DraftKings Inc v. Interactive Games LLC

1. Case Identification

• Case #: IPR2020-01107
• Patent #: 9,430,901
• Filed: June 17, 2020
• Petitioner(s): DraftKings Inc.
• Patent Owner(s): Interactive Games LLC
• Challenged Claims: 1-5, 7-22, and 24-27

2. Patent Overview

• Title: Wireless Gaming with Location Determination
• Brief Description: The ’901 patent describes systems and methods for authorizing wireless gaming on a mobile device. The system determines the device's location and enables or disables gaming functionality based on whether the device is within a pre-defined, authorized area of a property, such as a casino.

3. Grounds for Unpatentability

Ground 1: Obviousness over Wells and Bahl - Claims 1-5, 7-22, 26, and 27 are obvious over Wells in view of Bahl.

• Prior Art Relied Upon: Wells (Application # 2003/0064805) and Bahl (Patent 6,799,047).
• Core Argument for this Ground:
  • Prior Art Mapping: Petitioner argued that Wells disclosed the foundational system for mobile casino gaming, including a wireless game player, a server, and the process of verifying a player's location to enable gaming only in authorized areas. However, Wells relied on GPS for location, a technology known to be unreliable indoors. Bahl disclosed a superior system for precise indoor location tracking using signal strength characteristics (like SNR) from existing Wi-Fi network components (base stations/access points). Petitioner asserted that Bahl taught all the elements of creating a location-versus-signal-strength database for this purpose.
  • Motivation to Combine: A Person of Ordinary Skill in the Art (POSITA) would have been motivated to replace Wells's unreliable GPS-based location system with Bahl's more accurate and reliable indoor signal-strength-based system. The motivation was to improve the system's ability to comply with gaming regulations that strictly define legal gaming areas, a primary concern expressed in Wells. This combination represented a simple substitution of a known, superior technique to achieve a predictable result.
  • Expectation of Success: A POSITA would have had a high expectation of success because Bahl’s system was designed to be implemented on the exact type of existing wireless network infrastructure (i.e., multiple access points) that Wells disclosed for its casino environment.

Ground 2: Obviousness over Wells, Bahl, and Harkham - Claims 1-5, 7-22, and 26 are obvious over Wells and Bahl in view of Harkham.

• Prior Art Relied Upon: Wells (Application # 2003/0064805), Bahl (Patent 6,799,047), and Harkham (Application # 2002/0094869).

• Core Argument for this Ground:

  • Prior Art Mapping: This ground built upon the combination of Wells and Bahl. To the extent that combination was found not to teach limitations related to cumulative time limits, Petitioner argued that Harkham supplied the missing elements. Harkham disclosed a system for tracking user gambling activity over a longer period (e.g., five hours within a seven-day period) to prevent excessive gaming. This involved calculating a cumulative amount of time spent wagering and terminating play when a threshold was met.
  • Motivation to Combine: A POSITA would have been motivated to integrate Harkham's cumulative time-tracking features into the Wells/Bahl system to provide more comprehensive responsible gaming controls. While Wells taught basic time limits for a single session, Harkham taught a more robust, cross-session approach, which was a well-known goal in the gaming industry. This would improve player accountability and combat gambling addiction more effectively than the systems in Wells or Bahl alone.

• Additional Grounds: Petitioner asserted additional obviousness challenges, including:

  • Ground 3: Claim 4 is obvious over the combination of Wells and Bahl, further in view of Spirito (WO 02/063329). Spirito was introduced to teach using signal propagation delay and transmission times for location determination, offering an alternative or complementary method to Bahl's signal-strength approach.
  • Ground 4: Claims 24 and 25 are obvious over the combination of Wells and Bahl, further in view of Joao (Application # 2003/0224854). Joao was introduced to teach implementing time-of-day restrictions on gaming (e.g., disallowing activity during certain hours), adding another layer of regulatory control.

4. Key Claim Construction Positions

• Petitioner argued for construing the term “calibration device” as a “device suitable for establishing signal reference values.”
  • This construction was proposed because the term is not explicitly defined in the ’901 patent, but the specification describes a step to "calibrate wireless network" by "establishing a set of reference values used to identify each sub-zone," which includes signal strengths. Petitioner contended that Bahl's mobile computers, used to take initial signal measurements to build its location database, met this construction.

5. Arguments Regarding Discretionary Denial

• Petitioner argued that discretionary denial would be inappropriate under both §314(a) and §325(d).
  • Fintiv Factors (§314(a)): Petitioner contended that the co-pending district court litigation was at a very early stage, with Petitioner not yet having filed an answer to the complaint. As this was the first and only petition challenging the ’901 patent, denial was not warranted.
  • §325(d) Factors: Petitioner asserted that Bahl, Harkham, Spirito, and Joao were all new references not considered during the original prosecution. While Wells was cited in an Information Disclosure Statement (IDS), it was one of nearly 1,150 references in that IDS, and the Examiner never relied on, cited, or demonstrated any substantive consideration of Wells. Therefore, the petition did not present substantially the same art or arguments previously presented to the Office.

6. Relief Requested

• Petitioner requested institution of an inter partes review and cancellation of claims 1-5, 7-22, and 24-27 of the ’901 patent as unpatentable.