Patent Armory Inc v. BLH Acquisition Co LLC

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Patent Armory Inc. (Canada)
  • Defendant: BLH Acquisition Co., LLC (Delaware)
  • Plaintiff’s Counsel: Rabicoff Law LLC
• Case Identification: 2:23-cv-00393, E.D. Tex., 08/30/2023
• Venue Allegations: Venue is alleged to be proper based on Defendant maintaining an established place of business within the Eastern District of Texas.
• Core Dispute: Plaintiff alleges that Defendant’s products infringe five patents related to intelligent call routing and auction-based entity matching systems for telecommunications.
• Technical Context: The technology concerns advanced call center management systems that use economic principles and multi-factor optimization to route communications, aiming to improve efficiency beyond simple skill-based matching.
• Key Procedural History: The complaint does not allege any prior litigation, licensing history, or post-grant proceedings for the patents-in-suit. The asserted patents are related within a complex family, with U.S. Patent No. 9,456,086 being a parent to U.S. Patent No. 10,237,420, and the patents on intelligent call routing also sharing prosecution history.

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 inherent inefficiencies in traditional call center management, which struggles to balance high-quality customer service with the efficient use of resources (’420 Patent, col. 2:26-34). It notes that simple routing schemes, such as first-come-first-served, fail to account for the varying skills of agents or the specific needs of callers, leading to suboptimal performance (’420 Patent, col. 3:1-14).
  • The Patented Solution: The invention proposes a system that treats the matching of a caller to a call center agent as a type of auction (’420 Patent, Abstract). The system defines parameters for both the caller (the "first entity") and the available agents (the "second entities") and then performs an "automated optimization" to find the best match (’420 Patent, Abstract). This optimization considers not only the direct benefit or "economic surplus" of a potential match but also the "opportunity cost"—the value lost by making a particular agent unavailable for other potential callers who might be a better fit (’420 Patent, col. 24:41-50; Fig. 1).
  • Technical Importance: This approach moves beyond static, rule-based routing to a dynamic, economic model that seeks to optimize the overall, long-term efficiency of the call center rather than just handling the next call in line (’420 Patent, col. 27:8-14).
• Key Claims at a Glance:
  The complaint incorporates by reference claim charts from an unprovided exhibit (Compl. ¶17-18). Independent claim 1 of the ’420 Patent includes the following essential elements:
  • A method for matching a first entity with at least one second entity selected from a plurality of second entities, comprising:
  • 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;
  • 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.

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

• The Invention Explained:
  • Problem Addressed: The patent addresses the challenge of intelligently routing communications in a complex environment where both the communication sources (e.g., callers) and targets (e.g., agents) have varied and distinct characteristics that affect the outcome of an interaction (’748 Patent, col. 1:21-24).
  • The Patented Solution: The invention is a routing system that determines an optimal routing path by maximizing an "aggregate utility" (’748 Patent, Abstract). It does this by representing both communication sources and targets with predicted characteristics, each of which is assigned an "economic utility" value (’748 Patent, Abstract). A processor then calculates the optimal pairing by maximizing the combined utility, considering factors like agent cost, training utility, and anticipated outcome from the pairing (’748 Patent, col. 23:24-24:67).
  • Technical Importance: This system provides a framework for routing communications based on a holistic, utility-driven optimization, rather than on a single, predetermined address or a simple matching rule (’748 Patent, col. 18:10-21).
• Key Claims at a Glance:
  The complaint incorporates by reference claim charts from an unprovided exhibit (Compl. ¶26-27). Independent claim 1 of the ’748 Patent includes the following essential elements:
  • A communications routing system comprising:
  • a memory storing a plurality of predicted characteristics of a plurality of communications sources, each having an economic utility, and a plurality of predicted characteristics of a plurality of communications targets, each having an economic utility;
  • a processor for determining an optimal routing between the plurality of communications sources and the plurality of communications targets, by maximizing an aggregate utility with respect to the respective predicted characteristics;
  • wherein the determined optimal routing represents a linkage between at least one of the plurality of communications sources and at least one of the plurality of communications targets.

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: The patent title suggests a system for intelligently routing calls within a telephony system, likely a call center. This involves using defined characteristics of the call and the available agents to make a routing decision that is more advanced than simple queuing, aiming to improve operational efficiency.
• Asserted Claims: The complaint refers to "exemplary claims" identified in Exhibit 8, which was not provided (Compl. ¶30, ¶35).
• Accused Features: The complaint alleges that "Exemplary Defendant Products" practice the technology claimed in the ’979 Patent but does not specify which products or features are accused beyond referencing the unprovided exhibit (Compl. ¶30, ¶35).

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: Based on its title and relation to the other asserted patents, this patent likely discloses further improvements or alternative embodiments of an intelligent call routing system for call centers. The technology likely focuses on optimizing call-to-agent matching based on a multifactorial analysis.
• Asserted Claims: The complaint refers to "exemplary claims" identified in Exhibit 9, which was not provided (Compl. ¶39, ¶41).
• Accused Features: The complaint alleges infringement by "Defendant products" but relies on the unprovided Exhibit 9 to identify specific instrumentalities and features (Compl. ¶39, ¶41).

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: As a parent to the ’420 Patent, this patent describes a method for matching entities using an auction framework. The core technology involves optimizing the match based on economic factors, such as the value of the match and the opportunity cost of assigning a particular resource, thereby moving beyond simple first-in-first-out logic.
• Asserted Claims: The complaint refers to "exemplary claims" identified in Exhibit 10, which was not provided (Compl. ¶45, ¶50).
• Accused Features: The complaint makes general allegations of infringement against "Exemplary Defendant Products" and relies on the unprovided Exhibit 10 for specific details (Compl. ¶45, ¶50).

III. The Accused Instrumentality

• Product Identification: The complaint does not identify any accused products or services by name (Compl. ¶15, ¶21, ¶30, ¶39, ¶45).
• Functionality and Market Context: The complaint refers to "Exemplary Defendant Products" and states they are identified in charts included as Exhibits 6 through 10 (Compl. ¶15, ¶17). These exhibits were not provided with the complaint document. Therefore, the complaint does not provide sufficient detail for analysis of the functionality or market context of the accused instrumentalities.

IV. Analysis of Infringement Allegations

The complaint does not contain claim charts within its body, instead incorporating them by reference to Exhibits 6-10, which were not provided (Compl. ¶18, ¶27, ¶36, ¶42, ¶51). The narrative allegations state that the unidentified "Exemplary Defendant Products" practice the technology claimed by the patents-in-suit and satisfy all elements of the asserted claims (Compl. ¶17, ¶26, ¶35, ¶41, ¶50). Without the claim charts or identification of the accused products, a detailed analysis of the specific infringement theory for any patent is not possible.

• Identified Points of Contention:
  • Evidentiary Questions: A primary point of contention will likely be factual and evidentiary. Questions will arise as to what specific functionality within Defendant's unidentified products performs the complex steps required by the claims, such as performing an "automated optimization" ('420 Patent) or "maximizing an aggregate utility" ('748 Patent).
  • Scope Questions: The dispute may center on the scope of key claim terms. For the ’420 Patent, a central question is whether the calculations performed by the accused products constitute an "optimization" that considers both "economic surplus" and "opportunity cost" as those terms are understood in the patent. For the ’748 Patent, a key question is whether the accused system assigns and maximizes an "economic utility" for both communication sources and targets as required by the claims.

V. Key Claim Terms for Construction

• Term from the ’420 Patent: "economic surplus"
  • Context and Importance: This term is central to the claimed "automated optimization." Its construction will be critical to determining whether the accused system’s method for evaluating a potential match falls within the scope of the claims. Practitioners may focus on this term because it appears to require a specific type of economic calculation beyond a simple score matching.
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: The specification refers to optimizing a "cost-utility function" and notes that the outcome can be graded in terms of achieving "business goals" like "sales volume, profit, or the like" (’420 Patent, col. 24:30-36). This language could support a broad definition covering various business-oriented metrics.
    • Evidence for a Narrower Interpretation: The patent provides a specific, complex formula as an example of the optimization: An=Max({[Acn1∑(rs1ans1)+Acn2]+Bcn}+Ccn)+Dcn> (’420 Patent, col. 24:52-54). A defendant may argue this exemplary formula and its components limit the term to a more specific multi-factor calculation that includes distinct cost and opportunity cost components.
• Term from the ’748 Patent: "economic utility"
  • Context and Importance: The claim requires determining an optimal routing by "maximizing an aggregate utility" where both sources and targets have an associated "economic utility." The definition of this term is fundamental to the infringement analysis. The dispute may turn on whether the accused system's routing logic is based on a metric that qualifies as an "economic utility."
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: The specification describes utility in broad business terms, stating that "the agents serve a business purpose, and call outcomes may be graded in terms of achieving business goals" (’748 Patent, col. 24:31-33). This suggests "economic utility" could encompass a wide range of performance or value metrics.
    • Evidence for a Narrower Interpretation: The specification discusses converting non-economic goals like "customer satisfaction" into "economic terms prior to use in an optimization" (’748 Patent, col. 24:37-40). A defendant may argue this implies a requirement to translate all factors into a common, quantifiable economic unit, potentially narrowing the term's scope to exclude systems that use non-monetized scoring.

VI. Other Allegations

• Indirect Infringement: The complaint alleges induced infringement for U.S. Patent Nos. 10,491,748, 7,023,979, and 9,456,086 (Compl. ¶25, ¶34, ¶49). The allegations are based on the defendant allegedly distributing "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, ¶33, ¶48).
• Willful Infringement: The complaint alleges actual knowledge for the ’748, ’979, and ’086 patents, but bases this knowledge solely on the service of the complaint and its associated (but unprovided) claim charts (Compl. ¶23, ¶32, ¶47). This suggests the allegations are directed at post-suit conduct.

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

No probative visual evidence provided in complaint.

• Evidentiary Sufficiency: A foundational issue will be whether the complaint’s allegations, which rely entirely on unprovided exhibits to identify the accused products and map them to the claims, can survive a motion to dismiss. A key question for the case will be what specific evidence Plaintiff can produce to show that Defendant's systems perform the highly specific optimization and utility-maximization functions recited in the patent claims.
• Definitional Scope: The case will likely turn on a question of definitional scope: how will the court construe abstract, economics-based claim terms such as "economic surplus," "opportunity cost," and "economic utility"? The outcome will depend on whether these terms are interpreted broadly to cover general-purpose optimization metrics or are limited to the specific economic models and formulas described in the patent specifications.
• Functional Operation: A central technical question will be one of functional equivalence: assuming Plaintiff identifies an accused product, does its routing or matching algorithm perform the same function, in substantially the same way, to achieve the same result as the claimed methods? The dispute will focus on whether there is a fundamental mismatch between the patented economic auction models and the actual technical operation of the accused systems.