Patent Armory Inc v. Citibank NA

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Patent Armory Inc. (Canada)
  • Defendant: Citibank N.A. (Delaware)
  • Plaintiff’s Counsel: Rabicoff Law LLC
• Case Identification: 2:24-cv-01060, E.D. Tex., 12/18/2024
• Venue Allegations: Venue is alleged to be proper based on Defendant maintaining an established place of business in the district and committing alleged acts of patent infringement within the district.
• Core Dispute: Plaintiff alleges that Defendant’s systems for managing customer communications and allocating resources infringe five patents related to intelligent call routing and auction-based entity matching.
• Technical Context: The patents relate to advanced telecommunications and call center management systems designed to optimize the routing of communications (e.g., phone calls) to agents or other resources.
• Key Procedural History: The complaint does not mention any prior litigation, Inter Partes Review (IPR) proceedings, or licensing history related to the patents-in-suit.

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 Invention Explained

• Problem Addressed: The patent’s background describes the inefficiencies in traditional call center management, where routing decisions are often suboptimal (e.g., connecting a caller to an over-skilled or under-skilled agent) and scheduling is complicated by agents having overlapping, multi-skill capabilities (’420 Patent, col. 4:35-64, col. 5:58-6:14).
• The Patented Solution: The invention proposes a system that treats the matching of a "first entity" (e.g., a caller) to a "second entity" (e.g., an agent) as a dynamic auction (’420 Patent, Fig. 7). Instead of simple skill matching, it performs an "automated optimization" that considers the "economic surplus" of a potential match and the "opportunity cost" of making that specific agent unavailable for other potential calls (’420 Patent, Abstract). This allows for a more globally-optimal allocation of resources in real-time.
• Technical Importance: This approach provided a model for moving beyond static, rule-based call routing to a more dynamic, economically-driven system that could globally optimize resource allocation in a complex environment like a multi-skill call center (’420 Patent, col. 18:9-24).

Key Claims at a Glance

• The complaint does not specify which claims of the ’420 Patent are asserted, instead referring to "one or more claims" and an unprovided claim chart exhibit (Compl. ¶15, ¶17). Independent claim 1 is representative of the disclosed technology.
• Essential elements of Independent Claim 1 include:
  • Defining multivalued scalar data for a first entity (representing "inferential targeting parameters") and for a plurality of second entities (representing "characteristic parameters").
  • Performing an "automated optimization" with respect to an "economic surplus" of a match between the first and second entity.
  • The optimization also considers an "opportunity cost" of the unavailability of the second entity 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," Issued November 26, 2019

The Invention Explained

• Problem Addressed: The patent identifies a core architectural problem in prior art telecommunications systems: the separation of high-level intelligent control software from low-level communication hardware, which introduces latency and limits the system's ability to make real-time, context-aware routing decisions (’748 Patent, col. 1:40-2:24).
• The Patented Solution: The invention integrates the intelligent routing logic directly into a "communications control system" (’748 Patent, col. 18:55-58). The system uses a "call classification vector" to describe an incoming communication and a table of "agent characteristic vectors" to describe available resources. A processor within the system determines the "optimum agent selection" based on the correspondence between these vectors, allowing it to control routing directly and efficiently (’748 Patent, Abstract, Fig. 3).
• Technical Importance: This integrated architecture aimed to reduce system latency and complexity, enabling more sophisticated, real-time optimizations for routing communications without relying on external, high-level management systems for each decision (’748 Patent, col. 25:47-26:15).

Key Claims at a Glance

• The complaint does not specify which claims of the ’748 Patent are asserted, instead referring to an unprovided claim chart exhibit (Compl. ¶21, ¶26). Independent claim 1 is representative of the disclosed technology.
• Essential elements of Independent Claim 1 include:
  • An input for receiving a "call classification vector."
  • A table of "agent characteristic vectors."
  • A processor that determines an "optimum agent selection" based on a correspondence between the call vector and the agent vectors.
  • The processor then controls the call routing based on that determination.
• 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," Issued April 4, 2006

• Patent Identification: U.S. Patent No. 7,023,979, "Telephony control system with intelligent call routing," Issued April 4, 2006 (Compl. ¶11).
• Technology Synopsis: An earlier patent in the same family as the ’748 Patent, this invention describes a telephony control system that uses intelligent algorithms to route calls. It addresses the need for more sophisticated call routing than traditional first-in, first-out systems by considering factors like agent skills and call center capacity.
• Asserted Claims: The complaint asserts "one or more claims" without further specification (Compl. ¶30).
• Accused Features: The complaint alleges that the "Exemplary Defendant Products" practice the technology of the ’979 Patent but provides no specific details, instead incorporating by reference an unprovided claim chart exhibit (Compl. ¶30, ¶32).

U.S. Patent No. 7,269,253 - "Telephony control system with intelligent call routing," Issued September 11, 2007

• 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 also relates to the technology of the ’748 Patent family. It describes a system for intelligent call routing that moves beyond simple queuing to optimize call handling based on various parameters, aiming to improve efficiency in environments like call centers.
• Asserted Claims: The complaint asserts "one or more claims" without further specification (Compl. ¶36).
• Accused Features: The complaint alleges that the "Exemplary Defendant Products" practice the technology of the ’253 Patent but provides no specific details, instead incorporating by reference an unprovided claim chart exhibit (Compl. ¶36, ¶38).

U.S. Patent No. 9,456,086 - "Method and system for matching entities in an auction," Issued September 27, 2016

• 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: An earlier patent in the same family as the ’420 Patent, this invention discloses a system for matching entities using an auction-based model. It proposes a method that performs an optimization considering not just a direct match, but also economic factors and the opportunity cost of allocating a resource, moving beyond simple first-come, first-served logic.
• Asserted Claims: The complaint asserts "one or more claims" without further specification (Compl. ¶42).
• Accused Features: The complaint alleges that the "Exemplary Defendant Products" practice the technology of the ’086 Patent but provides no specific details, instead incorporating by reference an unprovided claim chart exhibit (Compl. ¶42, ¶47).

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."

Functionality and Market Context

The complaint does not provide sufficient detail for analysis of the accused instrumentality's functionality or market context. All allegations of function are conclusory statements that incorporate by reference a series of unprovided exhibits containing claim charts (Compl. ¶¶ 17-18, 26-27, 32-33, 38-39, 47-48). No probative visual evidence provided in complaint.

IV. Analysis of Infringement Allegations

The complaint alleges that Defendant’s "Exemplary Defendant Products" infringe the asserted patents (Compl. ¶¶ 15, 21, 30, 36, 42). However, it does not provide a factual basis for these allegations in the body of the complaint. Instead, for each asserted patent, it "incorporates by reference" claim charts from external exhibits (Exhibits 6-10), which were not filed with the complaint (Compl. ¶¶ 18, 27, 33, 39, 48). As a result, an element-by-element analysis of the infringement allegations based on the provided documents is not possible.

• Identified Points of Contention:
  • Pleading Sufficiency: An initial point of contention may be whether the complaint's conclusory allegations, which rely entirely on unprovided external exhibits for their factual basis, meet the plausibility standard for patent infringement complaints established by Ashcroft v. Iqbal and Bell Atlantic Corp. v. Twombly.
  • Scope Questions (’420 Patent): A central question for the auction-based patents will likely be whether Defendant's systems perform a true "automated optimization" that calculates an "economic surplus" and "opportunity cost" as required by the claims, or if they employ a different, non-auction-based logic for resource allocation.
  • Technical Questions (’748 Patent): A key technical question for the integrated routing patents will likely be architectural. The analysis may focus on whether the accused systems perform intelligent routing decisions within a low-level "communications control system" as claimed, or if they utilize a more conventional architecture where high-level management software directs a separate, lower-level switching system.

V. Key Claim Terms for Construction

• For the ’420 Patent:

  • The Term: "automated optimization with respect to an economic surplus ... and an opportunity cost"
  • Context and Importance: This phrase captures the essence of the auction-based invention. Practitioners may focus on this term because its construction will determine whether a system that merely performs "best-fit" routing, without explicitly calculating the claimed economic factors, can be found to infringe.
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: The abstract’s general language suggests the concept applies broadly to matching any "first entity" with a "second entity" using these economic criteria (’420 Patent, Abstract).
    • Evidence for a Narrower Interpretation: The specification provides detailed examples of cost-utility functions specifically for call centers, which include factors like agent salary, training costs, and anticipated sales outcomes, suggesting the terms have a specific meaning tied to these concrete economic calculations (’420 Patent, col. 24:1-51).

• For the ’748 Patent:

  • The Term: "communications control system"
  • Context and Importance: The point of novelty of the ’748 Patent is the integration of the intelligent "processor" within this "system." The scope of this term is critical because if it is construed broadly to include separate but connected computer systems, the claim may read on conventional architectures; if construed narrowly, it may be limited to a single, consolidated platform.
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: The technical field is described broadly as "computer integrated telecommunications systems," which may suggest that different integrated components can form the "system" (’748 Patent, col. 1:19-22).
    • Evidence for a Narrower Interpretation: The summary of the invention discusses integrating "intelligent aspects of the control algorithm with the communications management" and implementing features at a "relatively low level," suggesting a physically or logically unified system distinct from prior art where high-level software was separate from the switch (’748 Patent, col. 18:25-34, 18:55-58).

VI. Other Allegations

• Indirect Infringement: The complaint alleges induced infringement for the ’748 and ’086 Patents. The allegations are based on Defendant distributing "product literature and website materials inducing end users and others to use its products in the customary and intended manner" (Compl. ¶24, ¶45). Knowledge and intent are alleged to exist "at least since being served by this Complaint" (Compl. ¶25, ¶46).
• Willful Infringement: While the complaint does not explicitly use the word "willful," it alleges "Actual Knowledge of Infringement" for the ’748 and ’086 Patents based on the service of the complaint and the attached (but unprovided) claim charts (Compl. ¶23, ¶44). This forms a basis for post-suit enhanced damages. The prayer for relief also requests a finding that the case is "exceptional" under 35 U.S.C. § 285 (Compl. p. 11, ¶ N.i).

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

• A primary procedural question will be one of pleading sufficiency: are the complaint's allegations, which are devoid of factual detail regarding the accused products and rely entirely on incorporating unprovided exhibits by reference, sufficient to state a plausible claim for patent infringement?
• A core issue for the ’420 and ’086 patents will be one of functional scope: can the auction-related claim terms "economic surplus" and "opportunity cost" be construed to cover the logic used by Defendant’s resource allocation systems, or is there a fundamental mismatch in their technical and economic operation?
• For the ’748, ’979, and ’253 patents, a key technical question will be one of architectural configuration: does the evidence show that Defendant's accused systems embody the claimed integrated architecture where intelligent routing decisions are made within the low-level "communications control system," or do they follow a conventional model of separate high-level software and low-level switching hardware?