Monday, November 07, 2005

DATATREASURY SET TO INCREASE PRESSURE ON BANKING INDUSTRY AFTER NEW SETTLEMENT: In one of the more closely-watched patent litigations filed this year, DataTreasury Corporation announced today that France's Groupe Ingenico, a major player in point-of-sale electronic transaction terminals, has decided to settle in the matter, and that a licensing deal has been reached.

This lawsuit was one of several highly publicized suits DataTreasury filed in federal court against a variety of banks and payment-processing companies. The Ingenico settlement follows settlements with banking giant JPMorgan Chase, check-processing software provider NetDeposit, Inc., and RDM Corporation, a manufacturer of transaction terminals and check-image repositories. While settlement terms were not disclosed, it wouldn't be unreasonable to assume that the settlement was in the seven-to-eight-figure range.

Like other defendants, Ingenico was accused of infringing U.S. Patent Nos. 5,910,988 and 6,032,137, which were issued to DataTreasury in 1999 and 2000 for image capture, centralized processing and electronic storage of document and check information. These patents describe a technology process capable of implementing the federally enacted Check Clearing for the 21st Century Act, popularly known as "Check 21."

After yet another significant settlement, Ed Hohn, who is the lead attorney for for DataTreasury, sounded pretty darn confident in his statement to the press:

Ingenico wound up folding its hand and admitting that it couldn't bust DataTreasury's patents--just like JPMorgan Chase. I am excited to see the Court
enter yet another Consent Judgment stating that these patents are valid and enforceable. Our trial team will now enforce this company's intellectual property rights by trying First Data Corporation, Wells Fargo, Bank of America, Citigroup and the rest of the defendants on the only real issues that remain--infringement, damages and willfulness damages. Let the trials begin!

I have to admit that I'm surprised how quickly the chips are falling in DataTreasury's favor. I've read through the patents, and they appear to be pretty solid (i.e., fairly well-written, with reasonable claims). However, even solid patents will have some chinks in the armor, because, after all, this is where most applicants tend to skimp on prior art searching due to obvious cost factors. Also, as I previously mentioned on this blog, these patents did not have any non-patent prior art cited against them, and both applications issued as patents after the first office action. That may not mean anything in the end, but that suggests to me that there is at least a possibility that non-patent prior art is floating about.

But the fact that these settlements are rolling in currently suggests that DataTreasury's patents may have some heft to them. Nevertheless, I am always cynical towards statements made in press releases, and I rarely trust them ("the louder a man speaks of his virtue, the tighter the grip should be on the wallet"). It's also possible that DataTreasury is offering cut-rate settlements to get some big names on the books to help browbeat others into settling as well. If I was being threatened by DataTreasury, I would definitely start browsing through tax filings or corporate reports to extrapolate the estimated monies received from these settlements.

Previous post on DataTreasury - 271 Patent Blog.

DataTreasury's settlement with JP Morgan - 271 Patent Blog.

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