Konami Gaming, Inc. v. High 5 Games, LLC (D. Nev.)

Slot Machine Patent Invalidated As Being Directed to Ineligible Subject Matter

By Joseph Herndon --

Konami sued High 5 Games for patent infringement of U.S. Patent Nos. 8,096,869; 8,366,540; 8,662,810; and 8,616,955.  The '869 patent, which is entitled "Gaming Machines with Runs of Consecutive Identical Symbols," issued on January 17, 2012, and is the parent patent for the other three patents in this case.  The patents disclose variations on a slot gaming device in which the simulated digital "reels" depict a consecutive run of identical symbols in one reel to heighten the player's anticipation of a winning outcome, with the identical symbol changing for each "game."

The District Court granted summary judgment for High 5 Games, finding that the patents were directed to ineligible subject matter, i.e., an abstract idea equated to rules of a game.  While the Federal Circuit has noted that a "game using a new or original deck of cards" could potentially survive a § 101 challenge, the claims at issue here were found to only be directed to changes to game rules of a generic slot machine using conventional technology—thus, lacking a new/original "deck of cards" (i.e., new technology).

Patents At Issue

The '869 patent describes that there is provided a gaming machine arranged to display a matrix of symbols containing elements: each column of the matrix comprising a portion of a simulated rotatable reel of the symbol containing elements, and each of the symbol containing elements of at least one consecutive run of the symbol containing elements of at least one reel is caused to display an identical symbol.  Preferably, the identical symbol is selected by a game controller from a subset of available symbols.  Figure 1 of the '869 patent, reproduced below, shows a gaming machine with a display having a matrix of elements and symbols comprising portions of simulated rotatable reels.

A game controller pre-selects at random, at the initiation of a game sequence, a potential win element for each reel from the set of elements.  That is, the game controller predetermines which element, and therefore which symbol, will be displayed at the end of the game, and may therefore contribute to a winning outcome.  In this preferred embodiment, the number of elements in a run and the location of the consecutive run or runs within the strip are predetermined and remain constant for each game played on the machine.  The identical symbol which populates these consecutive run or runs of elements may be considered as one of a set of inner reel symbols.

The selection of the identical symbol is through a notional rotation of an inner reel, which is in effect, a look-up table and is not displayed, but its simulated rotation and coming to rest determines which symbol will populate the run or runs of consecutive elements of the left-most reel.  The symbols of the inner reel or look-up table from which the selection is made, are a sub-set of the set of symbols displayed in the remaining non-inner reel elements of the left-most reel.

Claim 1 of the '869 patent is representative of the asserted claims for the patents at issue in this case.

1.  A gaming machine comprising:
    a processor configured to execute a game displaying a matrix of symbol containing elements having a plurality of rows and a plurality columns;
    at least one column of said matrix comprising a portion of a simulated rotatable reel of a plurality of said symbol containing elements;
    said simulated rotatable reel comprising sections of symbol containing elements displaying a plurality of symbols that are fixed for each game played on said gaming machine;
    said simulated rotatable reel including at least one section in which a consecutive run of three or more of said symbol containing elements is populated by an identical symbol so that, as the simulated rotatable reel rotates, a consecutive string of said same identical symbol is sequentially displayed within said consecutive string of symbol containing elements; and
    said identical symbol is randomly selected anew for each play of said game, wherein said identical symbol is selected by virtually spinning a notional, non-visible, inner reel comprising a subset of said plurality of symbols.

Section 101 Challenge

High 5 argued that the claims are invalid as abstract under 35 U.S.C. § 101.  Specifically, High 5 argued that the claims at issue here are directed towards what are essentially game rules, albeit in the context of a computerized "game," and that the abstract concept of the manner in which the "game" is played or depicted, or the arrangement of the symbols in the course of the game, is not patentable, even if it is executed through the use of various technological components, generically recited.

Konami responded and emphasized that the claims cover a gaming machine that displays virtual reels having sections of identical, repeating symbols separated by sections of non-identical and thus non-repeating symbols, so that the displayed sections of repeating symbols heighten player anticipation of a potential win.  Konami argued that this functionality overcomes a problem recognized in the industry in which machines and games can offer novel and stimulating variations.

Pursuant to Alice Corp., the Court first determined whether the patents were directed toward a patent-ineligible concept, such as an abstract idea.  Here, the Court found that the patents at issue in this case are directed toward a patent-ineligible concept regarding "rules of a game," i.e., slot machine game rules.  High 5's analogy to game rules was compelling.  As laid out above, the patents recite essentially generic computing components, within the pre-existing framework of the "game" of a slot machine.  These components perform the functions of what may be described as an aesthetic variation on a play of the game—the game is played such that the reels display consecutive runs of the same symbol.  The primary focus of the patents, as acknowledged even by Konami, is displaying a consecutive run of a randomly selected identical symbol in one reel of the simulated digital reels in each iteration of a game as a means of increasing interest in the game and "increasing probability of a winning outcome."  As the Federal Circuit found in In re Smith, claims directed to new game rules or variations of a game are directed to an abstract patent-ineligible concept.  The Court thus found that the four patents at issue in this case are directed to altering the rules of the game regarding slot games, and are thus directed to a patent-ineligible concept.

Konami argued that, even if the claims are deemed to recite generic computer system components that are not in themselves inventive, the Court should find the "ordered combination" of the limitations, comprising a game in which "as the simulated rotatable reel rotates, consecutive string of the identical symbol . . . is sequentially displayed," to be sufficient.  Konami noted that in In re Smith, the Court posited in dicta that a novel game employing an original deck of cards (e.g., novel game using new technology) might be patentable.  Konami asserted that their patents are equivalent to a new deck of cards; they cover a new and original virtual reel for a slot machine.  Konami argued that in gaming systems prior to this invention, reels did not exhibit identical symbols in consecutive positions, nor where symbols on the reel randomly selected to change from game to game, and while some of the individual computer hardware components may be conventional, the limitations defining this inventive concept all depend on the unconventional configuration recited in the claims.

Thus, the Court's inquiry did not end with a finding that the patents are directed toward a patent-ineligible concept.  As Konami pointed out, the Court in In re Smith provided the explicit caveat that the invention of a "game using a new or original deck of cards" could potentially survive the second-step inquiry under Alice.  These patents may thus overcome a finding of invalidity for abstractness if they nonetheless disclose an "inventive concept sufficient to transform the claimed abstract idea into a patent-eligible" invention.

However, the Court did not find that the claims here individually, collectively, or in ordered combination disclose an "inventive concept".  The Court rejected Konami's argument that the ordered combination of claims results in an inventive concept by virtue of the unique display or configuration of symbols on the simulated reels.  While the claims at issue here may disclose a different configuration of the displayed symbols in a slot machine game, they do not disclose a new game or a new technology directed to the slot game.  The claims both individually and in an ordered combination disclose "purely conventional steps to an abstract idea."  Selecting an identical symbol for a consecutive run of symbols in one simulated digital reel, at least as disclosed in the asserted claims here, does not represent a new form of selection or derive from a new technology associated with slot games.  This selection process, as conceded by Konami, relies upon the use of random number generators and look-up tables.  While these technological components require programming, as the Examiner noted in his initial rejection of the patent application, the patents' use of these components does not represent a nonobvious ordered combination.

Moreover, the Court did not agree that the mere configuration of a consecutive run of symbols in one simulated reel represents something more than changing the rules of the game.  A generic slot game, as noted by experts in this case, has ever changing symbols selected at random.  Realigning and altering the display of symbols on simulated spinning reels is the very essence of the generic slot game.  Changing how often a symbol appears and where it appears in a slot game without more is simply altering the manner of display of random symbols -- i.e., changing the rules of the game.  Changes to game rules of a generic slot machine using conventional technology are not patentable.

The Court noted that the '869 patent was allowed inter alia because it disclosed an alleged unique method of random selection -- virtual spinning of a notional non-visible inner reel.  However, a review of the specification and asserted claims indicates that the inventor never actually provided the structure or programming for this process.  Consequently, Konami cannot establish that this selection process represents an inventive concept or new technology (or selection process) directed to a generic slot game.

Thus, the Court found that Konami's patents' claims individually and collectively are invalid for abstractness.

Konami Gaming, Inc. v. High 5 Games, LLC (D. Nev.)
Order by District Judge Richard F. Boulware, II

Comments

[EG]

Hey Joseph,

Another botched application of the nonsensical Mayo/Alice framework. What was described and claimed was clearly a machine, one of the statutory classes of subject matter. That should been the end of the 101 story and a denial of the SJ motion.

[MaxDrei]

It isn't so simple as just branding the eligibility approach "nonsensical". For example, under the EPC, methods of playing a game are per se ineligible. Yet whereas the UK Supreme Court filters out such subject matter under the eligibility filter, the EPO uses the obviousness filter to dispose of claims like this one. Each says the other is intellectually dishonest. But both get to the same result.

[Skeptical]

EG,

Alice itself clearly had claims that both sides of that case agreed met the statutory category portion of 35 USC 101.

The only other portion of 35 USC 101 is the utility requirement (is the innovation of the proper utility, that is, does it pertain to the Useful Arts or to the Fine Arts).

ALL ELSE is ultra-vires judicial mockery and law writing by a branch of the government to which NO allocation of authority to write the statutory law that is patent law has been made.

When the "bench" of the government (self-appointed) to be the "watchdog" of Constitutionality is itself the entity disregarding Constitutionality (separation of powers, no advisory pronouncements - and ANY futuristic 'inkling' of what MAY impede progress is necessarily an advisory opinion) who is there to speak up?

Congress? Sorry, but no, the bread and circus captured body that is Congress is too busy "listening" to the voices of the juristic person known as the corporation. Who as it happens is largely the same voice of the Efficient Infringers.

Will things get better without first getting immensely worse?

Sadly, I am:

[Skeptical]

MaxDrei,

Please tell me that you do not ascribe to the view that the Ends justify the Means.

[EG]

"It isn't so simple as just branding the eligibility approach 'nonsensical.'"

MaxDrei,

I completely disagree. The problem IS SCOTUS' nonsensical Mayo/Alice framework, having no basis in the patent statutes, ignoring 35 USC 112 which acknowledges that the invention is defined by the claims (and per Diehr, as "a whole"), not some made-up "directed to" malarkey foisted on us by SCOTUS, and even worse, deeming claimed subject matter as an ineligible "abstract idea," but never, never having the courtesy (or courage) to define in Alice or any other SCOTUS decision what, pray tell, that phrase means. No wonder there is so much uncertainty and chaos in the U.S. patent system. If it were up to me, SCOTUS would (and should) be stripped of any appellate review of patent cases.

[MaxDrei]

EG, let us distinguish between the 101 "framework" as you call it, and the detail (the "meat") with which the lower courts are required to clothe the "bone", by which I mean the "framework" tossed to them by SCOTUS.

There has to be an examination of what is eligible under 101, just like there has to be a test of what is eligible in Europe, under Art 52, EPC.

One way to do it is the EPO way, eschewing any consideration of what is the contribution to the art to be found in the claim.

Another way to do it is the English way, asking whether the contribution is within the ambit of the useful arts.

As 35 USC 101 includes the word "new" and is confined to the useful arts, the English way strikes me as fitting better to the USA than the EPO approach to Art 52 EPC.

As to whether the implementation of the "framework" is sensible or nonsensical, people differ.

[Paul Cole]

I have no time on a busy working day to go into this case in detail.

But I cannot help noticing that Konami took a chance and evidently did not win the jackpot.

It mostly happens for machines of this type.

[skeptical]

EG,

Great idea ( ;-) )

To that idea, may I remind all that the Constitution itself provides Congress with the ability to apply jurisdiction stripping? that patent appeals are not a matter of original jurisdiction of the Supreme Court (a predicate for jurisdiction stripping being met)? and that as long as a new Article III court is created (the current CAFC is a dysfunctional, brow-beaten mess), then the Supreme Court case of Marbury remains met (judicial review is reserved to the branch of the government identified as Article III and does NOT require judicial review by the Supreme Court itself).

Sadly, the better question is would Congress recognize its power to do what (should) be done?

I remain:

[EG]

Hey Skeptical,

Glad you like my thought on jurisdiction stripping. And the precedent is there to do so with respect to SCOTUS hearing patent cases. When the predecessor to the Federal Circuit, the Court of Customs and Patent Appeals (CCPA), was created, there was no provision for appeal of a CCPA decision to SCOTUS. That provision was only added later.