Its first case against Alphabet (Google) still stayed to await the outcome of multiple inter partes review (IPR) proceedings, Virginia plaintiff Security First Innovations, LLC (SFI) has now sued IBM (1:25-cv-00514) in the Eastern District of Virginia. The three patents-in-suit, each newly asserted in litigation, are described in the complaint as generally "relate[d] to systems for securing Data-At-Rest from unauthorized access or use". IBM is accused of infringement through the provision of its Cloud Object Storage system and related products, with features related to data parsing and encryption at issue.
The asserted patents (8,271,802; 8,904,194; 9,135,456) belong to a family of 18 with issue dates ranging from September 2012 through April 2024 and an earliest estimated priority date in October 2004. The original development work for the patents was conducted at Security First Corporation, a company described by Mark O'Hare—former CEO and founder, as well as a named inventor on the patents—as a "privately held company leading the way in the IT security industry with its data-centric software-defined security technology". In August 2022, Security First assigned the patents in a portfolio of 92 US patent assets, together with foreign counterparts, to SFI.
SFI was formed in Virginia on July 5, 2022, with Leo Guthart—the former chairman of Security First's board—as its organizer. On social media, Guthart identifies himself as a managing partner of Topspin Partners, characterized as "the successor fund to the Long Island Venture Fund", "an affiliate of Renaissance Technologies", a well-known hedge fund. Topspin's public website lists Guthart as a senior advisor.
SFI launched this, its sole litigation campaign in March 2023 with a suit against Google. For RPX coverage of that complaint, as well as additional background concerning Security First, see "'Data Chunks' Patents Make Litigation Debut" (March 2023). Google quickly responded with a motion challenging the asserted patents (9,338,140; 10,452,854; 11,068,609; 11,178,116) as ineligibly directed to the abstract idea of "parsing and encrypting stored data" under Alice.
In November 2023, District Judge Jamar K. Walker denied the motion, ruling that the patents are not "drawn to an abstract idea . . . Rather, the asserted claims are directed to a non-abstract improvement in the function of computers: an improved method for securely storing parsed and encrypted data on at least one storage device". In that same order, Judge Walker also granted SFI's motion to amend its complaint with willful infringement claims as to the '140 patent (but not as to the remaining asserted patents) in light of the plaintiff's "discovery" that Google had "met multiple times with SFI's predecessors-in-interest and was on notice of the patented technology".
The case has been stayed since January 2024 to await the outcome of multiple IPR proceedings. To date, three IPRs are awaiting final written decision (IPR2024-00212; IPR2024-00214; IPR2024-00215) and one (IPR2024-00213) has been denied institution (in June 2024). SFI moved to partially lift the stay and proceed with the case as to the claims of the '140 patent (the patent at-issue in the -213 IPR proceeding), but the motion was denied as the "totality of the circumstances weighed against lifting the stay".
In the new complaint, SFI alleges that the infringement was willful, pleading that IBM had contracted with Security First to include its technology in IBM products for over a decade (since 2012). Prior to IBM's cancellation of its last contract with it in 2019, Security First allegedly delivered multiple products and entered into numerous Joint Development Agreements with IBM to develop products.
The new case has been assigned to District Judge Anthony J. Trenga; The Law Offices of Charles B. Molster, III PLLC represents the plaintiff in litigation. The Eastern District of Virginia imposes heightened disclosure requirements on litigants. Pursuant to those local rules, the plaintiff discloses no entities as "parents, trusts, subsidiaries, and/or affiliates of said party that have issued shares or debt securities to the public or own more than ten percent of the stock" in it and no entities as "parties in the partnerships, general or limited, or owners or members of non-publicly traded entities such as LLCs or other closely held entities" in it. 3/24, Eastern District of Virginia.
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