DCT
2:23-cv-00196
Intercurrency Software LLC v. TD Ameritrade
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: Intercurrency Software LLC (Texas)
- Defendant: TD AMERITRADE, Inc., et al. (New York, Nebraska, Delaware)
- Plaintiff’s Counsel: Garteiser Honea, PLLC
- Case Identification: 2:23-cv-00196, E.D. Tex., 05/02/2023
- Venue Allegations: Venue is alleged to be proper based on Defendant maintaining a regular and established business presence within the Eastern District of Texas.
- Core Dispute: Plaintiff alleges that Defendant’s "thinkorswim" financial trading platform infringes three patents related to systems and methods for conducting securities transactions in a user's preferred currency.
- Technical Context: The technology at issue involves financial technology platforms that enable users to view pricing and execute trades in their local or preferred currency, even when the underlying asset is priced and traded in a different market currency.
- Key Procedural History: The three patents-in-suit belong to the same family, with the ’863 patent being a continuation of the ’107 patent, and the ’930 patent being a continuation of the ’863 patent. The complaint notes that the patents-in-suit have been cited by patents issued to industry leaders, but mentions no prior litigation or post-grant proceedings involving the patents.
Case Timeline
| Date | Event |
|---|---|
| 2007-04-18 | Priority Date for all Patents-in-Suit |
| 2018-08-28 | U.S. Patent 10,062,107 Issued |
| 2020-09-15 | U.S. Patent 10,776,863 Issued |
| 2022-09-20 | U.S. Patent 11,449,930 Issued |
| 2023-05-02 | Complaint Filed |
II. Technology and Patent(s)-in-Suit Analysis
U.S. Patent No. 10,062,107 - "CONSOLIDATED TRADING PLATFORM", Issued Aug. 28, 2018
The Invention Explained
- Problem Addressed: The patent describes a problem in prior art financial trading systems where an investor wishing to trade an asset in a foreign currency (e.g., a Chinese investor buying a U.S. stock) had to perform separate, bulk currency conversions. This introduced uncertainty, as the exchange rate could fluctuate between the time of the securities transaction and the currency exchange, obscuring the true profit or loss of the trade. (Compl. ¶19; ’107 Patent, col. 1:49-60). The patent asserts that prior art systems did not perform currency conversion "at a transactional level." (’107 Patent, col. 1:61-64).
- The Patented Solution: The invention proposes a "consolidated trading platform" that integrates a brokerage, a market exchange, and a currency exchange into a "three-tier architecture." (’107 Patent, col. 2:24-35). This system allows a user to select a "preferred currency" and then presents all pricing, data, and transaction settlements in that currency by performing the currency conversion in real-time as part of the transaction workflow. (’107 Patent, Abstract). This provides the trader with immediate certainty as to the value of the transaction in their chosen currency. (Compl. ¶21, ¶23).
- Technical Importance: The technology aimed to remove the risk and complexity of currency fluctuations from individual cross-border securities transactions by embedding the conversion process directly into the trading platform's core functionality. (Compl. ¶20-21).
Key Claims at a Glance
- The complaint asserts independent Claim 1. (Compl. ¶39).
- The essential elements of Claim 1 include:
- Providing a trading server coupled to currency and market exchange servers.
- Receiving an indicator of a "preferred currency" from a trader.
- Causing a client computer to display an asset in the preferred currency by determining a "prevailing exchange rate" and displaying all costs and fees in that currency.
- Conducting a transaction by transmitting a request to the market exchange server.
- Receiving a settlement notification and executing the transaction using a "calculated prevailing exchange rate" obtained "right before the transaction takes place" to prevent uncertainty.
- Performing a currency conversion from the market currency to the preferred currency using the calculated rate.
- The complaint’s exemplary assertion of Claim 1 suggests the right to assert other claims is reserved.
U.S. Patent No. 10,776,863 - "METHOD AND APPARATUS FOR DISPLAYING TRADING ASSETS IN A PREFERRED CURRENCY", Issued Sep. 15, 2020
The Invention Explained
- Problem Addressed: As a continuation, the ’863 patent addresses the same fundamental problem of transactional uncertainty caused by separating securities trading from currency conversion. (’863 Patent, col. 1:52-61).
- The Patented Solution: The patent describes a method for displaying trading assets where the asset’s valuation in the user's preferred currency changes "constantly" in accordance with updates to the prevailing exchange rate, even if the asset's market price remains unchanged. (’863 Patent, cl. 1). The solution is again based on a three-tier architecture that integrates brokerage, market, and currency exchange functions to provide a seamless user experience. (’863 Patent, Abstract; col. 2:25-35).
- Technical Importance: This patent further specifies the dynamic nature of the price display, reinforcing the invention's goal of providing traders with a real-time, actionable view of international markets in their local currency terms. (Compl. ¶21-23).
Key Claims at a Glance
- The complaint asserts independent Claim 1. (Compl. ¶55).
- The essential elements of Claim 1 include:
- Coupling a trading server to currency and market exchange servers.
- Receiving an indicator of a preferred currency.
- Causing a client computer to display an asset in the preferred currency, wherein the "valuation of the asset... changes in accordance with the prevailing exchange rate updated constantly even when a market value of the asset remains unchanged."
- Displaying costs and fees in the preferred currency.
- Conducting a transaction and receiving a settlement notification, executing the transaction with a calculated prevailing exchange rate.
- The exemplary nature of the allegation suggests other claims may be asserted later.
U.S. Patent No. 11,449,930 - "METHOD AND APPARATUS FOR TRADING ASSETS IN DIFFERENT CURRENCIES", Issued Sep. 20, 2022
Technology Synopsis
- As a continuation of the ’863 patent, this invention further details a system for trading assets across different currencies. The technology centers on a trading server that calculates and displays costs and fees for an asset in a user's selected "first currency," even though the asset trades in a "second currency," with the display dynamically updating based on the prevailing exchange rate from a coupled currency exchange server. (’930 Patent, Abstract; cl. 12).
Asserted Claims
- The complaint asserts independent Claim 12 as exemplary. (Compl. ¶71).
Accused Features
- The complaint alleges that the "thinkorswim" platform, by providing a trading server connected to forex and market exchange servers, infringes by enabling users to conduct transactions in a preferred currency. (Compl. ¶34, ¶71).
III. The Accused Instrumentality
Product Identification
- The accused instrumentalities are TD Ameritrade's "thinkorswim" trading platform and system, including its desktop, mobile, and web-based versions. (Compl. ¶34).
Functionality and Market Context
- The complaint alleges the "thinkorswim" platform is a "consolidated trading platform" that provides users with access to trade various financial instruments, including foreign exchange (forex). (Compl. ¶34, ¶39(i)). A screenshot provided in the complaint from a TD Ameritrade webpage describes "thinkorswim desktop" as an "integrated platform" for forex trading. (Compl. p. 9). The core accused functionality is the platform's alleged ability to allow a user to select a preferred currency, view asset prices in that currency, and execute transactions where the platform handles the currency conversion from the market currency. (Compl. ¶39).
IV. Analysis of Infringement Allegations
’107 Patent Infringement Allegations
| Claim Element (from Independent Claim 1) | Alleged Infringing Functionality | Complaint Citation | Patent Citation |
|---|---|---|---|
| providing a trading server coupled to one or more currency exchange servers and one or more market exchange servers; | Defendant provides trading servers coupled to its forex servers (currency exchange) and market exchange servers. | ¶39(i) | col. 8:46-51 |
| receiving in the trading server an indicator of a preferred currency from a trader; | The trading server receives an indicator of a preferred currency from a trader. | ¶39(ii) | col. 8:52-53 |
| causing a client computer associated with the trader to display at least an asset in the preferred currency while the asset is being traded in a market currency... | The platform causes the trader's client computer to display an asset in the preferred currency while it is being traded in a different market currency. | ¶39(iii) | col. 8:54-58 |
| conducting in the trading server a transaction of the asset by transmitting a transaction request from the trading server to a market exchange server when the trader decides to proceed with trading the asset; | The trading server conducts a transaction by sending a request to a market exchange server when the trader initiates a trade. | ¶39(iv) | col. 9:5-9 |
| receiving a settlement notification ... wherein the trading server is configured to calculate the prevailing exchange rate from all exchange rates obtained from the one or more currency exchange servers right before the transaction takes place... and executes the transaction with the calculated prevailing exchange rate... | The trading server receives a settlement notification and executes the transaction using a prevailing exchange rate calculated just before the transaction occurs. | ¶39(v) | col. 9:10-21 |
| performing a currency conversion of some portion or all of the transaction from the market currency to the preferred currency when the preferred currency is not identical to the market currency, the conversion being performed with the calculated prevailing exchange rate. | The platform performs a currency conversion from the market currency to the preferred currency using the just-in-time calculated exchange rate. | ¶39(vi) | col. 9:22-27 |
’863 Patent Infringement Allegations
The complaint alleges infringement of at least Claim 1 of the ’863 patent but does not provide a detailed, element-by-element breakdown of the accused functionality corresponding to each claim limitation. The complaint’s infringement theory is based on the general allegation that the Accused Instrumentalities provide a trading server coupled to currency and market exchange servers, thereby practicing the patented method. (Compl. ¶55). A more detailed analysis of the infringement allegations for this patent is not possible based on the complaint's text.
- Identified Points of Contention:
- Architectural Questions: The patents describe a "three-tier architecture" comprising a brokerage, market exchange, and currency exchange. (’107 Patent, Fig. 2B). A point of contention may be whether the "thinkorswim" platform, as a consolidated system, can be technically mapped to these distinct claimed components, or if its architecture differs in a way that avoids infringement.
- Technical Questions: A critical technical question is whether the accused platform performs the currency conversion as claimed. Specifically, does it calculate a "prevailing exchange rate... right before the transaction takes place" for the express purpose of settling that specific transaction and preventing "uncertainty in currency exchanges in another time"? (e.g., ’107 Patent, cl. 1). The evidence regarding the precise timing, source, and application of the exchange rate used by the accused platform will be central to the infringement analysis.
V. Key Claim Terms for Construction
"prevailing exchange rate"
- Context and Importance: This term is fundamental to the claims of all three patents. Its definition will be critical for determining whether the exchange rate used by the accused system meets the claim requirements, particularly concerning its timing ("right before the transaction") and source ("from the one or more currency exchange servers").
- Intrinsic Evidence for a Broader Interpretation: The specification describes the rate as being provided by a "participating financial agency" or "currency exchange server," which could support a construction that includes various types of real-time data feeds. (’107 Patent, col. 5:2-4; col. 6:50-54).
- Intrinsic Evidence for a Narrower Interpretation: The claims repeatedly link the calculation of this rate to the moment "right before the transaction takes place" for the specific purpose of preventing "uncertainty." (’107 Patent, cl. 1). This language may support a narrower construction requiring a rate that is locked-in for a specific transaction, rather than a general, periodically updated rate used for display purposes only.
"trading server"
- Context and Importance: The "trading server" is the central component in the claims, performing key functions like receiving user preferences, causing displays, and executing transactions. How this term is construed will determine how the claims are mapped onto the architecture of the accused "thinkorswim" system.
- Intrinsic Evidence for a Broader Interpretation: The specification notes that the three tiers of the architecture "may be implemented in a single computing machine," which could support a broader interpretation where the "trading server" encompasses the functionality of all three tiers in an integrated system. (’107 Patent, col. 5:30-31).
- Intrinsic Evidence for a Narrower Interpretation: Figure 2B of the patents depicts the "brokerage" (which functions as the trading server), "asset exchange," and "currency exchange" as distinct logical entities. This could support a narrower construction requiring the "trading server" to be a logically distinct component that communicates with separate exchange servers, potentially creating a point of dispute if the accused system is highly integrated.
VI. Other Allegations
- Indirect Infringement: The complaint alleges that Defendant induces infringement by advertising and marketing the "thinkorswim" platform for a use that infringes the patents. (Compl. ¶44, ¶47, ¶60, ¶76). The plaintiff asserts that such advertising supports a finding of intent to induce. (Compl. ¶47).
- Willful Infringement: Willfulness is alleged based on Defendant’s knowledge of the patents following the filing and service of the complaint. (Compl. ¶43, ¶59, ¶75). The complaint also pleads willful blindness, alleging Defendant has a "practice of not performing a review of the patent rights of others" prior to launching products and services. (Compl. ¶48, ¶64, ¶80).
VII. Analyst’s Conclusion: Key Questions for the Case
- A core issue will be one of architectural mapping: can the "three-tier architecture" described in the patents, which delineates brokerage, market exchange, and currency exchange functions, be mapped onto the allegedly more integrated software and server architecture of the accused "thinkorswim" platform?
- A key evidentiary question will be one of functional specificity: does the accused platform’s currency conversion feature perform the specific, time-critical function required by the claims—namely, calculating a "prevailing exchange rate" for an individual trade "right before the transaction takes place" to eliminate future currency risk—or does it use a more general, periodically updated rate for display and settlement that does not meet this limitation?