This week: The empire strikes back--Cisco Systems and Citibank file counter-suits against the patent holders making claims on videoconferencing and check-imaging, respectively; a defunct company with a less than stellar track record in the patent lawsuit business keeps filing; and a familiar player with a new name in E.D. Texas.
- Cisco Systems, Inc. v. Teleconference Systems, Llc Et Al. 09-cv-01550, N.D. California.
Teleconference Systems is a shell company set up by Acacia Research Corp., the Orange County-based patent-holding company that has, by one estimation, filed more patent suits than any other. Teleconference Systems was set up to enforce the 6,980,526 patent, which is related to videoconferencing; the patent is owned by Margalla Communications, a consulting company in Woodside, California, which presumably will share in any licensing booty Acacia wins.
On March 27, Teleconference filed its first patent lawsuit in Delaware, alleging that several companies in disparate industries have infringed the '526 patent. Teleconference is represented by Anthony Simon of The Simon Law Firm in St. Louis (formerly Simon Passante).
The defendants in that suit are Procter & Gamble Pharmaceuticals, HSBC, Baxter Healthcare, Applied Materials Inc., Wachovia Corp., Staples, Cabela's Inc., and Enbridge Holdings. What do these lucky winners have in common? They all use Cisco TelePresence products. But Cisco isn't named in the lawsuit.
So last week, Cisco filed a declaratory judgment lawsuit in San Jose, seeking to invalidate the Margalla/Teleconference Systems patent, noting that "the TelePresence Customer Suit has triggered indemnity requests by Cisco's customers." Cisco is represented by Edward Reines of Weil, Gotshal & Manges.
- Citibank, N.A. v. LML Payment Systems Corp. 09-cv-02204, N.D. Illinois.
This appears to be the first patent infringement lawsuit ever filed by Citibank, which has been on the defendant side of many patent suits over the past several years. It is a retaliatory suit--put differently, a patent infringement claim, not a DJ claim to invalidate. LML Payment Systems, a tiny Vancouver-based company that prominently displays its patents on its Web site, sued just about every bank you can name back in November, under the name LML Patent Corporation. But LML apparently is operating "enough" that it can be hit back. It does offer check-verification services, and Citibank claims those services infringe its 7,020,639 patent.
- Elan Microelectronics Corporation v. Apple, Inc. 09-cv-01531, N.D. California.
Elan, a Taiwanese company that provides touchpad technology for Asustek computers, sued Apple last week, saying that the iPhone, iPod Touch, and MacBook infringe its patents. In January, Apple made some threatening noise about using its patents against a competing Palm product. But despite the speculation about what action the company might take, Apple and its touch-screen technology have actually been on the receiving end of a few patent lawsuits brought by non-practicing entities. Elan's lawsuit is different because Elan is a real company, based in Taiwan. It is represented in this case by a team from Alston & Bird's Palo Alto office. (Elan actually has a touchscreen technology, which was cool enough to impress the folks at Engadget. More coverage at NYT.)
- Parallel Networks, Llc v. Amazon.Com, Inc. et al. 09-cv-00154, E.D. Texas (Marshall).
Parallel Networks is the new name for a once-upon-a-time company called EpicRealm that later became a patent-holding company. Parallel and its predecessor company already have sued a big chunk of the Internet. But this suit rounds out their campaign, targeting big players they've passed over before: Amazon and Google, and travel discounter Kayak.com.
Parallel Networks is managed by Terry Fokas, a Texas lawyer previously at Brobeck, Phleger & Harrison, the San Francisco law firm that was wiped out by the dot-com bust in 2003. As we have seen many times before, getting into the patent enforcement business is often a profitable coda to a failed dot-com. (Tobin Family Foundation v. Amazon is one example I recently covered.) Fokas didn't respond to a call TPA put in to the numbers he has listed with the Texas bar.
The predecessor company, EpicRealm, has sued dozens of big retailers and online service providers, including dating sites like eHarmony and travel sites like Orbitz and Priceline. Those earlier lawsuits claim the Web sites infringe the claims in its 5,894,554 and 6,415,335 patents. This new Parallel Networks lawsuit, like the others, is in E.D. Tex, and it's asserting a new patent, 6,446,111.
Inventor Keith Lowery is still involved in the company, according to a March story in the Dallas business journal which describes him as a "local technical whiz." (The story is by Jeff Bounds, the author of another article that nicely sums up EpicRealm's journey from actual company to patent holding company.)
The Lowery/Fokas licensing campaign, assisted by Baker Botts, has had decidedly mixed results. Oracle DJ'd the company's patents in Delaware before it could be sued in E.D. Texas, and a judge ruled in Oracle's favor on noninfringement grounds in December. Then it won its E.D. Texas case against online dating company Various Inc., part of Penthouse Media; the jury awarded it a whopping $1 million. In patent litigation, that's a Pyrrhic victory, since taking a high-stakes patent case to trial carries an average cost of about $4 million.
- Actus, LLC v. Bank of America Corp. et al. 09-cv-00102, E.D. Texas (Marshall).
A new holding company called Actus LLC filed suit in Marshall, Texas, on April 9, asserting four e-commerce patents against 20 defendants, most of them very large companies (Visa, Disney, Google, credit card issuers)--see Blaze Mobile.
The patents relate to Internet commerce and the accused products include various prepaid cards and payment services. (Google's accused products are Google Checkout and the Android Mobile phone.) The patents--nos. 7,249,099; 7,328,189; 7,177,838; and 7,376,621--orginally were assigned to an Arizona company called PayByClick Corp. Marvin T. Ling is listed as the inventor.
Texas corporate documents indicate Actus is managed by Dan Perez, a Texas lawer who has done work for patent-holding companies connected with Erich Spangenberg and his Plutus IP group of companies. Has Perez gone into business for himself? We've left him a message asking about Actus but haven't heard back yet.
Actus has sued 20 companies: Bank of America; Blaze Mobile; Capital One Financial Corp; Enable Holdings (which controls uBid.com); Google; Green Dot Corp.; Javien Digital Payment Solutions; J.P Morgan Chase; Mastercard International; Meta Financial Group; M&T Bank Corp.; Obopay; Sonic Solutions; Visa; Vivendi; Wal-Mart; Walt Disney; Western Union; Wildtangent; and Agileco.
The defendants' lawyers will go up against Actus' counsel, former McKool Smith lawyer William "Bo" Davis. Davis has his own shop in Longview, the same town where mentally anguished lawyers like Johnny Ward Jr. and Eric Albritton hang their shingles. Davis, Ward Jr., and Albritton all hunt for intellectual property infringers, but they seem to share ideas with each other: after all, their law firm Web sites all use the same software, and they're all at the same address: 111 West Tyler Street, in Longview, Texas. It's a fair bet that Davis admires other aspects of their business model, as well.
Photo: J. Mullin / Tyler St., Longview, Texas.