DCT

2:20-cv-00851

IBM Corp v. Zillow Group Inc

Log In
Key Events
Amended Complaint

I. Executive Summary and Procedural Information

  • Parties & Counsel:
  • Case Identification: 2:20-cv-00851, W.D. Wash., 03/08/2021
  • Venue Allegations: Venue is alleged to be proper because Defendants each have a regular and established place of business in the judicial district and have committed acts of infringement within the district.
  • Core Dispute: Plaintiff alleges that Defendants’ online real estate websites and mobile applications infringe seven patents related to foundational web technologies, user interfaces, and data analysis methods.
  • Technical Context: The technology at issue involves core functionalities of large-scale, interactive, and data-driven web platforms, which are central to the multi-billion dollar online real estate market.
  • Key Procedural History: The complaint notes that U.S. Patent No. 7,072,849 has previously been challenged on patent eligibility grounds and was found patent-eligible by both the District of Delaware and the Patent Trial and Appeal Board (PTAB). A jury in a separate case found that patent to be willfully infringed and not invalid. The complaint also notes that U.S. Patent No. 7,631,346 survived a patent eligibility challenge in district court and that its claims have been interpreted by the U.S. Court of Appeals for the Federal Circuit in an appeal from PTAB proceedings.

Case Timeline

Date Event
1988-07-15 ’849 Patent Priority Date
2000-05-31 ’443 Patent Priority Date
2001-04-12 ’389 Patent Priority Date
2005-04-01 ’346 Patent Priority Date
2006-07-04 ’849 Patent Issued
2006-07-11 ’443 Patent Issued
2006-07-24 ’904 Patent Priority Date
2007-03-06 ’389 Patent Issued
2009-12-08 ’346 Patent Issued
2011-09-27 ’183 Patent Priority Date
2011-12-30 ’789 Patent Priority Date
2012-11-20 ’904 Patent Issued
2015-10-13 ’789 Patent Issued
2016-01-26 ’183 Patent Issued
2016-06-01 Plaintiff alleges it first attempted to reach a licensing agreement with Defendant
2017-08-11 Defendant notified of alleged infringement of ’849 and ’789 Patents
2017-10-31 Defendant notified of alleged infringement of ’346 Patent
2019-01-14 Defendant notified of alleged infringement of ’183 and ’389 Patents
2019-08-26 Defendant notified of alleged infringement of ’904 and ’443 Patents
2021-03-08 Complaint Filed

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

U.S. Patent No. 7,072,849 - "Method for Presenting Advertising in an Interactive Service"

  • Issued: July 4, 2006

The Invention Explained

  • Problem Addressed: In the pre-Internet era of "time-sharing computer networks," interactive services suffered from processing bottlenecks at the central host computer and limited network bandwidth, which slowed response times for users (Compl. ¶21; ’849 Patent, col. 1:43-52). This problem was exacerbated when advertising data had to compete with the service's primary application data for these limited resources, diminishing the user experience (’849 Patent, col. 2:20-30).
  • The Patented Solution: The invention proposes a method to reduce the load on the host server by shifting processing to the user's computer. It achieves this by structuring both applications and advertisements as "objects" of data and code that can be processed locally on the user's machine (Compl. ¶18). This allows the user interface to be composed "on the fly from objects stored locally," some of which could be pre-fetched and stored at the user's "reception system" to minimize network delays (’849 Patent, Abstract; col. 3:15-23).
  • Technical Importance: This object-based, distributed processing approach was a foundational technology for making early graphical online services, such as the PRODIGY service developed by the inventors, commercially viable in an era of slow modem speeds and limited server capacity (Compl. ¶¶ 17, 19).

Key Claims at a Glance

  • The complaint asserts independent claim 1 and dependent claims 2-9, 12-22, and 25 (Compl. ¶138).
  • Independent Claim 1 is a method for presenting advertising, comprising the steps of:
    • Structuring applications for presentation at a first portion of a display screen.
    • Structuring advertising in a manner compatible with the applications for concurrent presentation at a second portion of the display screen.
    • Configuring the advertising as objects that include advertising data.
    • Selectively storing advertising objects at a store established at the user's reception system.

U.S. Patent No. 7,631,346 - "Method and System for a Runtime User Account Creation Operation Within a Single-Sign-On Process in a Federated Computing Environment"

  • Issued: December 8, 2009

The Invention Explained

  • Problem Addressed: Prior single-sign-on (SSO) technologies were problematic because they required a user to already have an existing account at the service provider they wished to access (Compl. ¶32; ’346 Patent, col. 2:19-42). This limited the utility of SSO for new users, forcing them to go through a separate registration process before they could benefit from streamlined access.
  • The Patented Solution: The patent describes a method for a user who is authenticated at a first system (an "identity provider") to access a resource at a second system (a "service provider") where they do not have an account. The method triggers an SSO operation that also facilitates the creation of a user account at the service provider "at runtime," using an identifier from the identity provider, thereby bypassing the need for a separate, manual registration step before accessing the protected resource (Compl. ¶34; ’346 Patent, Abstract).
  • Technical Importance: This technology extends the convenience of single-sign-on to first-time users of a service, improving the user experience and facilitating easier interaction between different online services within a "federated computing environment" (Compl. ¶35).

Key Claims at a Glance

  • The complaint asserts independent claim 1 and dependent claims 2-3, 5, 8, 10, and 12-13 (Compl. ¶162).
  • Independent Claim 1 is a method for managing user authentication, comprising the steps of:
    • Triggering a single-sign-on operation for a user to obtain access to a protected resource hosted by a second system, where that system requires a user account.
    • Receiving, at the second system, an identifier associated with the user from a first system.
    • Creating a user account for the user at the second system based on the received identifier after triggering the SSO operation but before generating a response for accessing the resource.

U.S. Patent No. 9,245,183 - "Geographical Area Condition Determination"

  • Issued: January 26, 2016
  • Technology Synopsis: The patent addresses the technical challenge of interpreting unstructured image data to assess the condition of a geographic area (Compl. ¶¶ 46-47, 58). The invention describes a method for a computer system to directly analyze image data (e.g., from security or personal cameras), identify discrete elements (e.g., broken windows, graffiti), score those elements by comparing them to a database of stored reference images ("baseline measurement values"), and generate an overall condition score for the location, which can be displayed on a map (’183 Patent, Abstract; Compl. ¶¶ 61-62).
  • Asserted Claims: Claims 1-20 (Compl. ¶177).
  • Accused Features: The Zillow "Zestimate" and Zillow Home Value Index (ZHVI) features, which allegedly use computer vision and machine learning to analyze photos of homes to determine their quality and value, are accused of infringement (Compl. ¶¶ 73, 178, 185).

U.S. Patent No. 9,158,789 - "Coordinated Geospatial, List-Based and Filter-Based Selection"

  • Issued: October 13, 2015
  • Technology Synopsis: The patent addresses limitations in prior art geospatial interfaces where mapped data was not dynamically responsive to user selections (Compl. ¶75). The invention provides a graphical user interface that synchronizes a map display and an associated list display, enabling a user to define a customized, non-rectangular search area on the map (the "draw" feature) and have both the map and the list concurrently update to show only the selected results (Compl. ¶¶ 78-79; ’789 Patent, Abstract).
  • Asserted Claims: Claims 1-2, 5-9, and 12-20 (Compl. ¶201).
  • Accused Features: Zillow's "Draw Your Own Search" feature, which allows users to draw a custom shape on a map to define a search area for real estate listings, is accused of infringing this patent (Compl. ¶¶ 82, 202).

U.S. Patent No. 7,187,389 - "System and Method for Simultaneous Display of Multiple Object Categories"

  • Issued: March 6, 2007
  • Technology Synopsis: The patent addresses the problem of displaying a large number of objects from complex systems on a two-dimensional screen without the display becoming overly cluttered and incomprehensible (Compl. ¶¶ 86-87). The solution involves organizing objects into distinct, adaptable "layers" based on their characteristics and using "non-spatially distinguishable display attributes" (such as color, hue, or shading) and display emphasis to visually distinguish objects in one layer from another, even when they overlap (Compl. ¶¶ 89, 91; ’389 Patent, Abstract).
  • Asserted Claims: Claims 1-6 and 8-17 (Compl. ¶224).
  • Accused Features: Zillow's map interface, which displays different categories of properties (e.g., "For Sale," "For Rent," "Sold") as objects that can be layered and distinguished by visual attributes like color, is accused of infringement (Compl. ¶¶ 225-226). This is illustrated in a screenshot of a Zillow map showing differently colored icons for listings. (Compl. Ex. 60, p. 90).

U.S. Patent No. 7,076,443 - "System and Technique for Automatically Associating Related Advertisements to Individual Search Results Items of a Search Result Set"

  • Issued: July 11, 2006
  • Technology Synopsis: The patent sought to improve upon prior art targeted advertising that relied on building user profiles with cookies, which could be inaccurate and burdensome (Compl. ¶¶ 96, 99). The invention proposes a method of generating advertisements based on the search results themselves, rather than a user profile. The system identifies a search result item, searches an advertisement repository using that item, identifies a matching ad, and correlates the ad with the search result item, for example by displaying an icon next to the result that the user can select to see related ads (’443 Patent, Abstract; Compl. ¶¶ 101-103).
  • Asserted Claims: Claims 1-7, 9-17, and 19-20 (Compl. ¶248).
  • Accused Features: Zillow's advertising services, which present advertisements related to real estate searches, are accused of infringement (Compl. ¶¶ 249, 250).

U.S. Patent No. 8,315,904 - "Organization for Promotion Management"

  • Issued: November 20, 2012
  • Technology Synopsis: The patent addresses challenges in managing and distributing large-scale, personalized marketing promotions, which prior art "mail merge" systems could not handle efficiently (Compl. ¶¶ 110-111). The invention describes a "bottom-up" system using "promotion templates" that can dynamically generate numerous individual "promotion instances." These instances can be searched and filtered based on a user's query and then grouped into a "promotion list" for delivery, allowing for highly tailored and flexible marketing campaigns (’904 Patent, Abstract; Compl. ¶¶ 114, 117-118).
  • Asserted Claims: Claims 1-5 and 7-10 (Compl. ¶271).
  • Accused Features: Zillow's advertising services, including Zillow Group Media and services for Premier Agents, which generate and deliver promotional content to users, are accused of infringement (Compl. ¶¶ 272-273).

III. The Accused Instrumentality

Product Identification

  • The accused instrumentalities are the Zillow websites, including www.zillow.com, and associated mobile applications, such as the Zillow Real Estate & Rentals applications for iOS and Android (Compl. ¶¶ 9, 125).

Functionality and Market Context

  • The Zillow platforms provide a suite of online real estate services, including searchable property listings, home value estimation tools (the "Zestimate"), advertising services for real estate professionals ("Premier Agent"), and a service for homeowners to sell their homes directly to Zillow ("Zillow Offers") (Compl. ¶¶ 8, 10, 125). A key interactive feature is the "Draw Your Own Search" tool, which allows users to define custom geographic search boundaries on a map (Compl. ¶82). The complaint asserts that Zillow operates the "largest portfolio of real estate and home-related brands on mobile and the web" (Compl. ¶8).

IV. Analysis of Infringement Allegations

U.S. Patent No. 7,072,849 Infringement Allegations

Claim Element (from Independent Claim 1) Alleged Infringing Functionality Complaint Citation Patent Citation
a method...comprising the steps of: structuring applications so that they may be presented, through the network, at a first portion of one or more screens of display; Zillow's website and mobile applications structure and present real estate listings, which constitute the "applications," in a primary portion of the user interface. ¶139b col. 4:11-14
and: structuring advertising in a manner compatible to that of the applications so that it may be presented...at a second portion of one or more screens of display concurrently with applications... Zillow structures and presents advertisements (e.g., for Premier Agents or Promoted Communities) concurrently with and alongside the real estate listings. A screenshot of a Zillow search result page shows property listings alongside other promoted listings. (Compl. Ex. 44, p. 60). ¶139c col. 4:15-19
wherein structuring the advertising includes configuring the advertising as objects that include advertising data and; The advertising content is allegedly configured as objects containing data, which are processed by the end user's device to be rendered on the screen. ¶139c col. 3:6-9
selectively storing advertising objects at a store established at the reception system. Browser caching mechanisms and Content Delivery Networks (CDNs) are alleged to selectively store advertising objects (e.g., images, code) on the end user's device or at network edge locations to reduce latency. The complaint alleges Zillow directs or controls this storing step. ¶139d, ¶143-144 col. 4:24-27
  • Identified Points of Contention:
    • Scope Questions: A primary question may be whether modern web architecture, involving browsers, client-side scripting, and CDNs, performs the claimed method of "structuring" and "selectively storing advertising objects." The patent was filed in an era of server-side "dumb" terminals, and the defendant may argue that modern browser caching is not equivalent to the "store established at the reception system" contemplated by the patent.
    • Technical Questions: The complaint alleges that steps like "selectively storing" are performed by third parties such as the user's browser or a CDN, but are attributable to Zillow because Zillow "controls and/or directs" their performance (Compl. ¶¶ 143-144). This raises a question of divided infringement and what level of control Zillow exercises over standard browser and CDN functions.

U.S. Patent No. 7,631,346 Infringement Allegations

Claim Element (from Independent Claim 1) Alleged Infringing Functionality Complaint Citation Patent Citation
a method for managing user authentication within a distributed data processing system, wherein a first system and a second system interact within a federated computing environment... Zillow (the second system) interacts with third-party identity providers like Google or Facebook (the first system) in what is alleged to be a federated computing environment to manage user sign-on. ¶163a col. 5:32-44
triggering a single-sign-on operation on behalf of the user in order to obtain access to a protected resource that is hosted by the second system... A user initiates an SSO operation by choosing to "Continue with Google" or "Continue with Facebook" to access Zillow's services (the protected resource). ¶163b col. 7:42-53
wherein the second system requires a user account for the user to complete the single-sign-on operation prior to providing access to the protected resource; Zillow requires a user account to access its full suite of services, and this account is necessary to complete the SSO process. ¶163b col. 2:32-35
receiving from the first system at the second system an identifier associated with the user; and After the user authenticates with Google/Facebook, Zillow receives an identifier (e.g., a token containing user information) from that first system. ¶163c col. 7:54-58
creating a user account for the user at the second system based at least in part on the received identifier...after triggering the single-sign-on operation but before generating at the second system a response for accessing the protected resource... If the user does not have a Zillow account, Zillow creates one using the information from the Google/Facebook identifier before granting the user full access to its platform. ¶163d col. 8:1-13
  • Identified Points of Contention:
    • Scope Questions: The analysis will likely focus on whether the standard integration between a website like Zillow and a third-party social login provider like Facebook constitutes the claimed "federated computing environment." The construction of this term, potentially informed by the Federal Circuit's prior interpretation mentioned in the complaint, will be critical (Compl. ¶41).
    • Technical Questions: A key factual question may be the precise sequence of events. The claim requires that the user account be created after triggering the SSO operation but before generating the response for accessing the resource. The exact timing and technical implementation of Zillow's new user registration flow via social logins will be scrutinized against this claim limitation.

V. Key Claim Terms for Construction

  • For the ’849 Patent:

    • The Term: "selectively storing advertising objects at a store established at the reception system"
    • Context and Importance: This term is central to the infringement analysis. Practitioners may focus on this term because its meaning is rooted in the pre-web Prodigy service architecture, and its application to modern web technologies like browser caching and CDNs is a point of potential dispute. Whether standard, automated browser caching constitutes "selectively storing" at a "store established at the reception system" will be a key issue of claim scope.
    • Intrinsic Evidence for Interpretation:
      • Evidence for a Broader Interpretation: The patent's abstract broadly refers to "storing and managing advertising at the user reception system so that advertising can be pre-fetched" (’849 Patent, Abstract), which might be argued to encompass any form of local storage for performance enhancement.
      • Evidence for a Narrower Interpretation: The detailed description explains that the goal is to make advertising "available at the reception system so as not to delay presentation of the service applications" (’849 Patent, col. 3:21-23). The specification also describes a system with a "cache/concentrator" (Fig. 2) and a deliberate process of pre-fetching objects "in anticipation of being called for presentation," which may suggest a more application-specific and managed process than a standard browser cache.

  • For the ’346 Patent:

    • The Term: "federated computing environment"
    • Context and Importance: The applicability of the entire claim hinges on this term. The central question is whether the common commercial arrangement between a website and a third-party identity provider (e.g., "Sign in with Google") falls within the patent's definition of this term.
    • Intrinsic Evidence for Interpretation:
      • Evidence for a Broader Interpretation: The patent states that a federation is a "loosely coupled affiliation of enterprises which adhere to certain standards of interoperability" (’346 Patent, col. 9:62-65), a definition that could arguably cover systems using open standards like OAuth for social logins.
      • Evidence for a Narrower Interpretation: The specification discloses how to structure this environment using a "nonconventional arrangement of computer components" and a "trust proxy" (’346 Patent, col. 10:62-11:7, Fig. 5). The complaint also references a Federal Circuit opinion that interpreted this term as an "environment containing different enterprises that 'adhere to certain standards of interoperability'" (Compl. ¶41), which suggests the specific standards and technical implementation disclosed in the patent may be critical to the term's scope.

VI. Other Allegations

  • Indirect Infringement: The complaint alleges inducement and contributory infringement across all asserted patents. The core factual basis is that Defendants provide the Zillow website and applications (including HTML, JavaScript, and other files) to end users, and through user manuals, customer support, and the design of the platform, instruct and encourage users to operate the services in a manner that directly infringes the method claims (e.g., Compl. ¶¶ 148, 150, 163, 165). The complaint also alleges that the provided software components have no substantial non-infringing use (Compl. ¶149).
  • Willful Infringement: Willfulness is alleged for all asserted patents. The allegations are based on Defendants' alleged pre-suit knowledge of the patents and their infringement. The complaint details a multi-year history of communications, including letters, meetings, and the provision of "detailed claim charts demonstrating how Zillow was infringing," beginning as early as August 2017 for the first set of patents (Compl. ¶¶ 126-128, 145, 166).

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

  • A core issue will be one of technological translation: can the language of patents filed during earlier technological eras (e.g., the pre-web ’849 Patent) be construed to read on the functionality of modern, standard web and mobile application architectures (e.g., browser caching, social logins, CDNs)? The case may test the boundary between infringing adoption of a patented concept and the independent evolution of technology.
  • A key evidentiary question will be one of direction and control: for the asserted method claims where steps are performed by Zillow's servers, the end-user's device, and third-party services, what specific actions did Zillow take that would demonstrate it directed or controlled the performance of every step of the claimed methods, as required to prove direct infringement?
  • A central legal question will be one of definitional scope: what are the proper constructions of key technical terms like "federated computing environment" ('346 Patent) and "selectively storing...at a store established at the reception system" ('849 Patent)? The outcomes of these claim construction disputes will likely be determinative for infringement on several of the asserted patents.