AG 18, LLC v. DRAFTKINGS INC.

This patent infringement lawsuit pits AG 18, LLC, the owner of the asserted patent, against DraftKings Inc., a prominent American digital sports entertainment and gaming operator. DraftKings, headquartered in Boston, offers online sports betting, daily fantasy sports, and iGaming products across the United States. The plaintiff, AG 18, LLC, appears to be a patent assertion entity, a type of firm that acquires patents to generate revenue through litigation and licensing rather than producing its own goods or services, a common model in patent monetization. The accused technology is core to DraftKings' business: its online and mobile sports betting and gaming platforms, which must verify a user's physical location to comply with state-by-state gambling regulations. The lawsuit asserts infringement of U.S. Patent No. 9,978,205, which is titled “Location Based Restrictions on Networked Gaming” and claims methods for restricting a player’s online wagering activity based on their geographic location.

The case was filed in the U.S. District Court for the District of New Jersey (D.N.J.), a significant and popular venue for patent litigation due to its experienced judiciary and specialized local patent rules designed to streamline complex cases. The matter was assigned to Judge Kevin McNulty. This venue is particularly relevant as DraftKings first launched its legal online sportsbook in New Jersey in 2018 following the Supreme Court's repeal of the federal ban on sports betting. The case is notable for its direct implications on the burgeoning U.S. online gambling industry, as the patent covers a fundamental compliance mechanism (geolocation) required for legal operation.

A critical aspect of this dispute is the parallel challenge to the patent's validity at the U.S. Patent and Trademark Office's Patent Trial and Appeal Board (PTAB). DraftKings filed an inter partes review (IPR) petition seeking to invalidate the '205 patent. In that proceeding, the PTAB found most of the patent's claims (1-17 and 19-30) to be unpatentable. However, claim 18, which relates to a gaming system where wagering limits convert to non-monetary wagering, survived the challenge. DraftKings appealed this finding, but in a very recent decision on May 6, 2026, the U.S. Court of Appeals for the Federal Circuit affirmed the PTAB's ruling, upholding the validity of claim 18. This appellate decision is a significant victory for AG 18, LLC, as it solidifies the enforceability of at least one claim and allows the district court litigation, which was likely stayed pending the appeal, to move forward with a validated patent claim.

A detailed analysis of the legal developments in AG 18, LLC v. DRAFTKINGS INC. reveals a case heavily influenced by parallel proceedings at the Patent Trial and Appeal Board (PTAB), a common scenario in modern patent litigation. The district court case was ultimately stayed pending the outcome of a PTAB review and a subsequent appeal to the Federal Circuit, which only recently concluded.

Filing and Initial Pleadings

The lawsuit commenced on 2021-08-19, when AG 18, LLC filed a patent infringement complaint against DraftKings Inc. in the U.S. District Court for the District of New Jersey. On the same day, AG 18 filed an amended complaint. The asserted patent is U.S. Patent No. 9,978,205, which relates to technology for location-based restrictions in networked gaming. DraftKings filed an answer and counterclaims, to which AG 18 replied on 2021-11-19.

Parallel PTAB Proceedings and Motion to Stay

The trajectory of the district court litigation was significantly altered by DraftKings' decision to challenge the validity of the '205 patent at the U.S. Patent and Trademark Office. DraftKings filed a petition for inter partes review (IPR) against all claims of the patent.

This led DraftKings to file a motion to stay the district court case pending the PTAB's review. On 2023-03-28, counsel for DraftKings informed the court that the PTAB had instituted an IPR against the '205 patent. Following this development, Magistrate Judge Jessica S. Allen issued an order on 2023-04-03 granting the motion to stay all proceedings pending the outcome of the IPR. The court reasoned that the PTAB's decision could simplify or even moot the issues before the court. The order specified that a potential further stay pending any appeals would be considered after the IPR concluded. Concurrent with the stay order, the case was administratively terminated, a procedural closure that allows the case to be reopened without prejudice pending the resolution of the parallel proceedings.

PTAB and Federal Circuit Outcomes

The IPR proceeding had a major impact on the scope of the dispute. The PTAB issued a final written decision finding claims 1–17 and 19–30 of the '205 patent unpatentable. However, the PTAB determined that DraftKings had failed to prove that claim 18 was unpatentable. The board found that DraftKings had improperly attempted to introduce a new prior art reference against claim 18 for the first time in its reply brief, a theory that was not present in its initial petition.

DraftKings (as DK Crown Holdings Inc.) appealed the PTAB's decision regarding claim 18 to the U.S. Court of Appeals for the Federal Circuit. In a decision dated 2026-05-06, the Federal Circuit affirmed the PTAB's ruling. The appellate court agreed that DraftKings had waived its new argument against claim 18 by not including it in its IPR petition, emphasizing that reply briefs cannot be used to introduce new invalidity theories. This decision left claim 18 of the '205 patent as the only surviving claim from the IPR challenge.

Final Disposition and Present Posture

As of 2026-05-08, the district court case remains administratively closed. Following the Federal Circuit's recent decision affirming the PTAB's finding on claim 18, the stay of the district court litigation is subject to being lifted. AG 18, LLC now has a single, presumptively valid claim to assert against DraftKings.

The next steps will likely involve the parties jointly reporting the outcome of the appeal to the District of New Jersey and requesting that the case be reopened. The litigation will then proceed, but narrowed to the issue of whether DraftKings infringes claim 18 of the '205 patent. Given that 29 of the 30 original claims have been invalidated, the scope and potential damages in the case have been significantly reduced, which could pave the way for a settlement between the parties. However, no such settlement has been publicly reported. The case is effectively pending reopening to address the remaining single-claim dispute.

Based on a review of available public records, the specific attorneys representing plaintiff AG 18, LLC in this matter could not be definitively identified. Court docket information, which would list counsel of record, is primarily accessible through the U.S. District Court's PACER system and is not fully available via general web searches.

However, based on litigation patterns of similar patent assertion entities and the jurisdiction of the case, counsel for the plaintiff likely includes attorneys from a New Jersey-based law firm serving as local counsel, potentially alongside a national firm specializing in patent litigation serving as lead counsel.

Frequent filers of patent litigation in the District of New Jersey often retain firms with strong local intellectual property practices. For example, firms known for handling patent cases in this district include Cole Schotz P.C., which has a significant litigation department in New Jersey.

The lead counsel in such cases is often from a nationally recognized patent litigation firm. Firms like Irell & Manella LLP and Greenberg Traurig, LLP are frequently involved in high-stakes patent assertion campaigns across the country.

Without access to specific filings for this case, such as the complaint or notices of appearance, it is not possible to provide a verified list of the individual attorneys, their roles, and their litigation history for this specific matter.

Based on a review of the docket and other publicly available information, the following counsel have appeared on behalf of defendant DRAFTKINGS INC. in this matter. The team comprises attorneys from Baker Botts L.L.P. acting as lead counsel and Carella, Byrne, Cecchi, Brody & Agnello, P.C. as local counsel in New Jersey.

Lead Counsel

• Name: Andrew D. Wilson

  • Role: Lead Counsel
  • Firm: Baker Botts L.L.P. (Washington, D.C.)
  • Note: Mr. Wilson's practice focuses on high-tech patent litigation, and his firm biography explicitly lists his representation of DraftKings in this case and the parallel inter partes review (IPR) proceedings before the Patent Trial and Appeal Board (PTAB). He was recognized as "One to Watch" by The Best Lawyers in America in 2023.

• Name: Lindsey H. Taylor

  • Role: Of Counsel
  • Firm: Baker Botts L.L.P. (Office not definitively identified in search results)
  • Note: A letter filed on the docket regarding the PTAB review proceedings was submitted by Lindsey H. Taylor, indicating her involvement on behalf of the defendant. While multiple attorneys share this name, context suggests she is part of the Baker Botts team.

• Name: Halima Shukri Ndai

  • Role: Of Counsel (Admitted Pro Hac Vice)
  • Firm: Baker Botts L.L.P. (New York, NY)
  • Note: According to docket reports, Ms. Ndai was added as pro hac vice counsel to receive electronic filings as of February 21, 2023.

Local Counsel

• Name: James E. Cecchi
  • Role: Local Counsel
  • Firm: Carella, Byrne, Cecchi, Brody & Agnello, P.C. (Roseland, NJ)
  • Note: Mr. Cecchi, a Member of his firm, filed a notice of appearance early in the case. He leads the firm's prominent class action practice and has served as lead or co-lead counsel in major multidistrict litigation, including cases involving Volkswagen's "Clean Diesel" marketing and the national opioid crisis.