By Mark Munger
With my work in the hospitality industry, I have designed and implemented a variety of in-room technology. One piece of this technology is the guest’s ability to “cast” the video from a local device to the TV in their room. Chromecast is the most popular method for casting and a court ruling earlier this year raised concerns about the legality of using Chromecast.
A July 2023 court ruling found Google’s Chromecast devices infringe patents held by Touchstream Technologies, a New York based company. While few took notice, this could have wide-ranging impacts on the hospitality sector. Google filed an appeal in September and is awaiting Touchstream’s response. Should the verdict stand upon appeal, hotels and other commercial enterprises using Chromecast casting devices in their business may violate Touchstream’s patents should they continue using the devices in a commercial environment.
The lawsuit, brought by Touchstream Technologies, alleged that Google’s Chromecast hardware and software infringed on 3 patents originally filed under the name Shodogg. These patents cover methods of controlling presentation content on display devices through various players and systems. Touchstream further argued that Google met with Touchstream before the introduction of Chromecast and signed an NDA, which gave Google access to information about Touchstream’s patents..
Google filed a response in this case and with the Patent Trial and Appeal Board (PTAB) claiming the patents were unpatentable based on Prior Art and Obviousness Contentions. Stated another way the inventions were covered by existing patents, were obvious to anyone with ordinary skill, and were not something new and novel.
The verdict was for Touchstream and against Google and Chromecast.
The court agreed with Touchstream that core elements of Chromecast relied on these patented technologies. This included Chromecast’s ability to discover and pair with nearby devices to receive streamed media –
What’s infringed?
Touchstream’s patents claim a system in which a server process is discovered and receives a request from a mobile device to play a video. The server then selects the appropriate video and sends it to the video player. The video player is then responsible for decoding and playing the video; instead of the mobile device. This oversimplifies though highlights that the infringement is the method Google Chromecast uses to connect, process, and send video to the remote device to play.
All three of the Touchstream patents ruled infringed are titled “Play control of content on a display device”. The patent further describes “a system for presenting and controlling content on a display device” that uses “a network, a server system coupled to the network and comprising one or more servers, a display device coupled to the network and having a display, and a personal computing device operable to transmit a first message according to a specified format over the network to the server system
Not all casting technology uses this method but Chromecast and its derivatives do. The Jury appears to have found that Google not only infringed on Touchstream’s patent, but Touchstream proved that they had talks with Google disclosing their patent before Google produced Chromecast and Google copied their technology. It was ruled that Google willfully infringed on the patents which expanded the damages.
Impact to hotels
To address the full impact, hoteliers need legal advice which this is not. Though generally here is the possible issue. The term that should be reviewed is “indirect infringement.” Hoteliers could be held liable based on this. Once appeals are exhausted, Google will have the duty to inform its customers of the infringement. It is yet to be determined what Google or Touchstream will do. The rest of this article is about possible actions that could be taken.
What’s next?
If the verdict is upheld, hoteliers will need to look at their options. Here are some of the available options. These are some technical options and are not to be considered legal advice.
- Obtain a license agreement from Touchstream Technologies
- Remove the Chromecast devices from use and not provide casting
- Replace the Chromecast device with another type of streaming device
- Continue using Chromecast
What is the cost for Casting
Touchstream has stated publicly that it has been negotiating license deals with businesses that use Chromecast in their products and services. Should Touchstream be willing to license existing installations, such as hotels, hotels could pay a license fee based on the existing number of Chromecasts installed. This may be good insurance.
Touchstream initially argued in its court case that it should be awarded a royalty rate of $1.35 per Chromecast sold based on its patents. The company claimed that this royalty rate would be fair and reasonable given the value of its patents and the benefits they provide to Google. However, the jury that heard the case ultimately awarded Touchstream a royalty rate of $0.30 per Chromecast sold.
Touchstream would be able to charge whatever they wanted to entities though, based on their pleadings, it would be reasonable to think that they would accept a license fee of $1.35 or less per Chromecast installed. This is far from certain and would be between the hotelier and Touchstream. Though preemptively, a group of hoteliers could approach Touchstream for licensing arrangements.
Remove the devices
Chromecast devices are estimated to be deployed in hundreds of thousands of hotel rooms worldwide. Hotels may need to remove or replace these devices or face legal jeopardy themselves providing they didn’t come to a license agreement with Touchstream.
Guests have come to expect casting in moderate to luxury accommodations. Removing does not appear to be a hospitable option. In budget hotels guests may accept this but in general, this is not a good option.
Replacements
There are non-Google devices though the extent these may also infringe on the Touchstream patents is unknown.
Apple Airplay is a peer-to-peer technology and appears not to have the same elements and methods. Though the discovery and server authentication could be reviewed. Other casting technologies such as Roku Connect, Amazon Fire TV Mirroring, Android TV Cast, WebOS Smartshare, Samsung SmartThings Cast, and LG TVs Miracast are all examples of casting and could be replacements. Each would need to be reviewed technically and their licensing reviewed to determine if they have any liabilities.
The case against Google added their meeting with Touchstream before Chromecast introduction as a key argument for infringement. Should other casting technologies infringe upon the patents, it will become a pure technical comparison that may be more difficult to prove. Though winning against Google does provide precedent, and a considerable legal fund to pursue others.
Do nothing and wait
It is possible that a hotelier could just continue with what they are doing and wait to see if they are contacted by Google or Touchstream informing them that their use of Chromecast is infringing. It is likely that at best, the license fee asked for would be the same or higher, and at worst, Touchstream would ask for damages. This puts off a decision and keeps the status quo though leaving a Damocles sword hanging over the hotelier’s head.
Pending Appeal
In September 2023, Google filed a motion with a Texas federal judge to overturn a jury’s $338.7 million verdict finding that its Chromecast devices infringed Touchstream Technologies Inc.’s patents. Google argued that the jury’s verdict was based on flawed legal theories and flawed interpretations of the patents. Google also argued that the damages awarded by the jury were excessive.
Touchstream has not yet responded to Google’s motion.
Looking forward
While Google is appealing the ruling, experts say it will be difficult to overturn. The jury ultimately awarded $338.7 million in damages, around double what Touchstream asked for. This highlights the financial liability hotels could face by continuing to use the infringing Chromecast devices in guest rooms.
For hotels, replacing hundreds of thousands of Chromecasts will be burdensome and costly. However, infringement claims from patent holders like Touchstream could be even more detrimental to the bottom line and brand. Hotels will need to weigh the risks and start evaluating alternate solutions. Touchstream has aggressively pursued licensing deals, offering cheaper non-infringing firmware – an option hotels may ultimately embrace.
There have been references about Google being held liable by hoteliers for Chromecast infringement and forced to pay the license fees for the hoteliers to continue to use the Google device. The small blip this would make in Google’s profits would help build its credibility in the hospitality industry. Such action would not happen until after all appeals are exhausted and anticipating what Google may do may not be a solid plan.
This ruling highlights the hidden dangers hotels face in adopting new technologies without proper due diligence. Even more reason to review the contracts and license agreements from technology vendors while reviewing their technology. How hotels address the licensing or pivot to new streaming solutions without Chromecast will be an important trend to watch in the coming year.
