Patent Armory Inc v. Ryder System Inc

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Patent Armory Inc. (Canada)
  • Defendant: Ryder System, Inc. (Florida)
  • Plaintiff’s Counsel: Rabicoff Law LLC
• Case Identification: 6:23-cv-00584, W.D. Tex., 08/11/2023
• Venue Allegations: Plaintiff alleges venue is proper because Defendant maintains an established place of business in the Western District of Texas.
• Core Dispute: Plaintiff alleges that Defendant infringes five U.S. patents related to intelligent call routing and auction-based systems for matching entities.
• Technical Context: The technology at issue pertains to optimizing communications in environments like call centers by using algorithms to match incoming requests with available resources based on various skill, cost, and utility parameters.
• Key Procedural History: The complaint does not mention any prior litigation, licensing history, or post-grant proceedings. Several of the patents-in-suit share a complex family history originating from a 2003 provisional application. Notably, U.S. Patent No. 10,237,420 was issued subject to a terminal disclaimer over a related patent, which may limit its enforceable term.

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 (Compl. ¶9).

The Invention Explained

• Problem Addressed: The patent's background section describes the inefficiency of traditional call center management, where simple rules like "first-come-first-served" or routing to the "longest-idle-eligible-agent" fail to account for the varying skills of agents and the specific needs of callers, reducing transactional throughput (’420 Patent, col. 3:1-4:52).
• The Patented Solution: The invention proposes a system for matching a "first entity" (e.g., an incoming call) with one of a plurality of "second entities" (e.g., call center agents). This is achieved by defining parameters for both entities and then "performing an automated optimization" that considers not only the quality of the match but also the "economic surplus" of that match and the "opportunity cost" of making that specific agent unavailable for other potential calls ('420 Patent, Abstract; col. 17:8-23). This process is depicted in flowcharts such as Figure 1 ('420 Patent, Fig. 1).
• Technical Importance: This technology represents a shift from static, rule-based call routing to a dynamic, economic model designed to optimize the overall efficiency and value of a communications network in real time ('420 Patent, col. 4:1-10).

Key Claims at a Glance

• The complaint does not identify specific asserted claims in its narrative text but incorporates by reference charts from an unattached exhibit (Compl. ¶17). As a representative example, independent claim 1 requires:
  • A method for matching a first entity with at least one second entity selected from a plurality of second entities.
  • Defining a plurality of multivalued scalar data representing inferential targeting parameters for the first entity.
  • Defining a plurality of multivalued scalar data for each of the plurality of second entities, representing their respective characteristic parameters.
  • Performing an automated optimization with respect to an economic surplus of a respective match and an opportunity cost of the unavailability of the second entity for 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 (Compl. ¶10).

The Invention Explained

• Problem Addressed: The patent addresses the challenge of efficiently handling electronic customer contact in environments like call centers, where the goal is to balance high-quality service with the efficient use of resources, a task that simple routing rules fail to accomplish effectively (’748 Patent, col. 2:25-34).
• The Patented Solution: The invention is a communications routing system that represents both "communications sources" (e.g., callers) and "communications targets" (e.g., agents) by their predicted characteristics and an associated "economic utility." The system then determines an optimal routing by "maximizing an aggregate utility" with respect to the characteristics of both the source and the destination ('748 Patent, Abstract; Fig. 1). This allows for a more holistic optimization than considering only one side of the communication link ('748 Patent, col. 18:8-23).
• Technical Importance: This approach provides a framework for optimizing communication networks based on the total value or utility created by a connection, rather than on simpler metrics like wait time or agent availability ('748 Patent, col. 17:8-23).

Key Claims at a Glance

• The complaint does not identify specific asserted claims but incorporates by reference charts from an unattached exhibit (Compl. ¶26). As a representative example, independent claim 1 requires:
  • A communications routing system with a communications router.
  • Representing a plurality of predicted characteristics of a plurality of communications sources, each having an economic utility.
  • Representing a plurality of predicted characteristics of a plurality of communications targets, each having an economic utility.
  • Determining an optimal routing between the sources and targets by maximizing an aggregate utility with respect to their predicted characteristics.
• 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"

• Patent Identification: U.S. Patent No. 7,023,979, issued April 4, 2006 (Compl. ¶11).
• Technology Synopsis: The patent describes a communications management system that receives a communication classification, accesses a database of agent skill scores, and computes an optimum agent selection. The system is designed to directly control the routing of the communication based on this computation (’979 Patent, Abstract).
• Asserted Claims: The complaint does not identify specific asserted claims but incorporates by reference charts from an unattached exhibit (Compl. ¶35).
• Accused Features: The complaint alleges infringement by "at least the Defendant products identified in the charts" (Compl. ¶30).

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

• Patent Identification: U.S. Patent No. 7,269,253, issued September 11, 2007 (Compl. ¶12).
• Technology Synopsis: This patent discloses an intelligent call routing system for a telephony control system. The invention focuses on optimizing a "cost-utility function" for long-term call center operation, which can involve both skill-based routing and routing for training purposes (’253 Patent, Abstract; Fig. 1).
• Asserted Claims: The complaint does not identify specific asserted claims but incorporates by reference charts from an unattached exhibit (Compl. ¶41).
• Accused Features: The complaint alleges infringement by "at least the Defendant products identified in the charts" (Compl. ¶39).

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

• Patent Identification: U.S. Patent No. 9,456,086, issued September 27, 2016 (Compl. ¶13).
• Technology Synopsis: The technology is an auction-based method for matching entities. The system defines inferential targeting parameters for a first entity and characteristic parameters for a plurality of second entities. It then performs an automated optimization based on the economic surplus of a match and the opportunity cost of making a second entity unavailable for other matches (’086 Patent, Abstract).
• Asserted Claims: The complaint does not identify specific asserted claims but incorporates by reference charts from an unattached exhibit (Compl. ¶50).
• Accused Features: The complaint alleges infringement by "at least the Defendant products identified in the charts" (Compl. ¶45).

III. The Accused Instrumentality

• Product Identification: The complaint does not identify any specific accused products or services by name. It refers to them generally as "Exemplary Defendant Products" (Compl. ¶15, 21, 30, 39, 45).
• Functionality and Market Context: The complaint does not provide sufficient detail for analysis of the functionality of the accused products. It makes only conclusory allegations that the products "practice the technology claimed" by the patents-in-suit (Compl. ¶17, 26, 35, 41, 50). The complaint makes no allegations regarding the products’ commercial importance or market positioning.

IV. Analysis of Infringement Allegations

No probative visual evidence provided in complaint.

The complaint alleges direct infringement of all five patents-in-suit. For each patent, the complaint states that an exhibit contains charts comparing the exemplary patent claims to the exemplary defendant products (Compl. ¶¶ 17, 26, 35, 41, 50). However, these exhibits were not attached to the complaint. The narrative infringement theory is limited to conclusory statements that the "Exemplary Defendant Products practice the technology claimed" and "satisfy all elements of the Exemplary... Patent Claims" (e.g., Compl. ¶17). The complaint provides no specific facts explaining how any accused product meets any specific claim limitation.

• Identified Points of Contention:
  • Evidentiary Questions: The central point of contention for all asserted patents will be evidentiary. For the '420 and '086 Patents, the dispute will focus on what evidence exists that Defendant’s systems perform an "automated optimization" based on "economic surplus" and "opportunity cost." For the '748, '979, and '253 Patents, the analysis will question what evidence shows that Defendant's systems determine an "optimal routing" by maximizing an "aggregate utility" or a "cost-utility function."
  • Scope Questions: A fundamental question for the court will be one of claim scope. Can the claims of the patents, which are heavily described in the context of call centers and telephony agents, be construed to cover the defendant’s systems, which operate in the logistics and fleet management industry?

V. Key Claim Terms for Construction

• The Term: "automated optimization with respect to an economic surplus ... and an opportunity cost" (from claim 1 of the '420 and '086 Patents).

• Context and Importance: This phrase constitutes the core functional step of the asserted auction-based patents. The outcome of the case may depend on whether Defendant’s resource allocation methods can be characterized as performing this specific, complex economic calculation. Practitioners may focus on this term because it appears to require more than simple heuristic-based routing (e.g., route to nearest vehicle) and imports specific concepts from economic theory.

• Intrinsic Evidence for Interpretation:

  • Evidence for a Broader Interpretation: The specification discusses optimization in general terms and contemplates various business goals, which could support an argument that the term is not limited to a specific formula ('420 Patent, col. 23:29-43).
  • Evidence for a Narrower Interpretation: The detailed description provides specific mathematical formulas for calculating cost and utility in a call center context, which could be used to argue that the claimed "optimization" is limited to the specific economic models disclosed ('420 Patent, col. 24:1-47).

• The Term: "maximizing an aggregate utility" (from claim 1 of the '748 Patent).

• Context and Importance: This is the central function of the intelligent routing system claimed in the '748 Patent. Infringement will likely turn on whether the accused system's objective function is proven to be the "maximization" of a defined "aggregate utility." Practitioners may focus on this term to distinguish between a system that truly performs a utility calculation versus one that simply applies rules to achieve an operational goal that is not expressed in terms of utility.

• Intrinsic Evidence for Interpretation:

  • Evidence for a Broader Interpretation: The patent abstract describes the invention broadly as a "communications routing system," which might support a construction that is not limited to telephony ('748 Patent, Abstract).
  • Evidence for a Narrower Interpretation: The specification repeatedly uses the example of a call center with "callers" and "agents," suggesting the claimed "utility" is tied to the specific economic and performance metrics of that environment ('748 Patent, col. 24:30-45).

VI. Other Allegations

• Indirect Infringement: The complaint alleges induced infringement of U.S. Patent Nos. 10,491,748, 7,023,979, and 9,456,086. The allegations are based on Defendant's distribution of "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 does not use the term "willful." It alleges that service of the complaint constitutes "actual knowledge" of infringement for the '748, '979, and '086 patents, forming a basis for post-suit enhanced damages (Compl. ¶23, 32, 47). No facts are alleged that would support a claim of pre-suit knowledge.

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

• A threshold question for the court will be one of pleading sufficiency: does the complaint, which fails to identify any specific accused products and describes infringement only through conclusory statements and references to unattached exhibits, state a claim for patent infringement that is "plausible on its face" under prevailing federal pleading standards?
• Should the case proceed, a core issue will be one of definitional scope: can the terms central to the patents' claims, such as "auction," "economic surplus," and "aggregate utility," which are rooted in the specification's context of call center optimization, be construed to read on the operational logic of Defendant's logistics and fleet management systems?
• A key evidentiary question will be one of functional proof: assuming a favorable claim construction, what evidence can Plaintiff produce to demonstrate that Defendant's systems actually perform the specific, multi-factorial optimization and utility-maximization functions required by the asserted claims, rather than merely applying conventional industry heuristics for resource allocation?