Sportvision, Inc v. MLB Advanced Media L.P.

Background

Sportvision, Inc. and SportsMEDIA Technology Corporation sued MLB Advanced Media, LP over an abandoned joint venture involving Sportvision’s PITCHf/x system for capturing, storing, and distributing pitch data from Major League Baseball games. The plaintiffs alleged that MLB Advanced Media stopped using PITCHf/x after the 2016 season, hired Sportvision’s former executive Ryan Zander, and used Sportvision’s trade secrets and intellectual property to develop a competing PITCHcast system.

The amended complaint asserted one patent-infringement claim, two trade-secret misappropriation claims, and six breach-of-contract claims. The patent claim was brought by SportsMEDIA Technology Corporation and alleged infringement of Claim 31 of U.S. Patent No. 7,341,530. The trade-secret and contract claims were brought by Sportvision.

Motion to Compel Arbitration

MLB Advanced Media asked the court to compel arbitration of the trade-secret and contract claims under Section 13.10 of the contract. That provision generally gave courts in New York exclusive authority over disputes arising from the agreement, but required arbitration of disputes concerning the operation of the joint venture, including certain budget, expense, revenue, marketing, and installation matters.

The court held that this was a narrow arbitration clause because it covered specific categories of disputes rather than every dispute arising from the contract. It ruled that the trade-secret claims were outside the clause. Those claims concerned MLB Advanced Media’s alleged handling of Sportvision’s confidential information, abandonment of the contract, and development of a competing product—not the operation of the joint venture.

The court also ruled that the breach-of-contract claims were outside the arbitration clause. Although resolving those claims might require interpreting the contract, the claims were based on the alleged abandonment of the agreement and the alleged use of Sportvision’s intellectual property to develop PITCHcast. The court therefore denied the motion to compel arbitration as to both the trade-secret and contract claims.

Motion to Dismiss the Patent Claim

MLB Advanced Media also moved to dismiss SportsMEDIA Technology Corporation’s patent-infringement claim. It argued that Claim 31 was invalid under Section 101 of the Patent Act because it claimed the abstract idea of collecting, analyzing, and displaying strike-zone information without an inventive step.

Applying the two-part framework commonly called the Alice test, the court first held that Claim 31 was directed to an abstract idea. The claim described determining the three-dimensional volume of a batter’s strike zone, converting that information into two-dimensional locations, and adding the strike-zone image to video in general terms. The court concluded that these steps involved collecting, analyzing, and presenting data, and that referring to baseball did not make the idea non-abstract.

At the second step, however, the court held that the plaintiffs had alleged enough to create a factual question about whether the claim contained an inventive concept. The plaintiffs alleged that their system could accurately determine a batter-specific strike zone and overlay it on live video, unlike earlier conventional systems that used a visual estimate or displayed the information only on replays. The court therefore denied the motion to dismiss the patent claim.

Disposition

Judge Paul G. Gardephe denied MLB Advanced Media’s motion to compel arbitration and denied its motion to dismiss. The opinion resolved the motions at the pleading and arbitration stage; it did not finally decide whether MLB Advanced Media misappropriated trade secrets, breached the contract, or infringed the patent.