The folks at Target recently received a U.S. Patent for a “Financial transaction card holder with card,” U.S. Pat. No. D610346. Yes, it’s just a design patent, but it’s pretty nifty nonetheless.
After asserting its patent for encrypted data transmissions (U.S. Patent No. 5,412,730) against over 20 banks and major credit card companies, TQP Development reached an agreement with American Express Travel Related Services to settle the dispute. TQP initially filed the suit in U.S. District Court for the Eastern District of Texas on March 25, 2009.
The Defendants include Barclays Bank, Prudential, Amazon,.com, Visa, and many more. TQP previously settled the matter with MasterCard back in June and with Amazon.com in July. This month is American Express.
MasterCard gift card retailer PrivaCash, which offers a pre-paid debit card having a pre-set spending limit but without using an actual credit card for retail purchases, filed a complaint on June 19, 2009, in the U.S. District Court for the Western District of Wisconsin, asserting that it’s U.S. Patent 7,328,181 is infringed.
Specifically, PrivaCash alleges that certain prepaid gift cards provided by American Express Company, and its subsidiaries American Express Incentive Services and American Express Travel Related Services, infringe the patent entitled “Method and System for Transacting an Anonymous Purchase Over the Internet.” The patent covers a method for transacting anonymous Internet purchases.
It will be interesting to see whether there are any “multiple actor” issues in this case, given that the claimed steps (see representative claim 1 below) recite distributing a plurality of unfunded purchase cards, issuing one of those cards to a cardholder, and making a purchase with that card at an unassociated retailer. The current Federal Circuit law holds that a method claim is only infringed when a single party performs each step of the asserted claim, unless a single party exercises “control or direction” over the entire infringement.
BMC Resources, Inc. v. Paymentech, L.P., 498 F.3d 1373 (Fed. Cir. 2007) (where steps of a method claim are performed by multiple parties, the entire method must be performed at the control or direction of the alleged direct infringer);
Muniauction, Inc. v. Thompson Corp., 532 F.3d 1318 (Fed. Cir. 2008) (“where the actions of multiple parties combine to perform every step of a claimed method, the claim is directly infringed only if one party exercises ‘control or direction’ over the entire process such that every step is attributable to the controlling party, i.e., the mastermind.’ . . . the control or direction standard is satisfied in situations where the law would traditionally hold the accused direct infringer vicariously liable for the acts committed by another party that are required to complete performance of a claimed method”)
Claim 1 A method of transacting a purchase, comprising:
distributing a plurality of unfunded purchase cards from a purchase card provider to a plurality of purchase card outlets, wherein each of the purchase cards is a bearer instrument having an associated account number issued by a major branded credit card organization, an expiration date and a non-personalized cardholder name selected by the purchase card provider printed thereon, wherein the purchase card does not include information identifying the specific perspective cardholder, wherein information associated with each of the purchase card accounts is maintained in a software implemented application operated by the purchase card provider;
issuing a purchase card to a cardholder at the a purchase card outlet;
contacting the purchase card provider to fund and activate the purchase card account of specific purchase card issued with a software implemented application or via the telephone; and
transacting a cardholder purchase at any one of a number of retailers not associated with the purchase card outlet which accepts credit cards of the major branded credit card organization, wherein the cardholder presents the purchase card and the retailer contacts the purchase card provider over a network connection to interface with the software implemented application transmitting the purchase amount and the purchase card account number without requiring the retailer to collect and transmit personalized cardholder identifying information, to verify using the software implemented retail application that the purchase card is unexpired and that the purchase amount does not exceed the cardholder’s funding limit, whereupon the purchase card account information will be debited by the amount of the purchase and the account of the retailer will be electronically credited completing the purchase transaction.
On May 26, 2009, Marshall, Texas-based Actus LLC filed a complaint seeking an injunction and damages in the U.S. District Court for the Eastern District of Texas for infringement of U.S. Patent Nos. 7,328,189, 7,249,099, 7,177,838, and 7,376,621, all titled “Method and Apparatus for Conducting Electronic Commerce Transactions Using Electronic Tokens.” The defendants’ accused products, including prepaid cards and payment services, allegedly infringe the four patents which cover Internet commerce and electronic payment systems.
The complaint identifies fifteen defendants that offer prepaid gift cards or online payment options for customers, including: Amazon.com, Amdocs, American Express Company, Apple, Barnes & Noble, Best Buy, Cabela’s, CitiGroup, eBay, FirstView, Marketing Technology Concepts, NetSpend, Officemax, U.S. Bancorp, and ViVOtech, Inc.
Back in April, Actus filed another suit, also in Marshall, Texas, asserting the same four e-commerce patents against 20 defendants, including Visa, Wal-Mart, Disney, Google, and various credit card issuers.
In the complaints, Actus asserts that it is the owner by assignment of the four patents, but the assignments have not yet appeared on the USPTO’s Patent Assignment Database. Each of these four patents was last assigned to PayByClick Corporation – Texas, which is the owner of 5 total patents. The lone, non-asserted patent is U.S. Patent 6,876,979, “Electronic Commerce Bridge System.”
Actus is represented in both suits by William E. “Bo” Davis, III of The Davis Firm.
Restricted Spending Solutions LLC, a subsidiary of Acacia Research Corp., filed a complaint yesterday against 14 financial institutions, asserting infringement of a U.S. patent. The defendants, which include banks and credit card companies, allegedly issue limited charge cards designed for teenagers or corporate employees that infringe the patent. Restricted Spending is represented by SimmonsCooper.
The complaint lists the following defendants: Allow Card of America Inc, Palm Desert Investments, Wachovia Corp, PAYJr Inc, CardLab Inc, Bancorp Inc, Discover Financial Services, Bank of America Corp, Commerce Bancshares Inc, UMB Financial Corp, Fifth Third Bancorp, MasterCard International Inc, Visa USA Inc and US Bancorp.
Restricted Spending Solutions’ patent 6,044,360 for a “Third party credit card” claims a system and method of allocating funds in pre-established customer accounts.
Last year, Restricted Spending asserted U.S. Patent 7,143,064 against Apple. The patent claims a method of allocating parental funds in pre-established accounts for use by children. Restricted Spending and Apple entered into a settlement and license agreement on June 20, 2008.