Nintendo of America, Inc. v. Magnavox Co.

Sanders Associates, Inc. (Sanders) (defendant) owned the ’507 patent and the ’305 patent, reissues of the ’284 and ’095 patents, respectively. Sanders granted Magnavox Co. (defendant) an exclusive license for the patents. The claims detailed an apparatus that displayed a game format in which players moved objects on a screen and attempted to intercept and reverse a ball’s travel path. The claims described the means for generating various hit and hitting symbols and spots, for ascertaining coincidence, and for imparting a distinct motion to hit spots upon coincidence. Nintendo of America, Inc. (Nintendo) (plaintiff) filed suit against Magnavox, seeking a declaration of invalidity of Magnavox’s patents due to alleged inequitable conduct during the patent-application process. Magnavox filed counterclaims for patent infringement. Nintendo alleged several instances of inequitable conduct. However, Nintendo’s primary assertion was that Magnavox failed to properly disclose material prior art to the United States Patent and Trademark Office (PTO) during the application process. Nintendo claimed that one of Magnavox’s attorneys, James Williams, witnessed a demonstration of the Space War video game while he attended undergraduate school at Stanford University and intentionally hid the game’s existence from the PTO. Space War involved two player-controlled spaceships that launched torpedoes at one another. Testimony established that Williams witnessed the game 11 years prior to the relevant patent application and had forgotten many key aspects of the game that would correspond to the relevant patent claims, such as Space War’s representations of hit spots and imparting distinct motion on coincidence. Williams had discussed his recollection with his co-counsel during the application process and chose not to cite the game to the PTO because Williams’s recollection had not indicated that any aspect of Space War was material to the application. The court found that the other conduct under consideration demonstrated negligence at best and did not constitute inequitable conduct. The court then addressed the nondisclosure of Space War.