Merit Industries Inc. v. JVL Corp.
case number 03-1618 (E.D. Penn - Settled)

Merit Industries and JVL Corp. have settled their ongoing litigation over countertop arcade games. Merit sued JVL back in 2003 for patent infringement of U.S. Pat. Nos. 5,575,717; 5,743,799 and 6,082,887. Fastforward to June 2008, where a jury held that all of the asserted claims of the '799 patent (claims 1,3, and 7) were invalid, both for anticipation and obviousness. The jury judged five of the seven asserted claims in the '717 patent to be invalid, but rejected JVL's contention that four claims of the '887 patent were invalid due to indefiniteness. Thus, although the jury found infringement with respect to all three patents, JVL was liable only for infringement of the two valid claims of the '717 patent and the four asserted claims of the '887 patent.

The jury awarded Merit $1,616,123 in royalties for willful infringement of the patents, but denied the request for an injunction and $24 million in lost-profits on the ground that JVL discontinued the infringing products when the suit was filed in 2003. However, facing the possibility of treble damages (for willful infringement) anda demand for $6M in attorney fees, JVL settled with Merit for an undisclosed sum, and the case was dismissed on Sept. 8, 2008. The case is Merit Industries Inc. v. JVL Corp., case number 03-1618, in the U.S. District Court for the Eastern District of Pennsylvania.

The patents in suit covered a variety of features. For example, claim 1 of the '717 patent (
System for creating menu choices of video games on a display) reads:
1. An apparatus for providing menu choices of video games on a display, the apparatus comprising:

(a) a mode selector for setting the apparatus in one of either a programming mode for selecting video game menu options or a menu choice selection mode for selecting video game menu choices for game activation;

(b) a video display for displaying and selecting the video game menu options and video game menu choices, the video game menu options being available for selection as video game menu choices; and

(c) a display controller for simultaneously displaying video game menu options and video game menu choices on the video display when the mode selector is in the programming mode, and for displaying video game menu choices when the mode selector is in the menu choice selection mode.

Claim 1 of the '799 patent (
Method for setting game credits in a gaming machine and tallying a total currency amount fed into the machine) reads:
1. A method for tallying a total currency amount fed into a gaming machine which accepts a plurality of different types of coins, each coin type representing a different number of currency units, the method comprising the steps of:

(a) displaying a setup screen on a video display showing a representation of the plurality of different coin types and the total number of currency units associated with each coin type;

(b) selecting the total number of currency units to be associated with each coin type while displaying the setup screen, wherein the selection is made individually for each coin type, a coin type/currency unit ratio being established for each different type of coin; and

(c) tallying the total currency amount fed into the machine based upon the number of coins deposited in the gaming machine and the total number of currency units selected for each coin type.

And claim 1 of the '887 patent (
Game machine with automated tournament mode) reads:
1. An automated tournament system for use with a game machine, the game machine implementing the system when placed in a tournament mode, the system comprising:

(a) a plurality of tournament games playable by a plurality of players on the game machine, each of the plurality of tournament games generating a total player score upon completion of game play, the player scores being used to determine the tournament winners;

(b) means for preprogramming at least one sequence of tournament games from the plurality of tournament games; and

(c) means for programming a tournament period for each tournament game, the preprogrammed tournament game for each sequence being playable during the programmed tournament period for the respective sequence.

While the jury ultimately decided that some of the claims were invalid, without a final judgment in this case Merit's claims may just very well live to fight another day...
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