DCT

1:24-cv-02816

Patent Armory Inc v. Oscar Health Inc

Log In

I. Executive Summary and Procedural Information

  • Parties & Counsel:
  • Case Identification: 1:24-cv-02816, S.D.N.Y., 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 health insurance communication systems infringe five patents related to intelligent call routing and auction-based entity matching for telecommunications.
  • Technical Context: The patents address methods for optimizing resource allocation in communications networks, such as call centers, by using algorithms to match incoming requests (e.g., calls) with available resources (e.g., agents) based on skills and economic factors.
  • Key Procedural History: The patents-in-suit claim priority back to a provisional application filed in 2003, indicating a long history of development for the underlying technology. The ’420 Patent was issued subject to a terminal disclaimer, which may limit its enforceable term to that of an earlier-expiring patent in the family.

Case Timeline

Date Event
2003-03-07 Earliest Priority Date for ’979, ’253, ’086, ’420, ’748 Patents
2006-04-04 U.S. Patent No. 7,023,979 Issues
2007-09-11 U.S. Patent No. 7,269,253 Issues
2016-09-27 U.S. Patent No. 9,456,086 Issues
2019-03-19 U.S. Patent No. 10,237,420 Issues
2019-11-26 U.S. Patent No. 10,491,748 Issues
2024-04-13 Complaint Filed

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

U.S. Patent No. 10,237,420 - "Method and system for matching entities in an auction"

  • Patent Identification: U.S. Patent No. 10,237,420, "Method and system for matching entities in an auction," issued March 19, 2019 (Compl. ¶9).

The Invention Explained

  • Problem Addressed: The patent’s background section describes the inefficiency of traditional call center management, particularly the "under-skilled agent" and "over-skilled agent" problems that arise from static agent groupings and reduce transactional throughput (’420 Patent, col. 4:35-64).
  • The Patented Solution: The invention is a method for matching entities, such as a caller and a call center agent, by performing an "automated optimization" that considers not only skill-based matching but also economic factors like "economic surplus" and the "opportunity cost" of making a particular agent unavailable for other potential matches (’420 Patent, Abstract). This transforms the routing decision into an auction-like mechanism for allocating resources (’420 Patent, col. 2:26-34).
  • Technical Importance: This approach provided a more dynamic and economically sophisticated model for resource allocation in call centers compared to conventional first-in-first-out or longest-idle-agent routing schemes (’420 Patent, col. 3:1-21).

Key Claims at a Glance

  • The complaint asserts infringement of "exemplary method claims" identified in an unprovided claim chart exhibit (Compl. ¶15, ¶17-18). Independent method claim 1 is representative.
  • The essential elements of independent claim 1 include:
    • Defining a plurality of multivalued scalar data representing inferential targeting parameters for the first entity.
    • Defining a plurality of multivalued scalar data representing characteristic parameters for each of a plurality of second entities.
    • Performing an automated optimization with respect to an economic surplus of a match and an opportunity cost of the unavailability of the second entity for an alternate match.
  • The complaint does not explicitly reserve the right to assert dependent claims.

U.S. Patent No. 10,491,748 - "Intelligent communication routing system and method"

  • Patent Identification: U.S. Patent No. 10,491,748, "Intelligent communication routing system and method," issued November 26, 2019 (Compl. ¶10).

The Invention Explained

  • Problem Addressed: The patent addresses the same inefficiencies in call center operations as the ’420 Patent, noting that traditional skill-based routing can be suboptimal without considering broader business goals and costs (’748 Patent, col. 3:1-4:34).
  • The Patented Solution: The invention is a system and method for intelligent routing that optimizes a "cost-utility function." This function considers not only short-term efficiency (skill-based routing) but also long-term call center goals, such as agent training (’748 Patent, Fig. 1). The system balances immediate needs against long-term operational improvements by factoring in variables like agent cost, training utility, and anticipated call outcomes (’748 Patent, col. 23:27-24:62).
  • Technical Importance: The technology provides a framework for routing decisions that are sensitive to a wider range of business variables beyond simple call-agent skill matching, enabling more strategic resource management (’748 Patent, col. 27:9-14).

Key Claims at a Glance

  • The complaint asserts infringement of "exemplary claims" identified in an unprovided claim chart exhibit (Compl. ¶21, ¶26-27). Independent claim 1 is representative.
  • The essential elements of independent claim 1 include:
    • 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 predicted characteristics.
  • The complaint does not explicitly reserve the right to assert dependent claims.

Multi-Patent Capsule: U.S. Patent No. 7,023,979

  • Patent Identification: U.S. Patent No. 7,023,979, "Telephony control system with intelligent call routing," issued April 4, 2006 (Compl. ¶11).
  • Technology Synopsis: This patent describes a telephony control system that provides for intelligent call routing. The invention moves beyond simple routing rules by implementing an "optimizing" function within a low-level communications server system, allowing it to evaluate targets based on high-level definitions and route communications accordingly (’979 Patent, col. 18:8-24).
  • Asserted Claims: The complaint asserts "exemplary method claims" identified in an unprovided exhibit (Compl. ¶30, ¶32-33). Independent claim 1 is representative.
  • Accused Features: The complaint generally accuses unspecified "Defendant Products" of practicing the claimed technology (Compl. ¶30).

Multi-Patent Capsule: U.S. Patent No. 7,269,253

  • Patent Identification: U.S. Patent No. 7,269,253, "Telephony control system with intelligent call routing," issued September 11, 2007 (Compl. ¶12).
  • Technology Synopsis: This patent, related to the ’979 Patent, also discloses a system for intelligent call routing within a communications control system. A key aspect is the use of a combinatorial optimization to determine an optimum target for a communication based on a multivariate cost function that compares attributes of the communication against attributes of at least three potential targets (’253 Patent, col. 85:31-41).
  • Asserted Claims: The complaint asserts "exemplary method claims" identified in an unprovided exhibit (Compl. ¶36, ¶38-39). Independent claim 1 is representative.
  • Accused Features: The complaint generally accuses unspecified "Defendant Products" of practicing the claimed technology (Compl. ¶36).

Multi-Patent Capsule: U.S. Patent No. 9,456,086

  • Patent Identification: U.S. Patent No. 9,456,086, "Method and system for matching entities in an auction," issued September 27, 2016 (Compl. ¶13).
  • Technology Synopsis: This patent, related to the ’420 Patent, describes an auction-based method for matching entities in a communications system. The method involves defining parameters for a first entity (e.g., a caller) and multiple second entities (e.g., agents) and performing an automated optimization that considers the economic surplus of a match and the opportunity cost of making an agent unavailable for other potential matches (’086 Patent, Abstract).
  • Asserted Claims: The complaint asserts "exemplary claims" identified in an unprovided exhibit (Compl. ¶42, ¶47-48). Independent claim 1 is representative.
  • Accused Features: The complaint generally accuses unspecified "Defendant Products" of practicing the claimed technology (Compl. ¶42).

III. The Accused Instrumentality

  • Product Identification: The complaint does not identify any specific accused product, method, or service by name (Compl. ¶¶ 15, 21, 30, 36, 42). It refers generally to "Exemplary Defendant Products" that are identified only in external exhibits not provided with the complaint.
  • Functionality and Market Context: The complaint does not provide sufficient detail for analysis of the functionality of any accused instrumentality. It makes only conclusory allegations that the unspecified products "practice the technology claimed" by the patents-in-suit (Compl. ¶¶ 17, 26, 32, 38, 47). No probative visual evidence provided in complaint.

IV. Analysis of Infringement Allegations

The complaint incorporates by reference claim charts from Exhibits 6, 7, 8, 9, and 10, which are not provided as part of the filed complaint (Compl. ¶¶ 18, 27, 33, 39, 48). The body of the complaint itself does not contain factual allegations detailing how any specific feature of a Defendant product maps to any specific claim element. Therefore, a claim chart summary cannot be constructed from the provided document, and the narrative infringement theory is conclusory.

  • Identified Points of Contention:
    • Pleading Sufficiency Questions: The primary point of contention, preceding any technical analysis, will likely be whether the complaint's allegations satisfy the plausibility standard under Federal Rules of Civil Procedure 8 and the precedents of Bell Atlantic Corp. v. Twombly and Ashcroft v. Iqbal. The lack of identification of any accused product and the absence of factual allegations to support the infringement claims may be a basis for a motion to dismiss.
    • Technical Questions: Assuming the case proceeds, a central question will be one of functional operation. For the ’420 and ’086 Patents, the issue will be whether the accused system performs a true "automated optimization" based on "economic surplus" and "opportunity cost," as claimed. For the ’748, ’979, and ’253 Patents, the question will be whether the accused system performs the claimed "cost-utility function" optimization or merely a conventional form of skill-based routing.

V. Key Claim Terms for Construction

  • The Term: "automated optimization with respect to an economic surplus ... and an opportunity cost" (’420 Patent, Claim 1)
  • Context and Importance: This phrase is the functional core of the auction-based matching claims. The outcome of the case for the ’420 and ’086 Patents may turn on whether the accused system performs a function that meets this definition. Practitioners may focus on this term because Defendant will likely argue that its system performs generic routing that does not calculate specific economic variables like "surplus" or "opportunity cost."
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: The specification discusses optimizing agent selection in general business terms, which could support a construction that does not require a rigid mathematical formula (’420 Patent, col. 22:4-14).
    • Evidence for a Narrower Interpretation: The specification provides detailed mathematical formulae for calculating cost and utility, including terms representing anticipated value and opportunity cost, suggesting the optimization is a specific, multi-step calculation rather than a general concept (’420 Patent, col. 24:51-62).
  • The Term: "optimizing a cost-utility function" (’748 Patent, Claim 1)
  • Context and Importance: This term is central to the intelligent routing claims of the ’748 Patent. Its construction will determine whether a general-purpose routing system that considers agent skill levels infringes, or if the claim requires a more specific calculation combining distinct "cost" and "utility" factors.
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: The patent describes the goal as balancing competing goals to make efficient use of call center resources, language that could support a broader definition of optimization (’748 Patent, col. 2:25-34).
    • Evidence for a Narrower Interpretation: Figure 1 and the accompanying text explicitly distinguish between "use skill-based routing" for short-term needs and "optimize cost-utility function for long term call center operation," suggesting the latter is a distinct, more complex process that includes factors like agent training (’748 Patent, Fig. 1; col. 36:27-33).

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" to use the accused products in an infringing manner (Compl. ¶24, ¶45).
  • Willful Infringement: Willfulness allegations for the ’748 and ’086 Patents are based on alleged post-suit knowledge. The complaint asserts that its service "constitutes actual knowledge of infringement" and that Defendant's continued alleged infringement is therefore willful (Compl. ¶23-24, ¶44-45).

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

  • A threshold issue will be one of pleading sufficiency: does the complaint, which fails to identify any accused product or provide factual allegations of infringement beyond incorporating unattached exhibits, meet the plausibility standard required to proceed to discovery?
  • A core technical issue will be one of functional implementation: can Plaintiff produce evidence that Defendant’s customer communication systems perform the specific, multi-factor "automated optimization" based on economic principles as recited in the asserted claims, or do they employ more conventional, non-infringing routing algorithms that fall outside the claims' scope?
  • A central legal issue will be one of definitional scope: can terms like "economic surplus" and "cost-utility function" be construed broadly to cover general business goals, or will the court limit them to the specific mathematical and economic models detailed in the patent specifications?