By Sagar V. Mankar 
The computing giant IBM and video game powerhouse Take-Two Interactive have officially ended their patent infringement lawsuit.
According to Reuters, both companies jointly notified a Delaware federal court on December 31 about IBM’s voluntary dismissal of the case “with prejudice.” This legal term indicates that IBM cannot bring the same claims against Take-Two again in the future.
The legal dispute, which began in September, centered around several key technologies that IBM claimed Take-Two had used without proper authorization. At the heart of the controversy were Take-Two’s popular gaming franchises, including NBA 2K, Grand Theft Auto, and Red Dead Redemption, along with their game launcher platform. IBM alleged that these products violated their patents in three main areas: web advertising systems, virtual world technologies, and user authentication methods.
IBM claims that Take-Two has been using these patented technologies without proper licensing. IBM argued that these technologies originated from their Prodigy service, an early internet platform launched in the late 1980s (before the World Wide Web – WWW).
IBM is no stranger to such legal disputes. Over the years, the tech giant has pursued patent infringement cases against companies like Zynga, Chewy, Groupon, and Rakuten, with most cases concluding in settlements or significant financial awards. For example, IBM secured a $57 million settlement with Groupon following an $83 million jury verdict. Similarly, the company won a $45 million jury verdict against Zynga, which was later acquired by Take-Two in 2022.
Details of the Infringed Patents
The ‘849 Patent – Web Advertising System
IBM claimed Take-Two infringed this patent through the Rockstar Games Launcher and store (www.store.rockstargames.com) by:
- Presenting advertising obtained from a computer network
- Structuring applications to be displayed in one portion of the screen
- Structuring advertising (like microtransaction offers) to be shown concurrently with applications in another portion of the screen
- Configuring ads as objects (using .jpg format)
- Selectively storing advertising objects in a local cache
The ‘704 Patent – User Authentication
IBM alleged infringement through NBA 2K Mobile Basketball and Rockstar Social Club website by:
- Using multiple authentication methods that generate security contexts
- Specifically, how the games handle login systems with:
- Facebook and Games Center authentication for NBA 2K Mobile
- Epic Games and Google authentication for Rockstar Social Club
- Creating aggregate security contexts when users authenticate through multiple services
The ‘209 Patent – Virtual World Systems
IBM claimed Take-Two violated this patent specifically through Red Dead Online by implementing:
- A virtual world query response system
- Features like fast travel requests to particular sessions
- Searching a “shard database” (servers hosting different game sessions)
- Managing custom shards (specific game sessions) with associated content
- Returning entry points to clients for accessing specific game sessions
- Maintaining databases of connected players in each session
IBM emphasized that they had attempted to engage Take-Two in licensing discussions since 2021, but according to IBM’s complaint, Take-Two “chose to continue to support Zynga’s efforts to avoid culpability for its willful infringement” instead of engaging in “productive business discussions.”
Although IBM extended an invitation for licensing discussions earlier this year, no satisfactory agreement was reached. This breakdown in communication ultimately led IBM to file the lawsuit in September 2024.
The joint dismissal filing doesn’t reveal whether any financial compensation or licensing agreements were part of the resolution, as both companies’ representatives declined to comment on the matter.
Sources: Reuters