United States District Court, D. Nevada
C. JONES United States District Judge
case arises out of the alleged infringement of eight patents
relating to online gambling. Pending before the Court is
Defendant Zynga, Inc.'s Motion to Dismiss. (ECF No. 65.)
For the reasons given herein, the motion is granted in part
and denied in part.
AND PROCEDURAL HISTORY
CG Technology Development, LLC (“CG Tech”) is a
wholly owned subsidiary of non-party CG Technology, L.P.
(“CG”), which provides technology solutions for
lottery, gaming, racing, and sports wagering. (Am. Compl.
¶ 2, ECF No. 64.) “[CG] specializes in providing
secure, scalable, mobile technology and risk management
solutions to integrated resorts, gaming partners, race and
sports books, and lottery industries.” (Id.)
CG and CG Tech produce mobile phone applications for
real-money and social casino gaming, as well as account-based
wagering systems. (Id.).
is the assignee of U.S. Patent No. RE39, 818. Plaintiff
Interactive Games Limited (“IG Ltd”) is the
assignee of U.S. Patent Nos. 6, 899, 628; 6, 979, 267; 8,
342, 924; 7, 029, 394; 9, 111, 417; and 6, 966, 832.
Plaintiff Interactive Games LLC (“IG LLC”) is the
assignee of U.S. Patent No. 7, 534, 169. Plaintiffs sued
Defendant Zynga, Inc. (“Defendant”) in this Court
for direct, indirect, and willful infringement via operation
of its various online casino games. On October 13, 2016, the
Court granted Defendant's motion to dismiss
Plaintiffs' original Complaint, (ECF No.1), finding that
(1) the ‘628, ‘267, ‘924, ‘394,
‘417, ‘832, and ‘169 Patents are
patent-ineligible under 35 U.S.C. § 101 and Alice
Corp. Pty. v. CLS Bank lnt'l, 134 S.Ct. 2347 (2014);
and (2) the ‘818 Patent is patent-eligible, but
Plaintiffs had failed to state a plausible claim of
relief. (See Order, ECF No. 54.)
have now amended their Complaint, asserting claims for
direct, induced, and contributory infringement, as well as
willful infringement of the ‘818 Patent. (Am. Compl.,
ECF No. 64.) Defendant moves again for dismissal. (Mot.
Dismiss, ECF No. 65.)
Rule of Civil Procedure 8(a)(2) requires only “a short
and plain statement of the claim showing that the pleader is
entitled to relief” in order to “give the
defendant fair notice of what the . . . claim is and the
grounds upon which it rests.” Conley v.
Gibson, 355 U.S. 41, 47 (1957). Federal Rule of Civil
Procedure 12(b)(6) mandates that a court dismiss a cause of
action that fails to state a claim upon which relief can be
granted. A motion to dismiss under Rule 12(b)(6) tests the
complaint's sufficiency. See N. Star Int'l v.
Ariz. Corp. Comm'n, 720 F.2d 578, 581 (9th Cir.
1983). When considering a motion to dismiss under Rule
12(b)(6) for failure to state a claim, dismissal is
appropriate only when the complaint does not give the
defendant fair notice of a legally cognizable claim and the
grounds on which it rests. See Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555 (2007). In considering
whether the complaint is sufficient to state a claim, the
court will take all material allegations as true and construe
them in the light most favorable to the plaintiff. See NL
Indus., Inc. v. Kaplan, 792 F.2d 896, 898 (9th Cir.
1986). The court, however, is not required to accept as true
allegations that are merely conclusory, unwarranted
deductions of fact, or unreasonable inferences. See
Sprewell v. Golden State Warriors, 266 F.3d 979, 988
(9th Cir. 2001).
formulaic recitation of a cause of action with conclusory
allegations is not sufficient; a plaintiff must plead facts
pertaining to his own case making a violation
“plausible, ” not just “possible.”
Ashcroft v. Iqbal, 556 U.S. 662, 677-79 (2009)
(citing Twombly, 550 U.S. at 556) (“A claim
has facial plausibility when the plaintiff pleads factual
content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct
alleged.”). That is, under the modern interpretation of
Rule 8(a), a plaintiff must not only specify or imply a
cognizable cause of action (Conley review), but also
must allege the facts of his case so that the court can
determine whether the plaintiff has any basis for relief
under the cause of action he has specified or implied,
assuming the facts are as he alleges (Twombly-Iqbal
a district court may not consider any material beyond the
pleadings in ruling on a Rule 12(b)(6) motion. However,
material which is properly submitted as part of the complaint
may be considered on a motion to dismiss.” Hal
Roach Studios, Inc. v. Richard Feiner & Co., 896
F.2d 1542, 1555 n.19 (9th Cir. 1990) (citation omitted).
Similarly, “documents whose contents are alleged in a
complaint and whose authenticity no party questions, but
which are not physically attached to the pleading, may be
considered in ruling on a Rule 12(b)(6) motion to
dismiss” without converting the motion to dismiss into
a motion for summary judgment. Branch v. Tunnell, 14
F.3d 449, 454 (9th Cir. 1994). Moreover, under Federal Rule
of Evidence 201, a court may take judicial notice of
“matters of public record.” Mack v. S. Bay
Beer Distribs., Inc., 798 F.2d 1279, 1282 (9th Cir.
1986). Otherwise, if the district court considers materials
outside of the pleadings, the motion to dismiss is converted
into a motion for summary judgment. See Arpin v. Santa
Clara Valley Transp. Agency, 261 F.3d 912, 925 (9th Cir.
Direct Infringement of the ‘818 Patent
‘818 Patent claims “[a] video game system . . .
which includes a wireless game controller which stores
information about the user of the controller.”
(‘818 Patent Abstract, ECF No. 64-2 at 3.) The
‘818 Patent has thirteen independent claims and twenty
dependent claims. (See Id. at 5:40-8:64, ECF No.
64-2 at 9-10.) Plaintiffs allege infringement of “at
least claims 1, 16, 20, 21, 24, 31, and 32.” (Am.
Compl. ¶ 20, ECF No. 64.) The Amended Complaint focuses
solely on the alleged infringement of Claim 20 “by way
of example, ” although the Court finds that all of the
asserted claims broadly contain certain essential elements:
(1) a game controller or hand-held device, (2) which
wirelessly transmits information (3) to a processor executing
a game, (4) which authorizes game play based at least in part
on the age of the player. (See ‘818 Patent
5:40-59, 6:61-7:10, 7:25-40, 7:46-54, 8:34-49, ECF No. 64-2
after amendment, Plaintiffs' claim of direct infringement
of the ‘818 Patent is sufficient to survive the motion
to dismiss. The allegations, including screenshots of
Defendant's online casino games, descriptions of how
Defendant's products allegedly work, and assertions of
testing, use, and demonstration of the ‘818 Patent, are
enough to make Plaintiffs' legal theory clear and
definite: By using smartphones, tablets, or personal
computers to test its products and demonstrate them at
promotional events, Defendants infringed the ‘818
Patent. Under this theory, these various electronic devices
would constitute the “controllers” described in
the Patent, and would wirelessly transmit information to a
remote processor executing Defendant's casino games.
Plaintiffs have specifically and plausibly pled
Defendant's use of the ‘818 Patent in testing,
promoting, and demonstrating its products, and the
screenshots are enough to show that game play is indeed
authorized “based at least in part on the age of the
player, ” and that “a plurality of input controls
. . . allow the player to interact with the processor.”
(See Am. Compl. ¶¶ 34-35, ECF No. 64.)
Indeed, Plaintiffs specifically allege that prior to
gameplay, “each user must confirm they are at least 13
years of age to create and register an account with Zynga by
agreeing to Zynga's Terms of Service.”
(Id. at ¶ 34.) After confirming their age and
registering an account, users must enter a unique username
and password to log in and play, which could reasonably
constitute the “identification code” required by
the ‘818 Patent's claims. Furthermore,