decoration decoration

When you want to know more...
For layout only
Site Map
About Groklaw
Legal Research
ApplevSamsung p.2
Cast: Lawyers
Comes v. MS
Gordon v MS
IV v. Google
Legal Docs
MS Litigations
News Picks
Novell v. MS
Novell-MS Deal
OOXML Appeals
Quote Database
Red Hat v SCO
Salus Book
SCEA v Hotz
SCO Appeals
SCO Bankruptcy
SCO Financials
SCO Overview
SCO v Novell
Sean Daly
Software Patents
Switch to Linux
Unix Books


Groklaw Gear

Click here to send an email to the editor of this weblog.

You won't find me on Facebook


Donate Paypal

No Legal Advice

The information on Groklaw is not intended to constitute legal advice. While Mark is a lawyer and he has asked other lawyers and law students to contribute articles, all of these articles are offered to help educate, not to provide specific legal advice. They are not your lawyers.

Here's Groklaw's comments policy.

What's New

No new stories

COMMENTS last 48 hrs
No new comments


hosted by ibiblio

On servers donated to ibiblio by AMD.

Lodsys - This is going to get expensive . . . for Lodsys - UPDATED 2Xs
Tuesday, July 05 2011 @ 02:10 PM EDT

Another day and three new declaratory judgment actions against Lodsys with respect to the four patents it has been asserting. While one of the three new actions is in the Northern District of Illinois, where several of the other declaratory judgment actions have been filed, two of them are in new venues - one in Arizona and one in the Southern District of California. This changing of venues is important. While Lodsys may seek to consolidate the cases in the Northern District of Illinois for the sake of efficiency (and saving Lodsys attorney's fees), Lodsys will likely have to defend in each of the other jurisdictions where a declaratory judgment action is filed, thus increasing the cost of defense as local counsel is retained in each case.

The new declaratory judgment actions are:
Case No. 2:11-CV-01307-NVW Ballard Spahr representing Drivetime Automotive Group

Case No. 11CV1285WQHRBB
Jones Day representing ESET

Case No. 1:11-CV-4088
Proskauer Rose representing Liveperson

Also, in the ESET case, ESET has filed a copy of the Lodsys letter [PDF] alleging patent infringement and the Lodsys claim chart that Lodsys sent ESET. The claim chart in particular may be helpful to those of you interested in continuing the search for prior art.


Lodsys demand letter sent to ESET:

Lodsys, LLC

March 28, 2011

Via Federal Express
Ms. Rita Pertzborn
ESET,LLC North America
610 W Ash St., Ste 1900
San Diego, CA 92101

Dear Ms. Pertzborn,

Re: Infringement of U.s. Patent Nos. 5,999,908,7,133,834,7,222,078, and 7,620,565 (Abelow)

Lodsys, LLCa Texas limited liability company is the owner of United States Patents 5,999,908, 7,133,834, 7,222,078, and 7,620,565 (the "Lodsys Patents"). The Lodsys Patents are directed to systems and methods for providers of products and/or services to interact with users of those products and services to gather information from those users and transmit that information to the provider. Attached is a complete copy of the '908 patent as well as certain pages of the '834, '078, and '565 patents for your review.

The inventions described by these patents are used by companies to interact with users of their products and services to, among other things:

  • provide online help, customer support, and tutorials
  • conduct online subscription renewals
  • provide for online purchasing of consumable supplies
  • survey users for their impressions of their products and services
  • assist customers to customize their products and services
  • display interactive online advertisements
  • collect information on how users actually use their products and services
  • sell upgrades or complimentary products
  • maintain products by providing users notice of available updates and assisting in the installation of those updates.

Some of the benefits companies receive from using these inventions are:

  • increased product sales (of consumables, subscriptions, and complementary products)
  • increased additional revenues (of in-product digital items and interactive advertising)
  • more efficient design of subsequent products (through faster time to market, better targeted features, and the ability to interactively update products in the field)
  • greater customer satisfaction (both in terms of future product development as a result of consumer input and through keeping products up to date or providing more effective online help resources in a cost efficient manner).

    The inventions detailed in the various claims of these patents were developed by Daniel Abelow, an expert in usability and in the organization, presentation, and incorporation, of information in websites, products, services, and enterprise systems. Dan earned a Bachelor's of Science in Economics degree from the Wharton School of Business at the University of Pennsylvania in 1971 and a master's degree from Harvard University, which included graduate work at the Massachusetts Institute of Technology. As an independent consultant on presenting information via the internet, Dan's clients have included companies such as Accenture, Agilent Technologies, Cisco, Harvard Business School, IBM, and Lotus Development.

    To date, companies including - Adobe, American Express, Apple, eBay, Google, Intuit, Microsoft, Nokia, Nokia-Siemens, Nvidia, Sony, Sony-Ericsson, Verizon, Yahoo and several other Fortune 1000 companies - have chosen to license the Lodsys Patents.

    Based on Lodsys' review, this letter constitutes our notice that ESET,LLC North America is infringing at least claim 1 of US 7,620,565 and claim 1 of US 7,222,078 as it relates to your provision of notice of available product updates and assisting in the download and installation of those updates with respect to your ESETNOD32 Antivirus 4.

    The Lodsys Licensing Opportunity

    Lodsys' patented technology provides numerous benefits to your company by reducing costs, increasing customer satisfaction, increasing revenues, and providing customer data and impressions that allow you to build more effective and relevant products faster and with greater certainty of meeting real customer needs. This is made possible by your collection of customer product usage details, demographic information, impressions on the usefulness of features or relevance of advertisements, and desires to customize your products or services and in what manner. It further occurs through the sale of consumable supplies and product upgrades or enhancements, the sale of complementary products, sales of subscription renewals, the provision of online support (to discover what customers do not understand or are having troubles with), and in product (or in website) customer satisfaction surveys and interactive advertising. These actions among many other instances of customer data collection, provide you with the opportunity to sell more products and services, build new versions faster in a competitive marketplace, have greater relevancy of your products and services (leading to greater customer satisfaction and greater brand value).

    We are interested in reaching a negotiated non-litigation licensing arrangement with you for ali uses of the Lodsys Patents and would like to discuss this matter with you within 21 days of your receipt of this letter. Please contact the undersigned at your earliest convenience to address this matter.

    Lodsys, LLC

    Lodsys is a limited liability company based in Marshali, Texas. We have retained the firms of Kelley, Donion, Gili, Huck & Goldfarb PLLC ( based in Seattle, Washington, and The Davis Firm, P.c. ( based in Longview, Texas, to assist the company in the licensing of the Lodsys Patents.

    /s/ Mark Small
    Mark Small, CEO
    Lodsys, LLC
    (903) 935-3202
    Enclosures (4)

    Lodsys LLC reserves all rights with regard to the '908, '834, '078, and '565 patents, including: (1) the right to seek damages anytime within the last six years that your company started to make use of lodsys' patented technology; (2) the right to change its royalty rates at any time; (3) the right to change this licensing program at any time without notice, including variance to conform to applicable laws. You should not rely on any communication or lack of communication from Lodsys, Kelley, Donion, Gill, Huck & Goldfarb PLLC, or The Davis Firm Group as a relinquishment of any of Lodsys' rights.

and the Claim Chart:

ESET North America

Infringement Claim Chart
for Claim 1 U.S. Pat. No. 7,222,078

Claim 1 of U.S. Pat. No. 7,222,078

  • A system comprising:
  • Units of a commodity that can be used by respective users in different loctions,
  • A user interface, which is part of each of the units of the commodity, configured to provide a medium for two-‐way local interaction between one of the users and the corresponding unit of the commodity, and further configured to elicit, from a user, information about the user’s perception of the commodity,
  • A memory within each of the units of the commodity capable of storing results of the two-‐way local interaction, the results including elicited information about user perception of the commodity. A communication element associated with each of the units of the commodity capable of carrying results of the two-‐way local interaction from each of the units of the commodity to a central location and,
  • A component capable of managing the interactions of the users in different locations and collecting the results of the interaction at the central location.

Alleged examples of the infringement of these claims are provided in images in the slides [PDF] containing the Claim Chart.



Earlier today Lodsys filed a patent infringement suit in the Eastern District of Texas against a number of the companies that have previously filed declaratory judgment actions against Lodsys in other jurisdictions. Defendants in this new action are DriveTime Automotive Group, Inc., ESET, LLC, ForeSee Results, Inc., LivePerson, Inc., OpinionLab, Inc., and The New York Times Company. Look for Lodsys to now seek a change of venue in each of the declaratory judgment actions, transferring them to the Eastern District of Texas. The challenge will be that Lodsys was not the first filer or first to serve in these competing cases, and, as others have already pointed out, while the patents are common, the facts of the alleged infringements are not. Will be interesting to watch these battles play out. In the meantime, expect new declaratory judgment actions to be filed as other potential defendants seek to avoid the Eastern District of Texas.

Here is the new Lodsys complaint [PDF].



ESET, LLC has elected to file a second declaratory judgment action [PDF] against Lodsys, this time in the Eastern District of Wisconsin where it believes Mark Small, CEO of Lodsys, lives and works. Hey, the more the merrier! That brings the total number of DJ actions to seven, filed in four different jurisdictions.


Lodsys - This is going to get expensive . . . for Lodsys - UPDATED 2Xs | 156 comments | Create New Account
Comments belong to whoever posts them. Please notify us of inappropriate comments.
Corrections Here
Authored by: red floyd on Tuesday, July 05 2011 @ 02:52 PM EDT
In case Mark has made a mistake.

Please use the title "rong => right", and in the message body, give
some context as to the location.

I am not merely a "consumer" or a "taxpayer". I am a *CITIZEN* of the United
States of America.

[ Reply to This | # ]

Newspicks discussion here
Authored by: red floyd on Tuesday, July 05 2011 @ 02:53 PM EDT
Please put the title of the newspick under discussion in your title.

I am not merely a "consumer" or a "taxpayer". I am a *CITIZEN* of the United
States of America.

[ Reply to This | # ]

Off Topic here
Authored by: red floyd on Tuesday, July 05 2011 @ 02:54 PM EDT
Please keep the discussion off-topic. Links are appreciated.

Use <a href="">Link Text</a>

On-topic posters will be forced to serve on a patent jury in the Eastern
District of Texas.

I am not merely a "consumer" or a "taxpayer". I am a *CITIZEN* of the United
States of America.

[ Reply to This | # ]

COMES goes here
Authored by: red floyd on Tuesday, July 05 2011 @ 02:56 PM EDT
Not sure how far along we are, but any COMES transcriptions go here.

Most of you who have been posting them know the drill. If you don't, ask here
or in Off-Topic and I'm sure someone will help you.

I am not merely a "consumer" or a "taxpayer". I am a *CITIZEN* of the United
States of America.

[ Reply to This | # ]

Obvious prior art for the 078 patent
Authored by: cjk fossman on Tuesday, July 05 2011 @ 03:31 PM EDT
Any customer feedback card shipped with a product, along with
a file cabinet for storing the cards, fits claim 1 of the

This is Quality Management Systems 101. I'm once again
astonished at the US Patent Office for granting a patent on
something like this.

[ Reply to This | # ]

Lodsys - This is going to get expensive . . . for Lodsys
Authored by: Anonymous on Tuesday, July 05 2011 @ 03:50 PM EDT
I am confused. What is to stop Lodsys from filing motions to consolidate cases
from the multiple jurisdictions in the name of judicial economy?

[ Reply to This | # ]

configured to elicit, "from a user"
Authored by: Anonymous on Tuesday, July 05 2011 @ 04:56 PM EDT
I've must have been watching too many lawyers on TV, but I guess
this is different from eliciting "from the user".

I had the obligation to install and use ESET-NOD32 in a previous job.
IIRC there was provision for the corporate admin to communicate with
ESET for the purpose of uploading unrecognised malware. I do not recall
if there was any provision to record "the user’s perception of
the commodity". Certainly for the peasants in the fields there was
only a provision for manual scanning of suspicious drives or documents.
All quarantine and feedback was automated, and that subset of users
could not have their perception elicited.

There was certainly a subset of users who had perceptions they
wanted elicited, mainly those who switched their machine off at night,
and found routine scanning and profile updates slowing their work.

[ Reply to This | # ]

How to ridicule this claim chart.
Authored by: PolR on Tuesday, July 05 2011 @ 04:59 PM EDT
Let's write a simple application which fundamentally runs this little dialog:

> Please say what to you think of this application?
> Answer:> [User type answers here]

Then the answer is recorded in a central location as the patent says, allowing
for multiple users in different locations to provide answers. But this little
application stores the text into a separate file, say it is called
elicitPrompt.txt. The application is coded to read and display to the user
whatever text is in this file and record the answer in a central location.

Here is the funny part. What if we change the text in the file? What if we make
it "What do you think of the Lodsys patent?" Then we get this dialog:

> What do you think of the Lodsys patent?
> Answer:> ?%$@!, from the bottom of my heart

With this simple change the application no longer infringes because it no longer
elicits the user's perception of the application. The difference between and
infringing and a non infringing computer program is not in the program. It is in
the text being displayed with no change to the actual program.

This patent is claiming as a function of a machine what is actually a function
of the semantics of the text. This is like a printing press. Its function is not
to print Shakespeare's Hamlet because this is a function of the meaning of the

We can make it even funnier with this dialog:

Question> What do you want to comment on today?
Answer> The Lodsys patent
Question> What do you think of "The Lodsys patent"?
Answer> I will leave that to your imagination.

What if the user answers like this?

Question> What do you want to comment on today?
Answer> This little program which is now nagging me
Question> What do you think of "This little program which is now nagging
Answer> I will leave that to your imagination.

Now we see that the program will infringe or not infringe depending on how the
user answers the first question. This is because the patent attribute to the
machine something which is not the function of a machine.

[ Reply to This | # ]

Lodsys - This is going to get expensive . . . for Lodsys
Authored by: Anonymous on Tuesday, July 05 2011 @ 06:19 PM EDT
Anti patent troll strategy requires industry wide cooperation.

1) Troll claims patents cover everybodys use
2) Everybody files different cases in different jurisdicitions for decrlaratory
non-infringement and slander
3) Patent troll is legal-fee'd to death attempting to cover all the cases in 2).
Failure to defend is also fatal

[ Reply to This | # ]

Ya ... thats what the lawyers and judges say
Authored by: Anonymous on Tuesday, July 05 2011 @ 06:52 PM EDT
... and it's pitiful what total ignorance of science and technology they show
when they speak such meaningless nonsense.

Judges are willfully and hopelessly ignorant, but cant admit it to themselves.

We are doomed.

[ Reply to This | # ]

Lodsys - This is going to get expensive . . . for Lodsys - UPDATE
Authored by: ThrPilgrim on Wednesday, July 06 2011 @ 04:09 AM EDT
To date, companies including - Adobe, American Express, Apple, eBay, Google, Intuit, Microsoft, Nokia, Nokia-Siemens, Nvidia, Sony, Sony-Ericsson, Verizon, Yahoo and several other Fortune 1000 companies - have chosen to license the Lodsys Patents.

To me that reads. We started off with no assets so non of the above could be bothered to fight us. Now we have all this licensing money so it would pay you to fight us.

Beware of him who would deny you access to information for in his heart he considers himself your master.

[ Reply to This | # ]

Lodsys - This is going to get expensive . . . for Lodsys - UPDATE
Authored by: Anonymous on Wednesday, July 06 2011 @ 08:32 AM EDT
The claims are so broad that my razor + tap + drains almost qualify, depending
on what meaning is attributed to the different words.
The handle of my razor qualifies as a user interface, inducing loss of facial
hair qualifies as eliciting a response from the user, the space between the
blades qualifies a memory for storing the response (hair + soap).
The tap and drains are components for transferring the user response (hair +
soap) to a central location.
The only thing that is missing is a component for controlling the taps.
It may seem absurd, but it is a valid interpretation of the claims. If it can
apply to both a razon and a computer, maybe the patent is not descriptive

[ Reply to This | # ]

Question regarding the move to East Texas
Authored by: msfisher on Wednesday, July 06 2011 @ 08:37 AM EDT
Is there a law against venue-shopping?

[ Reply to This | # ]

ESET chart pdf, claims charts & Groklaw
Authored by: msfisher on Wednesday, July 06 2011 @ 08:45 AM EDT
Groklaw is great at spotting and highlighting prior art. Two things in that

First, just looking at the pdf (if I'm reading it right), ANY program which
elicits feedback, alerts a user to impending license expiry and sets up a
payment is infringing. This also means that ANY such system that pre-dates the
patent should be prior art. I can remember the equivalent to the ESET example
as far back as the early 1990's -- I think Norton products were set up this way.
Come to think of it, this also points to obviousness.

Second, perhaps Groklaw should try to get the equivalent charts & pdf's from
Lodsys' other targets. That way, the entire community can be brought to bear
regarding obviousness & prior art.

[ Reply to This | # ]

Lodsys - This is going to get expensive . . . for Lodsys - UPDATE
Authored by: Anonymous on Wednesday, July 06 2011 @ 11:25 AM EDT
>Why is it fair for plaintiff to choose venue?

I didn't say that part was fair :) The assumption is that the plaintiff picks a
venue that's convenient for him, then the defendant can try to move the trial if
there's some really good reason for doing so. This system favors the plaintiff
a bit, which can be defended with these arguments:
-easier access to justice for victims of wrongdoing
-prevent a wealthy defendant/business from only having to defend before a jury
of its neighbors (i.e., friends and family of its employees)
-ensure locally-correct interpretation of local laws.

The lodsys case seems to be purely about patents, so the only applicable law is
federal, but the rule favoring plaintiff's choice of venue is easier to support
in cases where there is choice of applicable laws. You want the laws of
California interpreted by a state court in California, if at all possible.
"Convenient for the plaintiff" might mean "in a jurisdiction
with favorable laws", which is a feature. (Doing business in
Massachusetts? You might get sued in Massachusetts, under Massachusetts' broad
consumer-protection laws.) It might also mean "in a court with experience
with this type of law" (a feature), which is pretty hard to distinguish
from "in a district with a history of awarding verdicts favorable to
plaintiffs" (a bug).

[ Reply to This | # ]

Lodsys - This is going to get expensive . . . for Lodsys - UPDATE
Authored by: tanner andrews on Wednesday, July 06 2011 @ 01:15 PM EDT
UPDATE: [Lodsys now suing thosee who sued it, having filed new action in E.D. Texas]

Not only is there a possibility of venue shopping, but those actions will not lie in Texas. They would appear to be mandatory counter claims in the separate actions. They arise from the same subject matter as the dec actions, and indeed the resolution to the dec action will necessarily govern the Lodsys claims.

I am not your lawyer; please ignore above message.

[ Reply to This | # ]

That second ESET filing
Authored by: Anonymous on Thursday, July 07 2011 @ 02:41 PM EDT
says that the corporate address of LodSys is in Austin. I don't know if it
matters or not, but Austin is in the Western District of Texas, not the Eastern

[ Reply to This | # ]

Really simple and obvious prior art
Authored by: bugstomper on Thursday, July 07 2011 @ 10:24 PM EDT
What I find amazing about the construction claim is that Lodsys lays out how to
find prior art that should convince anyone, unless they do not intend to use
that claim construction in court.

They show how ESET Smart Security 4 has a registration reminder screen that
gives the user a way to enter credit card information that is sent to ESET where
they store information for later use, and the claim construction matches each of
those elements to the claim.

I did a quick search for shareware with online registration and focused on
results that looked like references to old DOS, Apple II, etc., shareware
programs that allowed one to register using a credit card number submitted over
a modem. You can tick off each of the elements in the claim construction in
products that were available in the 1980's, and it is an identical match to
Lodsys' claim construction against ESET, used for the very same purpose.

[ Reply to This | # ]

Groklaw © Copyright 2003-2013 Pamela Jones.
All trademarks and copyrights on this page are owned by their respective owners.
Comments are owned by the individual posters.

PJ's articles are licensed under a Creative Commons License. ( Details )