On Thursday, August 31st, a jury verdict entered into a patent infringement case in the Northern District of Texas found that Japanese gaming giant Nintendo (TYO:7974) infringed upon a patent asserted by Texas-based medical tech firm iLife Technologies Inc. In the verdict, the jury agreed that iLife proved that it was owed $10.1 million in a lump sum royalty for the sales of a series of games for the Wii U console. The jury also found that Nintendo didn’t prove invalidity of the asserted patent.
The jury found that sales of Nintendo’s Wii U games including Wii Sports, Wii Sports Resort, Wii Club Sports and Mario Kart 8, infringed upon claim 1 of U.S. Patent No. 6864796, entitled Systems Within a Communications Device for Evaluating Movement of a Body and Methods of Operating the Same. Issued in March 2005, it claims a system within a communications device capable of evaluating movement of a body relative to an environment using a sensor associated with the body sensing dynamic and static accelerative phenomena of the body and a processor that processes sensed phenomena to determine whether an evaluated body movement is within environmental tolerance and generates tolerance indicia which is transmitted by the communications device. The resulting invention results in a device capable of determining the cause of increased or decreased body activity, such as abnormal movement or potentially dangerous events like a fall.
The ‘796 patent was one of six patents asserted by iLife in its original complaint against Nintendo filed in Northern Texas in December 2013. The original complaint identified a wider array of accused products marketed by Nintendo including the Wii U console, the Nunchuk controller and the Wii U GamePad controller. iLife had alleged that motion-controlled, active play video gaming enabled by Nintendo’s wireless controllers and related technologies evaluate movements of a body relative to an environment, infringing upon the patents asserted by iLife without offering any substantial non-infringing use.
In December 2014, Nintendo filed an amended counterclaim denying all infringement allegations and asserting eight affirmative defenses including noninfringement, invalidity, no right to injunctive relief and unenforceability due to inequitable conduct. Nintendo’s amended counterclaim was filed about two months after Nintendo filed a series of petitions for inter partes review (IPR) proceedings at the Patent Trial and Appeal Board (PTAB) on all six patents asserted by iLife in the case. IPR proceedings were instituted on each of the patents and iLife’s ‘796 patent was the only one which had its validity upheld; the five other trials reached findings of all claims unpatentable. iLife patents invalidated at the PTAB include U.S. Patent No. 7479890, entitled System and Method for Analyzing Activity of a Body; U.S. Patent No. 7145461, same title as the ‘890 patent; and U.S. Patent No. 7095331, titled System and Method for Detecting Motion of a Body.
In January 2015, Northern Texas Chief District Judge Barbara M.G. Lynn entered an order in the district court patent infringement case denying Nintendo’s motion to stay the case pending institution of the IPR proceedings at the PTAB. In June 2016, a few months after PTAB issued final written decisions concluding the IPRs, Nintendo filed a notice of appeal in the Northern Texas infringement case informing the court that it would be appealing the IPR on the ‘796 patent to the U.S. Court of Appeals for the Federal Circuit.
Nintendo also seems very willing to appeal the jury verdict coming out of Northern Texas and will likely continue its validity challenges of the ‘796 patent. A statement from Nintendo included in coverage of the case published by Business Insider indicates Nintendo’s disagreement with the jury verdict and its plans to pursue invalidity challenges on appeal. “Nintendo does not infringe iLife’s patent and the patent is invalid,” the statement reads in part. In early August, Nintendo’s Switch video gaming console was the subject of a patent infringement challenge filed by video gaming equipment developer Gamevice, so the past month has already given Nintendo a fair amount of legal challenges to handle.