Takeaway:  The key question in determining whether a third party is an unnamed real party in interest is whether the third party has control over the proceeding. 

In its Decision, the Board instituted review of claims 1-3, 7, 8, 11-18, and 20 of the ’998 Patent, but did not institute review as to claim 19. The ’998 Patent is directed to a three-dimensional graphical, multi-user, interactive virtual world system that includes highly scalable architecture.

The Board began with claim construction, stating that the claims are given their broadest reasonable interpretation in light of the specification. The Board determined that at this stage, no claim terms needed express construction.

The Board then turned to the first ground of unpatentability – that claims 1-3, 7, 8, 11, 12, 16, 18, and 20 are obvious in view of Durward, Tracey, and Marathon. Regarding Tracey, the Board discussed its proffered publication date of May 7, 1993 in the International Herald Tribune newspaper. The Board found that Petitioner had made a sufficient showing because the paper stated that it is a global newspaper edited and published in Paris, and that it is published with The New York Times and The Washington Post.

Addressing the substance of the ground, the Board noted that Petitioner provided a limitation-by-limitation analysis of where each limitation is allegedly taught in Durward, Tracey, and Marathon. Patent Owner argued that there is no rationale to combine Durward, Tracey, and marathon because the combination is merely legal conclusions and lacks citation to any evidence as to why Durward’s virtual system would have been obvious to modify to include Tracey and Marathon’s view-switching features. The Board disagreed, and was persuaded by Petitioner’s assertion that a person of ordinary skill in the art would have combined the references to reduce the amount of data communication to the user, thereby increasing a user’s enjoyment, which the Board found was supported by articulated reasoning.

Patent Owner also argued that there is no rationale to combine Durward, Tracey, and Marathon because Durward’s users will receive data for a larger portion of virtual space, and not just relevant and priority spaces for that user, whereas Tracey and Marathon provide perspective switching of users. Patent Owner also argued that the combination would frustrate the purpose of Durward. The Board disagreed with these contentions.

The Board then reviewed the next ground of unpatentability – obviousness of claims 13-15 in view of Durward, Tracey, Marathon, and Schneider. Patent Owner argued that this combination fails for the same reasons as the first combination. Because the Board was not persuaded by those arguments originally, it also was not persuaded by them here.

Next, the Board reviewed the third ground of unpatentability – obviousness of claim 17 in view of Durward, Tracey, Marathon, and Wexelblat. Patent Owner argued that Durward, Tracey, Marathon, and Wexelblat would not have been obvious to combine because in claim 16, Petitioner maps Durward’s “multiple virtual spaces” that correspond to different applications, and combining those applications with Wexelblat’s teleportation results would not have been obvious. The Board disagreed, finding that Durward does not preclude database 104 from having multiple gaming virtual spaces with the same functions.

The Board then reviewed the final ground of unpatentability – obviousness of claim 19 in view of Durward and Pratt. Petitioner argued that Pratt has a printed publication date of no later than October 26, 1993, relying on the title page of Pratt that is dated June 1993 and stating that it is approved for public release and that distribution is unlimited. Petitioner also relies upon the declaration of the advisor to Pratt on the dissertation. The advisor stated that the distributed two copies of Pratt to the Defense Technical Information Center (“DTIC”), two copies to the library at the Naval Postgraduate School, one copy to the Director of Research Administration, four copies to the author, one copy to Major David Neyland, and one copy to Lieutenant Colonel Michael D. Proctor. The advisor also testified that the DTIC provides the general public and industry with access to unclassified, unlimited information. The Board found that that language printed on the cover page would not be sufficient to show public availability. The Board further found that Petitioner did not state that the individuals to which Pratt was distributed were those of ordinary skill in the art. Regarding the allegations about DTIC, the Board found that Petitioner had not shown that Pratt was available for download through DTIC. Regarding the library at the Naval Postgraduate School, the Board found that Petitioner did not show that it was catalogued, indexed, or shelved in a meaningful way such that Pratt was publicly accessible. Therefore, the Board found that Petitioner had not demonstrated that Pratt was prior art to the ’998 Patent.

Patent Owner also argued that the Petition should be denied under 35 U.S.C. § 325(d) because Durward was previously presented to the Patent Office. The Board declined to use its discretion to reject the Petition on those grounds.

Patent Owner further argued that Activision Publishing, Inc. is an unnamed real party in interest in this proceeding, and review should be barred on this basis. Petitioner and Activision entered into an agreement whereby Petitioner agreed to develop a series of products to be published and distributed by Activision. In 2012, Patent Owner filed and served a complaint against Activision alleging infringement of the ’998 patent, but that complaint did not allege infringement of Petitioner’s products. In 2014, Patent Owner sent a letter to Activision informing them that Patent Owner intends to add Petitioner’s product to the case, but has yet to do so. Patent Owner argues that its intent to add Petitioner’s products to the district court case “triggered” Petitioner’s duty under the agreement and gave Activision the opportunity to participate in the inter partes review. The Board disagreed, stating that Patent Owner has not shown that Activision has an opportunity to control the inter partes review, and Patent Owner’s arguments are based on unreasonable assumptions and interpretations of various sections of the agreement.

Bungie, Inc. v. Worlds Inc., IPR2015-01325
Paper 13: Decision on Institution of Inter Partes Review
Dated: November 30, 2015
Patent: 8,145,998 B2
Before: Karl D. Easthom, Kerry Begley, and Jason J. Chung
Written by: Chugn
Related Proceedings: Worlds Inc. v. Activision Blizzard, Inc., No. 1:12-cv-10576 (D. Mass.); IPR2015-01321; IPR2015-01264; IPR2015-01268; IPR2015-01269; IPR2015-01319