Skillz founder and CEO Andrew Paradise testified during the opening day of the company’s trial against AviaGames that the competitor stole its patent-protected gaming platform. He alleged they modified it to violate its operating terms.
Paradise and three coinventors acquired a patent — referred to in the legal case as the “‘564 Patent” — in May 2017. The patent is for a skill-based peer-to-peer wagering platform. The patent covers the technology of pairing first-time players and repeat players of similar skill sets based on their user metrics.
During direct examination by his attorney, Lazar Raynal, last Friday in Northern California’s U.S. District Court, Paradise testified that Skillz is primarily a business-to-business-to-consumer company that licenses its platform to game developers. The Skillz platform, he said, allows developers to agree to the software’s licensing terms and easily begin marketing their games and participating in a revenue share of the proceeds the game generates.
Paradise says AviaGames sought to lease the Skillz gaming platform for its own turnkey platform. The Skillz CEO said the company agreed to lend the patented “software development kit” (SDK) to Avia.
Platform Modifications
During his testimony, Paradise said Skillz decided to lend the patent to Avia because of the Hong Kong-based company’s proficiency in developing skill games.
Generally, we wouldn’t negotiate with a game company,” Paradise said. “Their CEO, Vickie [Chen], is a pretty sophisticated games person [with a] track record of promotions in gaming and an MBA at Cornell.”
Paradise said game developers that simply place their app on the Skillz platform after agreeing to the terms receive 50% of the game’s revenue. For instance, if each player stakes $2.50 on a solitaire game, the prize is $4.50, and Skillz and the developer pocket 50 cents each.
AviaGames, however, negotiated a 70% revenue share. Paradise said Skillz agreed to those terms because the company thought Avia could help market the Skillz platform.
The concept of a company negotiating with us and getting enablement and getting a better rev share is really about the business resources they can bring to the platform, typically marketing, as well as acumen in building games,” Paradise explained.
Soon after receiving the patented platform SDK, Paradise and Skillz allege in their lawsuit that Avia cloned the skill gaming technology, stole numerous games, and manipulated the patented player-pairing algorithm.
Specifically, the Skillz lawsuit alleges that Avia used computer bots instead of like-skilled real humans to compete against its customers.
Opening Defense
AviaGames has denied any wrongdoing. The company’s attorney, Jerry Riedinger, said “There’s more to the story” than what the plaintiffs contend.
Riedinger said during his opening statement that AviaGames doesn’t use bots, but instead, developed a way that allows players to compete against one another without playing simultaneously.
“You’re going to learn about historical playthroughs. It’s where you have players playing at a different time. One player playing a match against someone who played earlier. Both of them are real people. Both of them played real games, just one played the game earlier,” Riedinger declared.
The attorney says Avia solved Skillz’s player liquidity problem that results in players often waiting to be paired through the platform.
“Skillz doesn’t like the fact that we solved the problem,” Riedinger asserted. The attorney went on to say that Avia hasn’t infringed on Skillz’s patent because Avia isn’t using the player-pairing technology that was the leading reason for the patent issuance in the first place.
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