Delaware Horizon Inc v. Central Bank Of Oman

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Delaware Horizon, Inc. (Delaware); Mahmoud Al Sahli (Ohio)
  • Defendant: Central Bank of Oman (CBO) (Sultanate of Oman), et al.
  • Plaintiff’s Counsel: Law Office of Anthony J. Richardson II, LLC
• Case Identification: 3:25-cv-01127, N.D. Ohio, 06/01/2025
• Venue Allegations: Plaintiffs allege that each Defendant, though based in the Sultanate of Oman, has representatives in the United States who distribute an allegedly infringing product, on information and belief, within the Northern District of Ohio.
• Core Dispute: Plaintiffs allege that Defendants’ mobile banking applications and the mandatory "MpClear" mobile payment framework, operated by the Central Bank of Oman, infringe a U.S. patent for a system that enables financial transactions using a mobile device's generic SIM card as a universal identifier.
• Technical Context: The technology concerns a centralized mobile payment architecture designed to achieve interoperability between disparate banking and telecommunication networks by using a phone number as the primary user identifier, thus avoiding the need for specialized hardware or bank-specific SIM cards.
• Key Procedural History: The complaint alleges that Plaintiffs provided pre-suit notice of infringement to all Defendants via a public notice published in the Times of Oman newspaper. It further alleges that the Central Bank of Oman responded with a letter containing threats, which Plaintiffs characterize as evidence of willful infringement.

Case Timeline

II. Technology and Patent(s)-in-Suit Analysis

• Patent Identification: U.S. Patent No. 10,032,156, titled "System And Method For Conducting Financial Transactions Using A Mobile Device," issued on July 24, 2018.

The Invention Explained

• Problem Addressed: The patent’s background section describes challenges in mobile banking related to a "lack of interoperability between different technology standards," which makes it difficult for a single application to connect with multiple banks. It also notes the complexity and cost of prior systems that required device modifications, "extended function SIM cards," or special Point-of-Sale (POS) terminals (’156 Patent, col. 1:40-64).
• The Patented Solution: The invention discloses a system architecture coordinated by a central "system operator" that acts as an intermediary between a user's mobile device, their mobile network provider, and their financial institution (’156 Patent, Abstract). The system uses the phone number associated with a "generic SIM chip" as the user's primary identifier, allowing any standard mobile device to connect to the system without modification (’156 Patent, col. 3:45-54). This central operator handles initial user authentication and routes transaction requests, while the financial institution maintains its own secure database with sensitive account information and separately confirms transactions with the user, enabling a secure and interoperable payment network (’156 Patent, col. 4:5-24; Fig. 1).
• Technical Importance: This approach aimed to simplify and universalize mobile payments by decoupling the financial transaction system from the underlying mobile hardware, thereby promoting broad adoption across different banks and mobile carriers (’156 Patent, col. 1:65-col. 2:2).

Key Claims at a Glance

• The complaint asserts independent claims 1 and 8, along with dependent claims 2-7 and 9-18.
• Independent Claim 1 (Apparatus) recites essential elements including:
  • A network-enabled mobile device associated with a "generic SIM chip" that lacks extrinsic bank-specific information, using a phone number as an "identifier."
  • A "computerized system operator device" with a first processor and a first customer database.
  • A "computerized first financial institution device" with a second processor and a second customer database, where the second database is different from and not accessible to the system operator.
  • A process where the system operator authenticates the device using the identifier, sends a transaction request to the financial institution, which in turn communicates with the user for confirmation before executing the transaction.
• Independent Claim 8 (System) recites a similar architecture where a central "system operator" is configured to:
  • Receive financial requests from users with generic SIMs.
  • Retrace identifiers, authenticate users, and map them to their respective financial institutions.
  • Establish communication channels and intermediate the transaction between the user and the bank.

III. The Accused Instrumentality

Product Identification

• The complaint names the "Mobile Payment Clearing and Switching System (MpClear)" as the primary accused instrumentality (Compl. ¶22). It also accuses the specific mobile banking applications offered by the numerous other financial institution Defendants, which are required to use the MpClear system (Compl. ¶25).

Functionality and Market Context

• The complaint alleges that the MpClear system is a "regulatory framework established by CBO for mobile payments" and that its use is mandatory for all financial institutions operating in the Sultanate of Oman (Compl. ¶¶21-22).
• The Central Bank of Oman (CBO) is alleged to function as the "system operator," managing the core MpClear infrastructure and a central database that maps customer mobile numbers to their bank information (Compl. ¶33, p. 11).
• Each participating bank allegedly maintains its own separate systems and databases linking these phone numbers to detailed customer financial account data (Compl. ¶33, p. 11).
• The system enables users to register via their phone number and perform financial transactions, with CBO allegedly routing requests to the appropriate bank for execution (Compl. ¶33, pp. 11-12). The complaint alleges these applications are distributed to U.S. citizens through platforms like Apple's AppStore and Google Play (Compl. ¶24).

IV. Analysis of Infringement Allegations

The complaint incorporates a multi-page claim chart table that juxtaposes the elements of the asserted claims against the alleged features of the MpClear system (Compl. ¶33, pp. 11-19).

’156 Patent Infringement Allegations

Identified Points of Contention

• Scope Questions: A central question may be one of territoriality. The infringement analysis will depend on whether the alleged use of the accused mobile applications by consumers within the U.S. is sufficient to constitute infringement under U.S. patent law, given that the core banking and system operator infrastructure is located in Oman (Compl. ¶¶3-15, 24).
• Technical Questions: The dispute may focus on whether the accused system meets the "separate" database requirement. The claim requires the financial institution's database to be "not accessible to the system operator device" (’156 Patent, col. 10:36-38). The degree of data separation and CBO's actual access rights or capabilities in the MpClear system will likely be a point of factual dispute.
• Technical Questions: What evidence demonstrates that the CBO and the individual banks "separately use the identifier... to authenticate the user" as required by the final clause of claim 1? The nature and independence of the alleged "validation" by CBO versus the "verification" by the bank will require close examination (Compl. ¶33, p. 13).

V. Key Claim Terms for Construction

• The Term: "generic SIM chip"

• Context and Importance: This term is fundamental to the patent's claim of novelty, as it distinguishes the invention from prior art that allegedly required specialized, bank-issued SIM cards. The construction of "generic" will be critical to determining infringement, as it addresses whether a standard carrier-issued SIM remains "generic" after its identifier is registered with the accused banking system.

• Intrinsic Evidence for Interpretation:

  • Evidence for a Broader Interpretation: The specification contrasts the invention with systems requiring "complete replacement of the mobile device's Subscriber Identity Module (SIM) card with extended function SIM cards" (’156 Patent, col. 1:55-58). This suggests "generic" could be interpreted broadly to mean any standard SIM not specially manufactured with pre-loaded banking functions.
  • Evidence for a Narrower Interpretation: Claim 1 requires that the "generic SIM chip" "lacks any extrinsic information corresponding to the financial institution" (’156 Patent, col. 10:12-14). A defendant may argue that the act of registering the SIM's phone number with the MpClear system functionally associates the SIM with "information corresponding to the financial institution," thereby taking it outside the scope of this limitation.

• The Term: "system operator device"

• Context and Importance: The claims mandate a specific two-part architecture: a "system operator device" and a "first financial institution device". The complaint identifies CBO's MpClear system as the "system operator device" (Compl. ¶33, p. 11). Practitioners may focus on this term because the nature of the relationship between CBO (a central bank) and the other defendant banks, particularly given the allegation that CBO "mandates" use of the system, could call into question whether they are sufficiently distinct entities to satisfy the claim's structural requirements (Compl. ¶22).

• Intrinsic Evidence for Interpretation:

  • Evidence for a Broader Interpretation: The patent abstract and summary describe the system operator functionally as an entity that "regulates data flow between users, banks, [and] mobile communications service providers" and is "in communication with the bank" (’156 Patent, Abstract; col. 2:15-16). This could support a reading where any centralized clearinghouse performing these functions qualifies.
  • Evidence for a Narrower Interpretation: Figure 1 depicts the "SCB-O" (12) as a structurally separate box from "Bank 1" (16₁) and "Bank 2" (16₂). A defendant might argue that if the CBO's control over the defendant banks is so operationally integrated that they function as a single monolithic system for transaction processing, the claimed two-device structure does not exist.

VI. Other Allegations

• Indirect Infringement: The complaint alleges that by designing, mandating, and distributing the MpClear system and associated mobile applications, Defendants knew and intended for their customers to use the system in an infringing manner, thereby inducing infringement (Compl. ¶¶32, 41.1).
• Willful Infringement: The complaint alleges willful infringement based on both pre-suit and post-suit knowledge. It explicitly pleads that Plaintiffs put Defendants on notice of the ’156 Patent through a public newspaper advertisement on March 20, 2023, and that Defendants continued their allegedly infringing activity thereafter (Compl. ¶¶27, 34). The complaint further alleges that CBO's subsequent threatening letter demonstrates a deliberate disregard for Plaintiffs' patent rights (Compl. ¶¶35-37).

VII. Analyst’s Conclusion: Key Questions for the Case

• A core issue will be one of extraterritoriality: can Plaintiffs establish infringement "within the United States" when the accused system's central infrastructure is located abroad, based on allegations that the system is accessible to and used by U.S. residents via downloadable mobile applications?
• A second key issue will be one of definitional scope: can the term "generic SIM chip", defined in the patent as lacking "extrinsic information corresponding to the financial institution," be construed to read on a standard SIM card after its associated phone number is registered with and mapped to a specific bank account within the accused MpClear system?
• Finally, a critical evidentiary question will be one of willfulness: do the allegations of public notice via a newspaper advertisement and a subsequent threatening letter from the Central Bank of Oman establish an "objectively high likelihood" of infringement that was knowingly disregarded, potentially justifying an award of enhanced damages?