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`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 1 of 41 PageID #:1
`Case: 1:04-cv-O6278 Document #: 1 Filed: 09/28/04 Page 1 of 41 PageID #:1
`
`UNITED STATES DISTRICT COURT
`
`NORTHERN DISTRICT OF ILLINOIS
`
`EASTERN DIVISION
`
`Trading Technologies International, Inc,
`
`Plaintiff,
`
`V.
`
`.
`Goldenberg, Hehrncyer & COW-U1
`
`-
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`'55.;
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`COMPLAINT FOR PATENT INFRINGEMENT AND JURY DE
`
`
`
`Plaintiff Trading Technologies
`
`International,
`
`Inc.
`
`(«:1
`93‘:
`
`£1,713
`h
`“E?
`(“Trading Technolbgies”)3’fore‘z—‘its
`m
`
`complaint against Defendant Goldenberg, Hehineyer 8: Co. (“GHCO”), states as Follows:
`
`PARTIES
`
`1.
`
`Plaintiff Trading Technologies is a Delaware Corporation with a principal place of"
`
`business at 222 South Riverside Plaza, Suite 1100, Chicago, Illinois 60606.
`
`2.‘
`
`Defendant GI-ICO is an Illinois general partnership with its principal place of
`
`business at 600 West Chicago Avenue, Chicago, Illinois 60610.
`
`JURISDICTION AND VENUE
`
`3.
`
`This is an action for patent infringement arising under the acts of Congress relating to
`
`patents, namely the Patent Laws of the United States, 35 U.S.C. §§ 1 et seq. This Court thereby has
`
`subject matter jurisdiction pursuant to 28 U.S.C. §§ 1331 and 1338(a).
`
`4.
`
`Defendant GHCD regularly conducts business in this district and. has its headquarters
`
`located in this district. Defendant GHCO uses trading software that provides access to exchanges in
`
`
`
`‘\
`
`

`

`11
`
`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 2 of 41 PageID #:2
`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 2 of 41 PageID #:2
`
`this district, including the Chicago Board of Trade (“CBOT”) and the Chicago Mercantile Exchange
`
`(“CME”). This Court has jurisdiction generally over Defendant GHCO.
`
`5.
`
`Defendant GHCD has committed and continues
`
`to commit acts of patent
`
`infringement in this district. Therefore, this Court has specific jurisdiction over Defendant GHCD.
`
`6.
`
`Defendant GHCO resides in this district, because it is subject to personal jurisdiction
`
`in this district. Therefore, this District is a proper venue pursuant to 28 U.S.C. §§ 1391(b) and
`
`1400(b).
`
`INFRINGEMENT OF US. PATENT NO. 6,766,304
`
`CDUNT I:
`
`7.
`
`Plaintiff Trading Technologies is the owner of US. Patent No. 6,766,304 (“the ’304
`
`patent"), titled “Click Based Trading with Intuitive Grid Display of Market Dcpth,” which issued on
`
`July 20, 2004. A true and correct copy of the ”304 patent is attached as Exhibit A.
`
`8.
`
`Plaintiff Trading Technologies is in compliance with any applicable marking and
`
`notice provisions of 35 U.S.C. § 287.
`
`9.
`
`Defendant GHCO has and continues to infiinge the ’304 patent by making, using,
`
`selling andfor offering for sale products and methods covered by claims of the ’304 patent without
`
`Plaintiff Trading Technologies’ authorization in violation of 35 U.S.C. § 271(a).
`
`10.
`
`In addition, Defendant GHCO’s actions have and continue to constitute active
`
`inducement of andfor contributory infringement of the ’304 patent in violation of 35 U.S.C. §27l(b)
`
`and (c).
`
`14.
`
`15.
`
`Defendant GHCO’s future infringement of the '304 patent is willful and deliberate.
`
`Defendant GHCO’s infringement of the ’304 patent has caused irreparable harm to
`
`Plaintiff Trading Technologies and will continue to do so unless enjoined.
`
`
`
`

`

`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 3 of 41 PageID #:3
`Case: 1:04-cv-O6278 Document #: 1 Filed: 09/28/04 Page 3 of 41 PageID #:3
`
`INFRINGEMENT 0F U.S. PATENT N0. 6,772,132
`
`COUNT II:
`
`16.
`
`Plaintiff Trading Technologies incorporates paragraphs 1-15 as if set forth in full.
`
`17.
`
`Plaintiff Trading Technologies is the owner of US. Patent No. 6,772,132 (“the ’132
`
`patent"), titled “Click Based Trading with Intuitive Grid Display of Market Depth,” which issued on
`
`August 3, 2004. A true and correct cop}r of the ’132 patent is attached as Exhibit B.
`
`'19.
`
`Plaintiff Trading Technologies is in compliance with any applicable marking and
`
`notice provisions of 35 U.S.C. § 287.
`
`20.
`
`Defendant GHCCI has and continues to infringe the ’132 patent by making, using,
`
`selling and/or offering for sale products and methods covered by claims of the ’132 patent without
`
`Plaintiff Trading Technologies’ authorization in violation. of 35 U.S.C. § 271(a).
`
`22.
`
`Defendant GHCO’S actions have and continue to constitute active inducement of
`
`andIor contributory infringement of the ’132 patent in violation of 35 U.S.C. §27l(b) and (c).
`
`23.
`
`Defendant GHCO’s future infringement of the "132 patent is willful and deliberate.
`
`24.
`
`Defendant GHCD’s infringement of the ’132 patent has caused inoperable harm to
`
`Plaintiff Trading Technologies and will continue to do so unless enjoined.
`
`RELIEF REQUESTED
`
`THEREFORE, Plaintiff Trading Technologies prays for jUdgment and. relief including:
`
`(A)
`
`Judgment that Defendant GHCO has been and is infringing one or more of the claims
`
`of the ”304 and ’132 patents pursuant to 35 U.S.C. §§ 271(a), (b) and/or (c);
`
`
`
`

`

`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 4 of 41 PageID #:4
`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 4 of 41 PageID #:4
`
`(B)
`
`A preliminary and permanent injunction enjoining Defendant GHCC) and its officers,
`
`agents, servants, employees, attorneys, related business entities and those in active concert or
`
`participation with them from infringing the ’304 and ’132 patents;
`
`(C)
`
`An award of damages incurred by Plaintiff Trading Technologies as a result of”
`
`Defendant GHCO’s infringement of the ”304 and ’132 patents;
`
`(D)
`
`An award trebling the damages pursuant to 35 U.S.C. § 284 as a result of Defendant
`
`GHCO’s willful infringement of the ’304 and ’132 patents;
`
`(E)
`
`An assessment of costs, including reasonable attomey fees pursuant to 35 U.S.C. § 285,
`
`and prej udgment interest against Defendant GHCD; and
`
`(F)
`
`Such other and further relief as this Court may deem just and proper.
`
`JURY DEMAND
`
`Plaintiff Trading Technologies demands trial byjury on all issues so triable.
`
`
`
` . ifs 'r No. 6180462)
`
`
`.
`" igmond, Jr. (ID No. 6204980)
`Matthew J. Sampson (113 No. 6207606)
`McDonnell Boelmen Hulbert & Berghoff LLP
`300 South Wacker Drive
`
`Chicago, Illinois 60606
`Tel.: (312) 913—0001
`Fax: (312.) 913-0002
`
`
`
`

`

`-'
`
`-
`
`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 5 of 41 PageID #:5
`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 5 of 41 PageID #:5
`
`Steven F. Borsand (ID No. 6206597)
`Trading Technologies International, Inc.
`222 South Riverside
`
`Suite I 100
`
`Chicago, Illinois 60606
`Tel: (312) 476-1000
`Fax: (312) 476-1182
`
`Attorneys for Plaintiff,
`TRADING TECHNOLOGIES
`
`INTERNATIONAL, INC.
`
`
`
`

`

`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 6 of 41 PageID #:6
`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 6 of 41 PageiD #:6
`
`ExhibitA
`
`
`
`

`

`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 7 of 41 PageID #:7
`Case: 1:O4-cv-O6278 Document #: 1 Filed: 09/28/04 Page 7 of 41 PageID #:7
`|||||l|l|l|ll|||||l|l|||||||l||l||||||||l|llll||l||||llllll|l||||||||||||
`
`U5000766304132
`
`(15) United States Patent
`Kemp, II at al.
`
`(10) Patent No.1
`(45) Date 01' Patent:
`
`US 6,766,304 B2
`Jul. 20, 2004
`
`CLICK BASED TRADING WITH IN'I‘UITIVE
`GRID DISPLAY OF MARKET DEPTH
`
`5,774,377 A
`5,793,301 A
`
`6/1998 Patterson, Jr. et a1.
`11/1998 Patterson, Ir. ct :11.
`
`W0
`W0
`W0
`W0
`W0
`W0
`W0
`W0
`W0
`W0
`W0
`
`(List euntinued 0n next page.)
`FOREIGN PATENT DOCU MENTS
`
`W0 98/496219
`W0 99/191321
`W0 99/510259
`W0 99/531424
`W0 (XI/521519
`W0 00/621137
`W0 W/GSSJD
`W0 01/113830
`W0 01/115852
`W0 01/225515
`W0 01/133308
`
`11/1993
`4/1999
`6/1999
`10/1999
`9/2000
`10/2000
`11/2000
`3/2001
`3/2001
`3/2001
`11/2001
`
`OTHER PUBLICATIONS
`
`Patsysterns News Release, Patsystems Launches .I
`Nov. 6, 20013“
`wwwiradingtechnolngies.eomfproduets/irtrarie,
`(viewed May 22. 2001) dun. 9. 2000.
`Kharqu.A trading mum With a View, Futules, 2.7, 11—Nnv.
`1993.
`
`fuli.iitml
`
`'i‘rader,
`
`USPTO Presentation, NASDAQ, Nov. 3, 2001, enciemd pp.
`1—13.
`
`Primary Examiner—Richard Weisherger
`(74) .4110er Agent, or Firm—Friley 8.: Lardner
`
`(5 '7)
`
`AIISTI‘RACT
`
`A rnethnd and system l'nr reducing the time it takes for a
`trader in place a trade when electronically trading en an
`exehange, thus increasing the likelihood that the trader will
`have murders [filed at desirable prieea and quantities. The
`“Mercury" display and trading method of the preaenl inven-
`tion ensure fast and accurate execution of trades by display-
`ing market depth en a vertical in" hnri'mrital plane, which
`fluctuates ingieally up or down, left or right across the plane
`as the market prices fluctuates. This allnws the trader in trade
`quickly and eIIieiently.
`
`41] Claims, 6 Drawing Sheets
`
`(54)
`
`(75)
`
`Inventors: Gary Allan Kemp, II, Winnetka, [L
`(US); Jens-Um: Schluetter'. Evansinn.
`IL (US); Harris Brumiield. Chicago,
`[L (Us)
`
`('73) Assignee: Trading Tnehnnlnglas lntnrnatinnai,
`Inc.. Chicago. IL (US)
`
`( "‘ ) Notice:
`
`Subject to any disclaimer, the term of this
`patent is extended or adjusted under 35
`USE. 154(0) 11); 544 days.
`
`(21)
`
`Appt. N0.: 09/394,637
`
`Filed:
`
`(23)
`
`(55)
`
`Jun. 27, 2001
`Prior Publication Data
`
`US 2002/0059129I A1 May 16. 2002
`
`Related (LS. Applieatinn Data
`
`Divisiun 01 application No. 09/590,092, filed on Jun. 9,
`2000.
`Provisional applieatien No. 60/186,322, flied on Mar. 2,
`2000.
`
`(7.11511 17/511
`Int. 1131.7 ................................................
`.. 705/37; 705/36; 705/35
`
`Field of Search .............................. 705/35, 35, 37;
`345/814
`
`Rethrenees Cited
`US. PATENT DOCUMENTS
`
`(62)
`
`(60)
`
`(51)
`1‘52)
`(581
`
`(5(1)
`
`4,574,044 A
`4,750,135 A
`5,033,234 A
`5,077,665 A
`5,136,501 A
`5,270,922 A
`5,297,031 A
`5,207,032 A
`5,539,651 A
`
`Iii/1937
`15/1988
`8/1991
`12/1991
`3/1992
`12/1993
`3/1994
`3/1994
`11/1997
`
`Kalmus et al.
`
`364/403
`364/514
`
`Kramer
`Silvenrinn e1 11].
`364/403
`Silvenrian et 111.
`.. 364/405
`
`Higgins
`lllll 364/408
`Gulterman et 111.
`'l'rnjan et at.
`human
`
`Iiflill!littll'liifi'ml..-LIT'1
`
`1111111
`
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`
`
`
`
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`
`11111
`
`1030
`
`
`
`

`

`.
`
`-
`
`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 8 of 41 PageID #:8
`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 8 of 41 PageID #:8
`
`us 6,766,304 112
`Page 2
`
`U.S.l’N1‘EN'1‘DOCUMEN'1‘S
`
`5,797,002 A
`5,345,266 A
`5,915,245 A
`5,924,082 A
`5,924,033 A
`5,963,913 A
`5.012.04'5 A
`5,014,643 A
`6,093,051 A
`
`811998 Pullerson, Jr. fit all.
`1711995 Lupicn ct n1.
`5/1999 Puilcn'un, Jr. :l Ell.
`7/1999 Silvermun at al.
`7/1999 Silvcrmnn at El].
`111/1999 ("rarhcr
`U290” ”‘99:" ct 3]—
`UZUUU MiJ'ltDn ........................ 705/37
`wzuuu Lupicn cl 11L
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`10mm Luke. ct nl.
`6,131,037 A
`101209) Bclzberg
`6.134.535 A
`2,2001 Marlyn cl 6:].
`5‘195’547 B1
`5,272,474 131 mm Garcia
`6,273,982 B1
`3mm Kmhurnmer el all.
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`(#2002 Bum
`20030023033 A1
`2,1200; 1.3mm :15],
`2U02J0055399 A1
`SRUOE Williams
`
`* cited by cxamimr
`
`705/37
`70537
`
`
`
`

`

`-
`
`.-
`
`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 9 of 41 PageID #:9
`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 9 of 41 PageID #:9
`
`U.S. Patent
`
`Jul. 20, 2004
`
`Sheet] (THE
`
`US 6,766,304 82
`
`FIG. 1
`
`CONNECTION TC MULTIPLE EXCHANGES
`
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`...................................................................................................
`
`
`
`

`

`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 10 of 41 PageID #:10
`Case: 1:04-cv-O6278 Document #: 1 Filed: 09/28/04 Page 10 of 41 PageID #:10
`
`US. Patent
`
`Jul. 20, 24104
`
`Sheet 2 of 6
`
`US 6,766,304 B2
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`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 11 of 41 PageID #:11
`Case: 1:04-cv-O6278 Document #: 1 Filed: 09/28/04 Page 11 of 41 PageID #:11
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`US. Patent
`
`Jul. 20, 24104
`
`Sheet 3 of 6
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`US 6,766,304 B2
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`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 12 of 41 PageID #:12
`Case: 1:04-cv-O6278 Document #: 1 Filed: 09/28/04 Page 12 of 41 PageID #:12
`
`U.S. Patent
`
`Jul. 20, 2004
`
`Sheet 4 of 6
`
`US 6,766,304 B2
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`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 14 of 41 PageID #:14
`Case: 1:04-cv-O6278 Document #: 1 Filed: 09/28/04 Page 14 of 41 PageID #:14
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`

`

`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 15 of 41 PageID #:15
`Case: 1:04-cv-O6278 Document #: 1 Filed: 09/28/04 Page 15 of 41 PageID #:15
`
`1
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`2
`
`CLICK BASED TRADING WITH [NTUITIVE
`GRID DISPLAY OF MARKET DEPTH
`
`This application is a divisional application of Ser. No.
`09/590,692 filed Jun. 09, 2000 which claims benefit of
`60/186,322, filed Mar. 2, 2000.
`
`PRIORITY
`
`The present application claims priority to a US. Provi-
`sional Patent Application entitled “Market Depth Display
`Click Flased Trading and Mercury Display" filed Mar. 2,
`2000,
`the contents of which are incorporated herein by
`reference.
`
`FIELD OF INVENTION
`
`The present invention is directed to the electronic trading
`of commodities. Specifically, the invention provides a trader
`with a versatile and efficient tool [or executing trades. It
`facilitates the display of and the rapid placement of trade
`orders within the market trading depth of a commodity,
`where a commodity includes anything that can be traded
`with quantities and/or prices.
`
`BACKGROUND OF TIIE INVENTION
`
`At least (it) exchanger. throughout the world utilise elec-
`tronic trading in varying degrees to trade stocks, bonds,
`futures, options and other products. “these electronic
`exchanges are based on three components: mainframe corn-
`puters (host), rxirnmunications servers. and the exchange
`participants’ computers (client). 'ihe host forms the elec-
`tronic heart of the fully computerized electronic trading
`system. The system's operations cover order-matching,
`maintaining order books and positions, price information,
`and managing and updating the database for the nnline
`trading day as well as nightly hatch runs. The host is also
`equipped with external
`interfaces that maintain uninter-
`rupted online contact
`to quote vendors and other price
`information systems.
`through three types of
`Traders can link to the host
`structures: high speed data lines, high speed communica-
`tions servers and the Internet. High speed data lines establish
`direct connections between the client and the host. Another
`connection can be established by configuring high speed
`networks or communications servers at strategic access
`points worldwide in locations where traders physically are
`located. Data is transmitted in both directions between
`traders and exchanges via dedicated high speed communi-
`cation lines. Most exchange participants install two lines
`between the exchange and the client site or between the
`communication server and the client site as a safety measure
`against potential failures. An exchange’s internal computer
`system is Also often installed with backups as a redundant
`measure to secure system availability. The third connection
`utilises the Internet, Here,
`the exchange and the traders
`communicate back and forth through high speed data lines,
`which are connected to the Internet. 'lltis allows traders to be
`located anywhere they can establish a connection to the
`Internet.
`
`Irrespective of the way in which a connection is
`established,
`the exchange participants’ computers allow
`traders to participate in the market. They use software that
`creates specialized interactive trading screens on the traders'
`desktops. The trading screens enable traders to enter and
`execute orders. obtain market quotes, and monitor positions.
`The range and quality of features available to traders on their
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`screens varies according to the specific software application
`being run. The installation of open interfaces in the devel-
`opment of an cxchange’s electronic strategy means users can
`choose, depending on their
`trading style and internal
`requirements,
`the means by which they will access the
`exchange.
`The world’s stock, bond, futures and options exchanges
`have volatile Prt‘tduchs with prices that move rapidly, To
`profit in these markets, traders must be able to react quickly.
`A skilled trader with the quickest software.
`the fastest
`communications, and the most sophisticated analytics can
`significantly improve his own or his firm’s bottom line. The
`slightest speed advantage can generate significant returns in
`a fast moving market. in today’s securities markets, a trader
`lacking a technologically advanced interface is at 4 severe
`competitive disadvantage.
`Irrespective of what interface a trader uses to enter orders
`in the market, each market supplies and requires the same
`information to and from every trader. The bids and asks in
`the market make up the market data and everyone logged on
`to trade can receive this information if the exchange pro-
`vides it. Similarly, every exchange requires that certain
`information be included in each order. For example, traders
`must supply information like the name of the commodity,
`quantity, restrictions, price and multiple other variables.
`Without all of this information, the market will not accept
`the order. This input and output of information the same for
`every trader.
`With these variables being constant, a competitive speed
`advantage must come from other aspects of the trading
`cycle. When analyzing the time it takes to place a trade order
`for a given commodity, various steps contribute in dill'erent
`amounts to the total time required. Approximately 8% of the
`total time it takes to enter an order elapscs between the
`moment the host generates the price for the commodity and
`the moment the client receives the price. The time it takes for
`the client application to display the price to the trader
`amounts to approximately 4%. The time it takes for a trade
`order to be transmitted to the host amounts to approximately
`8%. The remainder of the total time it takes to place an order,
`approximately 80%, is attributable to the time required for
`the trader to read the prices displayed and to enter a trade
`order. The present invention proVides a significant advan-
`tage during the slowest portion of the trading cycle—while
`the trader manually enters his order. Traders recognize that
`the value of time savings in this portion may amount to
`millions of dollars annually.
`In existing systems. multiple elements of an order tnust be
`entered prior to an order being sent to market, which is time
`consuming for the trader. Such elements include the com-
`modily symbol. the desired price, the quantity and whether
`:1 buy or a still order is desired. The more time a trader takes
`entering an order, the more likely the price on which he
`wanted to hid or ofier will change or not be available in the
`market. The market
`is fluid as many traders are sending
`orders to the market simultaneously.
`It
`l'acl, successful
`markets strive to have such H high Volume of trading that any
`trader who wishes to enter an order will find a match and
`have the order tilled quickly, if not immediately, In such
`liquid markets,
`the prices or the commodities fluctuate
`rapidly. (in a trading screen, this results in rapid changes in
`the price and quantity fields within the market grid. If a
`trader intends to enter an order at a particular price, but.
`misses the price because the market prices moved before he
`could enter the order, he may lose hundreds, thousands, even
`millions of dollars. The faster a trader can trade, the less
`likely it will he that he will miss his price and the more likely
`he will make money.
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`us 6,755,304 B2
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`3
`SUMMARY OF THE INVENTION
`
`The inventors have developed the present invention: which
`overcomes the drawbacks of the existing trading systems
`and dramatically reduces the time it takes for a trader to
`place a trade when electronically trading on an exchange.
`This, in turn, increases the likelihood that the trader will
`have orders filled at desirable prices and quantities.
`The “Mercury” display and trading method of the present
`invention ensure fast and accurate execution of trades by
`displaying market depth on a vertical or horizontal plane,
`which fluctuates logically up or down, left or right across the
`plane as the market prices fluctuates. 'lhis allows the trader
`to trade quickly and efficiently.
`Specifically, the Present invention is directed to a graphi-
`cal user interface for displaying the market depth of a
`commodity traded in a market, including a dynamic display
`for a plu rality of bids and for a plurality of asks in the market.
`for the commodity and a static display of prices correspond-
`ing to the plurality of bids and asks. In this embodiment the
`pluralities of bids and asks are dynamically displayed in
`alignment with the prices corresponding thereto. Also
`described herein is a method and system for placing trade
`orders using such displays.
`Tltese errIlJodirrteots, and others described in greater detail
`herein. provide the trader with improved efficiency and
`versatility in placing, and thus executing, trade orders for
`commodities in an electronic exchange. Other leatures and
`advantages of the present invention will become apparent to
`those skilled in the art from the following detailed descrip-
`tion. It should be understood, however,
`that the detailed
`description and specific examples. while indicating pre-
`ferred embodiments of the present invention, are given by
`way of illustration and not limitation. Many changes and
`modifications within the scope of the present invention may
`be made without departing from the spirit thereof, and the
`invention includes all such modifications.
`
`BRIEF DESCRIPTION OF THE DRAWINGS
`
`FIG. 1 illustrates the network connections between mul-
`tiple exchanges and client sites;
`FIG. 2 illustrates screen display showing the inside mar-
`ket and the marketdepth ofa given mmmndity being traded;
`FIG. 3 illustrates the Mercury display of the present
`invention;
`FIG. 4 illustrates the Mercury display at a later time
`showing the movement of values when compared to FIG. 3;
`FIG. 5 illustrates a Mercury display with parameters set in
`order to exemplify the Mercury trading method; and
`FIG. 6 is a flowchart illustrating the process for Mercury
`display and trading.
`
`DETAILED DESCRIPTION OF THE
`PREFERRED EMBODIMENTS
`
`As described with reference to the accompanying figures,
`the present invention provides a display and trading method
`to ensure fast and accurate execution of trades by displaying
`market depth on a vertical or horizontal plane. which fluc-
`tuates logically up or down. left or right across the plane as
`the market prices fluctuates. This allows the trader to place
`trade orders quickly and efficiently. A oommodity’s market
`depth is the current bid and ask prices and quantities in the
`market. The display and trading method of the invention
`increase the likelihood that the trader will be able to execute
`orders at desirable prices and quantities.
`
`4
`invention is
`the present
`In the preferred emboditnent,
`implemented on a computer or electronic terminal. The
`computer is able to communicate either directly or indirectly
`(using intermediate devices) with the exchange to receive
`and transmit market. commodity. and trading order infor-
`mation. It is able to interact with the trader and to generate
`contents and characteristics of a trade order to be sent to the
`
`is envisioned that the system of the present
`exchange. It
`invention can be implemented on any existing or future
`terminal or device with the processing capability to perform
`the functions described herein. The scripe of the present
`invention is not limited by the type of terminal or device
`used. Further. the specification refers to a single click of a
`mouse as a means for user input and interaction with the
`terminal display as an example of a single action of the user.
`While this describes a preferred mode of interaction, the
`scope of the present invention is not limited to the use of a
`mouse as the input device or to the click of a mouse button
`as the user’s single action. Rather. any action by a user
`within a short period of time, whether comprising one or
`more clicks of a mouse button or other input device,
`is
`considered a single action of the user for the purposes of the
`present invention.
`The system can be configured to allow for trading in a
`single or in multiple exchanges simultaneously. Connection
`of the system of the present
`invention with multiple
`exchanges is illustrated in FIG. I. This figure shows multiple
`host exchanges 101—103 connected through routers 104—106
`to gateways 107—109. Multiple client. terminals 110—116 for
`use as trading stations can then trade in the multiple
`exchanges through their connection to the gateways
`107-409. When the system is configured to receive data
`from multiple exchanges. then the preferred implementation
`is to translate the data from various exchanges into a simple
`format. This. “translation" function is described below with
`
`reference to FIG. 1. An applications program interface (“TT
`Al’l” as depicted in the figure) translates the incoming data
`formats from the different exchanges to a simple preferred
`data format. This translation function may be disposed
`anywhere in the network. for example, at the gateway server,
`at the individual workstations or at both. In addition, the
`storage at gateway servers and at the client workstations,
`and/or other external storage cache historical data such as
`order books which list
`the client's active orders in the
`market; that is. those orders that have neither been filled nor
`cancelled.
`Infon'nation from different exchanges can be
`displayed at one or in multiple windows at
`the client
`workstation. Accordingly, ‘while reference is made throngh
`the remainder of the specification to a single exchange to
`which a trading terminal is connected,
`the scope of the
`invention includes the ability to trade, in accordance with the
`trading methods described herein.
`in multiple exchanges
`using a single trading terminal.
`invention
`The preferred embodiments of the present
`include the display of “Market Depth" and allow trader to
`view the market depth of a commodity and to execute trades
`within the market depth with a single click of a computer
`mouse button. Market Depth represents the order book with
`the current bid and ask prices and quantities in the market.
`In other words, Market Depth is each bit] and ask that was
`entered into the market, subject to the limits noted below, in
`addition to the inside market. For a commodity being traded,
`the “inside market" is the highest bid price and the lowest
`ask price.
`The exchange sends the price, order and fill information
`to each trader on the exchange. The present.
`invention
`processes this information and maps it
`through simple
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`Case: 1:04-cv-06278 Document #: 1 Filed: 09/28/04 Page 17 of 41 PageID #:17
`Case: 1:04-cv-O6278 Document #: 1 Filed: 09/28/04 Page 17 of 41 PagelD #:17
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`US 6,766,304 I32
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`5
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`algorithms and mapping tables to positions in a theoretical
`grid program or any other comparable mapping technique
`for mapping data to a screen. The physical mapping of such
`information to a screen grid can be done by any technique
`known to those skilled in the art. The present invention is not
`limited by the method used to map the data to the screen
`display.
`How far into the market depth the present invention can
`display depends on how much ol-
`the market depth the
`exchange provides. Some exchanges supply an infinite mar-
`ket depth, while others provide no market depth or only a
`few orders away from the inside market. The user of the
`present invention can also chose how far into the market
`depth to display on his screen. FIG. .2 illustrates a screen
`display of an invention described in a commonly owned
`covpending application entitled “Click Based Trading with
`Market Depth Display" Ser. No. 09/589,751, filed on Jun. 9,
`2000,
`the contents of which are incorporated herein by
`reference. This display shows the inside lrlark'et and the
`market depth of a given commodity being traded. Row 1
`represents the “inside market" for the commodity being
`traded which is the heat (highest) hid price and quantity and
`the best (lowest) ask price and quantity. Rows 2—5 represent
`the "market depth" for the commodity being traded. In the
`preferred embodiment of the present invention, the display
`of market depth (rows 2—5) lists the available nest-best bids,
`in column 203, and asks, in column 204. The working bid
`and ask quantity for each price level is also displayed in
`columns 202 and 2015 respectively (inside market—row 1).
`Prices and quantities for the inside market and market depth
`update dynamically on a real time basis as such information
`is relayed from the market.
`In the screen display shown in FIG. 2, the commodity
`(mntract) heing traded is represented in row i by the
`character string “EDI-IO". The Depth column 203 will
`inform the trader ot' a status hy displaying Llitl’erent colors.
`Yellow indicates that the program application is waiting for
`data. Red indicates that
`the Market Depth has failed to
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`receive the data from the server and has “timed out." Green
`indicates that
`the data has just been updated. The other
`column headings in this and all of the other figures, are
`defined as follows. ilithy (Bid Quantity): the quantity for
`eaeh working bid, BidPre (Bid Price):
`the price for each
`working bid,AskPrc (Ask Price): the price for each working
`ask, Astty (Ask Quantity): the quantity for each worldng
`ask, LastPrc (Last Price): the price for the last. bid and ask
`that were matched in the market and LastQty (Last
`Quantity): the quantity added at the last price. Total repre-
`sents the total quantity traded of the given commodity.
`
`The configuration of the screen display itself ini'onns the
`user in a more convenient and efficient manner than existing
`systems. Traders gain a significant advantage by seeing the
`market depth because they can see trends in the orders in the
`market. The market depth display shows the trader the
`interest the market has in a given commodity at dill‘erent
`price levels. If a large amount of bids or asks are in the
`market near the trader’s position, he may feel he should sell
`or buy before the inside market reaches the morass of orders.
`A lack of orders above or helowl the inside market might
`prompt a trader to enter orders near the inside market.
`Without seeing the market depth, no such strategies could be
`utilized. Having the dynamic market depth, including the bid
`and ask quantities and prices of a traded commodity aligned
`with and displayed below the current inside market of the
`commodity conveys the information to the user in a more
`intuitive and