PTAB

IPR2025-00709

Activision Blizzard Inc v. Milestone Entertainment LLC

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Key Events
Petition
petition

1. Case Identification

2. Patent Overview

  • Title: System for Effecting User Experience in an Electronic Game Environment
  • Brief Description: The ’635 patent discloses systems and methods for enhancing user experience in a multi-level electronic game. The system utilizes virtual currency ("vCoins") that can be acquired through gameplay or cash purchase and subsequently converted into non-cash goods to permit player advancement within the game.

3. Grounds for Unpatentability

Ground 1: Claims 1, 2, 4, 6, 8-10, 14-18, 21-23, 25, 27, and 29 are obvious over Schneier143.

  • Prior Art Relied Upon: Schneier143 (Patent 5,970,143).
  • Core Argument for this Ground:
    • Prior Art Mapping: Petitioner argued that Schneier143, a single reference, discloses every limitation of the challenged claims through its various described embodiments. For independent claim 1, Schneier143 allegedly taught a system for multi-level electronic games comprising game computers connected to a central computer. This system included memory for storing game information and a processor for generating gameplay. Petitioner asserted that the "credits" in Schneier143 function as the claimed "virtual money," as they can be acquired through both gameplay (e.g., achieving a high score) and cash purchase. The system also disclosed that the virtual money acquired by cash purchase is "subject to a multiplier," such as by offering volume discounts where purchasing more credits results in a lower cost per credit. Finally, Petitioner argued Schneier143 taught the "conversion of the virtual money into a non-cash good... to permit advancement," explaining that credits could be spent on items like a "special weapon, access to a map... or hints," which would help a player advance. The memory storing account information that is increased and decreased was mapped to Schneier143’s disclosure of tracking credits, reward points, and player ratings, which are incremented and decremented during gameplay.
    • Motivation to Combine (for §103 grounds): As a single-reference ground, Petitioner argued that Schneier143 itself taught that its various disclosed features were options that could be combined, which would have motivated a person of ordinary skill in the art (POSITA) to assemble the claimed system from its teachings.
    • Key Aspects: Petitioner noted that the ’635 patent issued with limited prosecution history, and the Examiner’s reason for allowance focused on the "conversion of virtual money into a non-cash good" limitation, which Petitioner contended is expressly taught by Schneier143.

Ground 2: Claims 1, 2, 4, 6, 8-10, 14-18, 21-23, 25, 27, and 29 are obvious over Schneier143 in view of Okita.

  • Prior Art Relied Upon: Schneier143 (Patent 5,970,143) and Okita (Application # 2003/0078102).
  • Core Argument for this Ground:
    • Prior Art Mapping: This ground was presented as an alternative, arguing that if Schneier143's "credits" are not considered "virtual money," the combination with Okita would render the claims obvious. Schneier143 provided the foundational gaming system as detailed in Ground 1. Okita was cited for its teaching of a "virtual money conversion unit" that converts game-specific "pseudo-values" (like earned points or credits) into a persistent "virtual money" that is stored on a management server and can be used across multiple different games. Petitioner argued this combination explicitly taught a system with "game play with virtual money" that can be acquired through gameplay (earning pseudo-values) and cash purchase (inserting coins), is subject to a prescribed conversion rate (a multiplier), and is used to purchase in-game supplies and items for advancement.
    • Motivation to Combine: A POSITA would have been motivated to integrate Okita's virtual money conversion functionality into Schneier143's system to improve the user experience. Okita explicitly stated its system creates "feelings of realism and tension" and promotes player engagement by allowing currency earned in one game to be used in others. This was a known and desirable goal in game design, providing a clear reason to combine the teachings.
    • Expectation of Success: Petitioner asserted a POSITA would have had a reasonable expectation of success because the systems of Schneier143 (central computer and game computers) and Okita (arcade-based server and clients) were substantially similar in structure and function. Implementing Okita's known conversion technology on a server to manage the credits from Schneier143's system would have been a predictable and straightforward integration of known technologies.

4. Arguments Regarding Discretionary Denial

  • Petitioner argued that institution is appropriate and discretionary denial should be rejected.
  • Under 35 U.S.C. §325(d), Petitioner contended that denial is improper because the primary references, Schneier143 and Okita, and the specific arguments made in the petition were never presented to or considered by the USPTO during the original prosecution of the ’635 patent.
  • Under 35 U.S.C. §314(a) and the Fintiv factors, Petitioner argued that denial would be inappropriate because the parallel district court litigation is currently stayed and no trial date is scheduled, making the Fintiv framework inapplicable.

5. Relief Requested

  • Petitioner requests institution of an inter partes review and cancellation of claims 1, 2, 4, 6, 8-10, 14-18, 21-23, 25, 27, and 29 of Patent 10,650,635 as unpatentable.