Real Estate Software Patent: User Action Steps Prevent Direct Infringement

US5032989Fig3Move, Inc. v. Real Estate Alliance Ltd., Dkt. No. 2012-1342 (Fed. Cir. March 4, 2013)

Move sought declaratory judgement of non-infringement of two of Real’s patents, U.S. 5,032,989 and U.S. 4,870,576. Real counterclaimed  that Move’s “Search by Map” and “Search by Zip Code” website functions infringed the patents. The district court issued summary judgement of non-infringement.

Claim 1 of the ‘989 patent was at issue on appeal and was directed to a method for locating real estate properties using a zoom enabled map on a computer. Claim 1 provided:

1. A method using a computer for locating available real estate properties comprising the steps of:

(a) creating a database of the available real estate properties;
(b) displaying a map of a desired geographic area;
(c) selecting a first area having boundaries within the geographic area;
(d) zooming in on the first area of the displayed map to about the boundaries of the first area to display a higher level of detail than the displayed map;
(e) displaying the first zoomed area;
(f) selecting a second area having boundaries within the first zoomed area;
(g) displaying the second area and a plurality of points within the second area, each point representing the appropriate geographic location of an available real estate property; and
(h) identifying available real estate properties within the database which are located within the second area.

Direct Infringement. In a prior appeal the Federal circuit determined that “selecting an area” as recited in steps (c) and (f) of claim 1 meant that “the user or a computer chooses an area having boundaries, not when the computer updates certain display variables to reflect the selected area.”

The Move system allowed the user to select a predefined area, such as a city, and the system would then zoom into the map according to the predefined boundaries of the area. The court found that the system did not “select an area having boundaries” by showing the predefined area after a user selected the area. Rather the computer just retrieved the map associated with the user’s choice. Therefore Move did not directly carry out the (c) and (f) steps of the claim.

Since Move did not directly carry out all of the steps, it must have direct or control over the performance of the missing steps by another party to be liable for direct infringement. The court found that it did not exert the required direction or control over its users to be liable for direct infringement.

Indirect infringement. The Federal Circuit found that the district court did not conduct the required analysis as to whether Move could be liable for inducing infringement by inducing its users to perform the claimed steps that Move did not itself perform.

Claim Language Suggestions. To allow for direct infringement, the claims could have been worded differently. Assuming the following was supported by the specification and permissible by the prior art, step (c) could have provided “receiving from a user a selection of a first area having boundaries within the geographic area” and step (f) could have provided “receiving from a user a selection of a second area having boundaries within the first zoomed area.” Such language might provide a better case for direct infringement.

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Gambling Machine Patents: Claims Requiring Player Action Raise Indirect Infringement Issues

USPatent7056215Aristocrat Tech. Australia v. Int’l Game Tech., Dtk No. 2010-1426 (Fed. Cir. 2013).

Aristocrat sued IGT alleging that IGT’s gambling game devices infringed U.S. Patent No. 7,056,215 (“the ’215 patent”) and U.S. Patent No. 7,108,603 (“the ’603 patent”). The district court granted summary judgment of non-infringement. This case presented an issue of direct vs. indirect infringement because certain claim language was interpreted to require a user/player to perform a step. In order for a party to be liable for direct infringement, “that party must commit all the acts necessary to infringe the patent, either personally or vicariously.” Therefore, in this case, if a player/user was required to perform a step, then IGT would not be liable for direct infringement.

Claim construction. Claim 1 of the ‘215 patent provided system included the following disputed claim language: (1) “awarding said one progressive prize” and (2) “making a wager”.

The Federal Circuit found that “awarding said one progressive prize” required the conferring of rights from the operator of the game to the player and not simply displaying the amount of the prize won. Therefore the actions by IGT’s employees in testing the game were not an infringing activity because during the testing of gaming machines legal entitlement to a prize is never conferred upon IGT employees.

The court also found that “making a wager” meant “betting, which is an act performed by the player” not simply processing a bet by the device.

Direct Infringement. The court found that under the properly construed claims no single actor performed all the steps of the claim. Further the court found that the acts of the user/player could not be imputed to the casino. The court stated “One party’s direction or control over another in a principal-agent relationship or like contractual relation-ship operates as an exception to this general rule, but absent that agency relationship or joint enterprise, we have declined to find one party vicariously liable for another’s actions.” The court found that IGT had no relationship with the player so as to impute the actions of the player to IGT. As a result, the court found no direct infringement.

Indirect infringement. The court reversed and remanded on the issue of indirect infringement, allowing the plaintiff to press its indirect infringement claims. The court stated, “[a] party who knowingly induces others to engage in acts that collectively practice the steps of the patented method—and those others perform those acts—has had precisely the same impact on the patentee as a party who induces the same infringement by a single direct infringer; there is no reason, either in the text of the statute or in the policy underlying it, to treat the two inducers differently.”

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