Skillz Platform Inc. v. Aviagames Inc.

• Decision Date: 14 March 2022
• Docket Number: 21-cv-02436-BLF
• Court: U.S. District Court — Northern District of California
• Parties: SKILLZ PLATFORM INC., Plaintiff, v. AVIAGAMES INC., Defendant.

SKILLZ PLATFORM INC., Plaintiff,
v.
AVIAGAMES INC., Defendant.

No. 21-cv-02436-BLF

United States District Court, N.D. California, San Jose Division

March 14, 2022

ORDER GRANTING IN PART AND DENYING IN PART MOTION TO DISMISS [Re: ECF No. 25]

BETH LAB SON FREEMAN UNITED STATES DISTRICT JUDGE

Before the Court is Defendant AviaGames Inc.'s (“AviaGames”) Motion to Dismiss Plaintiff Skillz Platform Inc.'s (“Skillz”) initial Complaint under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim for patent infringement based on a lack of patent eligible subject matter under 35 U.S.C. § 101 for its two asserted patents-U.S. Patent Nos. 9, 649, 564 (the “'564 Patent”) and 9, 479, 602 (the “'602 Patent”) (collectively, the “Asserted Patents”).

Based on the below reasoning, the Court (1) DENIES AviaGames' Motion as to the '564 Patent and (2) GRANTS AviaGames' Motion WITHOUT LEAVE TO AMEND as to the '602 Patent.

I. BACKGROUND

Skillz is a Delaware corporation with its principal place of business in Oregon. See Complaint, ECF No. 1 ¶ 12. Skillz owns the Asserted Patents. See Id. ¶¶ 60, 82. Further, Skillz maintains a mobile gaming platform, and it enables third-party game developers to make games available on the platform through a Software Development Kit (“SDK”). See Id. ¶¶ 2, 12, 22-27, 32-44. AviaGames is a Delaware corporation with its principal place of business in California. See Id. ¶ 13. Skillz alleges that AviaGames maintains a competing mobile gaming platform- Pocket7Games-which AviaGames developed using Skillz's intellectual property that it gleaned

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while developing games for Skillz's platform. See Id. ¶¶ 4-11, 45-56.

Skillz asserts two patents against AviaGames-the ‘602 Patent and the ‘564 Patent-related to mobile gaming. Skillz alleges that AviaGames' Pocket7Games application and standalone game applications, including “Bingo Clash, ” “Solitaire Clash, ” “21 Gold, ” “Explodocube, ” and “Tile Blitz, ” infringe the Asserted Patents. See Id. ¶¶ 71-96.

A. The ‘564 Patent

Skillz owns the '564 Patent, which is entitled “Peer-to-Peer Wagering Platform.” The '564 Patent was filed on December 21, 2015 and granted on May 16, 2017, although it belongs to a long line of continuation and continuation-in-part applications leading back to an application filed on August 8, 2012. See '564 Patent at 1.

Claim 1 of the '564 Patent provides the following:

1. A method comprising

receiving, at a client including an executable game instance a stream of pseudo random number seeds characterized by a unique match identifier for an online digital gaming competition, the client enrolled in the online competition

receiving, at the client and from a game server, game data for executing the game instance, the game instance requiring one or more random numbers to complete execution of the game instance

generating, using the stream of pseudo-random number seeds, a plurality of pseudo-random numbers; and executing the game instance by the client and using the plurality of pseudo-random numbers to provide the online competition to a player such that a beginning of gameplay experience is common between the game instance and a second game instance executing on a second client enrolled in the online digital gaming competition;

wherein at least one of receiving, generating, and executing is implemented by at least one data processor forming part of at least one computing system.

'564 Patent, Claim 1. Claim 11 of the '564 Patent is substantially the same as claim 1, but it claims a “non-transitory computer program product storing instructions.” And claim 18 of the '564 Patent is substantially the same, but it is a system claim. The dependent claims provide that the game instance is a game of skill (claims 2, 12, 19); the game instance is a game of skill having random

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elements (claims 3, 13, 20); the game instance initializes associated random elements to a common pseudo-random value (claims 4, 14, 21); generating the plurality of pseudo-random numbers includes generating a stream of pseudo-random numbers (claims 5, 15); the second game instance is executed by a second client using the plurality of pseudo-random numbers (claims 6, 16); the stream of random numbers is received from a remote transactional server independent of the game server (claims 7, 17); the client includes a wagering module (claim 8); the client, game server, and transactional server are separate and remote (claim 9); and the client is a mobile device (claim 10). The '564 Patent relates to ensuring that competitors in a mobile online gaming tournament played over client devices communicating with remote servers have (1) common gameplay within a single tournament that (2) varies randomly between tournaments.

The '564 Patent explains that “random numbers are typically used in gameplay engines to decide game elements and properties (e.g., what obstacles are present can be decided based on the value that a random number generator returns)[.]” '564 Patent, 14:51-55. The '564 Patent further explains that “the use of common random numbers can provide a common gameplay experience to a subset of users (e.g., the players involved in a third party game tournament) . . . to standardize (or level the playing field) for a game of skill that still has random elements.” Id., 14:55-60. The alleged innovation of the '564 Patent is to use a “tournament identification number as a seed to generate pseudo-random numbers, thus causing gameplay to be different between tournaments, but not between game instances involved in a given tournament.” Id., 15:3-7.

During prosecution of the '564 Patent, the first set of claims considered by the examiner were substantially the same as the resulting claims, with the only difference being that the phrase “pseudo random number seeds characterized by a unique match identifier” in the final independent claims was replaced with “pseudo random number seeds associated with a unique match identifier” in the preliminary claims. See January 26, 2016 Amendment at 2-5 (emphasis added). On August 23, 2016, the examiner issued a Non-Final Rejection of the preliminary claims. See Sacksteder Decl., ECF No. 25-1, Ex. E, August 23, 2016 Non-Final Rejection. The examiner stated that the claims were valid under § 101 because they were “necessarily rooted in computer technology and thus not drawn to an abstract idea.” See Id. ¶ 7. Further, the examiner stated that

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“the claimed invention does not merely take an abstract idea (i.e. a generic game) and ‘apply' it using only conventional components. Rather, . . . the presence of a randomized number generation seeding system is rooted in particularized computing elements. Thus, the claimed invention aligns with the facts of the Federal Circuit decision in Enfish.” Id. However, the examiner issued a non-final rejection of all but final Claim 8 as invalid in light of U.S. Patent Application No. 2010/0022307 (“Steuer”) and U.S. Patent Application No. 2010/0311496 (“Taylor”), and final Claim 8 as invalid in light of Steuer, Taylor, and U.S. Patent Application No. 2005/0090307 (“Walker”). See Id. ¶¶ 12-23. The examiner found that Steuer anticipated all elements of the claims, other than the fact that the stream of pseudo-random number seeds was “associated with a unique match identifier.” See Id. ¶ 16. However, the examiner found that this element was obvious in light of the Taylor reference, since it discloses using a seed combined with a current date and time to produce a unique input value for a game. See Id. ¶ 16. Further, the examiner found the three independent claims invalid based on the doctrine of nonstatutory double patenting over claims 1, 8, and 15 of U.S. Patent No. 9, 240, 101. See Id. ¶¶ 24-27.

In response, the applicants amended the claims to their final form (replacing “associated with” with “characterized by” in the independent claims) and filed a terminal disclaimer over U.S. Patent No. 9, 240, 101. See November 22, 2016 Amendment at 3-6, 8. The examiner granted the patent as amended. See January 18, 2017 Notice of Allowance.

B. The ‘602 Patent

Skillz also owns the ‘602 Patent, which is entitled “Event Platform for Peer-to-Peer Digital Gaming Competition.” The '602 Patent was filed on May 20, 2015 and granted on October 25, 2016. Claim 1 of the '602 Patent recites the following:

1. A method for implementation by at least one data processor forming part of at least one computing system, the method comprising:

receiving, by at least one data processor, data identifying a peer-to-peer gaming event and comprising a request to register for the peer-to-peer gaming event, the request originating from peer-to-peer gaming platform software stored in memory of a client and executing on the client, the client being remote from the data least one data

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processor, the peer-to-peer event being a geographically restricted peer-to-peer gaming competition having a plurality of participants each playing a skill-based digital game;

associating, using the at least one data processor, the client with the peer-to-peer gaming event;

receiving data characterizing a location of the client according to a geolocation system of the client, wherein the geolocation system of the client is a global positioning system (GPS) service or a local positioning system (LPS) utilizing beacons; and

comparing the location of the client to a predefined geolocation of the peer-to-peer event to determine, using the at least one data processor, that the client satisfies a geographical location requirement of the peer-to-peer gaming event; and

causing, using the at least one data processor, provision of the skill-based digital game to the client during the peer-to-peer gaming event, the skill-based digital game exchanging game data with a game server remote from the at least one data

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