F 178 e 1E—CB4811
`
`Document 1
`
`Filed 08/19/2005
`
`Page 1 of 40
`
`.thl
`
`AUG 19 2005
`
`UNITED STATES DISTRICT COURT
`W. DOBBINS
`CLE:&?:.ASE.LD|sfmc-r cofiflRTHERN DISTRICT OF ILLINOIS
`EASTERN DIVISION
`
`Trading Technologies International, Inc.,
`
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`Plaintiff,
`
`v.
`CQG, Inc.; and
`
`)
`)
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`
`CQGT, LLC
`
`)
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`Defendants.
`m___)
`
`.-=4--
`.- _‘
`JUDGE
`
`MAGISTRATE J”WE COLE
`
`COMPLAINT FOR PATENT INFRINGEMENT AND IIURY DEMAND
`
`Plaintiff Trading Technologies
`
`International,
`
`Inc.
`
`(“Trading Technologies”),
`
`for
`
`its
`
`complaint against Defendants CQG,
`
`Inc.
`
`(“CQG”) and CQGT, LLC (“CQGT")
`
`(collectively
`
`“Defendants”), 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 CQG is a Colorado Corporation with its principal place of business at
`
`1050 17'h Street, Suite 2000, Denver, co 80265.
`
`3.
`
`Defendant CQG has a regional office at 311 S. Wacker, Suite 3810, Chicago, IL
`
`60606.
`
`4.
`
`Defendant CQGT is a Colorado Limited Liability Company with its principal place
`
`of business at 1050 17‘“ Street, Suite 2000, Denver, co 80265.
`
`5.
`
`Defendant CQGT was formed by CQG on August 12, 2005.
`
`CQG EXHIBIT 1004
`
`0001
`
`CQG EXHIBIT 1004
`
`0001
`
`

`

`Case 1:05-cv—04811
`
`Document 1
`
`Filed 08/19/2005
`
`Page 2 of 40
`
`JURISDICTION AND VENUE
`
`6.
`
`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).
`
`7.
`
`Defendant CQG regularly conducts business in this district. Defendant CQG has an
`
`office located in this district. Defendant CQG provides trading software that is for use with the
`
`exchanges in this district,
`
`including the Chicago Board of Trade (“CBOT”) and the Chicago
`
`Mercantile Exchange (“CME”). This Court has jurisdiction generally over Defendant CQG.
`
`8.
`
`9.
`
`Defendant CQGT is a wholly owned subsidiary of CQG.
`
`Defendants have committed and continue to commit acts of patent infringement in
`
`this district. Therefore, this Court has specific jurisdiction over the Defendants.
`
`10.
`
`Defendants CQG resides in this district, because Defendant is subject to personal
`
`jurisdiction in this district. Therefore, this District is a proper venue pursuant to 28 U.S.C. §§
`
`1391(b) and 140003).
`
`INFRINGEMENT OF US. PATENT NO. 6,766,304
`
`COUNT I:
`
`11.
`
`Plaintiff Trading Technologies is the owner of US. Patent No. 6,766,304 (“the ’304
`
`patent”), titled “Click Based Trading with Intuitive Gn‘d Display of Market Depth,” which issued on
`
`July 20, 2004. A true and correct copy of the ’304 patent is attached as Exhibit A.
`
`12.
`
`Plaintiff Trading Technologies is in compliance with any applicable marking and
`
`notice provisions of 35 U.S.C. § 287.
`
`0002
`
`0002
`
`

`

`Case 1:05-Cv-04811
`
`Document 1
`
`Filed 08/19/2005
`
`Page 3 of 40
`
`13.
`
`Defendants have and continue to infringe the ’304 patent by making, using, selling
`
`and/or offering for sale products and methods covered by claims of the ’304 patent without Plaintiff
`
`Trading Technologies’ authorization in violation of 3S U.S.C. § 271(a).
`
`14.
`
`In addition, Defendants actions have and continue to constitute active inducement of
`
`and/or contributory infringement of the ’304 patent in violation of 35 U.S.C. §271(b) and (c).
`
`15.
`
`16.
`
`Defendants’ infringement of the ’304 patent is willful and deliberate.
`
`Defendants’ infringement of the ’304 patent has caused irreparable harm to Plaintiff
`
`Trading Technologies and will continue to do so unless enjoined.
`
`COUNT II:
`
`INFRINGEMENT OF US. PATENT NO. 6,772,132
`
`17.
`
`18.
`
`Plaintiff Trading Technologies incorporates paragraphs [—16 as if set forth in full.
`
`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 copy 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.
`
`Defendants have 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(3).
`
`21.
`
`In addition, Defendants’ actions have and continue to constitute active inducement of
`
`and/or contributory infringement of the ’132 patent in violation of35 U.S.C. §271(b) and (c).
`
`22.
`
`Defendant’s infringement of the ’132 patent is willful and deliberate.
`
`0003
`
`0003
`
`

`

`Case 1:05-cv-04811
`
`Document 1
`
`Filed 08/19/2005
`
`Page 4 of 40
`
`23.
`
`Defendant’s infringement of the ’132 patent has caused irreparable 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 Defendants CQG and CQGT have been and are infringing one or more
`
`of the claims of the ’304 and ’132 patents pursuant to 35 U.S.C. §§ 271(a), (b), and/or (0);
`
`(B)
`
`A preliminary and permanent injunction enjoining Defendants CQG and CQGT and
`
`their 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
`
`Defendants’ infringement of the ’304 and ’132 patents;
`
`(D)
`
`An award trebling the damages pursuant to 35 U.S.C. § 284 as a result of Defendants’
`
`willful infringement of the ’304 and ’132 patents;
`
`(E)
`
`An assessment of costs, including reasonable attorney fees pursuant to 35 U.S.C. § 285,
`
`and prejudgment interest against Defendant CQG and CQGT; and
`
`(F)
`
`Such other and further relief as this Court may deem just and proper.
`
`0004
`
`0004
`
`

`

`Date:
`
`Case 1:05-cv-04811
`
`Document 1
`
`Filed 08/19/2005
`
`Page 5 of 40
`
`JURY DEMAND
`
`Plaintiff Trading Technologies demands trial by jury on all issues so triable.
`
`Respectfully
`
`bmilted,
`
`
`
`
`
`rghoff (ID No. 618046
`Paul H.
`Leif R. Sigmond, Jr. (ID No. 6204980)
`Matthew J. Sampson (ID No. 6207606)
`George 1. Lee (ID. No. 6224430)
`S. Richard Carden (ID No. 6269504)
`Jennifer M. Swanz (ID No. 6279893)
`Dennis D. Crouch (ID No. 6281230)
`McDonnell Boehnen Hulbert & Berghoff LLP
`300 South Wacker Drive
`
`Chicago, Illinois 60606
`Tel.: (312) 913-0001
`Fax: (312) 913—0002
`
`Steven F. Borsand (ID No. 6206597)
`Trading Technologies International, Inc.
`222 South Riverside
`Suite 1100
`
`Chicago, Illinois 60606
`Tel: (312) 476-1000
`Fax: (312) 476-1 182
`
`Attorneys for Plaintiff,
`TRADING TECHNOLOGIES
`
`INTERNATIONAL, INC.
`
`0005
`
`0005
`
`

`

`pase 1:05-cv-O4811
`
`Document 1
`
`Filed 08/19/2005
`
`Page 6 of 40
`
`EXHIBIT A
`
`0006
`
`0006
`
`

`

`Case 1:05-cv—04811
`
`Document 1
`
`Filed 08/19/2005
`
`Page 7 of 40
`
`lllflllllllllllllflllllllllflllllllllllllllllllll
`
`USOO676630432
`
`(12) United States Patent
`Kemp, II et at.
`
`(10) Patent No.:
`(45) Date of Patent:
`
`US 6,766,304 BZ
`Jul. 20, 2004
`
`W (
`
`(75)
`
`54) CLICK BASED TRADING WITH INTUITIVE
`GRID DISPLAY OF MARKET DEPTH
`inventors: Gary Allan Kemp. LL Winnetkn. IL
`(US); Jens-Um Schluener. Emma.
`IL (US); Harris Brumfield, Cmcago,
`IL (us)
`
`6/1993 Patterson, Jr. e1 :1.
`5,774,377 A
`8/1998 Patter-son, Jr. a a1.
`5.793501 A
`(List continued on next P53“)
`FOREIGN PATENT DOCUMENTS
`W0 98/491539
`1111998
`W0 99/19821
`4/1999
`wo 9950239
`6/1999
`W0 9953424
`10,1999
`wo 00/52619
`9/2000
`WO 00162187
`10m
`W0 00/65510
`11/2000
`WO 01/16830
`30001
`wo 01/151152
`3/2001
`W0 01/3315
`SEEK/1
`wo 01/330051
`11/2001
`OTHER PUBLICATIONS
`Patsystems News Release, Palsy/stems Launches J Trader,
`Nov. 6, 2001.‘
`WW.0adingtecbnologies.wm/produds/xtnde_filll.htm1
`(Viewed May 22 2001) am 9. 2000~
`Khuouf, A trading room with a view, Fumtes, 27, 11—Nov.
`1998.
`USP'I‘O Presentation, NASDAQ, Nov. 8, 2001, enclosed pp.
`1_13_
`Prim? EWr—Ri¢a{d Waisbcrger
`(74) Mame» Agar“. or firm—Foley & Lardner
`(57)
`ABSTRACT
`A method and system for reducing the time it takes for a
`trader to place a trade when electronically trading on an
`References Cited
`exchange, thus increasing the likelihood that the Index will
`have orders filled at desirable prices and quantifies. The
`U'S' PATENT DOCUMENTS
`“Mercury" display and trading method of the present inVen-
`$574,044 A
`5/1937
`,, 354/403
`
`tion ensure fast and accurate execution of trades by display-
`4,750,1.35 A
`6/1988
`364/514
`in; make: depth on a vertical or horizontal plane. which
`5933234 A
`8/1991 Kim”
`fluctuates logically up or down, left 01 right across the plzne
`5,077.55 A
`12/199! 59"“"353 =1 'L
`364/403
`2:373:02: 1:
`13:33: 153”?“ ‘1 “" '“'
`" 323% as the market prices fluctuates. This allows the trader to trade
`
`5,297,031 A
`3/1994 0053111513111“ :1 .1.
`“my “‘1 ‘fic’muy'
`5,297,032 A
`3/1994 Trojan d 111.
`5,689,651 A
`11/1997 Loam-n
`40 Claims, 6 Drawing Sheets
`
`W0
`W0
`wo
`.
`‘
`W0
`(‘73) ASSIgnec. Ihzdlggiiecrnrihgg International,
`wo
`'
`g '
`W0
`.
`.
`.
`.
`.
`( ‘ ) Nance:
`SubJed-to any dsclnmer,’ the term of 11:15 W0
`patent 15 extended or adjusted under 35
`wo
`0511 15403) by 544 33%
`wo
`W0
`wo
`
`(21) Appl. No; 09/894,637
`(22) Filed:
`Jun. 27, 2001
`(65)
`Prior Publication Data
`us 2002‘ ”059’” M M“ 16' 2002
`Related US. Application 0901
`
`(62) Division of application No. 09/590,692, filed on Jun. 9,
`2000-
`(60) Win/ml application No. 60/186,322, filed on Mar. 2,
`(51)
`1:11. c1.7 ................................................ G06F 17/60
`. 705/37; 705/36; 705/35
`(52) US. Cl.
`...........
`
`(58) Fleld of Search
`705/35, 36, 37;
`345/314
`
`(56)
`
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`

`

` ’—
`
`Case 1:05-cv—04811
`
`Document 1
`
`Filed 08/19/2005
`
`Page 8 of 40
`
`US 6,766,304 132
`Pig: 2
`________________________.__________—.——-———-——————
`
`U'S'P
`5,797,002 A
`5,845,266 A
`5915.245 A
`5,924,082 A
`5,924,138 A
`5,963,923 A
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`2,2001 Martyn at :11,
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`
`0008
`
`0008
`
`

`

`Case 1:05-Cv-04811
`
`Document 1
`
`Filed 08/19/2005
`
`Page 9 Of 40
`
`US. Patent
`
`Jul. 20, 2004
`
`Sheet 1 of6
`
`US 6,766,304 B2
`
`FIG. 1
`
`CONNECTION TO MULTIPLE EXCHANGES
`
`101
`
`HOST EXCHANGE
`A FACleES
`
`102-;
`
`HOST EXCHANGE
`B FACILITIES
`
`HOST EXCHANGE
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`103a.
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`116
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`114
`113
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`110
`111
`...................................................................................................
`
`0009
`
`0009
`
`

`

`Case 1:05-cv-04811
`
`Document 1
`
`Filed 08/19/2005
`
`Page 10 of 40
`
`US. Patent
`
`Jul. 20, 2004
`
`Sheet 2 of 6
`
`US 6,766,304 B2
`
`203204205
`
`FIG.2
`
`202
`
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`
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`
`

`

`Case 1:05-cv-04811
`
`Document 1
`
`Filed 08/19/2005
`
`Page 11 of 40
`
`US. Patent
`
`Jul. 20, 2004
`
`Sheet 3 of 6
`
`US 6,766,304 BZ
`
`FIG. 3
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`

`Case 1:05-cv—04811
`
`Document 1
`
`Filed 08/19/2005
`
`Page 12 of 40
`
`US. Patent
`
`Jul. 20, 2004
`
`Sheet 4 of 6
`
`US 6,766,304 32
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`

`Case 1 :05-cv-O4811
`
`Document 1
`
`Filed 08/19/2005
`
`Page 14 0f 40
`
`US. Patent
`
`Jul. 20, 2004
`
`Sheet 6 of 6
`
`US 6,766,304 B2
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`

`Case 1:05—cv-O4811
`
`Document 1
`
`Filed 08/19/2005
`
`Page 15 of 40
`
`US 6,766,304 B2
`
`1
`CLICK BASED TRADING WITH IN'I'UITIVE
`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 5
`60/186,322, filed Mar. 2, 2000.
`PRIORITY
`
`The present application claims priority to a US. Provi- m
`sional Patent Application entitled “Market Depth Display
`Click Based Trading and Mercury Display" filed Mar. 2,
`2000, the contents of which are incorporated herein by
`reference.
`
`FIELD OF uwnrmou '
`
`15
`
`The present invention is directed to the electronic trading
`of commodities. Specifically, the invention provides a trader
`with a versatile and eflicient tool for executing trades. ll
`facilitates the display of and the rapid placement of trade 20
`orders within the market trading depth of a commodity,
`where a commodity includes anything that can be traded
`with quantifies and/or prices.
`
`BACKGROUND OF THE INVENTION
`
`25
`
`At least 60 exchanges throughout the world utilize elec-
`tronic trading in varying degrees to trade stocks, bonds,
`futures, options and other products. These electronic
`exchanges are based on three components: mainframe com- 39
`puters (host), communications servers, and the exchange
`participants’ computers (client). The host forms the elec-
`tronic heart of the fully computerizod electronic trading
`system. The system’s operations cover order-matching,
`maintaining order books and positions, price information, 35
`and managing and updating the database for the online
`trading day as well as nightly batch runs. The host is also
`equipped with elder-cal
`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 45
`netwodcs or communications servers at strategic access
`pains worldwide in locations where traders physically are
`located. Data is transmitted in both directions between
`traders and exchanges via dedicated high weed communi-
`cation lines. Most exchange participants install two lines 50
`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 55
`utiliZes the Internet Here,
`the exchange and the traders
`communicate back and forth through high Speed data lines,
`which are connected to the Internet. This allows traders to be
`located anywhere they can establish a connection to the
`IDleDCl.
`
`40
`
`so
`
`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 65
`execute orders, obtain market quotes, and monitor positions.
`The range and quality of features available to traders on their
`
`2
`screens varies according to the Specific software application
`being run. The installation of open interfaces in the devel—
`opment of an exchange '5 electronic strategy means users can
`choose, depending on their trading style and internal
`requirements,
`the means by which they wfll access the
`exchange.
`The world's stock. bond, futures and options exchanges
`have volatile products with prices that move rapidly. To
`profit in these markets, traders must be able to react quickly.
`A skilled trader with the quickesl 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 markeL In today's semrities markets, a trader
`lacking a technologically advanced interfatx 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 me 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 constant1 a competitive speed
`advantage mint 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 difierent
`amounts to the total time required. Approximately 8% of the
`total time it takes to enter an order elapse: 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 appron'mately 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
`mfllions of dollars annually.
`In existing systems, multiple elements of an order must be
`entered prior to an order being sent to market, which is time
`consuming for the trader. Such elements include the com-
`modity symbol, the desired price, the quantity and whether
`a buy or a sell order is desired The more time a trader takes
`entering an order, the more likely the price on which he
`wanted to bid or ofi'er will change or not be available in the
`market. The market is fluid as many traders are sending
`orders to the market simultaneously. It fact, successful
`markets strive to have such a high volume of trading that any
`trader who Wishes to enter an order will find a match and
`have the order filled quickly, if not immediately. In such
`liquid markets,
`the prices of the commodities fluctuate
`rapidly. On 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 I trader can trade, the less
`likely it will be that he will miss his price and the more likely
`he will make money.
`
`00015
`
`00015
`
`

`

`
`
`Case 1:05-cv-04811
`
`Document 1
`
`Filed 08/19/2005
`
`Page 16 of 40
`
`US 6,766,304 B7.
`
`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 ordem filled at desirable prices and quantities.
`The “Mercury” display and trading method of the present
`invention ensure fast and accurate execution of trade: by
`displaying marlret depth on a vertical or horizontal plane.
`which fluctuates logically up or down, left or right across the
`plane as the market prim fluctuates. This allows the trader
`to trade quickly and eficiently.
`the present invention is directed to a graphi-
`for displaying the market depth of a
`commodity traded in a market, including a dynamic display
`for a plurality ofbids and for a plurality of asls 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
`plunlities 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.
`These embodiments, and others described in greater detail
`herein, provide the trader with improvod eficiency and
`versatility in placing, and thus exeatting. trade orders for
`commodities in an electronic exchange. Other features 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.
`
`JD
`
`35
`
`4
`the present invention is
`In the preferred embodiment.
`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
`exchange. It
`is envisioned that the system of the present
`invention can be implemented on any existing or future
`terminal or device with the processing capability to perform
`the functions descnhed herein. The scope 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 dimlay 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
`invontion with multiple
`exchanges is illustrated in FIG. L This figure shows multiple
`host exeh anges 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—109. 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 applicatiors program interface ("TT
`API" as depicted in the figure) translates the incoming data
`formats from the difl’erent exchanges to a simple preferred
`data formaL 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 Information from difierent exchanges can be
`displayed at one or in multiple windows at
`the client
`workstation. Accordingly, ‘while reference is made through
`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 descn‘bed 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 bid 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
`
`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»
`hot and the market depth of a given commodity being traded;
`MG. 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 accmate 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. 'Ihis allows the trader to place
`trade orders quickly and eficiently. A commodity'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.
`
`45
`
`SS
`
`65
`
`00016
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`00016
`
`

`

`
`
`———.:-—-—--—-——
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`..
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`7,
`
`Case 1:05-cv-O4811
`
`Document 1
`
`Filed 08/19/2005
`
`Page 17 of 40
`
`5
`
`US 6,766,304 BZ
`
`6
`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. 135th)! (Bid Quantity): the quantity for
`each working bid. BidPt-c (Bid Price):
`the price for each
`working bid. Aslel’rc (Ask Price): the price for each working
`ask. Astly (Ask Quantity): the quantity for each working
`ask, LastPre (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.
`
`5
`
`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 an 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 of the market depth the
`exchange provides. Some exchanges supply an infinite mar- 10
`ket depth, whfle 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 illrstrates a screen
`display of an invention described in a commonly owned
`co-pending 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 market and the
`market depth of a given commodity being traded. Row 1
`rcpt-sens the “inside market" for the commodity being
`traded which is the best (highest) bid 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 next—best bids,
`in column 203, and asks, in column 204. The worldng bid
`and ask quantity for each price level is also displayed in
`columns 202 and 205 respectively (inside market—row 1).-
`Prices and quantifies hot 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
`(contract) being traded is represented in row 1 by the
`character string “CDHO”. The Depth column 208 will
`inform the trader of a status by displaying difi'erent colors.
`Yellow indicates that the program application is waiting for
`data. Red indicates that the Market Depth has failed to
`
`”the configuration of the screen display itself informs the
`user in a more convenient and eficient manner than existing
`15 systems. Traders gain a significant advantage by seeing the
`market depth because they can see trends in the order: in the
`market. The market depth display shows the trader the
`interest the market has in a giVen commodity a! difierent
`price levels. If a large amount of bids or asks are in the
`ition, he may feel he should sell
`20 market near the trader’s pos
`or buy before the inside market reaches the morass of orders.
`A lack of orders above or below the inside market might
`prompt a trader to enter orders near the inside market.
`Without seeing the market depth, no such strategies could be
`25 utilized. Having the dynamic market depth, including the bid
`and ask quantities and prices of I 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 easily understandable manner. Trends in the
`30 trading of, the commodity and other relevant characteristics
`are more easily identifiable by the user through the use of the
`present invention.
`Various abbreviations are used in the screen displays. and
`specifically, in the column headings of the screen displays
`reproduced herein. Some abbreviations have been discussed
`above. Alist of common abbreviations and their meanings is
`provided in Table 1.
`
`35
`
`Bid Quantity
`Btdozy
`Threshold Bid Price
`ThxslaBid(6)
`Bid Paine
`BidPrc
`Bid Qty Aecm Acanmlated Bid erttiry
`BidPrc Avg
`Bid Price Average
`
`BOO
`BOP
`Mh BOO
`Mk1 BOP
`Quote
`
`TABLE 1
`________—_,___.—.—-————-—————
`Abbreviatinno;
`DBCRD’TION
`(DLUMN
`DESCRIPTION
`COLUMN
`________________..____.—————-—--——-—-—
`Month
`Expiration Month’Yeat
`'l‘henBid
`Theoretical Bid Price
`Bid Minn)
`Bid MOW [D
`Thank
`Theoretial All Price
`erBuyca)
`Working Buy! for entire Group 11) Dec
`Quote Action (Suds
`individual quotes)
`Test Bid more mutiny
`Test Bid Quote Price
`Market Bid Quote Quality
`Marta Bid Quote Price
`Sandbox salutes!
`deactivate: mound for quoting
`Marks Ask Quote Quantity
`MktAQQ
`Ask Prim Average
`Ankh: Avg
`Marita Ask Quote Price
`hm AQP
`Astty Anew-n minted Ask Quantity
`Ask Quote Price
`AQP
`Akare
`Ask Price
`Ask Quote Quantity
`AQQ
`'I'hrshAxKE)
`“NOW All P