Patent Armory Inc v. Global Payments Direct Inc

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Patent Armory Inc. (Canada)
  • Defendant: Global Payments Direct Inc. (New York)
  • Plaintiff’s Counsel: Rabicoff Law
• Case Identification: 1:24-cv-05132, S.D.N.Y., 07/05/2024
• Venue Allegations: Plaintiff alleges venue is proper in the Southern District of New York because Defendant maintains an established place of business in the district.
• Core Dispute: Plaintiff alleges that Defendant’s business operations infringe five patents related to intelligent call routing and auction-based entity matching systems, primarily used in call centers.
• Technical Context: The technology concerns systems for optimizing call center operations by intelligently routing communications to agents based on skills, costs, and other factors, sometimes using auction-like economic models.
• Key Procedural History: All five patents-in-suit claim priority from the same U.S. provisional application filed in March 2003, indicating a long-standing and related technology portfolio.

Case Timeline

Date	Event
2003-03-07	Priority Date for all Patents-in-Suit
2006-04-04	U.S. Patent No. 7,023,979 Issued
2007-09-11	U.S. Patent No. 7,269,253 Issued
2016-09-27	U.S. Patent No. 9,456,086 Issued
2019-03-19	U.S. Patent No. 10,237,420 Issued
2019-11-26	U.S. Patent No. 10,491,748 Issued
2024-07-05	Complaint Filing Date

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.

The Invention Explained

• Problem Addressed: The patent’s background describes the inefficiency of traditional call center routing, which often relies on simple "first-in, first-out" queues or static agent groupings (’979 Patent, col. 3:22-34, incorporated by reference into the ’420 Patent). These methods can lead to suboptimal agent assignments, such as routing a call to an under-skilled or over-skilled agent, which reduces transactional throughput and efficiency (’420 Patent, col. 4:35-51).
• The Patented Solution: The invention proposes a system that treats the matching of an incoming communication (a "first entity") with an available agent (a "second entity") as an economic auction (’420 Patent, Abstract). The system defines parameters for both the caller and the available agents and then performs an "automated optimization" to find the best match, considering not only skills but also the "economic surplus" of a successful match and the "opportunity cost" of using a particular agent who might be better suited for another potential call (’420 Patent, col. 21:5-22:45). This process is illustrated in system diagrams such as Figure 3 (’420 Patent, Fig. 3).
• Technical Importance: This approach allows for a more dynamic and economically sophisticated allocation of call center resources, moving beyond static rules to a system that can continuously optimize for complex business goals.

Key Claims at a Glance

• The complaint does not specify which claims are asserted, instead incorporating them by reference to an unfiled exhibit (Compl. ¶17). Independent claim 1 is representative of the invention.
• Essential elements of independent claim 1 include:
  • A method for matching a first entity with at least one second entity selected from a plurality of second entities.
  • Defining a plurality of multivalued scalar data representing inferential targeting parameters for the first entity.
  • Defining a plurality of multivalued scalar data for each of the plurality of second entities, representing respective characteristic parameters.
  • Performing an automated optimization with respect to an economic surplus of a respective match.
  • The optimization also considers an opportunity cost of the unavailability of the at least one of the plurality of second entities for matching with an alternate first entity.
• 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.

The Invention Explained

• Problem Addressed: As with its related patents, the ’748 Patent addresses the inefficiencies of conventional call center routing systems that fail to account for complex, dynamic factors when connecting callers to agents (’420 Patent, col. 2:26-41, incorporated by reference into the ’748 patent).
• The Patented Solution: The ’748 Patent describes a communications routing system that determines an optimal routing path by "maximizing an aggregate utility" (’748 Patent, Abstract). The system represents communications sources (e.g., callers) and targets (e.g., agents) by their "predicted characteristics" and uses these characteristics to calculate the optimal pairing. Figure 7 illustrates a method where routing is based on an auction sensitive to both "economic factors and non-economic factors" (’748 Patent, Fig. 7).
• Technical Importance: This system provides a framework for intelligent routing that can balance quantitative economic goals with qualitative non-economic factors, such as the optimality of a profile match.

Key Claims at a Glance

• The complaint does not specify which claims are asserted, incorporating them by reference to an unfiled exhibit (Compl. ¶26). Independent claim 1 is representative of the invention.
• Essential elements of independent claim 1 include:
  • A communications routing system comprising a processor and memory.
  • The memory stores a plurality of multivalued scalar data representing predicted characteristics of communications sources.
  • The memory also stores a plurality of predicted characteristics of communications targets.
  • The processor is configured to determine an optimal routing between the sources and targets by maximizing an aggregate utility with respect to the predicted characteristics.
• The complaint does not explicitly reserve the right to assert dependent claims.

U.S. Patent No. 7,023,979 - "Telephony control system with intelligent call routing"

• Patent Identification: U.S. Patent No. 7,023,979, "Telephony control system with intelligent call routing", issued April 4, 2006.
• Technology Synopsis: This patent describes a telephony control system that optimizes call routing in a call center. It addresses the problem of inefficiently matching callers to agents by using a system that determines an "optimum agent selection" based on a correspondence between a call's classification vector and a table of agent characteristic vectors (’979 Patent, Abstract; col. 32:46-60).
• Asserted Claims: The complaint does not specify which claims are asserted, incorporating them by reference to an unfiled exhibit (Compl. ¶32).
• Accused Features: The complaint alleges infringement by "Exemplary Defendant Products" but does not identify specific products or features (Compl. ¶30).

U.S. Patent No. 7,269,253 - "Telephony control system with intelligent call routing"

• Patent Identification: U.S. Patent No. 7,269,253, "Telephony control system with intelligent call routing", issued September 11, 2007.
• Technology Synopsis: This patent, related to the ’979 Patent, also discloses a communications system that performs an "optimal agent selection" based on a "combinatorial optimization" (’253 Patent, Abstract). The system aims to improve upon basic call routing by considering a wider range of factors to create a better match between callers and agents, thereby optimizing for a cost-benefit outcome (’253 Patent, col. 32:1-12).
• Asserted Claims: The complaint does not specify which claims are asserted, incorporating them by reference to an unfiled exhibit (Compl. ¶38).
• Accused Features: The complaint alleges infringement by "Exemplary Defendant Products" but does not identify specific products or features (Compl. ¶36).

U.S. Patent No. 9,456,086 - "Method and system for matching entities in an auction"

• Patent Identification: U.S. Patent No. 9,456,086, "Method and system for matching entities in an auction", issued September 27, 2016.
• Technology Synopsis: This patent, related to the ’420 Patent, describes matching a first entity (e.g., a caller) with a second entity (e.g., an agent) by defining parameters for each and performing an automated optimization. The optimization considers the "economic surplus" of a potential match as well as the "opportunity cost" of making that match, thereby creating an auction-like system for routing communications (’086 Patent, Abstract).
• Asserted Claims: The complaint does not specify which claims are asserted, incorporating them by reference to an unfiled exhibit (Compl. ¶47).
• Accused Features: The complaint alleges infringement by "Exemplary Defendant Products" but does not identify specific products or features (Compl. ¶42).

III. The Accused Instrumentality

• Product Identification: The complaint does not identify any of Defendant's products or services by name (Compl. ¶¶ 15, 21, 30, 36, 42). It refers generally to "Exemplary Defendant Products" that are allegedly detailed in exhibits not filed with the court (Compl. ¶¶ 17, 26, 32, 38, 47).
• Functionality and Market Context: The complaint does not provide sufficient detail for analysis of the functionality or market context of any accused instrumentality. It alleges in conclusory fashion that the unidentified products "practice the technology claimed" by the patents-in-suit (Compl. ¶¶ 17, 26, 32, 38, 47).

IV. Analysis of Infringement Allegations

The complaint incorporates infringement allegations by reference to claim chart exhibits (Exh. 6, 7, 8, 9, 10), which were not filed with the complaint (Compl. ¶¶ 18, 27, 33, 39, 48). As such, a detailed claim chart summary cannot be provided. The narrative infringement theory is limited to general allegations that Defendant directly infringes by "making, using, offering to sell, selling and/or importing" the accused products (Compl. ¶¶ 15, 21, 30, 36, 42).

No probative visual evidence provided in complaint.

• Identified Points of Contention:
  • ’420 Patent: As the complaint provides no details of the accused product's operation, a central point of contention will be evidentiary. A key question will be what evidence demonstrates that Defendant's system performs an "automated optimization" that specifically calculates both an "economic surplus" and an "opportunity cost," as required by the patent’s claims.
  • ’748 Patent: Similarly, a key question will concern the evidentiary basis for infringement. The analysis may focus on whether Defendant's system uses "predicted characteristics" of both callers and agents to "maximiz[e] an aggregate utility." The specific technical implementation of this maximization function will be a central issue.

V. Key Claim Terms for Construction

• The Term: "economic surplus" (’420 Patent, claim 1)

• Context and Importance: This term appears to be at the core of the claimed optimization process. Its definition is critical because it is not a standard term of art in computer science, and its scope will determine what kind of calculation an accused system must perform to infringe. Practitioners may focus on this term because it introduces an economic concept into a technical claim, raising questions about its proper construction.

• Intrinsic Evidence for Interpretation:

  • Evidence for a Broader Interpretation: The specification suggests that the optimization can be based on various business goals, stating the system may be used to "optimally schedule agents for greatest efficiency, lowest cost, or other optimized variable" (’420 Patent, col. 4:8-10). This could support a broad definition of "economic surplus" tied to any quantifiable business objective.
  • Evidence for a Narrower Interpretation: The specification also provides more concrete examples, tying the optimization to "economic parameter[s], such as sales volume, profit, or the like" (’420 Patent, col. 24:35-37). A defendant may argue that this language limits the term to conventional financial metrics.

• The Term: "aggregate utility" (’748 Patent, claim 1)

• Context and Importance: This term defines the objective function that the claimed system seeks to maximize. Its construction is central to determining infringement, as it dictates the nature of the required optimization. Practitioners may focus on this term because its breadth could either capture a wide range of routing systems or be limited to those performing a specific, multi-factor calculation.

• Intrinsic Evidence for Interpretation:

  • Evidence for a Broader Interpretation: The word "utility" is a broad economic term that can refer to any measure of value or satisfaction. The patent does not appear to provide an explicit definition, which may support a construction covering any system that routes communications based on a composite value score.
  • Evidence for a Narrower Interpretation: The related ’420 Patent specification, which provides context, discloses a formula that includes factors such as agent cost, anticipated value of the transaction, and opportunity cost (’420 Patent, col. 24:50-65). A defendant may argue that "aggregate utility" should be construed more narrowly to require the combination of these specifically disclosed factors.

VI. Other Allegations

• Indirect Infringement: The complaint alleges induced infringement of the ’748 and ’086 Patents. The basis for these allegations is 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" (Compl. ¶¶ 24, 45).
• Willful Infringement: The complaint alleges willful infringement of the ’748 and ’086 Patents based on "actual knowledge" stemming from the service of the complaint itself, indicating a claim for post-suit willfulness (Compl. ¶¶ 23-24, 44-45). No facts are alleged to support pre-suit knowledge.

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

1. A central procedural question will be one of pleading sufficiency: Can the complaint, which identifies no accused products and provides no factual detail on infringement, relying instead entirely on unfiled exhibits, survive a motion to dismiss under the Twombly/Iqbal plausibility standard?
2. A core issue will be one of definitional scope: Can abstract economic concepts claimed in the patents, such as "economic surplus" and "aggregate utility," be construed to read on the functionality of Defendant's commercial systems, once identified? The dispute will likely focus on whether the general-purpose business logic in a routing system performs the specific, multi-part optimizations required by the claims.
3. A key evidentiary question will be one of functional operation: Assuming the complaint survives, what technical evidence will demonstrate that Defendant's systems actually perform the specific optimization and calculation steps recited in the claims, such as determining an "opportunity cost" for an agent or "maximizing an aggregate utility" across multiple pending communications?