Patent Armory Inc. v. American Airlines, Inc.

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Patent Armory Inc. (Canada)
  • Defendant: American Airlines, Inc. (Delaware)
  • Plaintiff’s Counsel: Rabicoff Law LLC
• Case Identification: 2:23-cv-00407, E.D. Tex., 09/09/2023
• Venue Allegations: Venue is based on Defendant maintaining an established place of business in the Eastern District of Texas.
• Core Dispute: Plaintiff alleges that Defendant’s internal systems and customer-facing products infringe five patents related to intelligent communication routing and auction-based matching systems.
• Technical Context: The technology at issue involves sophisticated methods for routing communications in call centers and matching entities (e.g., customers and agents) by optimizing for economic or utility-based factors, moving beyond simple skill-based assignment.
• Key Procedural History: The complaint does not allege any prior litigation or administrative proceedings. U.S. Patent No. 10,237,420 is a continuation of a family of applications that includes the also-asserted U.S. Patent No. 9,456,086. Similarly, U.S. Patent Nos. 7,023,979 and 7,269,253 appear to stem from a common application. These family relationships may be relevant to questions of claim scope and priority dates.

Case Timeline

Date	Event
2003-03-07	Earliest Priority Date for ’979, ’086, and ’420 Patents
2006-03-23	Earliest Priority Date for ’253 Patent
2006-04-03	Earliest Priority Date for ’748 Patent
2006-04-04	’979 Patent Issued
2007-09-11	’253 Patent Issued
2016-09-27	’086 Patent Issued
2019-03-19	’420 Patent Issued
2019-11-26	’748 Patent Issued
2023-09-09	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

• Issued: March 19, 2019

The Invention Explained

• Problem Addressed: The patent’s background describes inefficiencies in traditional call centers that use simple routing like first-come-first-served. These systems can lead to mismatches, such as routing a customer to an "under-skilled agent" who cannot solve the problem or an "over-skilled agent" whose expertise is wasted on a simple task, reducing overall throughput. (’420 Patent, col. 4:35-62).
• The Patented Solution: The invention proposes a more sophisticated matching system that functions like an auction. It matches a "first entity" (e.g., a caller) with a "second entity" (e.g., a call center agent) by performing an "automated optimization." This optimization considers not only the quality of the match but also the "economic surplus" created by that pairing and the "opportunity cost" of making that specific agent unavailable for other potential matches. (’420 Patent, Abstract; col. 24:41-50). This aims to maximize the overall efficiency of the system, not just handle the next call in line.
• Technical Importance: This approach represents a shift from static, rule-based call routing to a dynamic, economic model for allocating resources in real-time within a communications network. (’420 Patent, col. 18:9-22).

Key Claims at a Glance

• The complaint does not specify which claims are asserted, instead referring to an external exhibit. Independent claim 1 is representative of the patent's core inventive concept.
• Independent Claim 1: A method comprising the essential elements of:
  • Defining multivalued scalar data representing "inferential targeting parameters" for a first entity.
  • Defining 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 potential match and an "opportunity cost" of making one of the second entities unavailable for an alternate match.

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

• Issued: November 26, 2019

The Invention Explained

• Problem Addressed: The patent addresses the challenge of balancing competing goals in a call center, where customers expect high-quality service with minimal waiting, while the center must make efficient use of its resources. (’748 Patent, col. 2:26-34).
• The Patented Solution: The invention is a communications routing system that uses a processor to determine an optimal routing path. It does so by representing both communication "sources" (e.g., callers) and "targets" (e.g., agents) with predicted characteristics, each associated with an "economic utility." The system then determines an optimal routing by "maximizing an aggregate utility" for the entire system, considering all available sources and targets. (’748 Patent, Abstract). The process may include optimizing a "cost-utility function" that considers factors like long-term call center operation versus short-term efficiency. (’748 Patent, Fig. 1).
• Technical Importance: This technology provides a framework for system-wide optimization of communication routing, using economic utility as a metric to balance various business objectives simultaneously. (’748 Patent, col. 4:6-10).

Key Claims at a Glance

• The complaint does not specify which claims are asserted. Independent claim 1 is representative.
• Independent Claim 1: A communications routing system comprising the essential elements of:
  • A processor and memory configured to represent predicted characteristics and an "economic utility" for a plurality of communication sources.
  • Representing predicted characteristics and an "economic utility" for a plurality of communication targets.
  • Determining an optimal routing between the sources and targets by "maximizing an aggregate utility" with respect to their predicted characteristics.

Multi-Patent Capsules

• Patent Identification: U.S. Patent No. 10,491,748, Telephony control system with intelligent call routing, issued April 4, 2006.

• Technology Synopsis: This patent describes a telephony control system that intelligently routes calls based on an optimization of a cost-utility function. It discloses selecting an agent by maximizing a weighted sum of the agent's skills against the required skills for the call, while also considering factors such as agent cost and potential training benefits. (’979 Patent, col. 23:45-67).

• Asserted Claims: The complaint does not specify asserted claims, referring to an external exhibit. (Compl. ¶30).

• Accused Features: The complaint alleges infringement by "Exemplary Defendant Products" but provides no specific feature descriptions in the complaint body. (Compl. ¶30).

• Patent Identification: U.S. Patent No. 7,269,253, Telephony control system with intelligent call routing, issued September 11, 2007.

• Technology Synopsis: This patent discloses a method for routing communications based on a cost-benefit optimization. The system evaluates the skills of available agents against the needs of a communication and selects an agent to optimize a cost-benefit outcome, which may include non-economic factors like training opportunities or balancing long-term versus short-term call center goals. (’253 Patent, col. 23:45-col. 24:40).

• Asserted Claims: The complaint does not specify asserted claims, referring to an external exhibit. (Compl. ¶39).

• Accused Features: The complaint alleges infringement by "Exemplary Defendant Products" but provides no specific feature descriptions in the complaint body. (Compl. ¶39).

• 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, a parent to the ’420 patent, describes a system for matching entities by conducting an auction. The auction is sensitive to both economic factors (e.g., cost) and non-economic factors (e.g., the optimality of a profile match). The system uses these factors to determine a routing path between entities, such as a caller and an agent. (’086 Patent, Abstract; col. 18:9-22).

• Asserted Claims: The complaint does not specify asserted claims, referring to an external exhibit. (Compl. ¶45).

• Accused Features: The complaint alleges infringement by "Exemplary Defendant Products" but provides no specific feature descriptions in the complaint body. (Compl. ¶45).

III. The Accused Instrumentality

Product Identification

The complaint does not identify any specific accused products, methods, or services by name. (Compl. ¶15). It refers generally to "Exemplary Defendant Products" that are allegedly identified in external exhibits not filed with the complaint. (Compl. ¶15, ¶17).

Functionality and Market Context

The complaint does not provide sufficient detail for analysis of the functionality or market context of the accused instrumentalities. It makes only conclusory allegations that these unidentified products "practice the technology claimed" by the patents-in-suit. (Compl. ¶17, ¶26, ¶35, ¶41, ¶50).

IV. Analysis of Infringement Allegations

The complaint’s infringement allegations are presented entirely within external claim chart exhibits (Exhibits 6-10), which were not provided with the complaint filing. (Compl. ¶17, ¶26, ¶35, ¶41, ¶50). The complaint body itself does not contain a narrative description of the accused functionality sufficient to construct a claim chart summary or substantively analyze the infringement theory.

No probative visual evidence provided in complaint.

Identified Points of Contention

• Evidentiary Questions: As the complaint provides no factual support for infringement, a primary point of contention will be whether Plaintiff can, through discovery, produce evidence that Defendant’s systems for customer service, flight management, or other operations actually perform the specific multi-factorial economic optimizations required by the claims. For example, what evidence does the complaint provide that Defendant's call routing system calculates an "economic surplus" or "maximizes an aggregate utility" rather than using a more conventional skill-based or priority-based logic?
• Scope Questions: The infringement analysis may raise questions about the scope of the patent claims. For instance, can the term "auction," as used in the context of matching callers and agents, be construed to read on a system that prioritizes flight upgrade requests based on passenger status and fare class, as might be used by an airline? Does the term "entity," used abstractly in the claims, properly read on the specific users and systems in Defendant's business environment?

V. Key Claim Terms for Construction

Term: "economic surplus"

(from ’420 Patent, Claim 1)

Context and Importance

This term is central to the optimization step of the claimed method. Its definition will determine the nature of the calculation required to prove infringement. Practitioners may focus on this term because if it is construed narrowly to require a specific financial calculation, infringement may be more difficult to prove than if it is construed broadly to include non-monetary utility metrics.

Intrinsic Evidence for Interpretation

• Evidence for a Broader Interpretation: The specification discusses applying the invention to call centers, where goals include customer satisfaction and efficient use of resources, not just direct profit. (’420 Patent, col. 2:26-34). This context may support an interpretation where "economic surplus" encompasses non-monetary measures of utility or efficiency.
• Evidence for a Narrower Interpretation: The patent's title and claims use the term "auction," and the claims also recite "opportunity cost," both of which have well-defined meanings in economics. This may support a narrower construction requiring a more formal, quantifiable economic calculation. (’420 Patent, Title; Claim 1).

Term: "maximizing an aggregate utility"

(from ’748 Patent, Claim 1)

Context and Importance

This phrase defines the objective of the claimed routing system. The construction of "maximizing" and "aggregate utility" will be critical. The dispute may turn on whether the accused system must find a provably optimal solution for the entire system ("maximizing aggregate") or merely a better-than-prior-art solution for an individual routing decision.

Intrinsic Evidence for Interpretation

• Evidence for a Broader Interpretation: The specification describes balancing "competing goals" and optimizing a "cost-utility function," which may include factors like "long term call center operation." (’748 Patent, col. 2:30-31; Fig. 1). This language may support a construction where "maximizing" means achieving a better balance of factors, not necessarily a mathematically perfect optimum.
• Evidence for a Narrower Interpretation: The term "maximizing" in a claim context often implies finding the single best result from a set of options. Defendant may argue that its systems are heuristic and designed to find "good enough" solutions quickly, rather than performing the computationally intensive task of provably "maximizing" a utility function across an "aggregate" of all possible routings.

VI. Other Allegations

Indirect Infringement

The complaint alleges induced infringement for the ’748, ’979, and ’086 patents. The allegations are based on Defendant's knowledge from at least the service of the complaint and on the 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. ¶24-25, ¶33-34, ¶48-49).

Willful Infringement

While not pleaded as a separate count, the complaint alleges "Actual Knowledge of Infringement" for the ’748, ’979, and ’086 patents, with knowledge arising from the service of the complaint itself. (Compl. ¶23, ¶32, ¶47). This establishes a basis for a claim of post-filing willful infringement.

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

• A central issue will be one of evidentiary proof: given that the complaint lacks any specific factual allegations of infringement, can the Plaintiff develop evidence through discovery to show that Defendant’s complex, real-world operational systems perform the specific, multi-step economic optimizations and utility calculations required by the asserted claims?
• The case may also turn on a question of definitional scope: will key claim terms like "economic surplus" and "auction" be construed narrowly to require formal economic calculations, or broadly enough to encompass the more general utility-based heuristics and prioritization schemes commonly used in large-scale logistics and customer service systems?
• A third key question will be one of intent for inducement: for its indirect infringement claims, can Plaintiff demonstrate that Defendant, by providing user manuals or other materials, possessed the specific intent to encourage its employees or customers to use its systems in a manner that it knew would infringe the patents, particularly after being notified of the patents by the lawsuit?