Consolidated Transaction Processing v. Sephora USA — Dismissed with Prejudice
Consolidated Transaction Processing, LLC sued Sephora USA, Inc. in the Northern District of Illinois alleging infringement of two patents covering targeted product offerings based on personal information. The parties stipulated to dismiss all of plaintiff's claims with prejudice, with each side bearing its own costs, after 337 days of litigation.
Targeted-marketing patent suit against Sephora ends in stipulated dismissal
On December 5, 2022, Consolidated Transaction Processing, LLC filed suit against Sephora USA, Inc. in the U.S. District Court for the Northern District of Illinois (Case No. 1:22-cv-06812) before Judge Charles P. Kocoras. The complaint alleged infringement of US8712846B2 and US8396743B2, both directed to sending targeted product offerings based on personal information — technology directly relevant to Sephora's digital retail and personalisation operations.
The recorded basis of termination is Dismissed with Prejudice. The docket order — entered pursuant to Federal Rule of Civil Procedure 41(a)(1)(ii) — states that plaintiff's claims against defendant were dismissed with prejudice and defendant's claims against plaintiff were dismissed without prejudice, with each party bearing its own costs, expenses, and attorneys' fees. The specific terms underlying the parties' agreement are not disclosed in the available record.
The case closed on November 7, 2023, 337 days after filing — before any substantive merits ruling appears in the public record. The asymmetric prejudice treatment (plaintiff's claims with prejudice; defendant's counterclaims without prejudice) is consistent with a negotiated resolution, though the specific terms driving that asymmetry are not disclosed in the available record. What remains unknown publicly is whether any commercial arrangement accompanied the dismissal.
See Complete Case & Patent Analysis →Filing to Dismissed with Prejudice in 337 days
337 days from filing to close — just under the median federal patent case duration
US8712846B2 & US8396743B2 — targeted product offerings via personal data
Any company operating a personalised product recommendation engine, targeted promotional system, or data-driven customer offer platform — including retailers, e-commerce marketplaces, loyalty programme operators, and fintech platforms — should assess exposure under US8712846B2 and US8396743B2. These patents have been actively asserted; the absence of a merits ruling means their claims remain fully operable as enforcement instruments.
Official order — verbatim text
The stipulated order entered under Rule 41(a)(1)(ii) creates an asymmetric record: plaintiff's infringement claims are extinguished with prejudice, while defendant's counterclaims survive without prejudice. No substantive ruling on claim validity, infringement, or claim construction appears in the public record, leaving the legal scope of both patents unresolved and available for future enforcement by the plaintiff against different parties.
Dismissed with prejudice: what the stipulated resolution means for both parties
Rule 41 stipulated dismissal with prejudice explained
A Rule 41(a)(1)(ii) stipulated dismissal is a joint filing by both parties' counsel that terminates the action without a court judgment on the merits. A dismissal with prejudice is a final adjudication against the dismissed party — the plaintiff cannot re-file the same claims against Sephora in any court. The defendant's counterclaims were dismissed without prejudice, preserving Sephora's ability to re-assert them if needed.
No merits ruling enteredPlaintiff's claims permanently barred against Sephora
With plaintiff's claims dismissed with prejudice, Consolidated Transaction Processing cannot reassert US8712846B2 or US8396743B2 against Sephora USA on the same accused conduct. The patents themselves remain in force and can be asserted against other parties, but this defendant is effectively immunised from further suit on these facts. The specific terms of any arrangement between the parties are not disclosed in the available record.
Patents survive; Sephora shieldedSephora exits with counterclaims preserved
Sephora USA secured dismissal of the plaintiff's infringement claims with prejudice, achieving finality on its exposure to this litigation. Critically, Sephora's own counterclaims were dismissed without prejudice, meaning Sephora retains the ability to revive those claims in future proceedings if circumstances warrant. The asymmetric outcome is notable and consistent with a negotiated resolution, though the underlying terms are not publicly disclosed.
Counterclaims preservedPersonalisation-tech patent risk remains live for other retailers
The dismissal resolves only this bilateral dispute — both patents remain active and enforceable against third parties. Retailers and e-commerce platforms operating targeted product recommendation systems based on personal data should treat US8712846B2 and US8396743B2 as live enforcement risk. The absence of any invalidity or non-infringement ruling means there is no public record weakening these patents' scope.
Live risk for retail techFull party and counsel information
| Role | Name | Type | Detail |
|---|---|---|---|
| Plaintiff | Consolidated Transaction Processing, LLC | Company | /Search in Eureka ↗ |
| Defendant | Sephora USA, Inc. | Company | /Search in Eureka ↗ |
| Plaintiff counsel | Neil A. Benchell | Attorney | Counsel for Consolidated Transaction Processing, LLCSearch in Eureka ↗ |
| Plaintiff law firm | Devlin Law Firm LLC | Law Firm | Representing Consolidated Transaction Processing, LLCSearch in Eureka ↗ |
| Defendant counsel | Neil J. Mcnabnay | Attorney | Counsel for Sephora USA, Inc.Search in Eureka ↗ |
| Defendant counsel | Noel Franco Chakkalakal | Attorney | Counsel for Sephora USA, Inc.Search in Eureka ↗ |
| Defendant counsel | Robert Douglas Leighton | Attorney | Counsel for Sephora USA, Inc.Search in Eureka ↗ |
| Defendant law firm | Fish & Richardson P.c. | Law Firm | Representing Sephora USA, Inc.Search in Eureka ↗ |
| Defendant law firm | Goldberg Kohn Ltd. | Law Firm | Representing Sephora USA, Inc.Search in Eureka ↗ |
| Presiding judge | Judge Charles P. Kocoras | Judge | Illinois Northern District CourtSearch in Eureka ↗ |
R&D signals in the personalised product targeting patent space
Forward-looking patent intelligence on targeted product offering technology, consumer data personalisation, and the IP strategies of Consolidated Transaction Processing and Sephora USA.
Consolidated Transaction Processing's enforcement portfolio beyond these two patents
Mapping the full patent holdings of Consolidated Transaction Processing — including patents adjacent to US8712846B2 and US8396743B2 — reveals the breadth of its targeted-marketing IP and helps identify which technology claims may be asserted next. Portfolio activity, continuation filings, and assignment records are key signals for anticipating future enforcement campaigns.
Enforcement portfolio mapFiling trends in personalised product recommendation and consumer data targeting
The personalised product offering space has seen sustained patent filing activity from both retail majors and specialist IP players. Tracking filing trends around consumer profiling, real-time offer selection, and behavioural data targeting reveals where the technology frontier is moving — and where white space exists for novel R&D investment.
Personalisation IP trendsSephora USA's patent activity in digital retail and customer experience
Analysing Sephora USA's own patent filings and IP posture in digital retail, augmented reality beauty tools, and customer personalisation surfaces the depth of its defensive IP position. Companies with thin patent portfolios in asserted technology areas are more exposed to licensing pressure; understanding Sephora's posture informs sector-wide competitive IP strategy.
Retail beauty tech IPAdjacent claim space near US8712846B2: privacy-compliant targeting innovations
As data privacy regulation tightens globally, the mechanisms by which targeted product offers are generated from personal data are evolving rapidly — consent management, on-device inference, and anonymised personalisation represent areas where new patent filings could establish defensible IP positions adjacent to but distinct from the asserted claims. This white space is commercially significant and currently underdeveloped in the public patent record.
Privacy-tech white spaceSimilar targeted-marketing patent cases in N.D. Illinois and beyond
Explore patent infringement cases involving personalised product offering and consumer data targeting technology litigated in N.D. Illinois and related federal courts.
What this case signals for the retail personalisation IP landscape
Two targeted-marketing patents survived litigation contact — their scope was never publicly tested, keeping enforcement risk open for the sector.
Patents remain fully enforceable against other retail and e-commerce defendants
No invalidity finding, no claim construction ruling, and no non-infringement determination entered in this case. US8712846B2 and US8396743B2 exit litigation untested, meaning any company operating personalised product recommendation systems faces the same initial exposure as Sephora did. An FTO analysis against these patents is advisable for comparable retail-tech operators.
Asymmetric dismissal terms signal a negotiated exit — study the counterclaim angle
The plaintiff took dismissal with prejudice while defendant's counterclaims survived without prejudice. This structure suggests the parties had specific reasons to preserve Sephora's options, though those reasons are not in the public record. IP teams monitoring assertion campaigns by Consolidated Transaction Processing should note this pattern when evaluating response strategy.
Consolidated v Sephora — key questions answered
Consolidated Transaction Processing asserted two patents: US8712846B2 (application no. US13/794781) and US8396743B2 (application no. US13/401827). Both patents relate to systems and methods for sending targeted product offerings based on personal information, according to the case record.
The case was terminated on the recorded basis of Dismissed with Prejudice. The docket order entered under Federal Rule of Civil Procedure 41(a)(1)(ii) states that plaintiff's claims were dismissed with prejudice — permanently barring Consolidated Transaction Processing from re-asserting the same claims against Sephora — while defendant's counterclaims were dismissed without prejudice. Each party bore its own costs.
Yes. The stipulated dismissal resolved only the dispute between these two parties and contains no invalidity finding or claim construction ruling. Both patents remain in force and can be asserted against other parties. The specific terms of any arrangement between Consolidated Transaction Processing and Sephora are not disclosed in the available record.
The docket order records plaintiff's claims dismissed with prejudice and defendant's counterclaims dismissed without prejudice. This asymmetric structure is consistent with a negotiated resolution between the parties, but the specific terms driving that asymmetry are not disclosed in the available public record.
Plaintiff Consolidated Transaction Processing was represented by Neil A. Benchell of Devlin Law Firm LLC. Sephora USA was represented by Neil J. McNabnay, Noel Franco Chakkalakal, and Robert Douglas Leighton of Fish & Richardson P.C. and Goldberg Kohn Ltd. Judge Charles P. Kocoras of the Northern District of Illinois presided.
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