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DataTreasury Patents Invalidated

On April 29, 2015, the U.S. Patent and Trademark Office’s Patent Trial and Appeal Board (PTAB) issued decisions invalidating two of DataTreasury’s check-imaging patents as too abstract.

The decisions came as a result of Fidelity National Information Services, Inc. (Fidelity) petitioning the PTAB to review the DataTreasury patents under the America Invents Act (AIA). The AIA Covered Business Method review program is intended to give the patent office tools to reconsider patents that perhaps should never have been issued. Fidelity's petition, filed in response to being sued by DataTreasury for patent infringement, argued the patents are invalid because they recite abstract ideas that "do not invent any new machine or process" and use "off-the-shelf components to perform their known functions."

Upon review, the PTAB said each of the contested claims was invalid as an abstract idea. Additionally, it found certain claims were unpatentable for a lack of written description. The Board wrote, “For the reasons that follow, we determine that [Fidelity] has shown by a preponderance of the evidence that claims ... are unpatentable".

This ruling is a big victory for financial institutions and may offer relief for institutions that are not in active litigation with DataTreasury but are paying ongoing license fees to them for the now invalidated patents. To date JPMorgan, Bank of America Corp. and Citigroup Inc. have collectively paid DataTreasury $350 million. The patents are now considered worthless unless DataTreasury appeals.

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