US company Alpha Modus is suing Inditex for patent infringement

The US technology company Alpha Modus has filed a lawsuit against the Spanish fashion group Inditex. The reason is patent infringement. The company specializes in developing technological solutions for retail. Alpha Modus argues that the owner of chains such as Zara, Massimo Dutti and Bershka has violated its intellectual and industrial property rights. This happened because Inditex integrated the patented technologies into its ecosystem as a fashion group without authorization.

The lawsuit was filed Nov. 14 in the U.S. District Court for the Eastern District of Texas. The plaintiff is Alpha Modus Corporation, a subsidiary of the listed Alpha Modus Holdings. The lawsuit is directed against Industria de Diseño Textil (Inditex) and Zara USA. This is the Spanish company and its subsidiary for the Zara operations in the USA.

Alpha Modus accuses them of infringing up to four patents. Specifically, it concerns a method and system for customer support in retail, a method and system for inventory management, a method for marketing and disseminating personalized advertising for retail products and a method and systems for shopping in a retail store. Alpha Modus defends this series of patents as protection of its technologies. These are used for real-time analysis of retail activities and personalized interaction with customers. This also includes intelligent inventory management and automation of in-store purchases. The company complains that Inditex has violated these technologies. The group implemented it into its processes without consent. This was specifically done through systems for locating clothing items using RFID technology and through digital monitoring of consumer behavior in stores. The purchasing solutions and tools offered via mobile apps as well as the systems for inventory transfer are also affected.

“The patented technologies that are the subject of this lawsuit were developed over years of engineering, product development and testing in real-world retail environments,” Alpha Modus management said. The company is actively involved in the implementation of its AI-based analysis systems in stores. Systems for tracking customer interaction and digital interaction tools were also included. This supports a nationwide framework that builds on proven innovations. In order to help shape this context, the technology company maintains a growing network of sales partners and employees within its ecosystem. These integrated the patented methods into a broader retail infrastructure. “These collaborations support a range of working commercial implementations,” it continues. This proves that it is a technology that is neither theoretical nor inactive. Rather, it is actively marketed and integrated into operational environments. This integration is currently in a “continuous expansion”. It forms the “basis of the company’s AI retail ecosystem.” This underlines the “importance of protecting the integrity and value” of Alpha Modus’ intellectual property.

Compensation for royalties and aggravation for alleged willful misconduct

In response to this alleged violation of industrial and intellectual property, the technology company is initially demanding a guilty verdict before the US judiciary. This is intended to acknowledge that Inditex has infringed the patents. Based on this, Alpha Modus demands that the court determine financial compensation. This should not be lower than the license fees that the company would have received in the event of a license agreement. There is also additional compensation because the patent infringement is considered conscious and intentional. Finally, the imposition of interim injunctions is required. These are intended to prevent both Inditex and Zara from continuing to misuse and make unauthorized use of their patented technologies.

“The company only takes legal action if the unauthorized use of its patented systems provides the infringing party with a competitive advantage,” it said. This is now the case with Inditex and Zara. Alpha Modus argues that these companies have profited by misusing the technologies. They would have gained a competitive advantage over those companies that had authorized the implementation of these various retail solutions. These technologies are “essential for modern in-store retail operations,” emphasizes Alpha Modus. They included “analysis of interaction with the products” and “dynamic inventory management”. This also included “personalized marketing, tracking buyer movements” and “automated payment processes”. Alpha Modus emphasizes that the company typically licenses its intellectual property. We also work with organizations that maintain business relationships in accordance with legality.

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