Context and Importance: This term recites a specific technical mechanism for how the system optimizes content delivery. The viability of the infringement claim may depend on whether Defendant's methods for traffic management and routing can be shown to meet this limitation.

• Intrinsic Evidence for Interpretation:

  • Evidence for a Broader Interpretation: A party might argue that "trace route" should be interpreted broadly to encompass any method of analyzing network paths to make routing or segmentation decisions, not just the literal use of the "traceroute" command.
  • Evidence for a Narrower Interpretation: The claim explicitly recites "trace route" as a basis for segmentation ('452 Patent, col. 10:35-52). A party could argue this requires the use of a tool that maps the specific network path and hops between nodes, a function distinct from general load balancing or IP-based geolocation.

VI. Other Allegations

Indirect Infringement

• The complaint alleges inducement, asserting that Defendant encourages its customers to use its products and services in an infringing manner (Compl. ¶10). The complaint also alleges contributory infringement, stating there are "no substantial noninfringing uses" for the accused services (Compl. ¶11).

Willful Infringement

• Willfulness is alleged based on Defendant’s knowledge of the ’452 Patent from at least the filing date of the lawsuit (Compl. ¶10). The complaint also reserves the right to prove pre-suit knowledge and seeks a finding of willful infringement based on post-suit conduct (Compl. Prayer for Relief ¶¶e-f).

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

• A core issue will be one of definitional scope: can Defendant's server-centric CDN and load balancing architecture be construed as a "peer-to-peer... network" operating "outside controlled networks and/or content distribution networks (CDNs)," as the claim language requires? The resolution of this question may determine the viability of the entire case.
• A key evidentiary question will be one of technical implementation: what evidence will emerge to show that Defendant’s accused services perform the specific, granular functions recited in the claims, such as using a "trace route to segment" content, particularly given the absence of such detailed allegations in the complaint?