Fed. Cir. Issues Precedential Opinion in Take Two Patent Dispute

On Monday, a panel of Federal Circuit Court of Appeals judges partly dismissed and partly affirmed the non-infringement findings of a District of Delaware court in a suit involving four patents relating to networking technology. The decision in favor of the video game company Take-Two Interactive Software Inc. and its publishing label subsidiaries, 2K Sports Inc. and Rockstar Games Inc. (collectively, Take Two) overrode the contentions of plaintiff-appellant Acceleration Bay LLC.

According to the opinion, Acceleration sued Take Two alleging that some of its video games infringe on proprietary technology that allegedly “improves upon pre-existing communication techniques because it is ‘suitable for the simultaneous sharing of information among a large number of the processes that are widely distributed.’” In particular, the patents describe a “‘broad-cast technique in which a broadcast channel overlays a point-to-point communications network,’” the opinion said.

In March 2020, after making several claim construction rulings, the district court granted summary judgment of non-infringement for all four of the asserted patents, U.S. Patent Nos. 6,701,344, 6,714,966, 6,910,069, and 6,920,497. In this week’s decision, the panel rejected Acceleration’s argument with respect to two of the patents on mootness grounds.    

Take Two argued and the panel agreed that the challenge was not justiciable because Acceleration only contested one of the two independent grounds that the district court articulated in granting summary judgment for the 344 and ’966 patents. As such, the court reasoned, reversal of this decision would still leave summary judgment intact on the separate claim construction basis.

The panel affirmed the finding of non-infringement as to the ’069 patent because, similarly, Acceleration challenged one of two claim constructions. “Even considering Acceleration Bay’s arguments regarding the construction of the term ‘fully connected portal computer,’ the district court’s grant of summary judgment would remain intact because the district court interpreted a separate term in the ’069 patent’s asserted claims to include the ‘m-regular’ limitation,” the opinion said.

Finally, the court declined the appellant’s “novel theory, without case law support,” that Take Two “directly infringes by ‘making’ the claimed systems because Take Two qualifies as the ‘final assembler’ of the ‘accused systems.’” Acceleration made this argument despite the fact that Take Two does not make the hardware customers use to play the accused video games, the panel noted.The court ultimately rejected the argument, finding that the customer, not Take Two, “completes the system” by providing the hardware and installing the video game.

The court directed each party to bear its own costs on appeal. Acceleration is represented by Kramer Levin Naftalis & Frankel LLP, and Take Two by Winston & Strawn LLP.