Patent Armory Inc v. MasterCard Intl Inc

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Patent Armory Inc. (Canada)
  • Defendant: MasterCard International Incorporated (Delaware)
  • Plaintiff’s Counsel: Rabicoff Law LLC
• Case Identification: 1:24-cv-02815, S.D.N.Y., Filing Date: 04/13/2024
• Venue Allegations: Venue is alleged to be proper based on Defendant maintaining an established place of business in the Southern District of New York.
• Core Dispute: Plaintiff alleges that Defendant’s unspecified products and services infringe five patents related to intelligent call routing and auction-based systems for matching entities.
• Technical Context: The technology concerns advanced call center and communications routing systems that use economic and skill-based criteria to optimize the matching of incoming communications (e.g., calls) with available resources (e.g., agents).
• Key Procedural History: The complaint does not allege any prior litigation, Inter Partes Review (IPR) proceedings, or licensing history involving the patents-in-suit. The asserted patents claim priority through a chain of continuation and divisional applications originating from a provisional application filed in 2003, indicating a shared specification and a long prosecution history for the patent family.

Case Timeline

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

U.S. Patent No. 10,237,420 - “Method and system for matching entities in an auction” (Issued Mar. 19, 2019)

The Invention Explained

• Problem Addressed: The patent’s background section describes the inefficiency of traditional call center management, which often uses simple "first-come-first-served" or static "queue/team" models for routing calls, leading to suboptimal matching of callers to agents (’420 Patent, col. 3:36-4:34).
• The Patented Solution: The invention proposes a method for matching a "first entity" (e.g., a caller) with a "second entity" (e.g., an agent) by performing an "automated optimization" (’420 Patent, Abstract). This optimization uses defined parameters for each entity and considers not only the direct "economic surplus" of a potential match but also the "opportunity cost" of making a particular agent unavailable for other potential matches (’420 Patent, Abstract; col. 24:50-54).
• Technical Importance: This approach seeks to replace simplistic call routing rules with a dynamic, economic-based optimization that treats call routing as a resource allocation problem, aiming for greater overall efficiency in a communications system (’420 Patent, col. 2:26-34).

Key Claims at a Glance

• The complaint asserts one or more "exemplary method claims" without specifying claim numbers (Compl. ¶15). Claim 1 is the sole independent method claim.
• Claim 1 Elements:
  • Defining a plurality of multivalued scalar data representing inferential targeting parameters for a first entity and characteristic parameters for a plurality of second entities.
  • Performing an automated optimization with respect to an economic surplus of a match between the first entity and one of the second entities.
  • The optimization also considers an opportunity cost of the unavailability of that second entity for matching with an alternate first entity.
• The complaint does not explicitly reserve the right to assert dependent claims but refers broadly to "one or more claims" (Compl. ¶15).

U.S. Patent No. 10,491,748 - “Intelligent communication routing system and method” (Issued Nov. 26, 2019)

The Invention Explained

• Problem Addressed: Similar to the ’420 Patent, this patent addresses the inefficiencies in conventional telecommunications systems, particularly call centers that lack intelligent switching architectures (’748 Patent, col. 2:26-34).
• The Patented Solution: The invention claims a routing method that represents communications "sources" and "targets" by their predicted characteristics and an associated "economic utility" (’748 Patent, Abstract). An automated processor then determines the optimal routing by "maximizing an aggregate utility" for all potential linkages, moving beyond a one-to-one optimization to a system-wide optimization (’748 Patent, Abstract; col. 24:42-49).
• Technical Importance: The technology aims to provide a more holistic and globally optimized routing solution by considering the aggregate value of all potential matches within the system, rather than assessing each match in isolation (’748 Patent, col. 24:59-65).

Key Claims at a Glance

• The complaint asserts one or more "exemplary claims" without specifying claim numbers (Compl. ¶21). Claim 1 is a representative independent claim.
• Claim 1 Elements:
  • Representing a plurality of predicted characteristics of communications sources, each having an economic utility.
  • Representing a plurality of predicted characteristics of communications targets, each having an economic utility.
  • Determining an optimal routing between the sources and targets by maximizing an aggregate utility with respect to their respective predicted characteristics.
  • The determination is performed by an automated processor.
• The complaint refers broadly to infringing "one or more claims" of the patent (Compl. ¶21).

Multi-Patent Capsule: Additional Patents-in-Suit

• U.S. Patent No. 7,023,979: “Telephony control system with intelligent call routing” (Issued Apr. 4, 2006)

  • Technology Synopsis: The title suggests a system for intelligent call routing within a telephony control framework, likely representing an earlier embodiment of the technologies detailed in the ’420 and ’748 patents (Compl. ¶11).
  • Asserted Claims: The complaint asserts infringement of one or more unspecified claims (Compl. ¶30).
  • Accused Features: The "Exemplary Defendant Products" are accused of infringement (Compl. ¶30).

• U.S. Patent No. 7,269,253: “Telephony control system with intelligent call routing” (Issued Sep. 11, 2007)

  • Technology Synopsis: The title is identical to the ’979 Patent, suggesting it is part of the same patent family and covers similar subject matter related to intelligent call routing (Compl. ¶12).
  • Asserted Claims: The complaint asserts infringement of one or more unspecified claims (Compl. ¶36).
  • Accused Features: The "Exemplary Defendant Products" are accused of infringement (Compl. ¶36).

• U.S. Patent No. 9,456,086: “Method and system for matching entities in an auction” (Issued Sep. 27, 2016)

  • Technology Synopsis: The title suggests technology closely related to the ’420 Patent, focusing on a method for matching entities using an auction-based framework (Compl. ¶13).
  • Asserted Claims: The complaint asserts infringement of one or more unspecified claims (Compl. ¶42).
  • Accused Features: The "Exemplary Defendant Products" are accused of infringement (Compl. ¶42).

III. The Accused Instrumentality

The complaint does not identify any specific accused products or services by name. Instead, it globally refers to "Exemplary Defendant Products" and states that these products are detailed in claim charts attached as Exhibits 6 through 10 (Compl. ¶15, ¶17, ¶21, ¶26, ¶30, ¶32, ¶36, ¶38, ¶42, ¶47). These exhibits were not provided with the complaint. Consequently, the complaint does not provide sufficient detail for analysis of the accused instrumentality’s functionality or market context.

IV. Analysis of Infringement Allegations

The complaint’s infringement allegations are made entirely by reference to claim chart exhibits that were not provided (Compl. ¶18, ¶27, ¶33, ¶39, ¶48). The complaint’s narrative sections contain only conclusory statements that the "Exemplary Defendant Products practice the technology claimed" and "satisfy all elements" of the asserted claims (Compl. ¶17, ¶26, ¶32, ¶38, ¶47). Without the claim charts, a substantive analysis of the infringement theory is not possible.

No probative visual evidence provided in complaint.

• Identified Points of Contention:
  • Based on the complexity of the asserted claims, a central point of contention may be whether Defendant's commercial products actually perform the specific, multi-step economic calculations required. For the ’420 Patent, this raises the question of whether the accused systems perform an "automated optimization" that calculates both "economic surplus" and "opportunity cost."
  • For the ’748 Patent, a key technical question may be whether the accused systems determine routing by "maximizing an aggregate utility" across a plurality of sources and targets, or if they employ a simpler, sequential matching algorithm that does not meet this claim limitation.

V. Key Claim Terms for Construction

For the ’420 Patent:

• The Term: “automated optimization with respect to an economic surplus … and an opportunity cost”
• Context and Importance: This phrase constitutes the central functional step of the asserted independent claim. Its construction will be critical, as the infringement analysis may turn on whether the accused system’s routing logic can be characterized as performing this specific two-part economic optimization. Practitioners may focus on this term because it appears to require a more complex calculation than standard skill-based routing.
• Intrinsic Evidence for Interpretation:
  • Evidence for a Broader Interpretation: The specification describes the concept in general terms as balancing competing goals to make efficient use of call center resources, which could support a construction not strictly tied to one formula (’420 Patent, col. 2:26-34).
  • Evidence for a Narrower Interpretation: The detailed description provides a specific and complex mathematical formula as an example of the cost-utility function, which includes terms for anticipated value, opportunity cost, and transaction value (’420 Patent, col. 24:50-54). A defendant may argue this detailed embodiment limits the scope of the claim term.

For the ’748 Patent:

• The Term: “maximizing an aggregate utility”
• Context and Importance: This term defines the core inventive step of Claim 1. The dispute may focus on whether the accused system performs a global "maximization" across all potential pairings, or a less complex, localized optimization. The distinction between optimizing for a single best match versus maximizing the total utility of all matches simultaneously will be a key point.
• Intrinsic Evidence for Interpretation:
  • Evidence for a Broader Interpretation: The patent abstract describes the goal broadly as determining an "optimal routing," which a plaintiff might argue covers any advanced routing method that improves on prior art systems (’748 Patent, Abstract).
  • Evidence for a Narrower Interpretation: The specification states that instead of selecting an optimal agent for a given matter, "the system selects an optimal pairing of respective multiple agents with multiple matters," suggesting a combinatorial analysis is required, not just a simple search for the best available agent (’748 Patent, col. 24:59-65).

VI. Other Allegations

• Indirect Infringement: The complaint alleges induced infringement for the ’748 and ’086 patents. The allegations are based on Defendant’s distribution of "product literature and website materials inducing end users and others to use its products in the customary and intended manner that infringes" the patents (Compl. ¶24, ¶45). The complaint states that Exhibits 7 and 10 contain extensive references to these materials (Compl. ¶24, ¶45).
• Willful Infringement: The complaint pleads actual knowledge for the ’748 and ’086 patents, but the sole basis alleged for this knowledge is the service of the complaint itself (Compl. ¶23, ¶44). This pleading structure may support a claim for post-filing willfulness but does not allege pre-suit knowledge of the patents or infringement.

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

• A threshold procedural issue will be sufficiency of the pleadings: given that the complaint contains no specific factual allegations regarding the accused products or their operation and instead incorporates the entire infringement theory by reference to external exhibits, a key question is whether the complaint meets the plausibility standard required to survive a motion to dismiss.
• A central technical question will be one of functional equivalence: does the accused instrumentality’s routing system perform the specific, economically-grounded calculations required by the claims—such as optimizing for "economic surplus" and "opportunity cost" or "maximizing an aggregate utility"—or does it use a fundamentally different, less complex technical method for routing communications?
• A core legal issue will be one of claim construction: can the abstract, economically-focused claim terms like "automated optimization" and "aggregate utility," which are described with exemplary mathematical formulas in the specification, be construed broadly enough to cover the functionalities of a commercial-grade communications platform, or are they limited to the specific economic models disclosed?