Last November, slot machine maker PPT LLC, (d/b/a High 5 Games) filed a lawsuit against its rival, Gimme Games, alleging that the defendant’s CEO, Daniel Marks, used a trade secret algorithm to create slot machines. Gimme Games requested the case be dismissed due to an expired patent that disclosed the trade secret, but U.S. District Judge Jose L. Linares refused on the grounds that PPT LLC “sufficiently” pled its case.
Mr. Marks is a former employee of High 5 Games, thus had exclusive knowledge of the patented algorithms used by the slot machine maker. Marks served as Managing Member and Lead Games Designer for the company before ending his tenure with PPT to undertake a new position with the Australian-based slot machine maker, Aristocrat Technologies Inc. Aristocrat appointed Daniel Marks to play the role of CEO at his own third-party distributor, Gimme Games.
Entitled PTT LLC v. Gimmie Games et al., (case# 2:13-cv-07161), the lawsuit is being argued in the U.S. District Court for the District of New Jersey. PPT brought four allegations against the defendants, including “(1) Misappropriation under the New Jersey Trade Secret Act, (2) Unfair Competition under 15 U.S.C. § 1125 (a), (3) Unfair Competition under New Jersey Common Law, and (4) Breach of Contract.” PPT claims that new slot machine makers ‘Mega Symbols’ games are a direct infringement of High 5 Games’ patented algorithms.
Gimme Games responded by requesting a dismissal of the case on the grounds that the patent for PPT’s ‘Super Stacks’ slot machines had been abandoned, thereby disclosing the algorithm. PPT fired back in October by stating that its Super Stacks series does not reveal the trade secret in question. While the judge rejected the request for dismissal, he also discarded the plaintiff’s subsequent request for an injunction.
PPT filed for the injunction against Gimme Games last month, but Judge Linares found that the plaintiff was unable to provide evidence of present or future harm, but more importantly that the slot machine makers delay in filing the injunction was inexcusable. PPT claimed to be aware of the trade secret contract breech as early as September of 2013, yet they waited 2 months to file a lawsuit, and another 11 months to file for the injunction. PPT was unable to substantiate a viable reason for the delay, resulting in the judge’s refusal to grant relief.
In PPT’s favor, Judge Linares said last Friday, November 7th, “The court finds that the complaint sufficiently alleges the existence of the algorithms as a trade secret.” As such, the slot machine maker’s allegations of unfair competition, patent infringement and breach of contract will be upheld, and the case against Gimme Games will be heard.
As for PPT LLC’s denied request for injunction, the slot machine maker has been given 30 days (until December 6th) to amend its complaint, correcting the deficiencies in the plea. If PPT can prove just cause for an injunction by then, the judge could still rule that Gimme Games may no longer produce or make available any of its land-based or online slots until the court proceedings are finalized.