DCT

4:21-cv-02478

Uatp IP LLC v. Kangaroo LLC

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Key Events
Amended Complaint

I. Executive Summary and Procedural Information

  • Parties & Counsel:
  • Case Identification: 4:21-cv-02478, S.D. Tex., 10/06/2021
  • Venue Allegations: Venue is alleged to be proper based on Defendants' residence, regular and established places of business, and commission of infringing acts within the Southern District of Texas.
  • Core Dispute: Plaintiffs allege that former franchisees are infringing a patent covering an integrated multi-activity indoor amusement attraction by continuing to operate the same equipment under a new business name after their franchise agreement was terminated.
  • Technical Context: The technology relates to integrated, multi-level amusement park attractions that combine different types of elevated activities, a segment of the growing indoor family entertainment center market.
  • Key Procedural History: The dispute arises out of a franchise relationship governed by a 2016 agreement. Plaintiffs allege they terminated the agreement in January 2021, and subsequently discovered in July 2021 that Defendants were operating the same facility, including the patented equipment, under a new name.

Case Timeline

Date Event
2016-05-31 Franchise Agreement executed with Defendant Franchisee (Compl. ¶22)
2017-03-21 ’729 Patent Priority Date (U.S. Patent No. 10,702,729, p.1)
2020-07-07 ’729 Patent Issue Date (Compl. ¶29)
2020-11-03 Plaintiff sends Notice of Default to Defendant Franchisee (Compl. ¶24)
2021-01-20 Plaintiff issues notice of termination of the Franchise Agreement (Compl. ¶24)
2021-07-XX Plaintiff discovers Defendant Kangaroo operating the accused park (Compl. ¶25)
2021-10-06 First Amended Complaint filed

II. Technology and Patent(s)-in-Suit Analysis

U.S. Patent No. 10,702,729 - "MULTI-LEVEL PLAY EQUIPMENT"

Issued July 7, 2020 (’729 Patent)

The Invention Explained

  • Problem Addressed: The patent addresses the challenge of efficiently combining different types of elevated play equipment, such as ropes courses and zip lines, which traditionally existed as standalone attractions. The background notes a desire to improve play structures and "provide play structures with different types of elevated equipment to enhance the enjoyment by users" (’729 Patent, col. 1:33-36).
  • The Patented Solution: The invention is a play apparatus that integrates multiple types of elevated equipment (e.g., a ropes course and a zip coaster) around a shared, elevated "common hub area" (’729 Patent, col. 2:58-63). This design allows a participant to access and switch between different attractions using a single safety harness, creating a seamless, multi-activity experience (’729 Patent, col. 4:55-61; Fig. 1).
  • Technical Importance: This integrated approach allows for more efficient use of the vertical and horizontal space within large indoor facilities and provides a more varied and engaging user experience compared to separate, single-purpose attractions (’729 Patent, col. 4:62-66).

Key Claims at a Glance

  • The complaint asserts infringement of claims 1 through 12 (Compl. ¶31). Claims 1 and 12 are independent.
  • Independent Claim 1 requires, in part:
    • A first type of elevated equipment (e.g., ropes course) with a first user safety support.
    • A second type of elevated equipment with a second user safety support that forms a "closed loop."
    • A "common hub area" with an elevated platform providing entry and exit locations for both the first and second types of equipment.
    • A specific relationship where at least one entry/exit point for the second equipment is at the platform elevation, while another is at a different elevation.
  • Independent Claim 12 requires, in part:
    • A first type of elevated equipment with a first user safety support.
    • A second type of elevated equipment that comprises a "zip coaster."
    • A "common area" elevated above the ground that includes the entry and exit locations for both types of equipment.
    • A "control device" on the zip coaster rail that is movable between blocking and open positions to control trolley movement.
  • The complaint reserves the right to assert additional claims, including dependent claims (Compl. ¶31; Prayer for Relief ¶A).

III. The Accused Instrumentality

Product Identification

The "Adventure Hub" attraction located at the "Kangaroo Fun Zone" indoor play center in Laredo, Texas (Compl. ¶18, ¶21.a, ¶31).

Functionality and Market Context

The complaint alleges that the accused "Adventure Hub" is the exact, unmodified physical structure that was previously operated by Defendants under a license from Plaintiffs as part of an "Urban Air Adventure Park" (Compl. ¶25, ¶31). The structure is described as combining three separate activities: a zip-line ("Sky Rider"), a ropes course, and a soft playground, into "one continuous 'hub' of activity" (Compl. ¶21.a). A photograph provided in the complaint depicts a multi-level structure with an overhead rail system and various obstacle elements, consistent with the patent's description of an integrated ropes course and zip coaster (Compl. p.11). Another photograph provides a wider view showing the integration of the zip coaster rail and ropes course over other park attractions (Compl. p.18).

IV. Analysis of Infringement Allegations

'729 Patent Infringement Allegations

| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality - |
|:----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | Alleged Infringing Functionality - | Complaint Citation | Patent Citation |
| a) a first type of elevated equipment, the first elevated equipment having a first user safety support that extends for a first traverse... - | The "Adventure Hub" includes a ropes course activity. The complaint provides a photograph depicting this structure. - | ¶21.a; p.11 | col. 12:41-51 |
| b) a second type of elevated equipment... having a second user safety support... that forms a closed loop... - | The "Adventure Hub" includes a zip-line activity called a "Sky Rider," which is alleged to be the patented zip coaster. The patent describes the zip coaster rail as running in a continuous loop. | ¶21.a; ¶26 | col. 12:52-60 |
| c) a common hub area comprising a platform that is elevated above the ground... the common hub area including the first entry location, the first exit location, the second entry location and the second exit location... | The complaint alleges that the separate activities are combined into "one continuous 'hub' of activity" and that the structure has not been modified from its original, licensed version, which was built to embody the patented invention. | ¶21.a; ¶31 | col. 12:64-12:67 |
| ...at least one of the second entry location or the second exit location at the platform elevation, the other...located at a different elevation... - | The patent describes a zip coaster with an elevated starting platform and a recovery area at a different elevation. The complaint alleges the accused hub is an unmodified version of the patented design. | ¶31 | col. 13:8-12 |

Identified Points of Contention

  • Factual Questions: The core of the dispute appears to be factual rather than technical. The central question is whether the "Adventure Hub" at Kangaroo Fun Zone is, as the complaint alleges, the same unmodified structure that was operated under the franchise license (Compl. ¶31). Evidence of any modifications made by the Defendants after terminating the franchise agreement to design around the patent claims could be a primary point of contention.
  • Scope Questions: Should the case proceed to claim construction, a question may arise regarding the scope of "common hub area." The court would need to determine if the term requires a single, integrated physical platform as shown in the patent's embodiments, or if it could more broadly cover functionally linked but physically separate access points for the different activities.

V. Key Claim Terms for Construction

  • The Term: "common hub area"

    • Context and Importance: This term is foundational to the patent's claim of integrating multiple activities. The infringement case rests on the allegation that the accused "Adventure Hub" embodies this claimed integration. Practitioners may focus on this term because its definition determines whether merely co-locating attractions is sufficient to infringe, or if a specific structural integration is required.
    • Intrinsic Evidence for Interpretation:
      • Evidence for a Broader Interpretation: The patent claims define the area functionally as including the entry and exit locations for both types of equipment (’729 Patent, cl. 1).
      • Evidence for a Narrower Interpretation: The detailed description and figures consistently depict a specific, elevated physical structure ("common area 83") that serves as the central access point for both the ropes course and the zip coaster (’729 Patent, Fig. 8; col. 9:11-13). This may support a narrower construction requiring a single, integrated platform.

  • The Term: "closed loop"

    • Context and Importance: Claim 1 requires the second type of equipment (the zip coaster) to have a safety support that "forms a closed loop." This distinguishes the invention from a simple, one-way zip line. Infringement requires proof that the accused "Sky Rider" attraction operates as a continuous circuit.
    • Intrinsic Evidence for Interpretation:
      • Evidence for a Broader Interpretation: The term itself suggests any continuous path that returns to its origin.
      • Evidence for a Narrower Interpretation: The specification describes the zip coaster rail as having a "riding section" and a "recovery section" that "extends from the recovery area back to the starting area" (’729 Patent, col. 7:12-14). A defendant could argue that a system where the trolley must be manually returned, or where the circuit is not complete, does not form a "closed loop" as described.

VI. Other Allegations

  • Indirect Infringement: The complaint does not contain specific allegations of induced or contributory infringement, focusing instead on claims of direct infringement against the defendants for "using the invention, without authority" (Compl. ¶30).
  • Willful Infringement: The complaint alleges that the infringement is "willful and deliberate" (Compl. ¶34). The asserted basis for this claim is the defendants' prior franchise relationship, which allegedly provided them with a license and direct knowledge of the patent, followed by their continued use of the patented equipment after the license was terminated (Compl. ¶30, ¶32).

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

  • A central question will be one of factual identity: is the "Adventure Hub" operated by Defendants at the Kangaroo Fun Zone the same, unmodified physical structure that was previously licensed from Plaintiffs? The case may turn less on complex claim construction and more on evidence proving or disproving that Defendants altered the equipment to take it outside the scope of the patent claims after their franchise was terminated.
  • A second key question will relate to damages and remedies: given the context of a terminated franchise agreement and parallel claims for copyright and trade dress infringement, a core issue will be determining the appropriate measure of damages. The court will need to consider whether damages should be calculated as a reasonable royalty for the patent alone, or if a more holistic approach incorporating disgorgement of profits from the entire business operation is warranted under the various IP and contract claims.