A Monetization Firm, a Growing Web of Related NPEs, and a Variety of Inventor-Controlled Plaintiffs Targeted E-Commerce and Software in Q1

The top market sector for NPE litigation in Q1 2023 was E-Commerce and Software, accounting for 28% of new defendants added to patent litigation campaigns. Consumer Electronics and PCs saw the second highest amount of NPE litigation in the first quarter, followed by Mobile Communications and Devices, Networking, and Financial Services.

A wide variety of NPE plaintiffs, many of them interrelated, hit the E-Commerce and Software sector in Q1 2023. Among them were KOJI IP LLC, which filed its first litigation over location-based notifications on February 22; Street Spirit IP LLC, which on February 27 expanded the campaign it launched last September with new suits targeting content moderation and user verification tools; and AK Meeting IP LLC, which added a new complaint over screen sharing technology to its own existing campaign on February 1. All three are connected to Texas-based monetization firm Dynamic IP Deals (d/b/a DynaIP) via affiliated entity Pueblo Nuevo LLC, which has developed a distinctive approach to corporate disclosures after other plaintiffs under its control faced pressure from Judge Connolly over disclosures in his Delaware court (as detailed in the coverage linked above). Additionally, a fourth DynaIP plaintiff—AML IP LLC, which is under the firm’s direct management—pushed its online payments campaign past the 50-defendant mark in Q1 with a wave of new cases filed in January.

Other NPEs hitting this sector Q1 were several apparently associated with a familiar figure in patent monetization—a former inventor who in recent years has shifted to the assertion of patents acquired from others. Those plaintiffs included Convergent Assets LLC, which in March launched its first litigation campaign over targeted advertising technology, asserting patents developed at ADISN, an inventor-controlled digital advertising agency. Another was Hyperquery LLC, which in January filed its first litigation targeting smartphones with preinstalled Google search products and filed a second cluster of cases in March (see here and here). One more of those affiliated plaintiffs, Scancomm LLC, also added more litigation to the campaign that it kicked off in July 2022 over payment platforms, targeting features related to sharing contact information and making transactions by using QR codes. Additionally, yet another NPE in this extended family, InvesTrex LLC, filed one more case in its own campaign targeting web features for displaying real-time stock information in March. If past activity is any indication, these plaintiffs will likely proceed in file-and-settle fashion. See RPX Insight for more on the connections between these NPEs—and related patent acquisition activity indicating that even more litigation is coming.

Another plaintiff that hit the E-Commerce and Software space in the first quarter was Dialect, LLC, which in mid-February initiated a litigation campaign over certain products (i.e., Internet of Things devices, smartphones, tablets, and wearables) that incorporate voice-recognition software services. The asserted patents originated with Voicebox Technologies (acquired in 2018 by Nuance Communications). Dialect is connected to a different, but also familiar, figure in patent monetization, an individual who has been linked to other established NPE plaintiffs—including Oyster Optics, LLC, which, with its subsidiary and coplaintiff Oyster Optics, Inc., has waged an optical networking campaign, with some setbacks, since 2008; and Document Security Systems, Inc. (DSS), a publicly traded company with a rocky patent litigation history.

Other already-active inventor-backed plaintiffs filed complaints over a wide range of other technologies in this sector in Q1: Virtual Creative Artists, LLC brought another case over products with online photo sharing features in March; AlmondNet, Inc. and its subsidiary Intent IQ, LLC again focused on targeted advertising in a new complaint filed earlier that month; and PACid Technologies, LLC filed a complaint focused on the use of certain secure authentication standards, also in March. In January, inventor-controlled S3G Technology LLC continued to sue retailers over the provision of mobile apps for retail operations, asset tracking, and digital key operation; and Innovaport LLC (f/k/a PatentBank LLC) sued another retailer over its mobile app’s product availability tracking features.

See RPX’s first-quarter review for more on trends impacting NPE litigation in Q1.