Konami, no stranger to invalidity challenges against their video gaming patents, recently had four more patents directed to slot machines struck down as directed to abstract ideas.

On Feb. 21, 2018, the U.S. District Court for the District of Nevada granted summary judgment for defendant High 5 Games, LLC (“High 5”) against plaintiff Konami Gaming, Inc. (“Konami”).  The Court, dismissing Konami’s case, found all four of Konami’s asserted patents invalid as directed to unpatentable subject matter.



In the case, Konami alleged infringement of four patents: U.S. Patent Nos. 8,096,869, 8,366,540, 8,662,810, and 8,616,955. All asserted patents generally relate to slot machines, and High 5’s allegedly infringing products included various online and “land-based” slot machine games featuring a “Super Stack” feature (including, inter alia, “Bah, Humbug,” “Bollywood Bride,” “Dangerous Beauty,” “Diamonds of Athens The Dream,” “Shadow of the Panther,” and many others).
Claim 1 of the ’869 Patent reads:

1. A gaming machine comprising:
   a processor configured to execute a game displaying a matrix of symbol containing elements having a plurality of rows and a plurality columns;
   at least one column of said matrix comprising a portion of a simulated rotatable reel of a plurality of said symbol containing elements;
   said simulated rotatable reel comprising sections of symbol containing elements displaying a plurality of symbols that are fixed for each game played on said gaming machine;
   said simulated rotatable reel including at least one section in which a consecutive run of three or more of said symbol containing elements is populated by an identical symbol so that, as the simulated rotatable reel rotates, a consecutive string of said same identical symbol is sequentially displayed within said consecutive string of symbol containing elements; and
   said identical symbol is randomly selected anew for each play of said game, wherein said identical symbol is selected by virtually spinning a notional, non-visible, inner reel comprising a subset of said plurality of symbols.

After a lengthy discussion of claim construction, the Court found Konami’s patents’ claims “individually and collectively” invalid for abstractness.  Per the Court, the claims “perform the functions of what may be described as an aesthetic variation on a play of the game” because “the primary focus of the patents, as acknowledged even by Konami, is displaying a consecutive run of a randomly selected identical symbol in one reel of the simulated digital reels in each iteration of a game as a means of increasing interest in the game and ‘increasing probability of a winning outcome.’”  The Court was unpersuaded that the claims recited more than this idea: “[c]hanging how often a symbol appears and where it appears in a slot game without more is simply altering the manner of display of random symbols – i.e. changing the rules of the game.”

This decision underscores the continued impact of the Supreme Court’s 2014 decision in Alice v. CLS Bank.  In this case, the Court was clear: “changes to game rules of a generic slot machine using conventional technology are not patentable.”  Such a ruling may suggest that patents directed to game play rules may also be invalid as directed to abstract ideas.  Patentees may improve their likelihood of surviving similar challenges by, where possible, tying their claimed inventions to technology and technical problems.

On January 17, 2018, U.S. District Judge John Michael Vazquez of the District of New Jersey dismissed all patent infringement claims asserted by Joseph Scibetta (a/k/a “Bankers & Brokers”) (“Scibetta”), against Slingo, Inc. and RealNetworks, Inc. (collectively, “Slingo”).  The reason: none of Scibetta’s patents survived scrutiny 35 U.S.C. § 101.

Scibetta is the owner of various intellectual property rights relating to a card and casino game called “BANKERS & BROKERS.”   U.S. Patent No. 6,220,597, one of the patents asserted in the case, describes the game in detail:

1. A method for playing a wagering card game comprising the steps of:
   Providing a shuffled stack of playing cards where the cards are touched only by the dealer during the game comprising at least one deck thereof;
   providing a planar game playing surface comprising a plurality of separately delineated areas adapted for the placement of bets;
   establishing odds for payout of winning bets placed in any of the aforesaid plurality of separated and delineated areas;
   establishing an initial order of play where players are designated as first player, and so on to a last player;
   initiating a round of play by a first player establishing a bet by placing a wager in a designated space on the table near a pot designated and marked onto a surface for displaying a face-up side of a card dealt to each said player;
   dealing a stack of six face-down cards as a player's pot concealing the faces of each dealt card from each player and a dealer, to the first player and any other player in the game;
   dealing a stack of six face-down cards, concealing the faces of each dealt card from each player and the dealer, to the dealer as a dealer's pot;
   then, only the dealer turning the dealer's pot over and turning over the pots over for each player one at a time;
   then the dealer immediately determining a player's winning status or loss status by comparing a face-up card dealt to each player and a now face-up card dealt to the dealer in the dealer's pot;
   after comparing a dealer's face-up card to a player's face-up card, paying any winning bets placed by each player in the game;
   collecting the played or turned up cards from each pot after bets are paid and placing these cards in a discarded cards designated area on the table;
   determining whether the turned-up dealer's card matches the corresponding turned-up player's card, whereby at any time during the game or before the dealer may imposed step of disqualifying and discarding any got touched by a player.

The other asserted patents (U.S. Patent Nos. 6,626,433, 7,331,580, 7,618,044, and 7,857,314) are similar.

Slingo is alleged to have distributed an unlawful copy of BANKERS & BROKERS on their website slingo.com, which was later acquired by RealNetworks, Inc. The alleged copy of BANKERS & BROKERS is reproduced below (as retrieved from archive.org).



On December 12, 2016, Slingo moved to dismiss Scibetta’s case.  Among other assertions, Slingo claimed that all of Scibetta’s patents were invalid under 35 U.S.C. § 101.

The Court agreed. With regard to Alice step one, the Court noted that Scibetta’s asserted patent claims were substantially similar to the “method of conducting a wagering game” patent found invalid in In re Smith, 815 F.3d 816 (Fed. Cir. 2016), cert. denied sub nom., Trading Techs. Int’l, Inc. v. Lee, 137 S.Ct. 453 (2016).  Indeed, the Court noted that “there is no meaningful distinction between, on the one hand, the unpatentable abstract idea found in In re Smith and, on the other hand, the method and system claims here.”  Per the Court, the fact that some claims recited, among other things, a “‘means’ for identifying player/dealer positions” did not “change the fact that [BANKERS & BROKERS] stems from a patent ineligible abstract idea.”

With regard to Alice step two, the Court found that BANKERS & BROKERS “reflects well-understood, routine, and conventional wagering activity” such that “Plaintiffs made no technical improvement on the original abstract idea of a card wagering game using a standard deck of cards.”  The mere implementation of such a game on a computer did not change the Court’s analysis: “the claims do nothing more than simply describe the application of the game-related abstract ideas to a generic computer system.”

Scibetta’s case is not doomed.  Scibetta still has a viable claim for misappropriation against Slingo.  Moreover, while Scibetta’s trademark and unjust enrichment claims were also dismissed by the Court, the claims were dismissed without prejudice and largely based on pleading deficiencies.  As such, Scibetta will be afforded an opportunity to amend and supplement his complaint.

This case illustrates the difficulties of enforcing patents that, despite their presumption of validity, were granted prior to the Alice decision when the USPTO was using a different standard of examination.  A trend is appearing where the presumption of validity applied to those patents by courts appears to be inherently lower than that given to more recently granted patents.  Scibetta asserted five patents, and not one survived a motion to dismiss.  Those looking to acquire patent portfolios, for example, should be particularly wary of purchasing patents which may look great but may face significant hurdles during enforcement.  Sometimes, a single strong patent is worth more than a hundred unenforceable ones.

...in view of the overall tone of the questions, the panel seems more likely than not to reverse the district court’s holding of invalidity under Section 101, and remand this case for further proceedings to reassess 101 eligibility using the correct standard, and/or also to determine infringement and validity under 35 U.S.C. §§102-103 (novelty and obviousness).

Salt Lake City, Utah.  June 2, 2016.  U.S. District Judge Jill N. Parrish granted Electronic Arts Inc.’s motion to dismiss, saying that Utah-based White Knuckle Gaming LLC cannot sue for patent infringement because the patent at issue — which describes a method for updating sports videos games to reflect real-world changes like statistics, athlete appearances and uniforms — covers an abstract idea and does not include any additional elements that transform the claim into patent-eligible material.
“It is a longstanding business practice in the video game industry to update sports video games parameters to reflect real-world developments,” Judge Parrish wrote.

According to Judge Parrish, the patent doesn’t have any additional elements that transforms the abstract idea into an inventive concept because it doesn’t rely on anything other than generic computer equipment in order to be accomplished.

“The court holds that the patent is drawn to a patent-ineligible abstract idea, and merely requiring generic computer implementation fails to transform that idea into a patent-eligible invention,” Judge Parrish wrote.

The patent-in-suit is U.S. Patent Number 8,540,575 titled “Method and System for Increased Realism in Video Games.”  One interesting thing about this case is the length of the claims that were invalidated.  For example, representative claim 1 reads:

1. A game medium configured to provide a sports video game in conjunction with a video game machine, the sports video game including video game rules and video game character parameters, the video game character parameters including video game character performance parameters associated with individual video game characters, the game medium being configured to cause the video game machine to perform a method comprising:

loading video game data stored by the game medium into a random access memory of the video game machine for playing the video game, the video game data including the video game rules and a particular video game character performance parameter associated with a particular individual video game character associated with a particular real-life sports athlete, wherein the particular video game performance parameter is based at least in part on a real-life performance of the particular real-life sports athlete playing in one or more real-life sporting events, the particular video game character performance parameter affecting the manner in which the particular individual video game character performs in the sports video game;

during a single sports season, receiving a series of updated video game character performance parameters from a data server via a network including the Internet, wherein each of the updated video game character performance parameters in the series is based at least in part on one or more different real-life performances of the particular real-life sports athlete in one or more sporting events performed during the single sports season; 

updating the sports video game with each of the updated video game character performance parameters received, wherein each update changes the manner in which the particular individual video game character performs in the sports video game such that the particular individual video game character more closely simulates real-life performance attributes of the particular real-life athlete in the sports video game; and 

enabling a user to control the particular individual video game character in the sports video game using a video game controller connected to the video game machine.

This is a case that will be closely and heavily scrutinized in the wake of Alice v. CLS Bank.  Many practitioners will use this case as more fodder to try to read the tea leaves in the winds of change that is Federal jurisprudence on patent-eligible subject matter.

White Knuckle Gaming will likely appeal.  Along with the McRO case currently pending at the Federal Circuit, this could be another pertinent case in the world of video game patents.