NM, LLC v. The Kroger Co.

Case Overview and Background

This patent infringement litigation involves plaintiff NM, LLC, a New Mexico-based limited liability company, and defendant The Kroger Co., a major U.S. retailer. Public records and litigation patterns strongly suggest that NM, LLC is a non-practicing entity (NPE), also known as a patent assertion entity (PAE), meaning it was likely formed to acquire and enforce patents rather than to produce goods or services. The defendant, Kroger, is one of the largest supermarket operators in the United States, headquartered in Ohio and running thousands of retail food and drug stores, multi-department stores, and fuel centers under various brand names. The lawsuit alleges that Kroger's in-store systems for managing and updating product prices infringe upon the plaintiff's patent. The accused technology is fundamental to modern large-scale retail: Kroger's method of using a central database to electronically control and distribute pricing information to its point-of-sale scanners and other displays throughout its stores.

The single patent asserted in the case is U.S. Patent No. 5,978,773, titled "Method and system for updating and distributing pricing information in a retail establishment." Filed in 1995, the patent describes a system for managing price changes from a central controller and communicating those updates to remote pricing displays within a store. The lawsuit was filed on May 9, 2014, in the U.S. District Court for the District of Colorado. This venue is not a traditional hub for patent litigation, unlike the districts in Texas or Delaware. The choice of Colorado was likely based on Kroger's significant and continuous business operations in the state, where it operates under well-known banners such as King Soopers and City Market, thereby establishing legal jurisdiction. Information about the specific judge assigned to the case is not readily available in the public records searched.

The case is notable as it exemplifies the litigation model employed by PAEs during the early-to-mid 2010s, where patents covering broad business methods were asserted against large, established operating companies. The timing of the suit is also significant; the '773 patent was set to expire in October 2015, approximately 17 months after the complaint was filed. This limited remaining patent term often creates pressure for defendants to pursue an early settlement to avoid the high costs of litigation over a patent that would soon enter the public domain. The assertion against a foundational retail technology meant the case could have had broader implications for the grocery and retail industry if it had proceeded to a significant ruling. However, as is common in such cases, the final disposition is not publicly documented, suggesting a likely confidential settlement between the parties.

Key Legal Developments and Outcome

The litigation between NM, LLC and The Kroger Co. was short-lived, lasting just over six months before its termination. The case docket shows a rapid progression from filing to dismissal, which is characteristic of many patent lawsuits brought by non-practicing entities where an early settlement is the primary objective.

• 2014-05-09: Complaint Filed
  NM, LLC filed its patent infringement complaint against The Kroger Co. in the U.S. District Court for the District of Colorado, asserting U.S. Patent No. 5,978,773. The case was assigned to Judge William J. Martinez. The complaint alleged that Kroger's systems for updating and distributing pricing information to its point-of-sale scanners and in-store displays infringed upon the '773 patent.

• 2014-07-14: The Kroger Co.'s Answer
  Kroger filed its answer to the complaint. While the specific details of the answer, including any affirmative defenses or counterclaims, are not detailed in the available public records, defendants in such cases typically deny infringement, assert patent invalidity, and may raise other defenses like patent misuse or inequitable conduct.

• 2014-11-13: Joint Motion to Dismiss and Case Termination
  The parties filed a joint motion to dismiss the case with prejudice. The filing of a joint motion to dismiss with prejudice, where each party agrees to bear its own attorneys' fees and costs, strongly indicates that a confidential settlement was reached. On the same day, the court granted the motion and terminated the case.

There is no evidence in the public record that the case progressed to significant litigation milestones such as a Markman hearing for claim construction, summary judgment motions, or trial. The quick resolution prevented any substantive rulings on the validity or infringement of the asserted patent.

Furthermore, no parallel proceedings at the Patent Trial and Appeal Board (PTAB), such as an inter partes review (IPR), were filed against U.S. Patent No. 5,978,773 in connection with this or any other litigation. The absence of a PTAB challenge is not unusual in cases that settle quickly, as the IPR process is costly and typically pursued by defendants who are preparing for a longer-term litigation fight. The case was formally closed on November 13, 2014, with the likely outcome being a private settlement between NM, LLC and The Kroger Co.

Counsel for Plaintiff NM, LLC

Plaintiff NM, LLC was represented by attorneys from the Chicago-based intellectual property firm Niro, Haller & Niro, known for its aggressive representation of patent holders. The firm acted as lead counsel, with a Denver-based firm serving as local counsel in Colorado.

• Raymond P. Niro, Jr. - Lead Counsel

  • Firm: Niro, Haller & Niro (at the time of the case); now with Niro Law Firm.
  • Office Location: Chicago, Illinois.
  • Note: Niro is a prominent patent litigator known for securing multi-million dollar verdicts and settlements for patent holders, including in high-stakes cases against large corporations.

• Paul K. Vickrey - Lead Counsel

  • Firm: Niro, Haller & Niro (at the time of the case); later a founding partner of Vitale, Vickrey, Niro, Solon & Gasey LLP following the dissolution of the Niro firm.
  • Office Location: Chicago, Illinois.
  • Note: Vickrey is a veteran trial lawyer with decades of experience in high-stakes intellectual property litigation, having won substantial jury verdicts in patent and trade secret cases.

• David J. Mahalek - Counsel

  • Firm: Niro, Haller & Niro (at the time of the case).
  • Office Location: Chicago, Illinois.
  • Note: Mahalek was a junior litigation attorney at the Niro firm and was later involved in contentious litigation that resulted in court sanctions and a temporary suspension from practice before the USPTO.

• Heather A. Foster - Local Counsel

  • Firm: Recht Kornfeld P.C.
  • Office Location: Denver, Colorado.
  • Note: As local counsel, Foster would have handled procedural matters in the District of Colorado, and her firm, Recht Kornfeld P.C., is a well-established Denver firm with a broad civil and criminal litigation practice.

Counsel for Defendant The Kroger Co.

The Kroger Co. was represented by attorneys from the national law firm Perkins Coie LLP, which has a substantial intellectual property litigation practice. The team was led by attorneys from its Denver and Chicago offices.

• Peter J. Kinsella - Lead Counsel

  • Firm: Perkins Coie LLP
  • Office Location: Denver, Colorado
  • Note: Kinsella is a veteran intellectual property trial lawyer and was the managing partner of the firm's Denver office, with extensive experience in patent, trademark, and trade secret litigation across various technologies.

• Thomas L. Casagrande - Counsel

  • Firm: Perkins Coie LLP
  • Office Location: Denver, Colorado
  • Note: Casagrande's practice focuses on complex commercial litigation, including intellectual property disputes, and he has represented clients in federal courts across the country.

• Amanda Tessar - Counsel

  • Firm: Perkins Coie LLP
  • Office Location: Denver, Colorado
  • Note: Tessar is an experienced litigator focusing on intellectual property and technology, representing clients in patent, trademark, and copyright disputes.