On January 17, 2018, U.S. District Judge John Michael Vazquez of the District of New Jersey dismissed all patent infringement claims asserted by Joseph Scibetta (a/k/a “Bankers & Brokers”) (“Scibetta”), against Slingo, Inc. and RealNetworks, Inc. (collectively, “Slingo”). The reason: none of Scibetta’s patents survived scrutiny 35 U.S.C. § 101.
Scibetta is the owner of various intellectual property rights relating to a card and casino game called “BANKERS & BROKERS.” U.S. Patent No. 6,220,597, one of the patents asserted in the case, describes the game in detail:
1. A method for playing a wagering card game comprising the steps of:
Providing a shuffled stack of playing cards where the cards are touched only by the dealer during the game comprising at least one deck thereof;
providing a planar game playing surface comprising a plurality of separately delineated areas adapted for the placement of bets;
establishing odds for payout of winning bets placed in any of the aforesaid plurality of separated and delineated areas;
establishing an initial order of play where players are designated as first player, and so on to a last player;
initiating a round of play by a first player establishing a bet by placing a wager in a designated space on the table near a pot designated and marked onto a surface for displaying a face-up side of a card dealt to each said player;
dealing a stack of six face-down cards as a player’s pot concealing the faces of each dealt card from each player and a dealer, to the first player and any other player in the game;
dealing a stack of six face-down cards, concealing the faces of each dealt card from each player and the dealer, to the dealer as a dealer’s pot;
then, only the dealer turning the dealer’s pot over and turning over the pots over for each player one at a time;
then the dealer immediately determining a player’s winning status or loss status by comparing a face-up card dealt to each player and a now face-up card dealt to the dealer in the dealer’s pot;
after comparing a dealer’s face-up card to a player’s face-up card, paying any winning bets placed by each player in the game;
collecting the played or turned up cards from each pot after bets are paid and placing these cards in a discarded cards designated area on the table;
determining whether the turned-up dealer’s card matches the corresponding turned-up player’s card, whereby at any time during the game or before the dealer may imposed step of disqualifying and discarding any got touched by a player.
Slingo is alleged to have distributed an unlawful copy of BANKERS & BROKERS on their website slingo.com, which was later acquired by RealNetworks, Inc. The alleged copy of BANKERS & BROKERS is reproduced below (as retrieved from archive.org).
On December 12, 2016, Slingo moved to dismiss Scibetta’s case. Among other assertions, Slingo claimed that all of Scibetta’s patents were invalid under 35 U.S.C. § 101.
The Court agreed. With regard to Alice step one, the Court noted that Scibetta’s asserted patent claims were substantially similar to the “method of conducting a wagering game” patent found invalid in In re Smith, 815 F.3d 816 (Fed. Cir. 2016), cert. denied sub nom., Trading Techs. Int’l, Inc. v. Lee, 137 S.Ct. 453 (2016). Indeed, the Court noted that “there is no meaningful distinction between, on the one hand, the unpatentable abstract idea found in In re Smith and, on the other hand, the method and system claims here.” Per the Court, the fact that some claims recited, among other things, a “‘means’ for identifying player/dealer positions” did not “change the fact that [BANKERS & BROKERS] stems from a patent ineligible abstract idea.”
With regard to Alice step two, the Court found that BANKERS & BROKERS “reflects well-understood, routine, and conventional wagering activity” such that “Plaintiffs made no technical improvement on the original abstract idea of a card wagering game using a standard deck of cards.” The mere implementation of such a game on a computer did not change the Court’s analysis: “the claims do nothing more than simply describe the application of the game-related abstract ideas to a generic computer system.”
Scibetta’s case is not doomed. Scibetta still has a viable claim for misappropriation against Slingo. Moreover, while Scibetta’s trademark and unjust enrichment claims were also dismissed by the Court, the claims were dismissed without prejudice and largely based on pleading deficiencies. As such, Scibetta will be afforded an opportunity to amend and supplement his complaint.
This case illustrates the difficulties of enforcing patents that, despite their presumption of validity, were granted prior to the Alice decision when the USPTO was using a different standard of examination. A trend is appearing where the presumption of validity applied to those patents by courts appears to be inherently lower than that given to more recently granted patents. Scibetta asserted five patents, and not one survived a motion to dismiss. Those looking to acquire patent portfolios, for example, should be particularly wary of purchasing patents which may look great but may face significant hurdles during enforcement. Sometimes, a single strong patent is worth more than a hundred unenforceable ones.