Almondnet, Inc. v. Microsoft Corporation

Case Overview and Background

Plaintiff Almondnet, Inc., a veteran ad-tech company, initiated this patent litigation in the U.S. District Court for the Eastern District of New York, demonstrating its strategy of asserting its portfolio against major technology players. Almondnet, established in 1998, and its subsidiary Datonics are operating companies that develop and license technologies related to privacy-conscious targeted advertising, audience data aggregation, and analytics. Despite being an operating company, Almondnet is also a prolific patent plaintiff, having engaged in litigation against numerous tech giants, including Amazon, Meta, and Roku, often resulting in settlements or, in one notable instance, a $122 million jury verdict against Amazon. The original defendant in this specific case, 1:16-cv-01557, was Yahoo! Inc. (later Oath Holdings Inc.), a major internet services and media company. The case represents an earlier phase of Almondnet's broader, ongoing enforcement campaign.

The lawsuit initially accused Yahoo!'s advertising platforms of infringing multiple patents, including U.S. Patent No. 8,671,139. The '139 patent, titled "Media properties selection method and system based on expected profit from profile-based ad delivery," generally covers a system for automatically selecting which websites to display an ad on, based on calculations of expected profit from showing the ad to a visitor with a specific user profile. This technology is central to behavioral and programmatic advertising, where advertisers bid to show ads to specific users across different web properties based on their browsing history and other data. Almondnet alleged that Yahoo!'s ad network, which delivered targeted ads across its own sites and partner sites, utilized this patented method.

Filed in the Eastern District of New York and assigned to Senior Judge I. Leo Glasser, the case's venue became a critical issue. Following the Supreme Court's 2017 decision in TC Heartland LLC v. Kraft Foods, which tightened the rules for where patent lawsuits can be filed, Yahoo moved to dismiss the case for improper venue. Judge Glasser initially denied the motion, but the U.S. Court of Appeals for the Federal Circuit later granted a writ of mandamus, compelling the district court to either dismiss or transfer the case. This procedural outcome, effectively terminating the case in the EDNY as against Yahoo/Oath, is why its status is unclear from docket summaries. The case is notable as it was part of an early wave of Almondnet's litigation and was directly linked to several inter partes and covered business method (CBM) reviews at the Patent Trial and Appeal Board (PTAB), where Yahoo challenged the validity of Almondnet's patents. While this specific case against Yahoo was halted on venue grounds, Almondnet later filed new lawsuits against Microsoft and other major tech companies in the Western District of Texas, asserting the same '139 patent, among others. In a related action, Microsoft subsequently filed its own petition for inter partes review (IPR2022-01319) against the '139 patent, although the PTAB denied institution.

Unraveling a Transferred and Terminated Litigation

Case Summary: What began as a 2016 patent infringement lawsuit in the Eastern District of New York, captioned in public records as Almondnet, Inc. v. Yahoo! Inc., was ultimately transferred to Delaware and quickly terminated. The litigation was marked by a significant and prolonged dispute over venue, which escalated to the U.S. Court of Appeals for the Federal Circuit before the case was transferred and subsequently dismissed.

Contrary to the provided case metadata, the defendant in case number 1:16-cv-01557 was Yahoo!, Inc. (later Oath Holdings Inc.), not Microsoft Corporation. Almondnet filed a separate lawsuit against Microsoft years later in a different district. Furthermore, while the provided metadata lists U.S. Patent No. 8,671,139 as the patent-in-suit, extensive public records, including parallel patent review filings, connect the Yahoo litigation to a different family of Almondnet patents, including U.S. Patent Nos. 8,494,904 and 8,244,582.

Key Legal Developments and Outcome

Filing and Initial Pleadings (2016)

• 2016-03-30: Almondnet, Inc., along with its affiliates Datonics, LLC, and Intent IQ, LLC, filed a patent infringement complaint against Yahoo! Inc. in the U.S. District Court for the Eastern District of New York (EDNY).

Pre-trial Motions & Venue Dispute (2016-2019)

• 2016-07-11: Yahoo initially moved to dismiss for failure to state a claim under Rule 12(b)(6) but did not challenge the venue.
• 2017-05-22: The U.S. Supreme Court issued its landmark decision in TC Heartland LLC v. Kraft Foods Group Brands LLC, which significantly narrowed the definition of corporate residence for patent venue purposes.
• Post-TC Heartland: Following the Supreme Court's decision, Yahoo moved to dismiss the case for improper venue under 28 U.S.C. § 1400(b), arguing it did not have a "regular and established place of business" in the EDNY.
• 2017-09-01: The EDNY district court denied Yahoo's motion to dismiss, finding that Yahoo had waived its venue defense by not raising it in its initial motion to dismiss.
• 2017-10: Yahoo (by then known as Oath Holdings Inc.) petitioned the Federal Circuit for a writ of mandamus, asking the appellate court to order the district court to grant the motion to dismiss.
• 2018-11-14: After a complex procedural history that included a prior mandamus petition and a remand in light of the Federal Circuit's decision in In re Micron, the Federal Circuit granted Oath's second mandamus petition. The court ruled that TC Heartland represented a change in controlling law, meaning Oath's venue defense was not "available" at the time of its initial motion, thus excusing the failure to raise it. The Federal Circuit remanded the case with instructions for the district court to either dismiss or transfer the case.
• 2019-02-06: As a result of the Federal Circuit's order, the case was transferred from the EDNY to the U.S. District Court for the District of Delaware, where it was assigned case number 1:19-cv-00247.

Final Disposition in Delaware (2019)

• 2019-03-04: Shortly after the case was transferred, the litigation was terminated. Public litigation databases report that the case was concluded via a voluntary dismissal by the plaintiffs. This swift termination, following a multi-year battle over venue, suggests the parties may have reached a settlement.

Parallel PTAB Proceedings

• In parallel with the district court litigation, Yahoo filed multiple petitions for Covered Business Method (CBM) patent reviews with the Patent Trial and Appeal Board (PTAB), challenging the validity of several Almondnet patents asserted in the EDNY case.
• 2017-04-18 and 2017-05-15: Yahoo filed a series of CBM petitions against patents including U.S. Patent Nos. 7,822,639, 8,244,586, 7,979,307, 8,775,249, 8,494,904, and 8,244,582. In its petitions, Yahoo argued the patents were invalid under 35 U.S.C. § 101 for claiming abstract ideas.
• These PTAB proceedings were explicitly linked to the AlmondNet, Inc. et al. v. Yahoo! Inc., 1:16-cv-01557 (E.D.N.Y.) case. The PTAB's actions on these petitions would have proceeded in parallel and could have influenced settlement discussions; however, the ultimate transfer and dismissal of the district court case rendered their direct impact on that litigation moot.

No PTAB proceedings involving either Yahoo or Microsoft and U.S. Patent No. 8,671,139 have been identified in connection with this case.

Plaintiff's Counsel of Record

Based on a review of court filings and other public records, the following attorneys appeared on behalf of the plaintiff, Almondnet, Inc., and its related entities in this case. The representation was led by attorneys from the national litigation boutique Susman Godfrey L.L.P., with additional counsel from Hoffman Patent Firm.

Lead Counsel

• Name: Ian B. Crosby

  • Role: Lead Counsel
  • Firm: Susman Godfrey L.L.P. (Seattle office)
  • Note: Crosby's firm bio lists his successful representation of Almondnet in this matter, noting he "obtained settlement for patent owner client AlmondNet after defeating eight covered business method review petitions and obtaining transfer to District of Delaware in lieu of dismissal following the Supreme Court’s intervening decision in TC Heartland." He is a nationally recognized intellectual property trial lawyer with extensive experience in high-stakes patent litigation.

• Name: Louis J. Hoffman

  • Role: Lead Counsel
  • Firm: Hoffman Patent Firm (Scottsdale, Arizona)
  • Note: Docket entries from related appellate proceedings explicitly identify Hoffman as lead and pro hac vice counsel for Almondnet in the 1:16-cv-01557 case. He is a registered patent attorney who has focused on patent enforcement, licensing, and prosecution for over three decades.

Of Counsel

• Name: Mark Howard Hatch-Miller
  • Role: Of Counsel
  • Firm: Susman Godfrey L.L.P.
  • Note: A Notice of Appearance was filed by Mark Howard Hatch-Miller on behalf of Almondnet. While public information on this specific attorney is limited, docket entries associate him with the other Susman Godfrey attorneys representing the plaintiffs in this action. His role appears to be in a supporting capacity to the lead counsel from the firm.

Based on a review of court records and related filings, the defendant in the case captioned Almondnet, Inc., 1:16-cv-01557, in the U.S. District Court for the Eastern District of New York, was Yahoo! Inc. (later known as Oath Holdings Inc.), not Microsoft Corporation. The initial case metadata appears to be incorrect. The case against Yahoo! was ultimately transferred to the District of Delaware.

However, Almondnet has engaged in separate and extensive patent litigation against Microsoft Corporation in other federal districts concerning the same patent family related to targeted advertising technology. Counsel for Microsoft in those related matters have been identified through docket reports and parallel administrative patent challenges.

Counsel for Microsoft in Related Almondnet Litigation

While no counsel for Microsoft appeared in the 1:16-cv-01557 case, the following attorneys have been identified as representing Microsoft in other patent disputes brought by Almondnet.

Fish & Richardson P.C.

This firm frequently represents Microsoft in high-stakes patent litigation and appeared for the company in Inter Partes Review (IPR) proceedings before the Patent Trial and Appeal Board (PTAB) challenging the validity of Almondnet's patents.

• Name: Leisa M. Peschel
  • Role: Lead Counsel (in PTAB proceedings)
  • Firm: Fish & Richardson P.C., Minneapolis, MN
  • Note: Listed as counsel for petitioner Microsoft in IPR2022-01319, which challenged the patent-at-issue in district court litigation brought by Almondnet.

Perkins Coie LLP

Attorneys from Perkins Coie represented Microsoft in litigation filed by Almondnet in the U.S. District Court for the Western District of Texas.

• Name: Blake T. Dietrich

  • Role: Counsel
  • Firm: Perkins Coie LLP, Denver, CO
  • Note: Filed a notice of appearance for Microsoft in AlmondNet, Inc. et al v. Microsoft Corporation et al, 6:2022cv01206 (W.D. Tex.).

• Name: William Thomas Nilsson

  • Role: Counsel
  • Firm: Perkins Coie LLP, Seattle, WA
  • Note: Filed a notice of appearance for Microsoft in AlmondNet, Inc. et al v. Microsoft Corporation et al, 6:2022cv01206 (W.D. Tex.).

This summary clarifies the defendant in the specified case and provides counsel information for Microsoft based on related, correctly identified litigation initiated by the same plaintiff.