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TNS Media Research, LLC v. TRA Global, Inc.

United States District Court, S.D. New York

October 3, 2013

TNS MEDIA RESEARCH, LLC (d/b/a KANTAR MEDIA AUDIENCES) and CAVENDISH SQUARE HOLDING, B.V., Plaintiffs, -
v.
- TRA GLOBAL, INC. (d/b/a TRA, Inc.), Defendant. TRA GLOBAL, INC. (d/b/a TRA, Inc.), Counterclaim-Plaintiff, -
v.
- TNS MEDIA RESEARCH, LLC (d/b/a KANTAR MEDIA AUDIENCES); CAVENDISH SQUARE HOLDING, B.
v.
; WPP PLC; WPP GROUP USA, INC.; KANTAR GROUP LTD.; and KANTAR RETAIL AMERICA, INC., Counterclaim-Defendants

Page 282

For TRA, Defendant and Counterclaim-Plaintiff: Nathan Lowenstein, Esq., Perry Mark Goldberg, Esq., Trevor Stockinger, Esq., Goldberg, Lowenstein & Weatherwax LLP, Los Angeles, California.

For WPP Companies, Plaintiffs and Counterclaim-Defendants: Marc Rachman, Esq., Andrew Keisner, Esq., Davis & Gilbert LLP, New York, New York; Michael A. Albert, Esq., John Strand, Esq., Charles Steenburg, Esq., Eric Rutt, Esq., Wolf, Greenfield & Sacks, P.C., Boston, Massachusetts.

OPINION

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OPINION AND ORDER

Shira A. Scheindlin, U.S.D.J.

I. INTRODUCTION

This is a dispute over intellectual property pertaining to marketing and advertising analytics. Plaintiffs TNS Media Research, LLC (d/b/a Kantar Media Audiences) (" Kantar Media" )--a market research company--and Cavendish Square Holding B.V. (" Cavendish" )--Kantar Media's affiliate--commenced this action on June 14, 2011 against defendant TRA Global, Inc. (" TRA" ). Kantar Media seeks a declaration that it has not infringed United States Patent No. 7,729,940 (the " '940 Patent" ), of which TRA is the sole assignee. Cavendish alleged in the complaint that TRA breached a contract entitling Cavendish to place a member on TRA's board, but subsequently dropped this claim.

Kantar Media and Cavendish are indirect subsidiaries of WPP PLC, the United Kingdom-based parent company of the largest advertising agency group in the world by revenue. WPP PLC (hereafter, " WPP Parent" ) also maintains WPP Group USA, Inc. (" WPP USA" ), Kantar Group Ltd. (" Kantar Group" ), and Kantar Retail America, Inc. (" Kantar Retail" ) (collectively with WPP PLC, Kantar Media and Cavendish, the " WPP Companies" ) as subsidiaries.

TRA asserts the following six counterclaims against Counterclaim-Defendants the WPP Companies (singly or in combination): (1) patent infringement of the '940 Patent (against Kantar Media); (2) patent infringement of United States Patent No. 8,000,993 (the " '993 Patent" ) (against Kantar Media and Kantar Retail); (3) patent infringement of United States Patent No. 8,112,301 (the " '301 Patent" ) (against Kantar Media and Kantar Retail); (4) aiding and abetting breach of fiduciary duty (against Kantar Media, Cavendish, WPP Parent, WPP USA, and Kantar Group); (5) misappropriation of trade secrets (against the WPP Companies); and (6) breach of contract (against Kantar Retail, Kantar Media, and WPP USA).

Discovery is complete. Presently before the Court is the WPP Companies' motion for summary judgment. The WPP Companies argue that TRA cannot satisfy its burden of proving: (1) cognizable trade secrets or the misappropriation thereof; (2) non-patent damages; or (3) infringement of any of the patent claims it asserts.[1]

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The WPP Companies further argue that the patents alleged by TRA are invalid, on various grounds.

The WPP Companies allege that this motion would " dispose of the case as a whole" if granted.[2] Because TRA has potentially viable theories of damages for its non-patent claims that are not addressed in the WPP Companies' motion, this is in fact only a partial motion for summary judgment.

For the following reasons, the motion is granted as to non-infringement, trade secrets, and non-patent damages, and moot as to invalidity.

II. BACKGROUND[3]

A. Overview

TRA--a nested acronym[4] meaning " True ROI for Media" [5]--was founded in 2007 with the goal of using modern data-mining techniques to determine the cost-effectiveness of advertisements.[6] It soon embarked upon an enviable growth trajectory. After its first financing round in August 2007, its post-money valuation was roughly ten million dollars; after its second round in May 2009, roughly twenty-seven million dollars; and after its third round in May 2010, roughly fifty-four million dollars.[7]

The WPP Companies--through their investment arm, Cavendish--got in on the ground floor, investing a substantial sum in each of TRA's first three financing rounds.[8] The companies even engaged in merger talks--about which more below--but these negotiations fell through shortly after the WPP Companies spent over a billion dollars acquiring Kantar Media, a competing market analytics provider. Subsequently TRA's value dropped precipitously, and it was purchased by TiVo for approximately $20 million in July 2012.[9]

Before delving into the summary judgment record in greater detail, it is helpful to sketch out the contrasting versions of events urged by the parties. TRA alleges that the WPP Companies engaged in merger negotiations solely for the purpose

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of learning its trade secrets and copying its now-patented technologies; that the WPP Companies used this knowledge to release a competing product; and that these actions froze the market, causing its value to take a nosedive. The WPP Companies counter that the merger negotiations failed because TRA had nothing of value to offer; that it developed its products independently over a period of years; and that TRA's value declined because overeager initial investors eventually began to question TRA's lack of sales.

TRA alleges the infringement of fifteen patent claims, five alleged trade secrets, and the non-patent claims identified above. First, I lay out the evidence pertaining to the patent claims; second, to trade secrets; and finally, to non-patent damages.

B. The Patent Claims Asserted by TRA

1. The '940 Patent

a. Claim Asserted

The '940 Patent--titled " Analyzing Return on Investment of Advertising Campaigns by Matching Multiple Data Sources" --issued on June 1, 2010 with TRA designated as the sole assignee.[10] As the title suggests, the claimed invention relates to a method for correlating the ads that consumers view with their purchasing behavior. Claim 71 is illustrative of the invention, and is the only claim of the '940 Patent asserted by TRA. It is set forth in full below.

A computer-implemented method for facilitating analysis of consumer behavior in association with advertising exposure or program delivery, the method comprising:
collecting in an advertising measurement system:
(i) clickstream data [a recording of the user's input into a media device, such as a computer or television set-top box] from a program delivery source of a consumer, wherein collecting the clickstream data is not dependent on a supplemental data collection device, and also wherein the collected clickstream data includes household level data associated with multiple consumer households;
(ii) advertising data associated with delivery of the program by the program delivery source, wherein collecting the advertising data is not dependent on a supplemental data collection device, and also wherein the collected advertising data includes household level data associated with multiple consumer households;
(iii) program data associated with the program delivered on the program delivery source, wherein collecting the program data is not dependent on a supplemental data collection device, and also wherein the collected program data includes household level data associated with multiple consumer households;
(iv) purchase data from a purchase data source, wherein collecting the purchase data is not dependent on a supplemental data collection device, and also wherein the collected purchase data includes household level data associated with multiple consumer households;
matching at least portions of the collected advertising data, the collected clickstream data, the collected purchase data, and the collected program data in the advertising measurement system at a

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household data level with a centrally located electronic computer processor configured for centrally processing data received from the program delivery source, the advertising data source, the program data source, and the purchase data source, wherein the matching further includes:
(i) grouping the collected data in association with an account identifier of each consumer household without processing any personally identifiable information associated with the consumer household, and
(ii) matching each account identifier associated with each consumer household with other account identifiers associated with the same consumer household without processing any personally identifiable information associated with the consumer household;
storing the matched advertising data, clickstream data, purchase data, and program data in at least one centrally located electronic data storage medium operatively associated with the computer processor;
applying at least one cleansing and editing algorithm to the matched and stored data; and,
calculating at least one true target index metric based on the matched and stored data.[11]

In sum, the '940 patent teaches a method for: (1) using a computer to collect data about (i) commands that viewers input into, e.g., a television; (ii) the advertisements that they view; (iii) the programs they watch; and (iv) the products they go on to purchase; (2) grouping these data with a unique identifier that does not personally identify the viewer/purchaser, and transmitting it to a central database; (3) storing this grouped, 'blinded' data in the centrally located database; (4) cleansing and editing the data ( e.g., deleting information that is irrelevant to the advertiser using the invention, or repeated); and (5) using the data to generate granular statistical inferences about the cost-effectiveness of advertisements. For example, TiVo might collect data about the programs and advertisements its users watch, while Walgreens collected their purchasing information from customer loyalty cards; the companies might then group this data together and transmit it--without any personally identifying information--to TRA, which could use it to advise Proctor & Gamble whether to run ads for Tide Detergent during America's Got Talent.

b. Claim Construction Proceedings

A Markman hearing was held on July 6, 2012, and I subsequently issued an Order construing the two phrases in dispute as follows.[12]

Disputed Phrase

Construction

" data about a household that can be

" household level data associated with

later aggregated into a data set

multiple consumer households"

including multiple consumer

households"

" an algorithm to remove

" cleansing and editing algorithm"

inconsistencies in, correct, or otherwise

improve the reliability of data collected

from a program delivery source"

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The parties stipulated to the following claim term constructions, which were entered as an Order.[13]

Term

Stipulated Construction

" clickstream data from a program

" data describing a consumer's

delivery source of a consumer"

exposure to content delivered from a

program delivery source"

" advertising data associated with

" data describing advertisements

deliver of the program by the program

delivered from a program delivery

delivery source"

source"

" program data associated with the

" data describing media content

program delivered on the program

delivered from a program delivery

delivery source"

source"

" data describing the purchase of a

particular product at a given time,

" purchase data from a purchase data

obtained from a purchase data source,

source"

such as a shopping loyalty card, point

of sale collection means, or other

record of a sale of a product or service"

" a piece of hardware that is separate

from the program delivery source or

" supplemental data collection device"

purchase data source and is used for

the exclusive purpose of recording data

that facilitates analysis of consumer

behavior"

" a measurement of the benefit that a

" return on investment metric"

particular past investment ( e.g., an

advertisement) has produced in terms

of changed purchasing behavior"

" a report that allows users to compare

different media environments ( e.g .,

" true target index report"

particular programs, networks, or

dayparts) based on the likelihood that

consumers who meet a particular

profile will be exposed to such media"

" a process to account for differences

between the composition of the sample

" demographics weighting algorithm"

from which data is drawn and the

composition of the larger population

that one wants to study"

2. The '993 Patent

The '993 Patent--titled " Using Consumer Purchase Behavior for Television Targeting" --issued on August 16, 2011, and lists TRA as the sole assignee.[14] TRA asserts that Kantar Media and Kantar Retail have infringed claims 1, 2, 3, 7, 8, and 9. These claims are quoted in full below.

[Claim 1]:

A computer-implemented system for facilitating analysis of consumer behavior in association with advertising exposure

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or program delivery, the system comprising:
an advertising measurement system including at least one electronic computer processor configured for:
[(i)] collecting clickstream data from a program delivery source of a consumer, wherein collecting the clickstream data is not dependent on a supplemental data collection device, and also wherein the collected clickstream data includes household level data associated with multiple consumer households;
(ii) collecting advertising data associated with delivery of the program by the program delivery source, wherein collecting the advertising data is not dependent on a supplemental data collection device, and also wherein the collected advertising data includes household level data associated with multiple consumer households;
(iii) collecting programming data associated with the program delivered on the program delivery source, wherein collecting the programming data is not dependent on a supplemental data collection device, and also wherein the collected programming data includes household level data associated with multiple consumer households;
(iv) collecting purchase data from a purchase data source, wherein collecting the purchase data is not dependent on a supplemental data collection device, and also wherein the collected purchase data includes household level data associated with multiple consumer households; and
(v) matching at least portions of the collected advertising data, the collected clickstream data, the collected purchase data, and the collected programming data at a household data level;
wherein the collected data include a first identifier associated with the household assigned to the program delivery source;
a module configured to use a thesaurus for:
(i) producing data from the collected data without personally identifiable information, and
(ii) indexing the produced data with a second identifier, wherein the thesaurus relates each first identifier of each household to the second identifier;
at least one electronic data storage medium operatively associated with the computer processor, the data storage medium configured for storing the matched advertising data, clickstream data, purchase data, and programming data;
a module programmed for applying at least one cleansing and editing algorithm to the matched data or the stored data; and
a module programmed for calculating at least one return on investment metric or true target index metric based on the matched or stored data.[15]
[Claim 2]
The system of claim 1, further comprising:
a list matcher configured to:
receive data communicated in parallel from the one or more data sources, the communicated data comprising at least personally identifiable information associated with the household and the first identifier associated with the household assigned by the data source;

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generate the thesaurus relating each first identifier associated with the household to the second identifier; and
send the thesaurus to the module configured to use the thesaurus.[16]
[Claim 3]
The system of claim 1, wherein the thesaurus is configured for relating an account number identifier to at least one other account number identifier associated with the same household across multiple data sources.[17]
[Claim 7]
A computer-implemented method for facilitating analysis of consumer behavior in association with advertising exposure or program delivery, the method comprising:
collecting in an advertising measurement system:
(i) clickstream data from a program delivery source of a consumer, wherein collecting the clickstream data is not dependent on a supplemental data collection device, and also wherein the collected clickstream data includes household level data associated with multiple consumer households;
(ii) advertising data associated with delivery of the program by the program delivery source, wherein collecting the advertising data is not dependent on a supplemental data collection device, and also wherein the collected advertising data includes household level data associated with multiple consumer households;
(iii) programming data associated with the program delivered on the program delivery source, wherein collecting the programming data is not dependent on a supplemental data collection device, and also wherein the collected programming data includes household level data associated with multiple consumer households; and,
(iv) purchase data from a purchase data source, wherein collecting the purchase data is not dependent on a supplemental data collection device, and also wherein the collected purchase data includes household level data associated with multiple consumer households;
matching at least portions of the collected advertising data, the collected clickstream data, the collected purchase data, and the collected programming data in the advertising measurement system at a household data level with at least one electronic computer processor configured for processing data received from the program delivery source, the advertising data source, the programming data source, and the purchase data source, wherein the matching further includes:
[(i)] receiving data including a first identifier associated with the household assigned by the data source, and
(ii) electronically using a thesaurus for: producing data without personally identifiable information, and indexing the produced data by a second identifier, wherein the thesaurus relates each first identifier of the household to the second identifier; storing the matched advertising data, clickstream data, purchase data, and programming data in at least one electronic data

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storage medium operatively associated with the computer processor; applying at least one cleansing and editing algorithm to the matched data or the stored data; and, calculating at least one return on investment metric or true target index metric based on the matched or stored data.[18]
[Claim 8]
The method of claim 7, further comprising:
receiving data communicated in parallel from the one or more data sources, the communicated data comprising at least personally identifiable information associated with the household and the first identifier associated with the household assigned by the data source; and,
generating the thesaurus for relating each first identifier associated with the household to the second identifier.[19]
[Claim 9]
The method of claim 7, further comprising using the thesaurus for relating an account number identifier to at least one other account number identifier associated with the same household across multiple data sources.[20]

3. The '301 Patent

The '301 Patent--titled " Using Consumer Purchase Behavior for Television Targeting" --issued on February 7, 2012, and lists TRA as the sole assignee.[21] TRA asserts that Kantar Media and Kantar Research have infringed claims 1, 23, 42, 47, 49, 63, 108, and 109, which are set forth in full below.

[Claim 1]
A computer-implemented method for facilitating analysis of consumer behavior in association with advertising exposure or program delivery, the method comprising:
collecting in an advertising measurement system:
(i) clickstream data from a program delivery source of a consumer, wherein collecting the clickstream data is not dependent on a supplemental data collection device, and also wherein the collected clickstream data includes household data;
(ii) advertising data associated with delivery of the program by the program delivery source, wherein collecting the advertising data is not dependent on a supplemental data collection device, and also wherein the collected advertising data includes ...

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