Patent Armory Inc v. Texas Taco Cabana LP

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Patent Armory Inc. (Canada)
  • Defendant: Texas Taco Cabana, L.P. (Texas)
  • Plaintiff’s Counsel: Rabicoff Law LLC
• Case Identification: 6:24-cv-00184, W.D. Tex., 04/11/2024
• Venue Allegations: Plaintiff alleges venue is proper because Defendant maintains an established place of business in the Western District of Texas and has committed acts of patent infringement in the district.
• Core Dispute: Plaintiff alleges that Defendant’s customer communication systems infringe five patents related to intelligent call routing and auction-based matching for telecommunications systems.
• Technical Context: The patents address methods for optimizing the routing of communications in call centers by matching callers to agents based on complex factors like skill, cost, and predicted outcomes, moving beyond simple first-in-first-out queuing.
• Key Procedural History: The complaint does not allege any significant procedural events, such as prior litigation, licensing history, or administrative patent challenges.

Case Timeline

Date	Event
2002-03-07	U.S. Patent Nos. 7,023,979 & 7,269,253 Priority Date
2003-03-07	U.S. Patent Nos. 10,237,420 & 9,456,086 Priority Date
2006-04-03	U.S. Patent No. 10,491,748 Priority Date
2006-04-04	U.S. Patent No. 7,023,979 Issues
2007-09-11	U.S. Patent No. 7,269,253 Issues
2016-09-27	U.S. Patent No. 9,456,086 Issues
2019-03-19	U.S. Patent No. 10,237,420 Issues
2019-11-26	U.S. Patent No. 10,491,748 Issues
2024-04-11	Complaint Filing Date

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 Mar. 19, 2019)

The Invention Explained

• Problem Addressed: The patent background describes inefficiencies in traditional call center management, where Automatic Call Distribution (ACD) systems use simplistic routing like "first-come-first-served" or longest-idle-agent (Compl. ¶9; ’420 Patent, col. 2:42-51, col. 4:10-24). These methods are suboptimal when agents have varying skills, leading to problems such as routing calls to under-skilled or over-skilled agents, which reduces transactional throughput (’420 Patent, col. 4:35-54).
• The Patented Solution: The invention proposes a method to match a "first entity" (e.g., a caller) with a "second entity" (e.g., an agent) by performing an "automated optimization" (’420 Patent, Abstract). This optimization considers the "economic surplus" of a potential match and the "opportunity cost" of making that agent unavailable for other potential callers, moving beyond simple queuing to a dynamic, economic-based model for resource allocation (’420 Patent, col. 22:1-24:67, Fig. 1).
• Technical Importance: This technology represents a shift from static, rule-based call routing to a dynamic, economically-driven optimization framework intended to improve efficiency and outcomes in complex, multi-skilled call center environments (’420 Patent, col. 18:30-40).

Key Claims at a Glance

• The complaint asserts infringement of unspecified claims of the ’420 Patent (Compl. ¶15). The first independent claim is Claim 1, which requires:
  • A method for matching a first entity with at least one second entity selected from a plurality of second entities, comprising:
  • defining a plurality of multivalued scalar data representing inferential targeting parameters for the first entity and a plurality of multivalued scalar data of each of the plurality of second entities, representing respective characteristic parameters for each respective second entity; and
  • performing an automated optimization with respect to an economic surplus of a respective match of the first entity with the at least one of the plurality of second entities, and an opportunity cost of the unavailability of the at least one of the plurality of second entities for matching with an alternate first entity.

U.S. Patent No. 10,491,748 - "Intelligent communication routing system and method" (Issued Nov. 26, 2019)

The Invention Explained

• Problem Addressed: The patent addresses the same technical problem as the ’420 Patent: the inefficiency of conventional call center routing systems that fail to account for variations in agent skills and dynamic changes in call demand (Compl. ¶10; ’748 Patent, col. 2:41-54).
• The Patented Solution: The invention is a communications routing system that determines an optimal routing by "maximizing an aggregate utility" (’748 Patent, Abstract). The system represents both communication sources (callers) and targets (agents) with predicted characteristics, each having an "economic utility," and then calculates the optimal pairing based on these factors (’748 Patent, col. 23:25-24:67).
• Technical Importance: This approach seeks to provide a more holistic and intelligent routing decision by formalizing the value of different potential caller-agent pairings into a unified utility function, allowing for more granular and adaptive control over call distribution (’748 Patent, col. 18:30-40).

Key Claims at a Glance

• The complaint asserts infringement of unspecified claims of the ’748 Patent (Compl. ¶21). The first independent claim is Claim 1, which requires:
  • A communications routing system, comprising a processor and memory storing instructions to:
  • store a representation of a plurality of predicted characteristics of a plurality of communications sources, each having an economic utility;
  • store a representation of a plurality of predicted characteristics of a plurality of communications targets each having an economic utility; and
  • determine an optimal routing between the plurality of communications sources and the plurality of communications targets, by maximizing an aggregate utility with respect to the respective predicted characteristics... and control a router to route... according to the determined optimal routing.

U.S. Patent No. 7,023,979 - "Telephony control system with intelligent call routing" (Issued Apr. 4, 2006)

• Technology Synopsis: This patent, an early member of the asserted patent family, addresses inefficient call routing by proposing a control system that uses a processor to compute an "optimum agent selection" (’979 Patent, Abstract). The computation is based on a received "communications classification" and databases of agent skill scores and skill weights, with the system directly controlling the call routing (’979 Patent, col. 1:51-67).
• Asserted Claims: Unspecified claims (Compl. ¶30).
• Accused Features: The complaint accuses "Exemplary Defendant Products" as detailed in Exhibit 8, which was not filed with the complaint (Compl. ¶30, 32).

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

• Technology Synopsis: This patent describes a communications system that determines an optimal target for a communication through a "combinatorial optimization" (’253 Patent, Abstract). The optimization is based on the communication's classification and the characteristics of potential targets, and preferably includes a cost-benefit analysis (’253 Patent, col. 1:50-67).
• Asserted Claims: Unspecified claims (Compl. ¶36).
• Accused Features: The complaint accuses "Exemplary Defendant Products" as detailed in Exhibit 9, which was not filed with the complaint (Compl. ¶36, 38).

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

• Technology Synopsis: This patent, an ancestor to the ’420 Patent, discloses a method for matching a first entity with a second entity by defining "multivalued scalar data" for each and performing an "automated optimization" (’086 Patent, Abstract). The optimization considers the "economic surplus" of a match and the "opportunity cost" of making one entity unavailable for other potential matches, framing the routing decision as an auction-like process (’086 Patent, col. 1:57-67).
• Asserted Claims: Unspecified claims (Compl. ¶42).
• Accused Features: The complaint accuses "Exemplary Defendant Products" as detailed in Exhibit 10, which was not filed with the complaint (Compl. ¶42, 47).

III. The Accused Instrumentality

Product Identification

• The complaint refers generally to "Exemplary Defendant Products" (Compl. ¶15, 21, 30, 36, 42).

Functionality and Market Context

• The complaint does not identify any specific products or describe their functionality. Instead, it incorporates by reference claim chart exhibits (Exhibits 6-10), which were not filed with the public complaint and are therefore not available for analysis (Compl. ¶17, 26, 32, 38, 47). The complaint makes no allegations regarding the products' commercial importance.

No probative visual evidence provided in complaint.

IV. Analysis of Infringement Allegations

The complaint does not contain factual allegations detailing how the accused products infringe the patents-in-suit. For each count of infringement, the complaint states that infringement is demonstrated in claim charts included as exhibits (Compl. ¶¶ 17, 26, 32, 38, 47). Because these exhibits were not filed with the complaint, a tabular analysis of the infringement allegations is not possible. The narrative infringement theory is limited to conclusory statements that the accused products "practice the technology claimed by" the asserted patents (Compl. ¶17).

Identified Points of Contention

• Factual Questions: A primary question will be what evidence Plaintiff can produce to demonstrate that Defendant's systems perform the specific, complex optimizations required by the claims. The asserted patents describe sophisticated economic modeling, including calculating "economic surplus," "opportunity cost," and "maximizing aggregate utility." The factual dispute will center on whether Defendant's systems, which may be simpler rule-based or queue-based systems, actually perform these claimed functions.
• Scope Questions: A central legal question will concern the scope of the claim terms. For instance, do terms rooted in economic and auction theory, such as "economic surplus" ('420 Patent, Claim 1) or "maximizing an aggregate utility" ('748 Patent, Claim 1), read on the functionalities of a customer service or order-taking system for a quick-service restaurant? The analysis will question whether the accused system's logic, if any, for assigning a customer to a service agent rises to the level of the claimed "automated optimization."

V. Key Claim Terms for Construction

• For the ’420 Patent:

  • The Term: "economic surplus ... and an opportunity cost"
  • Context and Importance: These terms are the core of the "automated optimization" step in Claim 1. The definition of what constitutes an "economic surplus" and an "opportunity cost" in the context of call routing, and what calculations are required to assess them, will be critical to determining infringement. Practitioners may focus on whether these terms require a specific quantitative financial calculation or can be met by a more qualitative, priority-based assessment.
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: The specification suggests these economic concepts can be tied to non-monetary goals like "customer satisfaction" (’420 Patent, col. 24:36-40), which might support an argument that a system optimizing for such qualitative factors meets the limitation.
    • Evidence for a Narrower Interpretation: The specification repeatedly discusses the optimization in terms of a "cost-utility function" that normalizes disparate factors into a common metric, "cost," and includes components like agent salaries, training costs, and sales volume (’420 Patent, col. 24:1-67). This may support a narrower construction requiring a specific, multi-component economic calculation.

• For the ’748 Patent:

  • The Term: "maximizing an aggregate utility"
  • Context and Importance: This term defines the goal of the "optimal routing" determination in Claim 1. The dispute will likely focus on what level of computational complexity is required to achieve "maximization" of an "aggregate utility." The patent's viability against a potentially simpler system depends on whether this term can encompass basic load-balancing or skill-based rules, or if it requires a more holistic, system-wide optimization calculation.
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: The term "utility" is broad, and the specification notes it can include factors like "customer satisfaction" (’748 Patent, col. 24:36-40), potentially allowing for a less-quantitative interpretation of the optimization goal.
    • Evidence for a Narrower Interpretation: The patent describes a complex "cost function" that includes anticipated changes in agent value, the value of the transaction, and opportunity costs, suggesting a multi-faceted calculation is needed to determine the "aggregate utility" (’748 Patent, col. 24:50-63). This could support a construction requiring a global optimization across multiple callers and agents, rather than a series of independent local optimizations.

VI. Other Allegations

• Indirect Infringement: The complaint alleges induced infringement of the ’748 and ’086 Patents. The allegations are based on Defendant allegedly distributing "product literature and website materials" that instruct end users on how to use the accused products in an infringing manner (Compl. ¶¶ 24, 45).
• Willful Infringement: The complaint does not use the term "willful." However, for the ’748 and ’086 Patents, it alleges that service of the complaint constitutes "actual knowledge" of infringement and that Defendant's infringement has continued post-filing (Compl. ¶¶ 23-24, 44-45). These allegations may form the basis for a claim of post-suit willful infringement.

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

• A central issue will be one of evidentiary proof: Given the complaint's lack of specific factual allegations, a key question is what evidence Plaintiff will be able to marshal to show that Defendant’s customer interaction systems perform the complex, multi-factorial "automated optimization" and "utility maximization" functions recited in the patent claims, as opposed to more conventional, rule-based routing.
• The case will also turn on a question of definitional scope: Can claim terms rooted in economic theory, such as "economic surplus," "opportunity cost," and "aggregate utility," be construed broadly enough to cover the logic of a quick-service restaurant's customer call or order management system, or will they be limited to requiring specific, quantitative calculations that may not be present in the accused instrumentality?