Patent Application Number: 2009200139
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Facilitator's Comment 
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United States
With the possible exception of the "determining" step, the claimed mechanism is a subset of that described or implied in the prior art, wherein the card reader can read either or both a stripe and/or an IC. Now presumably an incompatible IC is one that cannot be read by a particular reader. It seems reasonably obvious that if a card containing a magnetic stripe and an incompatible IC is inserted into the prior art reader, which can read either/both the stripe and/or the IC, that the IC would not be read but the user info would be retrieved from the magnetic stripe. I don't see any significant departure from that in the active "determining" action in the current application.
What they are doing is switching all the cards back to use the mag-strip process, swapping the readers out, issuing everyone new cards (with either the same or a mapping for the mag-stripe ids), then switching back to holding the data in the new cards.
It's a business process for migrating to new chip reader technology via old mag-strip technology.
One reason no-one else may have been talking about doing/having done this is that it appears to introduce a security hole - the id number on the mag-strip is pretty easy to copy to another card, and the system can't tell the difference between the original card and the copy. Chipped cards are a LOT harder to acquire and copy.
Regarding "It's a business process for migrating to new chip reader technology via old mag-strip technology" : The background and descriptive material are interesting and motivating, but the things that are claimed do not include a business process for migrating to new chip reader technology, nor anything about switching cards back (sic) to using a mag-strip process. The claims refer to a gaming system that, when a user presents an incompatible smart card, will process the user based on the mag stripe instead. (And later, when the user now has a valid smart card, will process from same.) This does sound useful in migrating to a new smart card format, though the invention is not restricted to that by the claims.
http://www.freepatentsonline.com/y2009/0230186.html
Mag-Strip cards - basically most of the cards in your pocket.
Smart cards - a card with an embedded computer chip, memory chip and battery.
Originally their loyalty cards were all mag-stripe cards. These operates with a central server (often limited to a single site) and could do all of the transactions described here (load it with credit at the front desk, then swipe it in the machines to transfer credit). Timezone used to use such a system in WA.
They then would have moved to a system using hybrid cards, where the mag strip would still work, as they installed the readers for the new chipped cards. Such hybrid readers (chip and mag-stripe) are quite common - there are a couple installed where I work. Once the readers were all in and they'd distributed the new chipped cards to everyone. They may have then unplugged the local servers, relying on the data held on the smart cards instead.
They now seem to be migrating to a new set of smart cards, want to reestablish the local servers, and move back onto the hybrid platform - essentially running the old mag-stripe system - until they have enough of the readers converted to read the new chips that they can cut over to that system.
The inventive bit they are trying to claim seems to be dropping back to the old mag-stripe system so they don't have to by more expensive chip readers which could read both the old chips and the new chips. They may have had to significantly re-implement the old mag-stripe support system to get it to work (new servers, new codes, etc...)