DCT
5:17-cv-01145
FireKing Security Products LLC v. American Security Products Co
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: FireKing Security Products, LLC (Indiana)
- Defendant: American Security Products Company (California)
- Plaintiff’s Counsel: Kilpatrick Townsend & Stockton LLP
- Case Identification: 5:17-cv-01145, C.D. Cal., 06/12/2017
- Venue Allegations: Venue is alleged to be proper because Defendant is incorporated in California, maintains its corporate headquarters and principal place of business within the district, and has allegedly committed acts of infringement and has a regular and established place of business in the district.
- Core Dispute: Plaintiff alleges that Defendant’s "CashWizard" line of smart safes infringes a patent related to the electronic tracking of cash deposits and withdrawals using event-based identifiers.
- Technical Context: The technology concerns smart safe systems used in retail and business environments to automate and secure cash handling, which enables features like provisional bank credit based on electronically verified deposits.
- Key Procedural History: The complaint details the '098 Patent's chain of title, including multiple assignments and a corrective assignment filed in 2010 to rectify scrivener's errors regarding the names and incorporation states of the involved entities. This history is central to establishing the plaintiff's standing to assert the patent.
Case Timeline
| Date | Event |
|---|---|
| 2000-10-20 | '098 Patent Priority Date |
| 2001-04-11 | '098 Patent assigned to AT Systems, Inc. |
| 2007-05-08 | U.S. Patent No. 7,216,098 issues |
| 2009-11-02 | '098 Patent assigned to AT Systems Technologies, Inc. |
| 2010-09-24 | Corrective assignment of '098 Patent to FKI Security Group |
| 2016-11-01 | '098 Patent assigned to Plaintiff FireKing |
| 2017-06-12 | Complaint Filed |
II. Technology and Patent(s)-in-Suit Analysis
U.S. Patent No. 7,216,098 - "Electronic Transmission and Tracking of Deposit Information," Issued May 8, 2007
The Invention Explained
- Problem Addressed: The patent identifies the difficulty business establishments face in reconciling daily sales receipts with cash held in a drop safe, particularly because cash withdrawals (e.g., by an armored car service) often occur at times that do not coincide with the end of a business day, leading to co-mingled funds from different periods and complicating accounting ('098 Patent, col. 1:46-54). The complaint adds that using simple date and time stamps for tracking is unreliable due to time zone differences and asynchronous clocks between devices (Compl. ¶21).
- The Patented Solution: The invention is a cash control system that tracks deposits relative to a "predetermined event," such as an armored car pickup, rather than relying on absolute time. It uses a "pair of identifiers" (e.g., a sequence number and an alternate sequence number) that are updated based on whether such an event has occurred. This allows the system to generate distinct reports for cash accumulated before the event versus after the event, enabling accurate reconciliation regardless of when the event happens during a business day ('098 Patent, col. 9:5-18; col. 10:48-64).
- Technical Importance: This method of event-based tracking provides a more robust and reliable way to manage cash flow, which facilitates commercially significant services like "provisional credit," where a bank can credit a retailer's account for cash deposited in a smart safe before it is physically collected (Compl. ¶22).
Key Claims at a Glance
- The complaint asserts infringement of at least independent claim 1 (Compl. ¶36).
- The essential elements of independent claim 1 include:
- A safe assembly with a currency reader.
- A memory with control software programmed to update a pair of identifiers that distinguish deposit information based on a "predetermined event."
- A central control unit that receives deposit information and transmits reports.
- Means for detecting the predetermined event.
- Means for detecting the accounting period after the event.
- Means for generating the pair of identifiers to indicate whether a deposit occurred before or after the event, where the identifiers do not contain date or time values.
- A cash information server to receive the reports and identify the amount of cash collected.
- The complaint does not explicitly reserve the right to assert dependent claims, but this is standard practice.
III. The Accused Instrumentality
Product Identification
- The "CashWizard" line of smart safes, including models BR2012, BR2013, BR3113, BR3119, BR 3120, and BR3122 (Compl. ¶¶23-24).
Functionality and Market Context
- The complaint alleges the Accused Products are comprehensive cash control systems that secure cash, use a currency reader to track transactions, and monitor daily cash volumes (Compl. ¶39). They are allegedly configured to detect a "courier event" (e.g., armored car pickup) and use "tracking numbers which are identifiers" to distinguish deposits made before this event from those made after (Compl. ¶¶40, 42). This information is allegedly transmitted via "Cloud Web Services" to an intermediate server for monitoring and reporting (Compl. ¶¶37, 49). The complaint provides a screenshot from a promotional video, described as showing master reports accessible by an end user (Compl. ¶29).
IV. Analysis of Infringement Allegations
'098 Patent Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| a safe assembly including a safe adapted to secure cash and a currency reader coupled to the safe and programmed to determine an amount of cash received in the safe; | The Accused Products are smart safes with at least one currency reader that keeps track of cash transactions to determine the amount of cash received and monitors daily volumes. | ¶39 | col. 4:3-15 |
| a memory in which a control software is stored, the control software programmed to update a pair of identifiers that distinguish deposit information accumulated only during an accounting period before a predetermined event and deposit information accumulated during an accounting period that includes a period after the predetermined event; | The Accused Products include a memory with control software and use updatable "tracking numbers" as identifiers to distinguish deposits made before an armored car pickup from those made after. | ¶¶40, 42 | col. 14:32-40 |
| a central control unit which receives deposit information from the safe assembly and generates and transmits deposit reports... | The Accused Products have a central control unit that receives deposit information and generates and transmits deposit reports, such as "end of day" reports and "courier reports." | ¶¶41, 46 | col. 5:6-14 |
| means for detecting the predetermined event used to determine the accounting period before the predetermined event; | The Accused Products are configured to detect a "courier event signifying an armored car pickup of cash" which determines the accounting period before that event. | ¶¶40, 47 | col. 14:48-51 |
| means for generating, using the control software... the pair of identifiers to indicate whether the deposit information was accumulated... before the predetermined event or... after the predetermined event by making the identifiers to be different from one another or to be identical to each other... | The Accused Products generate a pair of identifiers; for example, after a pickup, an "identifier number" is changed to an "alternate identifier number," making them different, whereas they would be the same if no pickup occurred. | ¶¶43, 48 | col. 14:52-62 |
| wherein the pair of identifiers do not contain values including a date and/or a time of the predetermined event; | The Accused Products are configured to generate a pair of identifiers "other than a date or time" to determine when the deposit information was accumulated. | ¶48 | col. 14:62-64 |
| a cash information server configured to receive the deposit information and the pair of identifiers... and to identify the amount of cash collected... | AmSec provides "Cloud Web Services" which function as a cash information server to receive deposit information and reports, allowing for online monitoring and identification of cash collected during respective accounting periods. | ¶49 | col. 6:5-14 |
- Identified Points of Contention:
- Scope Questions: Claim 1 recites multiple "means-plus-function" elements (e.g., "means for detecting," "means for generating"). The infringement analysis will depend on the court first identifying the corresponding structures disclosed in the '098 patent specification (e.g., a processor executing specific software steps, a "hot key" input) and then determining whether the accused "CashWizard" system's architecture is structurally identical or equivalent.
- Technical Questions: A key question is how the accused system's "tracking numbers" are generated and whether they are truly "other than a date or time" as required by the claim (Compl. ¶48). The litigation may explore whether these numbers are derived from, or are a proxy for, a timestamp, which could create a non-infringement argument.
V. Key Claim Terms for Construction
The Term: "means for detecting the predetermined event"
- Context and Importance: This is a means-plus-function limitation under 35 U.S.C. § 112(f). Its scope is not its literal function but is limited to the corresponding structure described in the patent's specification and its equivalents. Practitioners may focus on this term because the outcome of the infringement analysis for this element will depend entirely on a structural comparison between what is disclosed in the patent and what is implemented in the accused device.
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: A plaintiff might argue that the specification discloses multiple structures, such as "an operator, e.g., a store manager, also identifies the end and/or beginning of a business day... [by pressing] a hot key or [swiping] a card key" ('098 Patent, col. 5:46-49) or "a calendar/clock determines the end of a business day" ('098 Patent, col. 5:50-51), suggesting the structure is a processor configured to receive a signal from any of several input types.
- Evidence for a Narrower Interpretation: A defendant may argue the structure is limited to the specific examples given—a physical "hot key" or card swipe mechanism linked to a processor—and that a purely software-based detection method in the accused product is not structurally equivalent.
The Term: "a pair of identifiers"
- Context and Importance: The entire inventive concept hinges on using these identifiers to track deposits relative to an event. Defining what qualifies as an "identifier" and whether the accused "tracking numbers" meet this definition is central to the dispute.
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The claim language itself is broad, not limiting the identifiers to a specific format. The complaint alleges that the accused "tracking numbers" and "sequence numbers" function as these identifiers (Compl. ¶¶42, 45).
- Evidence for a Narrower Interpretation: The specification provides a very specific example of a "sequence number" and an "alternate sequence number" that are managed in a particular way (e.g., incremented and reconciled) ('098 Patent, col. 9:5-18; Fig. 4). A defendant could argue that the term "pair of identifiers" should be construed as being limited to this specific two-number, increment-and-reconcile implementation.
VI. Other Allegations
- Indirect Infringement: The complaint does not contain a separate count for indirect infringement. However, it alleges facts that could potentially support such a claim, for example by asserting that Defendant markets and provides operating instructions and applications for the Accused Products, which could be construed as encouraging or instructing infringement by end-users (Compl. ¶¶30, 37).
- Willful Infringement: The complaint seeks increased damages pursuant to 35 U.S.C. § 284 in its prayer for relief (Compl. p. 12, ¶4). However, it does not plead specific facts establishing that Defendant had pre-suit knowledge of the '098 Patent or its alleged infringement.
VII. Analyst’s Conclusion: Key Questions for the Case
- A core issue will be one of structural correspondence under means-plus-function analysis: Will the court find that the software and hardware architecture of the accused "CashWizard" system is structurally equivalent to the specific processor, input, and software configurations disclosed in the '098 patent specification for performing the claimed "means for detecting" and "means for generating" functions?
- A key evidentiary question will be one of technical implementation: Do the "tracking numbers" used by the accused system function as the claimed "pair of identifiers," and critically, does evidence show they are generated and exist as values that "do not contain... a date and/or a time," or are they merely a proxy for a timestamp?