Boston-Based DraftKings Faces Patent Infringement Lawsuit

• DFS Contest and Sports Betting Operator DraftKings Accused of Patent Infringement
• Engine Media alleges infringement of patents owned by its subsidiary, Winview
• DraftKings Could Argue Patent Applies to Feed of Event, Not Event Itself

On Wednesday, gaming company Engine Media filed a lawsuit against Boston-based DraftKings, accusing the daily fantasy sports contest and sports betting operator of infringing on two key patents owned by one of its three subsidiaries, Winview Games.

The suit, filed with the District Court in New Jersey, claims DraftKings has been using solutions to solve common issues in online sports betting that are too similar to the proprietary ones created and owned by Winview.

The patents in question attempt to create an online sports betting environment where all live bettors see the same odds at the same time as well as prevent some bettors from seeing live sporting action before the betting operators do, a phenomenon known as “past-posting.”

DFS Contest and Sports Betting Operator DraftKings Accused of Patent Infringement

Engine Media alleges infringement of patents owned by subsidiary Winview

The lawsuit alleges that “various gaming services provided by DraftKings” infringe on these two Winview US Patents:

• The ‘243 Patent, which creates a usable “methodology for equalizing systemic latencies in TV Reception” so that all live bettors see odds at the same time regardless of any lag time in the broadcast.
• The ‘543 Patent, which provides a “method of and system for managing client resources and assets for activities on computing devices,” also known as geolocation, or identifying the geographic location of users.

Solving these issues is vital to reputable online sports betting and, according to the lawsuit, these Winview patents keep the playing field fair:

Recognizing that these latencies in receipt of broadcast content need to be accommodated in order to maintain user enjoyment and fairness for all participants, the inventors described and claimed technical solutions to these problems.

However, from DraftKings’ perspective, at issue is whether these exclusive rights apply to the feed of the event or the event itself, a fundamental difference that could make or break Winview’s legal argument.

DraftKings Could Argue Patent Applies to Feed of Event, Not Event Itself

Some industry experts have pointed out that because these Winview patents technically apply to the feed of the event and not the event itself, DraftKings could argue that their markets are based on the sporting event itself and therefore aren’t covered by the patents.

In other words, no profitable betting operator would base their markets on the television feed since there is no telling whether “live” broadcasts are being affected by “systemic latency,” giving bettors a possible advantage if they see the action before whoever is setting the odds does.

Regardless, Tom Rogers, executive chairman of Engine Media, believes this lawsuit is worth pursuing, telling the media:

We will continue assessing how we can protect our intellectual property.

Since DraftKings is probably not the only betting operator using “similar solutions” to these common problems, expect whatever outcome this lawsuit creates to affect the online sports betting industry as a whole.