Quibi is already locked in a legal battle over its rotating video tech
The crown jewel of Quibi’s forthcoming short form video streaming service is a piece of technology the company refers to as “Turnstyle,” which seamlessly switches between landscape and portrait video orientations depending on how you hold your phone. A new lawsuit filed on Tuesday from interactive video developer Eko alleges that Quibi stole the technology after Eko demoed it to employees of the company, including founder and chairman Jeffrey Katzenberg.
In addition to claiming that Quibi is infringing on Eko’s patent for rotating video, Eko’s lawsuit says Quibi misappropriated its trade secrets, as two Quibi employees were given access to Eko’s proprietary technology under NDA while they were at Snapchat before they left to work at Quibi. This included Eko’s “Real Time Switching” technology, which Eko alleges was used by Quibi to create Turnstyle.
Eko CEO Yoni Bloch had also allegedly demonstrated Eko to Katzenberg, “including details regarding technology that Quibi now uses in its touted Turnstyle feature,” according to the lawsuit. Bloch sent materials to Katzenberg, including “APIs/SDKs that embodied the functionality Quibi now calls ‘Turnstyle.’”
(Disclosure: Vox Media, which owns The Verge, has a deal with Quibi to produce a Polygon Daily Essential, and there have been early talks about a Verge show.)
Making matters more complicated, Quibi has its own patent on rotating video with the employees who had seen Eko’s tech listed as inventors. Quibi also filed a lawsuit against Eko one day before Eko filed its own, asking a court to find that Turnstyle doesn’t infringe Eko’s patent. Quibi’s lawsuit states that Eko’s patent and technology “are inapplicable to Quibi’s app and its Turnstyle functionality.”
Quibi alleges that after Eko’s team saw the app during Quibi’s keynote at CES in January, Eko “embarked on a campaign of threats and harassment to coerce money or a licensing deal from Quibi.” Quibi’s lawsuit claims that Eko issued a complaint to Apple’s App Store “in an attempt to derail the scheduled launch of Quibi’s app.” The lawsuit also states that the two aforementioned accused employees don’t have engineering experience and therefore had no “reason to request or obtain Eko code.”
A Quibi spokesperson confirmed to The Verge that the two employees were part of the team that developed the technology — which is also why they were listed as inventors on the patent. The company reiterated, however, that neither have engineering or coding backgrounds. The accusations against them are meritless, the company told The Verge.
“In any event, no Quibi employee brought or used any Eko trade secrets, computer code, or proprietary information to Quibi,” the lawsuit reads.
A representative for Quibi told The Verge that the claims made in Eko’s lawsuit “have absolutely no merit and we will vigorously defend ourselves against them in court.” The representative added that Turnstyle was developed internally, and Quibi “in fact, received a patent for it.”
A person familiar with Eko’s lawsuit against Quibi told The Verge that Quibi has not responded to a letter from Eko sent on February 25th alleging that Quibi was infringing Eko’s patent. The letter, which was obtained by The Verge, states that the “fact that Quibi obtained a patent does not save Quibi from infringement.” The letter breaks down the similarities between Eko and Quibi’s feature — including images demonstrating how the tech works — and language used for both patents.
“Your letter states that Turnstyle does not infringe because it does not resize or map video based on the window dimensions,” the letter reads. “In fact, a simple reading of [Quibi’s] patent demonstrates that Quibi is practicing [Eko’s] patent.”
The two patents are indeed similar. The Eko patent describes a system that “seamlessly transitions” a video between states when a property (like orientation) of a user device changes, while the Quibi patent specifies sending two different video files in different aspect ratios and switching between them when the phone is rotated.
The aforementioned person familiar with Eko’s lawsuit told The Verge that “there’s always a world where someone could be doing something else and there’s a misunderstanding, but there’s all these indications that this isn’t a misunderstanding.”
Whether Quibi’s Turnstyle tech infringes on Eko’s is up to a court to decide. But the Quibi patent reveals some anomalies, Matt Macari, a patent lawyer, told The Verge. First, Quibi didn’t disclose any prior examples of relevant patented technology to the US Patent and Trademark Office (USPTO) when it filed its application, which is uncommon. Companies cite previous patents that are applicable to the application they’re submitting, and The Verge has learned that Quibi didn’t feel any citations were necessary. As the patent application went through the process, the USPTO cited 17 prior patents deemed relevant to Quibi’s technology, and Eko’s patent isn’t one of them.
Quibi’s patent was also issued less than a year after the company filed the application, which means the company paid thousands of dollars to ensure the application was prioritized in the examiner’s queue, Macari said. Standard applications usually take about two to three years to be processed and approved.
Still, Quibi’s decision to file for expedited examination may have nothing to do with Eko, Macari said, since Eko’s technology is older than Quibi’s. “You don’t assert your patents against prior art [citations] as that would end up invalidating your patent,” Macari told The Verge. “But Quibi might have filed for expedited examination because there is definite value in having IP to attract investors or to establish an area of patent protection going forward with a new product [or] service.”
Quibi and Eko are asking a federal judge in California to make a final call on infringement. Quibi is also asking the judge to order Eko to withdraw its complaint to Apple’s App Store ahead of the streamer’s launch on April 6th. The app is currently available to preorder in Apple’s marketplace.