Court Opinion

ID: 9956162
Source: CourtListenerOpinion
Date Created: 2024-04-01 13:01:22.768455+00
Date Added: 2024-06-11T08:15:16.949886
License: Public Domain

Case: 23-1073    Document: 37     Page: 1   Filed: 03/21/2024

        NOTE: This disposition is nonprecedential.

   United States Court of Appeals
       for the Federal Circuit
                  ______________________

        SAVVY DOG SYSTEMS, LLC, POM OF
              PENNSYLVANIA, LLC,
                Plaintiffs-Appellants

                             v.

 PENNSYLVANIA COIN, LLC, PA COIN HOLDINGS,
                    LLC,
            Defendants-Appellees
           ______________________

                        2023-1073
                  ______________________

    Appeal from the United States District Court for the
 Middle District of Pennsylvania in No. 3:19-cv-01470-JPW,
 Judge Jennifer P. Wilson.
                   ______________________

                 Decided: March 21, 2024
                 ______________________

     STEVEN G. HILL, Hill, Kertscher & Wharton LLP, At-
 lanta, GA, argued for plaintiffs-appellants. Also repre-
 sented by DAVID KEELER LUDWIG.

    JOHN V. GORMAN, Morgan, Lewis & Bockius LLP, Phil-
 adelphia, PA, argued for defendants-appellees. Also repre-
 sented by JULIE S. GOLDEMBERG; AMY M. DUDASH,
 Wilmington, DE.
Case: 23-1073    Document: 37     Page: 2   Filed: 03/21/2024

 2         SAVVY DOG SYSTEMS, LLC v. PENNSYLVANIA COIN, LLC

                  ______________________

     Before TARANTO, CHEN, and STOLL, Circuit Judges.
 STOLL, Circuit Judge.
     Savvy Dog Systems, LLC and POM of Pennsylvania,
 LLC (collectively, “Savvy Dog”) appeal from the United
 States District Court for the Middle District of Pennsylva-
 nia’s summary judgment holding the asserted claims of
 U.S. Patent No. 7,736,223 ineligible for patenting under
 35 U.S.C. § 101. Because we agree with the district court’s
 conclusion, we affirm.
                         BACKGROUND
                              I
     “Tic-Tac-Fruit” is an electronic game in the prior art
 where—like tic-tac-toe—a player wins by having three
 symbols of the same type in a row. A game processor sets
 up the game by populating a three-by-three grid filled with
 symbols, selecting the winning combination(s), testing the
 display to ensure that the player cannot obtain a more val-
 uable winning outcome than the outcome determined by
 the game, and then displaying the grid to the player. The
 player then selects a “symbol to be replaced with a ‘Wild
 Card’ to obtain a winning game outcome.” J.A. 1485. Fig-
 ures 1A and 1B show the game display before and after a
 “Wild Card” is placed by a user.
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 SAVVY DOG SYSTEMS, LLC v. PENNSYLVANIA COIN, LLC        3

 ’223 patent Figs. 1A, 1B. In the prior art version of Tic-
 Tac-Fruit (“prior art Tic-Tac-Fruit”), the grid generation
 and testing occur after the player committed to playing.
 Appellants’ Br. 5 (citing J.A. 1510–11 (Harrigan Depo.
 at 112:5–113:8)).
    To address the rise in electronic gambling games, Ohio
 prohibited gambling games but permitted “skill-based”
 games, i.e., where “the outcome of play during the game
 must be controlled by the person playing the game and not
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 4          SAVVY DOG SYSTEMS, LLC v. PENNSYLVANIA COIN, LLC

 by predetermined odds or random chance controlled by the
 machine.” ’223 patent col. 1 ll. 21–30.
      The ’223 patent, entitled “Electronic Gaming Method
 and System Having Preview Screen,” purports to be a more
 skill-based and less chance-based implementation of the
 prior art Tic-Tac-Fruit. See ’223 patent col. 3 ll. 59–63.
 The abstract describes displaying the game field “to the
 player as a preview for deciding whether or not to play the
 displayed game.” ’223 patent Abstract, col. 1 ll. 15–17. Un-
 like the prior art Tic-Tac-Fruit, the invention described in
 the ’223 patent previews the game to the player before the
 player commits to playing the game. ’223 patent col. 9
 ll. 56–64; see Appellants’ Br. 6; J.A. 1509–11 (Harrigan
 Depo. at 111:23–113:23). According to Savvy Dog, this pre-
 view reduces the role of chance in relation to the role of skill
 because “[t]he player would play the displayed game know-
 ing the outcome.” ’223 patent col. 11 ll. 23–25; see Appel-
 lants’ Br. 13.
     Representative claim 44 of the ’223 patent recites:
     44. An electronic gaming system comprising:
         an electronic game terminal including a
         touch screen display;
         a game processor for generating an interac-
         tive electronic game on the game terminal,
         the game processor configured for:
         constructing a field having a plurality of el-
         ements for the interactive game display
         wherein each element includes a game
         symbol from a plurality of predetermined
         game symbols;
         determining at least one winning combina-
         tion for each play of the game;
         testing the game field prior to displaying
         the game to the player to ensure that a
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 SAVVY DOG SYSTEMS, LLC v. PENNSYLVANIA COIN, LLC            5

         winning combination more valuable than
         the determined winning combination is not
         generated inadvertently in completing the
         field;
         automatically displaying an actual game to
         be played on the touch screen game display
         to a player prior to initiating activation of
         game play;
         determining if the player has decided to
         play the displayed game; and
         displaying an outcome resulting from play
         of the displayed game.
 ’223 patent col. 16 l. 46–col. 17 l. 2.
                                II
     Savvy Dog filed suit against Pennsylvania Coin, LLC
 and PA Coin Holdings, LLC (collectively, “Appellees”) in
 the Middle District of Pennsylvania for allegedly infringing
 certain claims of the ’223 patent.
     Appellees moved to dismiss, arguing—among other
 things—that the asserted claims of the ’223 patent were
 directed to ineligible subject matter under 35 U.S.C. § 101.
 After reviewing representative claim 44’s language, the
 parties’ arguments, and case law, the district court “con-
 clude[d] that claim 44 describes the rules for playing a
 game, and is thus an abstract idea within the meaning of
 Alice step one.” Savvy Dog Sys., LLC v. Penn. Coin, LLC,
 No. 3:19-cv-01470, 2020 WL 1550676, at *4–6 (M.D. Pa.
 Apr. 1, 2020) (citing Alice Corp. Pty. Ltd. v. CLS Bank Int’l,
 573 U.S. 208, 218 (2014)). The district court, however, de-
 nied the motion to dismiss because “[w]hether the technol-
 ogy embedded into the game processor is an improvement
 and ‘inventive concept’ is a question of fact that the court
 cannot determine at this early stage of litigation.” Id.
 at *8.
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 6         SAVVY DOG SYSTEMS, LLC v. PENNSYLVANIA COIN, LLC

     During claim construction, the district court construed
 the claim limitation “an actual game to be played” to mean
 “the constructed game field of the game to be played.”
 Savvy Dog Sys., LLC v. Penn. Coin, LLC, No. 3:19-cv-
 01470, 2020 WL 7488878, at *9 (M.D. Pa. Dec. 21, 2020)
 (Claim Construction Op.).
     Appellees later filed a motion for summary judgment,
 again arguing that the asserted claims were patent ineligi-
 ble under § 101. For Alice step one, the district court relied
 on its previous analysis from its motion to dismiss ruling.
 Savvy Dog Sys., LLC v. Penn. Coin, LLC, No. 3:19-cv-
 01470, 2022 WL 4349829, at *5 (M.D. Pa. Sept. 19, 2022)
 (Summary Judgment Op.). The district court then deter-
 mined for Alice step two that none of the claimed elements
 of claim 44 individually, or in an ordered combination,
 transformed the abstract idea into an inventive concept.
 Id. at *9. The district court accordingly granted Appellees’
 motion for summary judgment.
    Savvy Dog appeals.         We have jurisdiction under
 28 U.S.C. § 1295(a)(1).
                         DISCUSSION
     We apply regional circuit law when reviewing a district
 court’s grant of summary judgment. C R Bard Inc. v. An-
 gioDynamics, Inc., 979 F.3d 1372, 1378 (Fed. Cir. 2020).
 Applying Third Circuit law, we review the district court’s
 grant of summary judgment de novo. Id. (citing Acumed
 v. Adv. Surgical Servs., 561 F.3d 199, 211 (3d Cir. 2009)).
 Summary judgment is appropriate when “there is no genu-
 ine dispute as to any material fact and the movant is enti-
 tled to judgment as a matter of law.” Fed. R. Civ. P. 56(a);
 see C R Bard, 979 F.3d at 1378.
    Patent eligibility under § 101 is a question of law that
 may involve underlying questions of fact. See Mortg.
 Grader, Inc. v. First Choice Loan Servs. Inc., 811 F.3d
 1314, 1325 (Fed. Cir. 2016). We review the district court’s
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 SAVVY DOG SYSTEMS, LLC v. PENNSYLVANIA COIN, LLC             7

 ultimate conclusion on patent eligibility de novo. See In-
 tell. Ventures I LLC v. Cap. One Fin. Corp., 850 F.3d 1332,
 1338 (Fed. Cir. 2017). The Supreme Court established a
 two-step test to determine whether a claim is eligible for
 patenting under § 101. See Alice, 573 U.S. at 217–18. For
 Alice step one, we must assess whether the claims at issue
 are directed to a patent-ineligible concept, i.e., a law of na-
 ture, natural phenomenon, or abstract idea. Id. at 217. If
 the answer is yes, we proceed to Alice step two to consider
 the claim elements, both individually and as an ordered
 combination, to determine whether these elements contain
 an “inventive concept” sufficient to “‘transform the nature
 of the claim’ into a patent-eligible application.” Id. at 217–
 18 (quoting Mayo Collaborative Servs. v. Prometheus
 Lab’ys, Inc., 566 U.S. 66, 72–73, 78 (2012)). With Alice step
 two, we must determine whether the claims recite addi-
 tional features that are more than “well-understood, rou-
 tine, conventional activity” to render the claims eligible for
 patenting. Mayo, 566 U.S. at 79–80.
     Addressing Alice step one, the district court character-
 ized claim 44 of the ’223 patent as being directed to “rules
 for playing a game.” Summary Judgment Op., 2022 WL
 4349829, at *4. Savvy Dog contends that claim 44 is actu-
 ally directed to “a novel gaming terminal architecture” that
 previews the game “before the player commits to play the
 game, thereby elevating skill and lessening the role of
 chance in the game.” Appellants’ Br. 23 (emphasis omit-
 ted); see also Appellants’ Br. 17.
      Whether viewed as being directed to a set of rules for
 playing a game or to a game previewed to the player before
 committing to playing, we agree with the district court that
 claim 44 is directed to an abstract idea. We have found
 similar game implementations to be patent ineligible. See,
 e.g., In re Smith, 815 F.3d 816, 818–19 (Fed. Cir. 2016)
 (concluding that the claimed “method of conducting a wa-
 gering game” was directed to an abstract idea); In re Marco
 Guldenaar Holding B.V., 911 F.3d 1157, 1160–61
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 8          SAVVY DOG SYSTEMS, LLC v. PENNSYLVANIA COIN, LLC

 (Fed. Cir. 2018) (concluding the claimed “method of playing
 a dice game” was directed to an abstract idea).
      Even if claim 44 is viewed as being directed to display-
 ing the game field before the player commits to play the
 game, claim 44 is not directed to a technological solution to
 a technological problem. Notably, the specification does
 not describe “overcoming some sort of technical difficulty”
 in displaying the preview of the game before player com-
 mitment. ChargePoint, Inc. v. SemaConnect, Inc., 920 F.3d
 759, 768 (Fed. Cir. 2019); see, e.g., ’223 patent col. 11 l. 65–
 col. 12 l. 20. For example, the disclosed processor is merely
 a means for setting up and playing the game. See, e.g., ’223
 patent col. 2 ll. 28–45 (“A game processor generates an
 electronic game display on a game terminal . . . .”); id. at
 col. 4 ll. 40–43. The specification “never suggests” that the
 processor “is improved from a technical perspective, or that
 it would operate differently than it otherwise could.”
 ChargePoint, 920 F.3d at 768.
      Indeed, the invention is directed to a concept for over-
 coming the legal obstacles discussed in the Background
 section of the patent rather than providing a technological
 solution to a technological problem. See ’223 patent col. 1
 ll. 18–60. Although Savvy Dog argues that the invention
 solves this legal or business problem by elevating skill and
 lessening chance, the purported solution is not a technolog-
 ical one. Rather the purported elevation in the player’s
 skill is due to when the game field is displayed, not how it
 is displayed. Stated differently, nothing in the claim or the
 specification describes a new technological way of display-
 ing. The idea of displaying before a player starts the
 game—instead of after the player starts the game—is ab-
 stract. Accordingly, even under Savvy Dog’s characteriza-
 tion of what the claim is directed to, claim 44 is directed to
 an abstract idea.
     Turning to Alice step two, we agree with the district
 court’s determination that the additional claim elements of
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 SAVVY DOG SYSTEMS, LLC v. PENNSYLVANIA COIN, LLC            9

 claim 44 “fail[ed] to contain an inventive concept” to trans-
 form the claim into a patent-eligible application. Summary
 Judgment Op., 2022 WL 4349829, at *5–6. Savvy Dog as-
 serts that the testing of the game field and the automatic
 previewing of the actual game to be played, whether indi-
 vidually or as an ordered combination, are inventive con-
 cepts. Appellants’ Br. 33–34.
      We determine that these steps are abstract ideas them-
 selves—whether viewed as part of a set of rules for playing
 a game or part of a game previewed to the player before
 committing to playing—and thus cannot be an inventive
 concept under Alice step two.              BSG Tech LLC
 v. Buyseasons, Inc., 899 F.3d 1281, 1290 (Fed. Cir. 2018)
 (“It has been clear since Alice that a claimed invention’s
 use of the ineligible concept to which it is directed cannot
 supply the inventive concept that renders the invention
 ‘significantly more’ than that ineligible concept.”).
     After identifying the abstract idea at Alice step one, we
 are to consider what remains in the claims at Alice step
 two. Id. at 1290. Here, all that remain are generic and
 conventional computer components (e.g., a gaming termi-
 nal and touch screen display) that are used in a routine and
 conventional way. “If a claim’s only ‘inventive concept’ is
 the application of an abstract idea using conventional and
 well-understood techniques, the claim has not been trans-
 formed into a patent-eligible application of an abstract
 idea.” Id. at 1290–91.
     For the above reasons, we conclude that representative
 claim 44 is directed to an abstract idea and that “the par-
 ticular elements of the claim, considered both individually
 and as an ordered combination,” fail to “transform the na-
 ture of the claim into a patent-eligible application.” TecSec,
 Inc. v. Adobe Inc., 978 F.3d 1278, 1292 (Fed. Cir. 2020)
 (quotations and citations omitted). We therefore affirm the
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 10        SAVVY DOG SYSTEMS, LLC v. PENNSYLVANIA COIN, LLC

 district court’s summary judgment that the asserted claims
 of the ’223 patent are ineligible for patenting. 1
                        CONCLUSION
      We have considered Savvy Dog’s remaining arguments
 and find them unpersuasive. Because the district court
 correctly concluded that the ’223 patent claims are directed
 to ineligible subject matter, we affirm.
                        AFFIRMED

      1  Savvy Dog also asserts on appeal that the district
 court erred in its construction of the term “an actual game
 to be played.” See Claim Construction Op., 2020 WL
 7488878, at *9. As acknowledged by Savvy Dog’s counsel,
 we need not address this claim construction issue because
 we agree with the district court’s § 101 analysis. See Oral
 Arg. at 1:00–1:10, https://oralarguments.cafc.uscourts.gov/
 default.aspx?fl=23-1073_03042024.mp3.