Patent Troll Stalks Social Gaming Industry Over Virtual Payments

Fremont Troll

A new patent troll announced its arrival this week by suing companies like Facebook, Zynga and Playfish. Its weapon is a patent that it claims applies to buying and selling goods in games like Barn Buddy and Mafia Wars.

In a series of lawsuits filed in San Diego federal court, Gametek LLC asked a judge to rule that the gaming companies are infringing US Patent No. 7076445. As is typical, the lawsuit uses complicated jargon to describe the patent:

The various claims of the ‘445 patent cover, inter alia, a method of managing a game comprising displaying a plurality of game objects, determining if the user has sufficient consideration to purchase a game object, presenting an offer to purchase the game object dependent upon parameters comprising the tracked activity of the user and the indication that the user has sufficient consideration, permitting the user to purchase the game object without interrupting the game, supplying the purchased game object to the user without interrupting the game, and incorporating the game object into the game

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In plain English, though, the patent would seem to cover the common practice of using virtual currency to obtain items in a game. A patent application was filed in 2000 and the patent itself was granted in 2006.

Last year, the patent was assigned to Theados Corporation, a Maryland firm serving video game developers and building “the world’s first revenue operating system.” The firm in turn transferred the patent to a California shell company called Gametek LLC which is acting as a vehicle for the lawsuits.

The lawsuits list a who’s who of the social gaming world, including Six Waves, Crowdstar, Rock You, Electronic Arts (NSDQ: ERTS) and Funzio.

The nature of the lawsuit reflects an ongoing trend in which non-practicing entities, known pejoratively as “patent trolls,” make a business of acquiring patents and suing companies engaged in real businesses.

While Congress passed patent reform legislation last year that was intended to mitigate the patent troll problem, the new law largely affects only newly granted patents. In the meantime, there has been an uptick of troll suits as billionaire funds invest in the lawsuits. The Wall Street Journal (NSDQ: NWS) reported earlier this year that some of the country’s top patent lawyers are quitting their firms to become trolls.

A sample complaint from Gametek is below.

Gametek Uses Social Gaming Industry

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