Cloud IPQ: Enhancing Your Cloud IpQ®

In its latest filing in February 2019, non-practicing entity Akoloutheo, LLC has expanded its Eastern District of Texas patent litigation campaign to include Oracle. Akoloutheo accuses the& Oracle Analytics Cloud, Oracle Exadata, and Oracle Data Visualization technology as infringing on its patent. Formed in January 2018 as a Texas Limited Liability Company, Akoloutheo was assigned the rights to U.S. Patent 7,426,730 (the ‘730 patent) less than one month later. Akoloutheo wasted no time, beginning its litigation campaign and filing its first patent litigation lawsuit just five days after taking ownership of the ‘730 patent.

Since February 2018, and prior to filing its latest suit against Oracle, Akoloutheo has filed nine other patent infringement suits asserting the ‘730 patent. Akoloutheo’s targets include major players like Siemens cloud-based software and PaaS solutions including the MindSphere cloud-based IoT Operating System, and Citrix Systems cloud-based software and SaaS solutions for network monitoring and management. Akoloutheo has also sued energy companies alleging infringement of another one of its patents relating to IoT-based technologies, such as CenterPoint Energy and its IoT-Based Smart Grid and Smart Meters. Each of Akoloutheo’s ten suits involving the ‘730 patent have been filed in the plaintiff-friendly U.S. District Court for the Eastern District of Texas, and have been resolved quickly. Of the nine cases filed before Oracle, seven resulted in voluntary dismissal (likely settlement) after approximately 100 days of minimal litigation activity.

In its sparse complaint, Akoloutheo alleges that Oracle infringes the ‘730 patent, which claims priority to a provisional application filed in April 2001. The patent was issued in September 2008 and expires in April 2022. The ‘730 patent attempts to address the problem of how to provide an efficient, generalized, and scalable transaction framework that integrates a variety of information services without requiring extensive custom development for each of the services. By creating and employing flexible transaction functions, the ‘730 patent purportedly limits, controls, and processes large amounts information that flows between sources and consumers according to specific rules.

In its complaint against Oracle, Akoloutheo alleges that Oracle provides access to various cloud-based network software (such as Oracle Analytics Cloud) as well as devices and systems for managing networked resources (such as Oracle’s Exadata Database Machine), which, when coupled with information and application resources, form a cohesive Oracle network communication system that infringes the ‘730 patent. As an example of an infringing system, Akoloutheo points to Oracle’s Data Visualization Desktop which provides user access to a variety of network resources that are catalogued for that individual user. Once the user selects a network resource to access, the system selects the responsive resource and delivers it to the user through the interface.

Given that there has been no meaningful challenge to the validity of ‘730 patent in a petition for Inter Partes Review or through extended litigation, it’s likely that Akoloutheo’s patent campaign could continue unabated. With the general applicability of the patent, many more companies could find themselves in Akoloutheo’s crosshairs should they offer products related to cloud-based software and/or IoT solutions that enable users to access critical information across various network resources and network connected devices. Since Akoloutheo appears to be scaling up the size of the entities it targets, large cloud services providers and IoT technology providers could be ensnared it its ongoing infringement suits.

Akoloutheo is the Greek work for “follow” or “to join one as a disciple.” While Oracle most certainly will not “follow” Akoloutheo anywhere under any circumstance, since the case is still in its early stages, observers will have to wait and see whether Oracle raises a challenge to the ‘730 patent or “follows” the other defendants and resolves the case early. Given its track record of early dismissals, it’s likely that Akoloutheo is settling on the cheap for nuisance value, so there may be limited cause for concern as to Akoloutheo’s ability to disrupt the cloud software and IoT industry at this stage. Even so, this patent troll campaign is a prime example of the IP threats and distractions that companies using cloud and IoT technologies face today and in the foreseeable future.