Published: June 27, 2024

Federal Court’s Ruling Strengthens ‘Public Domain’ Status Of Geolocation Technology For Online Gambling

If you take some time to look through the enormous catalog of patents the United States government has granted over the course of nearly two and a half centuries, you’ll find some interesting concepts, to put it kindly.

A general concept in that nebulous task of deciding whether to grant a patent and what exactly the patent is for is that you can’t patent an abstract idea. The "whats-it” you apply to the patent must exist in the corporeal realm, and it must serve a demonstrable purpose.

According to the most recent court to consider the complaint, that abstract idea concept was the cause of a recent challenge to the operation of several regulated US online casinos. The resulting decision should give the operators of those casinos additional confidence to move forward in the US.

Beteiro v. DraftKings, et al challenged online casinos’ use of geolocation tech

The matter at issue is Beteiro v. DraftKings, et al. Beteiro is a Texas corporation that develops technology for gaming activities. Among the defendants in this lawsuit were:

  • DraftKings
  • Entain
  • Kindred
  • PointsBet

All of those companies either are or have been involved in operating licensed online casino products in at least one state. Beteiro originally filed the complaint in the federal district court for New Jersey on Nov. 22, 2021.

Among its allegations was that the defendants infringed upon several of Beteiro’s patents related to the geolocation of individuals accessing online gambling platforms. However, on Sept. 7, 2022, the district court granted the defendants’ petition to dismiss the case entirely, stating that it found the subject matter of Beteiro’s patent claims ineligible for protection and thus, Beteiro failed to make an acceptable claim to the court.

In simpler language, what Beteiro was trying to argue that it had patents for was too indefinite for the court to render an opinion on whether the defendants’ technology had violated a patent for or not. Because Beteiro had no other argument for how it had been wronged to the point the court needed to intervene, there was no case.

On Sept. 29, 2022, Beteiro appealed that decision to the US Court of Appeals for the Federal Circuit. That was to no avail, however, as the circuit court affirmed the district court’s ruling on June 21, 2024.

Appellate court strengthens district court’s ruling

From the perspective of 20/20 hindsight, Beteiro probably would have been better off not appealing this matter. The appellate court’s involvement only strengthened precedent against future similar claims by Beteiro.

The appellate court reviewed the district court’s application of the Alice/Mayo test for patent infringement claims and agreed with the analysis. That test is the standard for reviewing such claims.

For example, the appellate court agreed "with the district court that Beteiro’s claims are directed to the abstract idea of ‘exchanging information concerning a bet and allowing or disallowing the bet based on where the user is located.'” Furthermore, the appellate court deemed Beteiro’s claims as "drafted using largely (if not entirely) result-focused functional language, containing no specificity about how the purported invention achieves those results.'”

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