Virtuozzo International GmbH v. Cloud Linux, Inc. et al

On April 9, 2021, Virtuozzo International GmbH (“Plaintiff” or “Virtuozzo”), represented by Karen L. Pascale and Robert M. Vrana of Young, Conaway, Stargatt & Taylor LLP filed an intellectual property lawsuit against Cloud Linux, Inc. and Cloud Linux Software, Inc. (“Defendants”), seeking injunctive relief along with damages for allegedly infringing the technology relating to virtualization containers owned by the Plaintiff. This case was filed in the U.S. District Court for the District of Delaware with Judge Leonard P. Stark presiding. 

In its complaint, the Plaintiff alleged that “The patents-in-suit, U.S. Patent Nos. 6,928,194 (the “’194 patent”), 7,725,258 (the “’258 patent”), 7,925,114 (the “’114 patent”), 8,483,960 (the “’960 patent”), 9,389,298 (the “’298 patent”), 9,797,980 (the “’980 patent) (collectively, the “Asserted Patents”), are generally directed to systems and methods for collection of image data using a plurality of sensors and for processing the collected image data to generate high quality output images.”

The Plaintiff further alleged “U.S. Patent Nos. 7,461,148 (“the ’148 Patent”); 10,795,659 (“the ’659 Patent”); 8,145,740 (“the ’740 Patent”); and 8,539,137 (“the ’137 Patent”) (collectively, “the Asserted Patents”). Defendants make, use, sell, offer for sale, or import into the United States products and services that infringe and/or are used to infringe the Asserted Patents. These products and services include at least CloudLinux OS, LVE Manager, CageFS, and KernelCare+ (the “Accused Products”).”

The Plaintiff even further alleged that “Further, before the filing of this Complaint, Defendants’ CEO, Igor Seletskiy admitted that Defendants’ LVE technology “is similar to” Virtuozzo’s “container technologies,” which technologies are patented and protected, in part, by one or more of the Asserted Patents. Moreover, before the filing of this Complaint, Defendants had a close relationship with Virtuozzo, including as a result of the spinning out of assets from Virtuozzo into Cloud Linux. On information and belief, as a result of that close relationship, Defendants knew of (or should have known of but willfully blinded themselves to) Plaintiff’s patented technologies and the Asserted Patents, and knew, or should have known, that Defendants were using without authorization those patented technologies, and therefore infringing the Asserted Patents.”

The Plaintiff also alleged that “Further, before the filing of this Complaint, Defendants were informed that they were infringing Plaintiff’s patents, including through the operation of Defendants’ Cloud Linux OS and LVE technologies. Defendants did not dispute that they were infringing, but nevertheless did not cease their infringing conduct nor pay for a license. On information and  belief, as a result of that notice of infringement, Defendants investigated their infringing conduct and knew of their and their customers’ infringement of the Asserted Patents, or willfully blinded themselves to those facts by advertently failing to conduct such an investigation.”

There are four claims for relief laid down by the Plaintiff. The first claim is for alleged infringement of U.S. Patent 7,461,148. The second claim is for alleged infringement of U.S. Patent 10,795,659. The third claim is for alleged infringement of U.S. Patent 8,145,740 and the fourth claim is alleged infringement of U.S. Patent 8,539,137.

In its prayer for relief, the Plaintiff has requested the court to adjudicate that the Defendant has infringed the patents-in-suit, grant preliminary and permanent injunction against Defendants, and award damages which shall not be less than reasonable royalty including all prejudgment and post-judgment interest. The Plaintiff further requested the court to award trebled damages along with costs of litigation.

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