DCT
6:21-cv-00399
Global Eticket Exchange Ltd v. Ticketmaster LLC
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: Global eTicket Exchange Ltd. (Delaware)
- Defendant: Ticketmaster L.L.C. (Virginia) and Live Nation Worldwide, Inc. (Delaware)
- Plaintiff’s Counsel: Leichtman Law PLLC; Raymond W. Mort, III
- Case Identification: 6:21-cv-00399, W.D. Tex., 04/23/2021
- Venue Allegations: Plaintiff alleges venue is proper in the Western District of Texas because Defendants conduct substantial business in the district, have committed acts of infringement there, and maintain regular and established places of business. The complaint asserts that these places of business include event venues where Ticketmaster installs, owns, and controls ticketing equipment, and where venue staff are directed by Ticketmaster to perform will-call and other ticketing services.
- Core Dispute: Plaintiff alleges that Defendants’ integrated platform for primary and secondary electronic ticket sales and venue access infringes two patents related to secure, database-driven electronic ticket exchange systems.
- Technical Context: The technology at issue addresses systems for managing the entire lifecycle of an electronic event ticket, from initial sale through secondary market exchange and final validation for venue entry, using a centralized database to track ownership and rights.
- Key Procedural History: The complaint alleges that U.S. Patent No. 8,849,720 was cited by the U.S. Patent and Trademark Office against a patent application filed by Ticketmaster in a rejection dated January 13, 2015. Plaintiff asserts this event establishes Defendants' pre-suit knowledge of the patent. The complaint also notes that the ’720 Patent expired prior to the filing of the lawsuit.
Case Timeline
| Date | Event |
|---|---|
| 2001-03-22 | Earliest Priority Date for ’720 and ’065 Patents |
| 2014-09-30 | U.S. Patent No. 8,849,720 Issued |
| 2015-01-13 | Alleged date of Ticketmaster's knowledge of ’720 Patent via USPTO Office Action |
| 2019-02-26 | U.S. Patent No. 10,217,065 Issued |
| 2021-04-23 | Complaint Filed |
II. Technology and Patent(s)-in-Suit Analysis
U.S. Patent No. 8,849,720 - "Entertainment Event Ticket Purchase And Exchange System," issued September 30, 2014
The Invention Explained
- Problem Addressed: The patent describes the inefficiencies of traditional paper-based ticketing, where fixed prices fail to capture the true market value of tickets for popular events (leading to scalping) or are too high for less popular events (leading to empty seats) (’720 Patent, col. 1:58-67). Additionally, physical tickets are difficult for patrons to securely and conveniently exchange. (’720 Patent, col. 2:16-33).
- The Patented Solution: The invention proposes a fully electronic ticket system that replaces physical bearer tickets with electronic records. The system features a market-making component to establish fair initial prices, a secondary trading market where patrons can exchange tickets electronically, and a venue entry system that verifies ownership rights stored in a central database, rather than requiring a physical ticket. (’720 Patent, Abstract; col. 3:1-14). The core concept is to manage all ticket-related rights as data within a controlled electronic ecosystem.
- Technical Importance: This approach aimed to give venue owners more control over both primary and secondary ticket markets, reduce fraud associated with counterfeit paper tickets, and provide greater flexibility for ticket holders. (Compl. ¶30, ¶32).
Key Claims at a Glance
- The complaint asserts independent claim 1.
- Claim 1 of the ’720 Patent recites the essential elements of:
- A system for selling and exchanging electronic tickets for entertainment events, comprising:
- A "patron interface" for a first patron to purchase an electronic ticket.
- A "database" that stores (i) identifying information for at least a first and a second patron, and (ii) a "token" representing the ticket, which is associated with the first patron's identifying information.
- A "trading system" that allows the ticket to be transferred to the second patron by re-associating the token with the second patron's information in the database.
- A "payment system" that stores account information and automatically debits and credits patron accounts for purchases and transfers.
- An "entry system" with a reader that communicates with the database to verify an entering patron is associated with the token and then provides physical access to the venue.
- The complaint reserves the right to assert dependent claims 6, 7, 10, 11, 14, 15, 17, 21, 22, and 25. (Compl. ¶59).
U.S. Patent No. 10,217,065 - "Entertainment Event Ticket Purchase And Exchange System," issued February 26, 2019
The Invention Explained
- Problem Addressed: Stemming from the same family as the ’720 Patent, the ’065 Patent addresses challenges in managing the sale and dissemination of electronic tickets, particularly when one person purchases tickets on behalf of others. The technical problem is ensuring that each ticket is correctly and securely associated with its intended end-user. (’065 Patent, col. 13:1-10, col. 15:21-34).
- The Patented Solution: The invention claims a system where a patron can use an interface to purchase tickets for both themself and other individuals. The system then features a notification component that is responsive to such a purchase, automatically informing the other individuals that a ticket has been purchased for them and is available. (’065 Patent, cl. 15). This is integrated with a storage system that tracks the association of each ticket to a specific person and an entry system that verifies this association at the venue. (’065 Patent, cl. 15).
- Technical Importance: The complaint alleges this system enhances security by creating a clear, verifiable chain of title for each ticket from the purchaser to the end-user, restricting venue access to authorized individuals and preventing fraud. (Compl. ¶36, ¶37).
Key Claims at a Glance
- The complaint asserts independent claim 15.
- Claim 15 of the ’065 Patent recites the essential elements of:
- A system for the sale and dissemination of tickets, comprising:
- A "patron interface" allowing a patron to purchase electronic tickets for that patron and for other individuals.
- A "storage system" that stores information associating each purchased ticket with a particular person.
- A "notification system" which, in response to a ticket purchase for another individual, automatically notifies that individual that a ticket has been purchased for them and is available.
- An "entry system" that is responsive to presented information to (i) communicate with the storage system to confirm the individual is associated with a ticket and (ii) permit entry into the venue.
- The complaint reserves the right to assert dependent claims 16 and 17. (Compl. ¶76).
III. The Accused Instrumentality
Product Identification
The "Accused Systems" are identified as Defendants’ "TM+ integrated primary and secondary market electronic ticket sales and venue access control system." (Compl. ¶42). This includes the websites www.ticketmaster.com and www.livenation.com, associated mobile applications, and the "Presence" venue access control platform. (Compl. ¶42, ¶45).
Functionality and Market Context
The Accused Systems provide an integrated platform where consumers can buy primary-market tickets directly from venues and also buy and sell "verified" resale tickets from other fans. (Compl. ¶43, ¶44). The system is built around a unified "Ticketmaster/Live Nation customer account" database, allowing a single login to access tickets and account information across both brands' websites. (Compl. ¶50). A screenshot in the complaint shows the Live Nation sign-in page, which is explicitly "Powered by ticketmaster." (Compl. p. 17). The system stores patron identifying and payment information to facilitate these transactions. (Compl. ¶62, ¶65). For venue entry, the system relies on electronic tickets, typically presented as a QR code or barcode on a mobile device, which are scanned by readers at the venue. (Compl. ¶8, ¶66). Defendants allegedly market the system as providing enhanced security by "verifying" every resale ticket and re-issuing it in the new buyer's name. (Compl. ¶44).
IV. Analysis of Infringement Allegations
’720 Patent Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| a patron interface via which a first patron purchases an electronic ticket for an entertainment event at a venue from a vendor; | The ticketmaster.com and livenation.com websites and mobile apps, which enable registered users to purchase electronic tickets. | ¶61 | col. 4:45-54 |
| a database storing: (i) identifying information about at least the first patron and a second patron, and (ii) a token representing the electronic ticket purchased... said token being associated with the identifying information about the first patron... | The Accused Systems' network databases, which allegedly store customer account profiles with identifying information (name, address, etc.) and a "token" representing the electronic ticket associated with the purchaser's account. | ¶62, ¶63 | col. 5:29-40 |
| a trading system via which the electronic ticket... can be transferred by the first patron to the second patron, wherein the association of said token is transferred from the identifying information about the first patron to the identifying information about the second patron within said database; | The Accused Systems' ticket transfer feature, which allows a user to transfer a purchased ticket to another registered user, allegedly changing the association of the ticket's token in the database. | ¶64 | col. 11:8-13 |
| a payment system that stores profile information regarding at least an account of the first patron and an account of the second patron, and that is configured to... automatically debit... and credit... | The Accused Systems' e-commerce payment system, which stores user credit card information and is allegedly configured to automatically handle debits for purchases and credits for sales in the secondary market. | ¶65 | col. 5:41-52 |
| an entry system having at least one access control device with a reader at the venue... which is responsive to presenting of identifying information... to: (i) communicate with said database to determine that the presented identifying information... is associated with the token... and (ii) ... provide the entering patron... with physical access to the venue... | The "Presence" venue access control platform, which employs readers to scan a patron's QR code or barcode, communicates with the system's database to verify the ticket's validity and association with the patron, and grants entry. | ¶66 | col. 7:6-21 |
’065 Patent Infringement Allegations
| Claim Element (from Independent Claim 15) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| a patron interface via which a patron can purchase electronic tickets to an entertainment event at a venue for that patron and for other individuals; | The Accused Systems' websites and apps, which enable a patron to purchase tickets and subsequently use a "Transfer" feature to send them to other individuals. | ¶78 | col. 15:36-46 |
| a storage system which stores information regarding each electronic ticket purchased by the patron, said information associating each electronic ticket with a particular person; | A network storage system that allegedly stores a token for each ticket and associates it with the identifying information of a specific individual (either the original purchaser or the recipient of a transfer). | ¶79 | col. 15:47-53 |
| a notification system which is responsive to a purchase of an electronic ticket by the patron for at least one individual other than said patron, to automatically provide a notification to the at least one individual that a patron has purchased a ticket... | The ticket transfer feature, which allegedly provides an automatic email or text message notification to the recipient when a ticket is transferred to them. The complaint provides a screenshot from a help article explaining this notification process. (Compl. p. 37). | ¶80 | col. 15:54-65 |
| an entry system which is responsive to presentation of information pertaining to an individual to (i) communicate with said storage system... and (ii) permit individuals who are associated with electronic tickets... to enter the venue... | The Accused Systems' venue entry system, which uses QR code/barcode readers to communicate with the network storage system to verify the ticket and permit entry for the associated individual. | ¶81 | col. 16:1-12 |
- Identified Points of Contention:
- Scope Questions: What constitutes a "token" under the '720 Patent? The patent describes a "token" in the context of a "trading system" analogous to a stock market. A question for the court is whether the Defendants' centrally managed database entry and associated barcode, where the Defendant is an intermediary in all transfers, meets the definition of a "token" that can be transferred via a "trading system" as contemplated by the patent.
- Technical Questions: Does the Accused System’s ticket “Transfer” functionality meet the '065 Patent’s requirement for a notification system that is "responsive to a purchase"? The complaint alleges infringement based on a transfer that occurs after the purchase is complete. (Compl. ¶80). This raises the question of whether a user-initiated, post-purchase action satisfies the claim language, which links the automatic notification directly to the "purchase" event itself.
V. Key Claim Terms for Construction
The Term: "token" (from ’720 Patent, Claim 1)
- Context and Importance: The "token" is the fundamental unit representing the electronic ticket. Its construction is critical because it will determine whether the data structure used in the Accused System—a database entry linked to a barcode and managed centrally by Ticketmaster—falls within the scope of the claim, which describes a token being transferred in a "trading system."
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The specification suggests that rights are stored in "electronic form" generally, and refers to a "membership card or a token which serves as an identification device," which could support a broad reading on any unique electronic identifier. (’720 Patent, col. 3:3-4, col. 5:57-59).
- Evidence for a Narrower Interpretation: The flowcharts and description of the "trading system" depict a "Move Token" step, suggesting a discrete data object that is exchanged between patron accounts in a secondary market, which could be construed more narrowly than simply updating a central database record. (’720 Patent, Fig. 6, element 72).
The Term: "notification system which is responsive to a purchase... to automatically provide a notification" (from ’065 Patent, Claim 15)
- Context and Importance: This term's construction is central to the infringement analysis for the ’065 Patent. Practitioners may focus on this term because the Accused System’s notification appears to be triggered by a "transfer" action, not the "purchase" action itself. The case may turn on whether these are considered part of the same event.
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: A plaintiff may argue that the term "responsive to a purchase" should be read in the context of the entire system for selling and disseminating tickets. The patent discusses purchasing tickets for a group as a single transaction concept. (’065 Patent, cl. 17).
- Evidence for a Narrower Interpretation: A defendant may argue the plain language requires a direct causal link: the purchase event itself must trigger the automatic notification. The specification describes a process where list members can be selected during the ordering process, which then leads to notification, suggesting a tighter integration than the separate purchase and transfer steps alleged in the complaint. (’065 Patent, col. 17:41-54).
VI. Other Allegations
- Indirect Infringement: The complaint alleges that Ticketmaster actively induces infringement by "knowingly encouraging and facilitating third parties," specifically event venue owners, to use the Accused Systems in a way that directly infringes the ’720 and ’065 Patents. (Compl. ¶69, ¶84).
- Willful Infringement: The complaint alleges willful infringement for both patents. For the ’720 Patent, willfulness is based on alleged pre-suit knowledge dating back to at least January 2015, when the patent was cited by the USPTO against a Ticketmaster patent application. (Compl. ¶70). For the ’065 Patent, willfulness is based on knowledge acquired "at least upon the filing or service of this Complaint." (Compl. ¶84).
VII. Analyst’s Conclusion: Key Questions for the Case
- A core issue will be one of operational sequence: for the ’065 Patent, does the Accused System's user-initiated "transfer" function, which is performed as a separate step after a purchase is completed, satisfy the claim requirement for a notification system that is automatically "responsive to a purchase"?
- A key evidentiary question will be one of pre-suit knowledge: for the ’720 Patent, can the plaintiff demonstrate that the 2015 USPTO citation put Ticketmaster on notice of infringement and that its subsequent conduct met the high bar for subjective willfulness, thereby opening the door to enhanced damages?
- A central claim construction question will be one of technical definition: can the term "trading system" as used in the ’720 Patent, which is described with analogies to stock markets, be construed to cover the Defendants' platform, where Ticketmaster acts as a mandatory intermediary for all "verified" resale transactions rather than facilitating direct peer-to-peer exchanges?