Marshall federal jury awards $7.5M in proxy server patent infringement case – Marshall News Messenger

618dac0137946.image ProxyEgg Marshall federal jury awards $7.5M in proxy server patent infringement case - Marshall News Messenger

A federal jury in Marshall ordered Oxylabs to pay approximately $7.5 million to Bright Data, formerly known as Luminati Networks, for patent infringement related to a proxy server network.

Bright Data, based in Israel, sued the Lithuanian competitor in 2019, accusing the company of willfully infringing three patents-in-suit. The case was filed as Luminati Networks LTD v. Teso Lt, and sister companies UAB, Oxysales and Metacluster LT. The defendants are collectively known as “Oxylabs”.

In 2020, Oxylabs solidified its spot as the largest global proxy provider, exceeding 100 million ethically-obtained residential proxies.

According to the Associated Press, Bright Data is renowned as the world’s largest data collection platform dedicated to enable businesses view the internet with complete transparency.

“It really means a lot to our client that we got our day in court this year,” attorney Robert Harkins, representing the plaintiff, told the jury.

The jury awarded a total of $7,474,876 in the case. Bright Data was seeking $9.3 million. In the case, Bright Data accused Oxylabs of infringing its patented invention through the use of the defendant’s Oxylabs Residential Proxy Service.

According to Bright Data, residential proxies allow users to choose a specific location (country, city or a mobile carrier) and surf the web as a real-user in that area.

Bright Data’s website,, explains that proxies can be defined as intermediaries that protect users from general web traffic. They also act as buffers by concealing your IP address. Proxies are also alternative IP addresses assigned to users by the provider, the website notes.

“Since 2014, Luminati has offered proxy-based services relying on its ‘Residential Proxy Network,’ the lawsuit states, explaining the patents. “Luminati permits its business customers to utilize its residential proxy network to gather data over the internet using residential proxy devices from various localities as required by the customers.

“Because each of these residential proxy devices has its own residential IP address, web servers receiving requests from these proxy devices do not recognize such requests as originating from the actual user making the request. Instead, the server identifies the request as coming from a residential device based upon the residential IP address of the proxy device. These residential proxy devices provide businesses with a number of advantages. For example, online retailers may anonymously use these residential proxy devices to gather information from web servers (such as for comparative pricing), businesses may utilize these devices to test their web sites from any city in the world, and cyber security firms may employ these devices to test web sites for malicious code.”

Lawsuit claims

According to the lawsuit, the defendant has continued to use, provide, sell, and offer to sell as well as import into the United States residential proxy services including Oxylabs Residential Proxy Service and Real-Time Crawler when it uses the Residential Proxy Service (the accused products-in-suit), including through direct communication with customers and, for example, through the defendants’ website.

“Upon information and belief, defendants offer ‘large-scale web data extraction’ products and services under the Oxylabs brand. Upon information and belief, this includes a residential proxy network with over thirty million residential devices, each with its own IP addresses,” the lawsuit states. “Defendants tout their residential proxy service as including ‘proxies in every country and every city in the world.’ Upon information and belief, these residential proxies have IP addresses that are assigned from a standard Internet Service Provider (ISP) to a homeowner or other residential or mobile user. Upon information and belief, this residential proxy network is used to access content over the internet, wherein that content is identified by a content identifier.”

“Upon information and belief, defendants share common shareholders and jointly provide, sell and offer to sell the Accused Instrumentalities through the same website,” the lawsuit adds. “As such, defendants are jointly and severally liable for infringing the asserted patents.”

Representing the plaintiff, Harkins noted that the patent infringement case meant so much to Bright Data that they brought all top executives to testify, including Bright Data’s CEO Or Lenchner, founder Ofer Vilenski, and chief technology officer Ron Kol.

“Mr. Vilenski started this company with hard work and excellent ideas with his partner,” Harkins said, sharing he was inspired by Microsoft co-founder Bill Gates.

Closing arguments

Harkins told jurors that Bright Data provides reliable and accurate data collection. He argued that the patents are not about caching as the defendant suggested.

Harkins also argued that the technology has always been in the 2009 patent application. He said the inventor came up with the ideas in 2009 and the use for them later.

“The technology was always there. Ofer Vilenski (the named inventor) said he was working for a more elegant internet and they came up with eight different things,” Harkins said. “Yes, there was an invention about caching, but Mr. Vilenski described it as routing.”

Attorney Brett Govett, representing Oxylabs, argued that the lawsuit was all about making money for investors.

“The plaintiff is owned 75 percent by a private equity fund,” said Govett. “That’s all this lawsuit is about, generating return for the investor.”

He noted the purpose of a private equity fund is to invest capital on behalf of the limited partners, investors and to generate the return for investors.

“They have some 53 percent of the market proxy already. What they’re attempting to do … they want 100 percent of the market on a patent that has nothing to do with residential proxy,” said Govett.

“You’re darn right they’re stretching the patent,” he said.

Trying to prove invalidity, Govett said the patents-in-suit are not new inventions.

“It’s ordinary use of the internet. There’s nothing novel or inventive about that,” he said.

Govett also argued that the defendant’s server is outside of the United States, and therefore does not infringe.

“At least every asserted claim is provided outside of the United States,” he said. “Canada, Germany, Singapore. We have customers there. The second server is required in the United States for infringement. We’re not talking about sending or receiving letters. We’re talking about computers and transmitting information over the internet. These claims do not work without all its components. Because the second server is not in the United States, there is no infringement.”

Making final arguments for the plaintiff, Harkins said Bright Data wasn’t suing about servers outside of the United States.

“Walmart, Amazon, Target — these are companies that will only do business with the dominate market players and there are only two – Bright Data is number one and Oxylabs is number two,” Harkins said. “Every step is performed at the minions and not at the server”

“They are distracting you,” he said of the defendant. “We are not suing about minions that are outside of the United States.”

The trial was held in US District Chief Judge Rodney Gilstrap’s courtroom.

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