The Magnavox Co., et al. v. Chicago Dynamic Industries, et al.

201 U.S.P.Q. 25 (N.D. Ill. 1977)

For those of you who love home video games as much as we do, the following lawsuit will be of interest.

The case concerns the Magnavox Company (makers of the Odyssey) who released a ping-pong style game you may have heard of: Pong. The defendants in this case released similar ping-pong games and Magnavox sued for patent infringement.

At issue in the case were three similar patents that all dealt with a “Television Gaming Apparatus.” While there were several questions at issue in the case, the court focused on the issue of whether the patents were obvious or anticipated in light of one another, as either finding would lead to invalidity.

I. Background

On April 17, 1973, United States Patent 3,728,408 (“the ‘408 patent”), was issued to Ralph Baer. In his oral judgment of the case, District Judge Grady commented: “The ‘408 patent, I think, is the pioneer patent in this art . . . with the players participating in the game in an environment such as a home or some place where a large computer would clearly not be available.” After issuance of the ‘408 patent, for the first time, video games would be brought to the home.

Two years later, on August 5, 1975, William Rusch received a similar television patent. This patent, United States Patent RE28,507 (“the ‘507 patent’), “discloses a movable hitting spot which is controlled by the player and which, by striking a hit spot, can change the direction of that hit spot.” The ‘507 patent used the term “distinct motion,” which Judge Grady interpreted as referring not to “a predictable motion,” but rather to motion that is different from the motion that characterized the hit spot immediately prior to the striking of the hit spot. This idea of changing the direction of the hit spot was not present in the development of games at this time. Before this patent, a player would simply turn a knob which set in motion a series of events that he had no further control over. After the ‘507 patent, however, players could now control the movement of the ball based upon the area of the hit spot the ball struck!

II. Analysis

One question presented to the court was whether the feature of patent ‘507 was obvious at the time of its production. Others had imitated the ‘507 patent in similar ping-pong style games, but Judge Grady found that the novel feature of ‘507 was not obvious. In particular, the judge relied on the testimony by people from RCA who admitted that they had the mechanical capability to create this feature, but were going in a different direction of development at the time.

The next issue concerned what knowledge, if any, the patent examiner had when the ‘507 patent was examined for re-issue. The ‘408 patent, awarded before the ‘507 patent, should have been mentioned in the application, but it was not. The court sought to determine if the patent examiner had knowledge of the ‘408 patent and was actively trying to cover it up in his issuance of the ‘507 patent. Judge Grady determined that since the ‘507 patent was neither anticipated by nor obvious in light of the ‘408 patent, the patent examiner would have reached the same conclusion and awarded the ‘507 patent.

The next issue involved another television gaming apparatus patent, United States Patent RE28,598 (“the ‘598 patent”) which was issued on October 28, 1975. This patent made improvements to the visual reproduction in ‘507. Judge Grady found that ‘507 anticipated the ‘598 patent and also that ‘598 patent was obvious in the light of ‘507. The court determined that the ‘598 patent rectified some of the visual reproduction in ‘507 which, while an improvement, was not patentable. The ‘598 patent simply used the same type of circuitry in a more efficient way to achieve better results. As a result, 28,’598 patent was found invalid by Judge Grady as being anticipated by and obvious in view of the ‘507 patent.

Finally, Judge Grady turned to the question of whether the defendant’s Pong-like games infringed the ‘507 patent. The court found that the games did infringe the claims of the ‘507 patent “to the extent that they contain or use a player-controlled movable hitting symbol which, when it coincides with a hit symbol, causes a change in direction of that hit symbol.” Because all of the defendant’s games featured this characteristic, they were all held to infringe on ‘507.
The defendants made several arguments to provide that their games differed from the ‘507 patent. The judge, however, found these arguments to be immaterial and ruled against them on all counts. The first attempt by the defendant was focused on the influence of the direction of the ball by the place on the paddle where the ball strikes. In the ‘507 patent, when a ball in the game comes into contact with a hit symbol it changes the direction of that hit symbol in a distinct way. The defendants argued that the games do not meet this claim because the direction of the ball cannot be predicted after it strikes the paddle. Judge Grady disagreed, however, ruling that “distinct” meant “simply a motion that is different from the motion characterizing the ball immediately before the coincidence.”

III. Conclusion

This early lawsuit showed that courts were prepared to handle video game patent law, and also was a testament to the strength of patents in the video game industry. For more information on Mr. Baer’s early products, check out Ralph Baer’s web site, which has many more details about his inventions and his trials and tribulations getting them produced!

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