ADT Seeks to Block Imports of Vivint Smart-Home Systems
(Bloomberg) -- ADT Inc., the largest home-security company in the U.S., filed a U.S. patent-infringement complaint seeking to block imports of products made by rival Vivint Smart Home Inc., escalating a battle over the growing American market for smart-home technologies.
ADT claims Vivint’s home security monitoring and automation control panels infringe two patents for “smart home integration, data collection, and control panel functions and interfaces, among other capabilities and features.” The panels allow a consumer to monitor smoke detectors, lights, doorbells and other devices via a mobile app and use of the ADT inventions are an effort by Vivint to obtain an “unfair advantage,” ADT said.
“Vivint launched its SkyControl Panel and related products with the express desire, in the words of its former CEO, to ‘control anything and everything inside the home,’” ADT’s chief legal officer, David W. Smail, said in a statement. “Apparently Vivint also meant ‘by any means necessary.’”
Vivint pledged to fight the claims, calling them “completely without merit” and a “reactionary countersuit” to its own patent claims against ADT.
ADT, founded in 1874 as American District Telegraph, is the leader of the $18 billion residential-monitoring and security-services market, though its dominance is being challenged by new entrants, according to Bloomberg Intelligence analyst Eshan Toorabally. One in five U.S. single-family homes are professionally monitored, though the overall smart-home market is projected to grow an average of 20% a year through 2023.
ADT, based in Boca Raton, Florida, has been aggressive in protecting its market share and its brand. Last week, it settled a lawsuit accusing Amazon.com Inc.’s Ring unit of “brazen” copying of ADT’s blue octagon, forcing Ring to change its sign design.
The complaint against Vivint was filed in the U.S. International Trade Commission in Washington, with a mirror lawsuit filed in federal court in Waco, Texas, seeking unspecified damages. The trade commission is a popular forum for patent owners because it moves quickly -- typical investigations are completed in less than 17 months -- and can result in items being stopped at the U.S. border.
The case escalates a battle between the two companies that’s been going on for more than a year. ADT sued Vivint in August, accusing it of misleading ADT customers into switching services using false and “well-rehearsed sales tactics” in door-to-door sales.
Vivint filed a lawsuit against ADT in February, claiming ADT’s Pulse and Control smart home security systems infringe its patents. ADT is seeking to have most of the case dismissed, arguing that five of the six patents in the case are invalid because they don’t cover inventions but “an abstract idea involving the collection, process and communication of data.”
Vivint’s Home Security System, SkyControl Panel, and Smart Hub are made in various locations in Asia and in Mexico. ADT said Vivint reported 1.7 million subscribers in 2020, less than 11% of the residential security services market, so it can easily meet consumer demand if Vivint’s products are kept from the U.S. market.
Provo, Utah-based Vivint became a public company last year after merging with Mosaic Acquisition Corp., a special purpose acquisition company. The deal marked one of the largest U.S. SPAC mergers ever, carrying an enterprise value of $4.2 billion.
This isn’t Vivint’s only case at the trade agency in Washington. It’s also fighting a patent-infringement complaint filed by closely held EcoFactor that seeks to block imports of its smart thermostat system, and one by Eyetalk 365 LLC that seeks to halt imports of video doorbells.
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