Patent Armory Inc v. Healthplex Inc

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Patent Armory Inc. (Canada)
  • Defendant: Healthplex, Inc. (New York)
  • Plaintiff’s Counsel: Rabicoff Law LLC
• Case Identification: 1:24-cv-07934, S.D.N.Y., 10/18/2024
• Venue Allegations: Plaintiff alleges venue is proper because Defendant maintains an established place of business within the Southern District of New York and has allegedly committed acts of patent infringement in the district.
• Core Dispute: Plaintiff alleges that Defendant’s communication routing systems infringe five U.S. patents related to intelligent call routing and auction-based systems for matching entities.
• Technical Context: The technology at issue relates to optimizing the operation of communications systems, such as call centers, by using complex algorithms to match incoming communications with the most suitable available agents or resources.
• Key Procedural History: None mentioned in the complaint.

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: March 19, 2019 (the ’420 Patent). (Compl. ¶9).

The Invention Explained

• Problem Addressed: The patent describes the inefficiency of traditional call centers that use simple routing logic, such as first-in-first-out queues or longest-idle-agent selection. These methods are described as inadequate for environments where agents have varying skills, leading to mismatches that reduce transactional throughput and overall efficiency. (’420 Patent, col. 4:13-34).
• The Patented Solution: The invention proposes a method for matching a "first entity" (e.g., a caller) with a "second entity" (e.g., a call center agent) by performing a multifactorial optimization. This process involves defining parameters for both entities using "multivalued scalar data" and then conducting an "automated optimization" that considers not only the quality of the match but also the "economic surplus" of the match and the "opportunity cost" of making an agent unavailable for other potential matches. (’420 Patent, Abstract; col. 20:9-24). Figure 3 illustrates this architecture, showing "Call Classification Vectors" being processed to match callers with appropriate agents based on various data points like agent characteristics and cost functions. (’420 Patent, Fig. 3).
• Technical Importance: The claimed solution represents a shift from static, rule-based call distribution to a dynamic, economically-driven optimization model, intended to improve resource allocation in complex communication environments. (’420 Patent, col. 18:8-21).

Key Claims at a Glance

• The complaint asserts infringement of one or more "exemplary method claims." (Compl. ¶15). Independent claim 1 is representative of this technology.
• 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 and a plurality of multivalued scalar data of each of the plurality of second entities, representing respective characteristic parameters for each respective second entity; and
  • performing an automated optimization with respect to an economic surplus of a respective match of the first entity with the at least one of the plurality of second entities, and 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 reserves the right to assert additional claims. (Compl. ¶15).

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

• Issued: November 26, 2019 (the ’748 Patent). (Compl. ¶10).

The Invention Explained

• Problem Addressed: The patent addresses the same technical problem as the ’420 Patent: the limitations of conventional, non-deterministic systems in efficiently managing real-time communications where participants have varied characteristics. (’420 Patent, col. 2:26-34).
• The Patented Solution: The invention is a communications routing system that determines an optimal routing path by representing communication sources and targets with predicted characteristics and maximizing an "aggregate utility" between them. This utility is described as economic, and the system aims to find the best match based on these predicted economic values. (’748 Patent, Abstract). The system architecture is depicted as involving a communications control server application that performs a "multifactorial optimization" to resolve an optimal target. (’420 Patent, Fig. 5).
• Technical Importance: This patent claims the system architecture that implements the economically-driven, intelligent routing method, providing a framework for dynamic and optimized communication path selection in complex networks. (’420 Patent, col. 18:8-21).

Key Claims at a Glance

• The complaint asserts infringement of one or more "exemplary claims." (Compl. ¶21). Independent claim 1 is representative.
• Essential elements of a representative independent claim, based on the abstract, would likely include:
  • A communications routing system and method,
  • 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, and
  • determining an optimal routing between the sources and targets by maximizing an aggregate utility with respect to their predicted characteristics.
• The complaint reserves the right to assert additional claims. (Compl. ¶21).

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

• Patent Identification: U.S. Patent No. 7,023,979, issued April 4, 2006. (Compl. ¶11).
• Technology Synopsis: This patent relates to intelligent call routing in a telephony control system. It addresses the problem of efficiently matching incoming calls to the most appropriate agents in a call center by considering factors beyond simple queue order, such as agent skills and other call characteristics. (Compl. ¶11; ’420 Patent, col. 2:26-34).
• Asserted Claims: The complaint asserts infringement of "exemplary method claims" without specifying claim numbers. (Compl. ¶30).
• Accused Features: The complaint alleges that Defendant’s "Exemplary Defendant Products" infringe the ’979 Patent, incorporating by reference the claim charts in Exhibit 8, which is not attached to the complaint. (Compl. ¶¶ 30, 32).

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

• Patent Identification: U.S. Patent No. 7,269,253, issued September 11, 2007. (Compl. ¶12).
• Technology Synopsis: This patent is also directed to intelligent call routing within a telephony control system. The invention provides a system for routing communications based on an analysis of both caller needs and agent capabilities to create an optimal match, thereby improving call center efficiency. (Compl. ¶12; ’420 Patent, col. 2:26-34).
• Asserted Claims: The complaint asserts infringement of "exemplary method claims" without specifying claim numbers. (Compl. ¶36).
• Accused Features: The complaint alleges that Defendant’s "Exemplary Defendant Products" infringe the ’253 Patent and incorporates by reference the claim charts in Exhibit 9, which is not attached to the complaint. (Compl. ¶¶ 36, 38).

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, issued September 27, 2016. (Compl. ¶13).
• Technology Synopsis: This patent describes a method for matching entities using an auction-based framework. Similar to the ’420 Patent, it moves beyond simple skill-matching to an economic model where resources (e.g., agents) are allocated based on a cost-benefit optimization that considers factors like opportunity cost. (Compl. ¶13; ’420 Patent, Abstract).
• Asserted Claims: The complaint asserts infringement of "exemplary claims" without specifying claim numbers. (Compl. ¶42).
• Accused Features: The complaint alleges that Defendant’s "Exemplary Defendant Products" infringe the ’086 Patent and incorporates by reference the claim charts in Exhibit 10, which is not attached to the complaint. (Compl. ¶¶ 42, 47).

III. The Accused Instrumentality

Product Identification

The complaint does not identify any accused product, method, or service by name. It refers generally to "Exemplary Defendant Products." (Compl. ¶15).

Functionality and Market Context

The complaint provides no specific technical description of the accused products' functionality. Instead, it makes the conclusory allegation that the products "practice the technology claimed" by the patents-in-suit. (Compl. ¶¶ 17, 26, 32, 38, 47). The complaint alleges infringement through Defendant’s acts of "making, using, offering to sell, selling and/or importing" these products, as well as through internal testing by employees. (Compl. ¶¶ 15, 16). For a detailed technical comparison, the complaint incorporates by reference Exhibits 6, 7, 8, 9, and 10, which are not filed with the complaint. (Compl. ¶¶ 17, 26, 32, 38, 47).

IV. Analysis of Infringement Allegations

The complaint does not contain claim charts or detailed infringement allegations in the body of the document. For its infringement theory against the ’420 and ’748 Patents, it incorporates by reference Exhibits 6 and 7, respectively, which were not provided with the filing. (Compl. ¶¶ 18, 27). The narrative infringement theory is limited to the conclusory statement that the "Exemplary Defendant Products incorporated in these charts satisfy all elements of the Exemplary [...] Patent Claims." (Compl. ¶¶ 17, 26).

No probative visual evidence provided in complaint.

Identified Points of Contention

• Scope Questions: A central question will be whether Defendant’s accused systems perform an "auction" as that term is used in the ’420 and ’086 Patents. The analysis may turn on whether a system that algorithmically matches a communication to a resource, without an explicit bidding process, can be considered an "auction." A similar question arises regarding whether the accused systems calculate an "economic surplus" or "aggregate utility," or if they perform a more conventional, non-economic, skill-based matching function that falls outside the scope of the claims.
• Technical Questions: The complaint lacks any specific factual allegations detailing how the accused products operate. A primary point of contention will be evidentiary: what proof can Plaintiff provide that the accused products perform the specific "multifactorial optimization" required by the claims, as opposed to a different, non-infringing routing algorithm? The functionality described in the patents, such as considering "opportunity cost" (’420 Patent, Abstract), suggests a complex process that Plaintiff must prove is present in the accused systems.

V. Key Claim Terms for Construction

The Term: "automated optimization"

• Patent: ’420 Patent, Claim 1
• Context and Importance: This term is the central action of the claimed method. Its construction will be critical to determining infringement. Practitioners may focus on this term because its scope will define whether conventional rule-based or algorithmic routing systems, common in the industry, are covered, or if the claim is limited to a more specific and complex mathematical optimization process.
• Intrinsic Evidence for Interpretation:
  • Evidence for a Broader Interpretation: The specification refers to optimizing a "cost-utility function" and a "global minimization of the cost function," which could be argued to cover any process that seeks to improve efficiency by weighing different factors. (’420 Patent, col. 4:9-12; col. 23:3-20).
  • Evidence for a Narrower Interpretation: The detailed description discusses specific optimization goals, such as maximizing an "economic surplus" and accounting for "opportunity cost," suggesting the "automated optimization" is not a generic process but one tied to specific economic calculations. (’420 Patent, Abstract; col. 24:42-50).

The Term: "economic surplus"

• Patent: ’420 Patent, Claim 1
• Context and Importance: This term appears to be a key differentiator from prior art skill-based routing. The infringement analysis will depend heavily on whether the accused system can be shown to calculate or optimize for such a value. Practitioners may focus on this term because it is not a standard technical term in the art of call routing and its definition may be outcome-determinative.
• Intrinsic Evidence for Interpretation:
  • Evidence for a Broader Interpretation: The patent does not appear to provide an explicit definition, which may support an argument that the term should be given its plain and ordinary meaning in the context of economics, potentially encompassing any calculation of value or utility.
  • Evidence for a Narrower Interpretation: The term is used in conjunction with "opportunity cost" and a multifactorial optimization, suggesting it refers to a specific, quantifiable economic metric rather than a general concept of "value" or "utility." (’420 Patent, Abstract). The lack of a specific definition or formula in the specification could also support an argument that the term is indefinite.

VI. Other Allegations

Indirect Infringement

The complaint alleges induced infringement of the ’748 and ’086 Patents. (Compl. ¶¶ 25, 46). 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." (Compl. ¶¶ 24, 45). The complaint cites Exhibits 7 and 10, which are not attached, as containing extensive references to these materials. (Compl. ¶¶ 24, 45).

Willful Infringement

The complaint does not use the word "willful" but alleges "Actual Knowledge of Infringement" for the ’748 and ’086 Patents, based on the service of the complaint and the attached (but missing) claim charts. (Compl. ¶¶ 23, 44). This allegation of post-suit knowledge may be intended to support a later claim for enhanced damages under 35 U.S.C. § 284.

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

• A core issue will be one of definitional scope: can patent terms with specific economic connotations, such as "auction" and "economic surplus," be construed broadly enough to read on the functionality of Defendant's communication routing systems, or are these terms limited to systems that perform explicit bidding and formal economic calculations?
• A key evidentiary question will be one of technical proof: given the complaint's complete reliance on unattached exhibits for its technical infringement theory, a central issue will be whether Plaintiff can produce sufficient evidence to demonstrate that Defendant's products actually perform the specific, multi-part "automated optimization" required by the claims, as opposed to conventional skill-based routing.