Activision sued for patent infringement over fantasy sports software (Update)

Activision Blizzard Inc. is being sued for possible patent infringement, and the patents in question suggest a possible new direction for the company: fantasy sports.

Texas-based Virtual Gaming Technologies, LLC, filed the case yesterday in U.S. District Court for the Eastern District of Texas, claiming Activision is infringing on patents it owns for "real-time interaction systems" most used in fantasy sports games. The technology covered by those patents involves giving fantasy sports players access to updated information about their players' performances during live, ongoing contests.

Virtual Gaming contends that Activision is illegally using processes invented by William Junkin, a pioneer in the field of fantasy sports. Their complaint notes Junkin founded a popular fantasy gaming league in the 1990s and that real-time scoring technologies are now broadly used by the vast majority of games in the genre. His patents are now owned by Virtual Gaming, which has licensed them to large video game companies including Electronic Arts, Konami, Microsoft and Sony.

Activision, the documents state, has appropriated the widely used systems for a mostly unspecified series of products. One game the plaintiff does name, however, is NASCAR: The Game: Inside Line, developed by Eutechnyx and published in 2012 for PlayStation 3, Wii and Xbox 360. That game features performance statistics and data culled from actual racing league records, but according to Virtual Gaming Technologies, it also implements Junkin's real-time scoring system. The lawsuit says Activision does so knowingly and with no regard to Virtual Gaming's rights.

Activision isn't known to be involved in fantasy sports

What's most notable here is that the specificity and popularity of the technologies to the realm of fantasy sports — which Activision currently has no direct ties to — suggests a shift toward that genre for the company. The documents repeatedly reference how integral the real-time score updating and interaction affordances of Junkin's patents are to a majority of fantasy sports leagues, even citing a competitor to further underline this point.

Activision currently publishes no sports video games licensed by any real world league or promotion. Its last such title was a version of Inside Line for Windows PC in 2013. That series has since passed to two different publishers.

"A large percentage of our users, when they play, are watching their team and their opponents [sic] team, and it gets very exciting with everything updating live and as fast as possible," Mark Nerenberg, chief product officer of DraftStreet.com, said in a statement included in the filing.

Junkin's creations enabled players online to become more directly involved with fantasy sports, which Virtual Gaming Technologies claims played a large role in increasing the genre's popularity.

"Fantasy sports has become a $27 billion business due to the excitement provided by advanced interactive gaming systems such as those invented by Mr. Junkin," the lawsuit says. Prior to Junkin's implementation of real-time interactive scoring systems and databases to his own FantaSports, the concept held more water offline than on.

Now, numerous sites using Junkin's work have entered the increasingly popular fantasy sports space on the internet, and Sony, Microsoft and other major gaming companies have made their own attempts to break into the lucrative market. Activision has not confirmed plans to do so itself; instead, it recently announced it would be taking a more pronounced stab at esports, an arena it already is a major player in.

"Fantasy sports has become a $27 billion business"

The company's new esports division, as revealed in October, will exist as a third subsidiary, co-existing with Activision Publishing and Blizzard Entertainment. Not much is known about how the division will operate, but the involvement of former Major League Gaming president Steve Bornstein, who also was the former chief executive of ESPN, has its own implications for the company's plans. With popular esports titles like Heroes of the Storm and StarCraft in its portfolio, Activision Blizzard is no stranger to success in the genre.

That's not to suggest Activision has no intention to try out other, different media. At BlizzCon 2015 in November, the company announced that it would be producing films and television shows, including one based on the Call of Duty franchise.

We've reached out to Activision for comment regarding its involvement in the lawsuit, as well as any plans it has for fantasy sports, and will update this story with any reply.

Update: Virtual Gaming Technologies has also filed lawsuits against Electronic Arts, Zynga, Take-Two Interactive (the parent company of 2K Sports and 2K Games) and Konami, alleging the same infringement as in the Activision lawsuit. Additionally, GamesIndustry.biz reports that Virtual Gaming, was founded in Texas in late September and has since filed 16 lawsuits in federal court. Federal court for the Eastern District of Texas is a notorious jurisdiction for patent litigation.