Cryptozoic Entertainment and Hex Entertainment have responded to the lawsuit Wizards of the Coast filed in federal court in May and amended in August, charging that WotC is "Fearing competition in the trading card game industry" and "frantic about the loss of its monopoly position due to the expiration of its patent on Magic: The Gathering two months ago." 

The Wizards of the Coast lawsuit alleged that Hex: Shards of Fate, an online game that raised over $2 million, infringed on Magic: The Gathering (see "WotC Sues Cryptozoic").

Cryptozoic ties much of its response to WotC’s expiring patent, arguing that the lawsuit is attempting to extend the patent "by asserting copyright protection over functional concepts."    

With regard to the patent claim, the response notes that “even if Wizards’ patent were to be held valid,… damages would be much less than the cost of this litigation to Wizards in view of the brief patent term involved,” arguing that WotC is trying to “litigate a smaller competitor out of business, rather than compete fairly in the marketplace.” 

Cryptozoic also argues that there are no documented examples of individuals that were confused by the alleged infringement. 

WotC’s expanded complaint from August adds a cause of action, "Trade Dress Dilution" as a form of unfair competition under the Lanham act, and enumerates a larger number of alleged copyright infringements in a 107-page appendix to the complaint listing Hex cards and copyrighted Wizards of the Coast cards in tandem.

WotC’s amended complaint also displays a remarkable depth of knowledge about the players of Magic Online, noting the user IDs of players playing from an IP address registered to Cryptozoic, the number of times they accessed the site, and the number of trades and tournaments in which they participated.  The complaint argues that that use of the Magic Online site demonstrates that Cryptozoic employees had access to the cards and other features which they are alleged to have infringed. 

It doesn’t look like this will be resolved any time soon, unless it is by settlement.  According to a discovery schedule signed by both parties, discovery will be completed in November of 2015, with a trial date suggested for "Spring 2016."