IP Law Daily, PATENT—D. Nev.: Patent for placing wagers on multiple sporting events unpatentable as directed to abstract idea, (Jan 23, 2023)

By Linda O’Brien, J.D., LL.M.

A patent for calculating odds on sporting events was similar to well-known, long-standing practices in the sports betting industry and failed to describe any specific steps showing some hardware or software innovation.

An infringement action over a software company’s mobile device application pertaining to the patented method for allowing the calculation of odds for wagers involving bets on multiple sporting events was dismissed as the patent was directed toward the abstract idea, the federal district court in Las Vegas, Nevada has ruled. The patent owner failed to demonstrate that the method was directed toward an innovative concept. Thus, the software company’s motion for judgement on the pleadings was granted and the case was closed (Pure Parlay, LLC v. Stadium Technology Group, Inc., January 20, 2023, Silva, C.).

Pure Parlay, LLC owns U.S. Patent No. 9,773,382 (the ’382 patent), which discloses a "computer-implemented system and method for making multiple-game sporting event wagers" through use of a viewable display to access a wagering system hosted on a "centralized computer network." Bettors select sports teams for a "multiple armed event wager," in which the bettor must win each of the bets to win money. The system displays baseline odds for the wager that are a function of the odds of each "arm" of the wager when the arms are assigned "equal starting shade values," and then allows the bettor to handicap the events within a minimum-maximum range by moving the point spread. The system then calculates the total point shade and the resulting odds and allows the bettor to place the wager.

In May 2019, Pure Parlay brought a patent infringement suit against software company Stadium Technology Group, Inc. and its parent company GVC Holdings, PLC. Stadium provides risk management software to regulated gaming operators for race and sports books. The complaint alleged that Stadium’s mobile device application, which allows its users to place multiple-arm event wages on sporting events, infringes the ’382 patent. In January 2021, the court granted the defendants’ motion to dismiss with leave to amend based on a finding that the plaintiff insufficiently pleaded how the application infringed its patent. Before the court was the defendants’ motion for judgement on the pleadings regarding the third amended complaint as the patent was directed toward unpatentable subject matter and therefore could not support a claim of infringement.

The court found that the ’382 patent was directed toward the abstract idea of managing a multi-game sports wager. Specifically, the flexible point shading in multi-game sports wagers that employ no patent-eligible innovative concept. The plaintiff described the patent as a method for increasing wagering flexibility for bettors making multi-game sports wages from a smartphone or tablet. However, the court noted that the increased wagering flexibility arising from the use of a drop-down menu or slide bar to “change the line of each arm of a parlay while the odds update in real time.” The software used to carry out the patent’s method and the electronic devices used to place bet were tangible items outside of the patent’s claims. As such, the ’382 patent simply covered the abstract idea of allowing a bettor to shade multiple lines within a parlay.

The ’382 patent discloses only generalized steps to be performed on a computer, smartphone, or tablet. The method was comprised of equally generic steps of: providing and accessing a wagering system; selecting a plurality of sports teams; determining the odds; calculating the amount of point shading permitted; choosing how many points to take by bettor; combining the shade for each arm of the parlay and calculating the total odds of the bet in light of the bettor’s shade choices. None of those steps purported to explain how the patent’s method was effectuated with sufficient specificity, the court explained.

Further, the patent’s method was analogous to well-known, long-standing practices in the sports betting industry, according to the court. The plaintiff acknowledged that sport books have long allowed bettors to shade a single line of a sports bet. The purported innovation merely extended the long-standing practice of permitting shading a sports bet to multiple arms of a parlay. Also, the ’382 patent specifications did not recite an improvement in computer functionality. The purported method was described in broad and generic functional terms but failed to identify how the end result was achieved either by unique software or hardware configurations. The specifications also did not indicate a unique configuration of otherwise generic components. Because the patent was simply too generic in how the claimed method was effectuated, the patent was focused toward an abstract idea.

The individual claim elements did not recite an inventive concept, the court stated. Each step of the claimed method was a conventional step taken by generic computer components. Some steps involved actions taken by a bettor, such as accessing the wagering system, selecting a plurality of teams, and choosing a quantity of points to shade. While other steps were simple computations, such as determining baseline odds for the parlay, defining the maximum amounts of points that could be shaded, calculating the maximum and minimum possible odds based on those definition, combining the chosen quantity of points shaded, and calculating the total odds for the parlay. The plaintiff did not assert that any of those steps were novel or unique. In rejecting Pure Parlay’s argument that the ordered combination of the claim elements provided an inventive concept, the court noted that patent failed to describe any specific steps showing some computational upgrade or software innovation. Thus, the ’382 patent was directed toward unpatentable subject matter and Pure Parlay’s suit for infringement could not proceed based on an invalid patent, the court concluded.

The Case is No. 2:19-cv-00834-CDS-BNW.

Attorneys: Rob L. Phillips (FisherBroyles, LLP) for Pure Parlay, LLC. Michael Neal Feder (Dickinson Wright PLLC) for Stadium Technology Group, Inc., GVC Holdings PLC.

Companies: Pure Parlay, LLC; Stadium Technology Group, Inc.; GVC Holdings PLC

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