DCT

2:15-cv-09199

Paz Gaming Inc v. Racing Card Derby Holdings Ltd

Log In

I. Executive Summary and Procedural Information

  • Parties & Counsel:
  • Case Identification: 2:15-cv-09199, C.D. Cal., 11/25/2015
  • Venue Allegations: Venue is alleged to be proper based on Defendants transacting business and committing acts of infringement within the district.
  • Core Dispute: Plaintiff alleges that Defendants are infringing a patent for a casino card game by marketing and selling a competing game, and further alleges that Defendants intentionally interfered with Plaintiff's licensing agreement for its patented game.
  • Technical Context: The technology relates to a method for a casino-style card game where players wager on which of four card suits will be the first to appear a predetermined number of times as cards are dealt from a deck, simulating a horse race.
  • Key Procedural History: The complaint alleges that Plaintiff had a 10-year license agreement with DEQ Systems Corp. ("DEQ") to sublicense the patented game. It further alleges that Defendant RCD sent a letter to DEQ claiming ownership of the intellectual property in the game, which allegedly caused DEQ to terminate its agreement with Plaintiff. This history forms the basis for the claims of willful infringement and intentional interference with contractual relations.

Case Timeline

Date Event
1998-01-14 ’713 Patent Priority Date
2000-06-27 ’713 Patent Issue Date
2013-10-06 Plaintiff enters into license agreement with DEQ Systems Corp.
2015-11-25 Complaint Filing Date

II. Technology and Patent(s)-in-Suit Analysis

U.S. Patent No. 6,079,713 - "Method of Playing a Game of Chance", issued June 27, 2000

The Invention Explained

  • Problem Addressed: The patent identifies a gap in the art for casino-style games that use playing cards to simulate the action of a horse race ('713 Patent, col. 1:15-17).
  • The Patented Solution: The invention is a method for a game of chance where players place wagers on which card suit (e.g., Hearts, Spades, etc.) will "win" by being the first to have a predetermined number of its cards (e.g., four) dealt from a deck. The method involves dealing cards one by one and placing them on a designated playing field to track the "race" between the suits (’713 Patent, Abstract; col. 2:31-41). The layout of the playing surface is illustrated in the patent’s Figure 1, which is incorporated by reference into the complaint (Compl. ¶9, Ex. A).
  • Technical Importance: The invention provides a novel, casino-banked game with a specific thematic structure (a "race") and defined payout odds, creating a new wagering proposition for players ('713 Patent, col. 2:41-43).

Key Claims at a Glance

  • The complaint does not identify specific claims of the ’713 Patent as being asserted (Compl. ¶10). Independent claims 1 and 4 represent the broadest method claims.
  • Independent Claim 1 recites a method with the following essential elements:
    • Providing a set of playing pieces with at least four distinguishable suits, each suit having an equal number of pieces.
    • Placing a wager corresponding to a scenario where a first predetermined number of a first suit is dealt before a second predetermined number of a second suit is dealt.
    • Repeatedly dealing playing pieces.
    • Determining whether the predetermined number of pieces for various suits has been dealt, until a winning condition is met.
  • Independent Claim 4 recites a similar method, adding the limitation of:
    • Dealing the playing pieces onto a "substantially centrally located" area "in an orientation to render an attribute of the playing piece discernible by each of the plurality of players."
  • The complaint does not explicitly reserve the right to assert dependent claims.

III. The Accused Instrumentality

Product Identification

The complaint identifies the accused instrumentality as a "Game" that Defendants use, distribute, import, and sell (Compl. ¶10).

Functionality and Market Context

  • The complaint does not provide specific details regarding the functionality or operational mechanics of the accused game. It alleges that Defendants have infringed the ’713 Patent through the sale and use of this "Game" (Compl. ¶10).
  • The complaint alleges that Defendants entered into contracts with casinos to be the "exclusive provider of Plaintiff's patented Game," suggesting the accused instrumentality is the same as, or a direct copy of, the game covered by the ’713 Patent (Compl. ¶20-21).

IV. Analysis of Infringement Allegations

The complaint makes a general allegation of infringement without providing a claim chart or mapping specific features of an accused product to the elements of any asserted claim (Compl. ¶10). The infringement theory appears to be based on the allegation that Defendants are marketing the very same game that is the subject of the ’713 Patent. The complaint's Figure 1, incorporated from the patent, depicts the playing surface layout for the patented game method (Compl. ¶9, Ex. A).

  • Identified Points of Contention:
    • Technical Questions: A primary question for the court will be an evidentiary one: does the game marketed by Defendants in fact perform all the steps of any asserted claim of the ’713 Patent? The complaint does not provide the evidence needed to conduct this analysis.
    • Scope Questions: The dispute as framed in the complaint appears to center more on commercial rights than on technical distinctions. A core question is whether Defendants' activities constitute "use" of the patented method under 35 U.S.C. § 271.

V. Key Claim Terms for Construction

  • The Term: "predetermined number" (claims 1, 9)

    • Context and Importance: This term is central to the game's win condition. The "race" ends when a suit reaches this number of dealt cards. Its construction could determine whether the claim covers variations of the game.
    • Intrinsic Evidence for a Broader Interpretation: The term itself is general and could be construed to mean any number established prior to the start of a round of play, allowing for game variations.
    • Intrinsic Evidence for a Narrower Interpretation: The specification repeatedly uses the number "four" as the example for the predetermined number (e.g., ’713 Patent, col. 3:25-26, "the Diamond suit is the first suit to be exposed four times"). A party could argue the claims should be limited to this disclosed embodiment.

  • The Term: "playing pieces" (claims 1, 4, 9)

    • Context and Importance: The scope of this term dictates whether the claims are limited to physical game components or can extend to electronic or virtual implementations.
    • Intrinsic Evidence for a Broader Interpretation: The term is generic. Further, the license agreement attached to the complaint explicitly contemplates "electronic, online or internet implementations" of the Game, which could be presented as evidence of the understood scope of the intellectual property (Compl. Ex. B, Sec. 2.1).
    • Intrinsic Evidence for a Narrower Interpretation: Dependent claim 2 specifies "playing cards," which could imply through claim differentiation that "playing pieces" in independent claim 1 is broader, but not necessarily extending to non-physical embodiments. The entirety of the preferred embodiment describes a physical table game with a standard deck of cards (’713 Patent, col. 2:24-28), which might support a narrower construction limited to tangible objects.

VI. Other Allegations

  • Indirect Infringement: The complaint alleges inducement and contributory infringement, stating Defendants' infringing acts include their "contributing to and inducement of others to use, distribute, sell and/or offer for sale infringing games" (Compl. ¶10). The factual basis appears to be the alleged contracts between Defendants and casinos (Does 1-100), where the casinos would be the direct infringers by practicing the patented game method (Compl. ¶20).
  • Willful Infringement: The complaint alleges that Defendants' infringement was "knowingly, willful, and/or objectively reckless" (Compl. ¶11). This allegation is supported by the specific assertion that Defendant RCD sent a letter to Plaintiff’s licensee, DEQ, accusing DEQ of "stealing RCD's intellectual property by marketing Plaintiff's patented Game," which suggests Defendants had pre-suit knowledge of the patent and Plaintiff's commercialization efforts (Compl. ¶11c).

VII. Analyst’s Conclusion: Key Questions for the Case

  • Pleading Sufficiency: A threshold issue is whether the complaint's conclusory allegation of infringement, which lacks a factual basis mapping an accused product to claim limitations, satisfies federal pleading standards under Twombly and Iqbal.
  • Commercial Rights vs. Technical Infringement: The case as pleaded appears to be fundamentally a dispute over commercial rights and ownership of a single game concept. A key question for the court will be to unravel the competing claims of ownership between Plaintiff and Defendants, the resolution of which may be dispositive of the patent infringement claim itself.
  • Basis for Willfulness: Should infringement be found, a central question will be whether Defendants’ alleged pre-suit knowledge, evidenced by the letter sent to Plaintiff's licensee, is sufficient to support a finding of willful infringement and a potential award of enhanced damages.