Acceleration Bay – MMO Fallout

IPE Update: Epic Games v. ABC Moving Forward

Epic Games is moving forward with its lawsuit against Acceleration Bay (ABC) following an order denying the defendant’s motion to dismiss.

Taking the initiative upon itself, Epic Games filed suit several months ago against Acceleration Bay, seeking a declaratory judgment that their game Fortnite did not infringe on patents owned by the defendant. The lawsuit was predicated on contacts between the two parties where ABC appeared to be offering a “mutual resolution” to avoid potential litigation, as it believed that Epic Games had infringed on a patent owned related to network technology. Epic got snarky with its response, noting that ABC appears to exist solely to litigate patents it buys in bulk from third parties.

Last month Acceleration Bay filed a motion to dismiss on grounds of lack of subject matter jurisdiction (wrong court) and lack of controversy (there must be reasonable anticipation of a lawsuit in order to file for a declaratory judgment). Following oral arguments on October 22, the court denied the motion. Acceleration Bay must file an answer to the lawsuit no later than November 5.

As always, MMO Fallout has uploaded the relevant dockets to our Google Drive. You can view the decision at this link. The file included a motion to seal certain exhibits so you may see some of our documents get replaced/removed/redacted in the future depending on circumstances.

IPE Update: Acceleration Bay Files MTD Against Epic Games

Nearly two months ago Epic Games filed a lawsuit against Acceleration Bay LLC seeking declaratory judgment from the court in regard to allegations that Epic was using technology owned by AB in one of its many patents. Acceleration Bay filed a motion to dismiss on lack of subject matter jurisdiction (wrong court) as well as lack of controversy. In order to receive a declaratory judgment, a plaintiff must show the court that there is very likely to be a lawsuit over the matter.

“The Court should dismiss this action because there is no immediate case or controversy between Epic Games and Acceleration Bay. Epic Games seeks declaratory judgment of non-infringement of seven patents owned by Acceleration Bay. But in the pre-suit communications that Epic Games alleges gave rise to this action, Acceleration Bay did not provide Epic Games with any claim charts or infringement analysis and Acceleration Bay did not threaten Epic Games with litigation. Instead, the parties were engaged in preliminary licensing discussions, when Epic Games abruptly filed this action. The Complaint fails to allege facts sufficient to confer declaratory subject matter jurisdiction over this action, dictating dismissal under Federal Rule of Civil Procedure 12(b)(1).”

For its part, Acceleration Bay has denied ever threatening Epic with a lawsuit (despite evidence from Epic showing just that) but instead offering a “mutually acceptable path forward” which may end up on the list of veiled threats alongside “nice business you got here, it’d be a shame of something were to happen to it.”

“Acceleration Bay never threatened Epic Games with litigation. For example, on April 30, 2019 and May 8, 2019, Acceleration Bay’s representative (Mr. Garland) stated in an email that Acceleration Bay is “interested in arranging an introductory meeting [to] provide an overview of Acceleration Bay and to agree to a mutually acceptable path forward” and that Acceleration Bay “remain[s] interested in trying to reach a business solution with Epic Games.” Declaration of Paul Andre filed herewith (“Andre Decl.”), Ex. 1 at 1.”

See? No threats, just wanting to reach an amicable solution (and sue if you don’t meet our demands). If you wanted to see the “generic, substance-free form letter” that Epic received, I have included it below.

As always, MMO Fallout has provided the court dockets in our Google Drive at the attached link. Download it, share it, do whatever you want with it. It is 74 pages in whole so get yourself a nice cup of coffee before you dive in.

In Plain English: Epic and the Generic, Substance-Free Patent Troll

Epic Games is once again back in court, except this time they are taking on a more defensive tone.

As of July 18, Epic Games has filed a lawsuit against Acceleration Bay LLC regarding some bad blood between the two companies that has boiled over in the past few years. According to court dockets filed in the Northern District of California, Epic Games is asking for a declaratory judgment of non-infringement regarding seven patents owned by the defendant.

According to Epic’s filing, defendant Acceleration Bay LLC in early 2015 acquired a number of patents from The Boeing Company. These patents cover a computer network and/or broadcast channel with an m-regular, incomplete topology. I’ll let the docket try to explain some of it, but it has to do with how computers interact on a network.

The claims of these patents all require that (1) each participant/computer in the network must have connections to at least three other neighboring participants.
The claims of these patents all require that (2) the network must be “m-regular” where each participant is connected to the exact same number, m, of neighbor participants.
The claims of these patents all require that (3) the network must be incomplete – m must be at least two less than the total number of participants.
31. In other words, each participant must be connected to at least three neighbor participants, and no participant can be connected to all of the other participants in the network.

Fast forward to 2018 and Acceleration Bay’s lawyers sent a letter to Epic with allegedly no explanation or information, and claimed that Epic was infringing on their patents and would require a license. The letter was apparently so poorly vetted by AB’s legal team that they didn’t notice that the threat still contained the name of an unrelated company that AB had presumably also threatened over its patents.

As they say, bad form.

Additionally, Epic asserted that Acceleration Bay couldn’t get through its letter without completely lying about its own existence, claiming that it was founded in 2012 (it was founded in August 2014), and calling itself a “technology incubator” (it isn’t) that “partners with inventors, corporations and entrepreneurs to accelerate growth in creating innovative companies.” AB doesn’t accelerate growth in anything. Acceleration Bay, according to Epic’s attorneys, does not provide any product or service whatsoever, and exists only to monetize patents acquired from third parties. According to Epic’s attorney’s, AB is exclusively in the market of monetizing patents.

On July 10, representatives of both companies sat down to a teleconference and evidently nothing was accomplished. AB’s attorneys don’t appear to understand what their own patent covers, or how Epic operates their games, as Epic states in the court dockets that many online multiplayer games, especially those being asserted in this lawsuit, do not function the way that the patent would cover, as player networks are communicating with Epic’s servers and not each other.

Epic has assembled its Avengers team of lawyers from the offices of Winston & Strawn to convince the court for a preemptive declaration that Epic is not infringing on any patents alleged in this case. Acceleration had not filed a lawsuit against Epic, however the threatening letters are enough for Epic to go to the court and demand an answer to force the letters to stop. Acceleration Bay has 21 days to respond to the lawsuit.

As always, MMO Fallout has acquired at our own cost the dockets for this case and they can be found on our Google Drive. The docket itself is linked here, as Acceleration.pdf, or it will be in a folder titled “Acceleration” once more dockets are uploaded.

I paid way too much for this article. If you really like patents, I recommend checking out the docket because it’s about 25 pages of the actual lawsuit and then 350+ of the patents at dispute presented at evidence. Our condolences go out to the court clerk who had to print this out and file it.