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DDR Holdings v. Digital River

DDR Holdings v. Digital River

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Published by PatentBlast
DDR Holdings v. Digital River
DDR Holdings v. Digital River

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Published by: PatentBlast on Aug 22, 2013
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08/22/2013

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C
OMPLAINT
 
DDR
V
.
 
DRIV P
AGE
1
IN THE UNITED STATES DISTRICT COURT
 
FOR THE EASTERN DISTRICT OF TEXAS
 
(MARSHALL DIVISION)
 DDR HOLDINGS, LLC,Plaintiff,vs.DIGITAL RIVER, INC.,Defendant.))))))))Civil Action No. 2:13-cv-647
COMPLAINT
 
(Related to Civil Action No. 2-06-CV-00042-JRG)
  JURYDDR Holdings, LLC (“DDR”) alleges:1. DDR is a Georgia limited liability company with its principal placeof business in Dunwoody, Georgia. DDR is in the business of developing,managing, and licensing intellectual property for syndicated e-commerce,including related patents and other intellectual property.2. DDR owns all right, title, and interest in U.S. Patent 6,993,572,issued January 31, 2006, and U.S. Patent 8,515,825, issued August 20, 2013(today), including the right to sue for any patent infringement.3. Daniel D. Ross is the managing director of DDR and a co-inventorof the patents-in-suit here.4. In the late 1990s, Mr. Ross founded a company called NexchangeCorporation to commercialize inventions in the patents (then an application). By2000, Nexchange had arranged a network of content websites that reached overhalf of all U.S. Internet users, and over forty brand-name merchants offeredgoods or services over the Nexchange network. However, Nexchange beganwinding down its services in late 2000. In 2003, Mr. Ross acquired the rights tothe patent properties for valuable consideration from Nexchange and assignedthose rights to a company he formed, DDR. DDR owns both of the patents listedin paragraph 2 above.
 
C
OMPLAINT
 
DDR
V
.
 
DRIV P
AGE
25. Defendant Digital River, Inc. (“DRIV”) is a Delaware corporationheadquartered in Eden Prairie, Minnesota. In January 2006, DDR sued DRIV forinfringing the ‘572 Patent and its parent patent. DDR’s suit was in this district,Civil Action No. 2-06-CV-00042.6. The lawsuit against DRIV proceeded to trial in October 2012 inMarshall, Texas. At trial, DDR presented evidence that DDR alleged constitutedinfringement of claims 13, 17, and 20 of the ‘572 Patent by DRIV through itsactivities in connection with six DRIV customers. DRIV presented at trialevidence and argument alleging that the asserted patent claims were invalid onaccount of prior art.7. The jury, by verdict rendered on October 12, 2012, found that DRIVhad infringed claims 13, 17, and 20 of the ‘572 Patent and awarded DDR a judgment of $750,000 for compensation for DRIV’s infringement through thetime of trial. The jury further found that DRIV had not proven by clear andconvincing evidence that the above-listed claims of the ‘572 Patent were invalid.8. After trial, DRIV moved for judgment as a matter of law on variousgrounds, including non-infringement and damages, and also including invalidityof the above-listed claims of the ‘572 Patent
 
as claiming unpatentable subjectmatter under 35 U.S.C. § 101, as indefinite under 35 U.S.C. §112, and asunpatentable over certain prior art. The Court denied DRIV’s motions in theirentirety and entered judgment on June 20, 2013, in the amount of $1,061,960.70(the compensation for infringement, plus pre-judgment interest through trial,plus post-judgment interest through the date of judgment).9. DRIV has continued to infringe claims 13, 17, and 20 of the ‘572Patent since the date of the jury verdict with respect to at least three of the sixcustomers, including the largest, as to which the jury found DRIV’s activitiesinfringing DDR’s patents.
 
C
OMPLAINT
 
DDR
V
.
 
DRIV P
AGE
310. DRIV’s activities with respect to at least the customers referenced inparagraph 9 as continuing infringement also infringe the newly issued ‘825Patent from today’s date.11. DRIV also is infringing claims 13, 17, and 20 of the ‘572 Patent andcertain claims of the ‘825 Patent with respect to other of its customers.12. For example, DRIV made publicly accessible, over the Internet, aweb page located at “store.trendmicro.com” that is, upon information and belief,operated and controlled by DRIV. Through that website, DRIV has facilitated thesales of goods of DRIV’s customer, Trend Micro Inc., to a large number ofresidents of this district. In connection with operation of that website, DRIVinfringes the above-listed patents and patent claims.13. Upon information and belief, DRIV has earned tens of millions ofdollars from transactions having connection with the United States effectuatedthrough the Internet, through operation of the above-referenced and otherinfringing websites.14. The ‘825 Patent issued after the Patent Office was made aware,
inter alia
, of the existence of the lawsuit and trial referenced above, the argumentsmade by DRIV of invalidity, including specifically DRIV’s arguments withrespect to alleged invalidity for unpatentable subject matter under 35 U.S.C.§101, indefiniteness under 35 U.S.C. §112, and prior-art invalidity under 35U.S.C. §§102/103, and the Court’s judgment. The Patent Office received alengthy invalidity report prepared by an expert retained by DRIV and whotestified at trial for DRIV, as well as all prior-art references previously cited byDRIV during the course of the lawsuit before the expert’s report, and decided toallow the ‘825 Patent nonetheless.15. DRIV has infringed the patents and claims listed in paragraph 11above, whether directly, literally, through the doctrine of equivalents, or byinducing or contributing to infringement by others, including its customers.

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