DCT
2:23-cv-00361
Intercurrency Software LLC v. Foris DAX Asia Pte Ltd
I. Executive Summary and Procedural Information
- Parties & Counsel:
- Plaintiff: Intercurrency Software LLC (Texas)
- Defendant: Foris DAX Asia Pte. Ltd. (Singapore)
- Plaintiff’s Counsel: Garteiser Honea, PLLC
- Case Identification: 2:23-cv-00361, E.D. Tex., 08/04/2023
- Venue Allegations: Venue is alleged on the basis that the Defendant is a foreign entity not resident in the United States, is subject to personal jurisdiction in the district, and has conducted business and committed acts of infringement within the district.
- Core Dispute: Plaintiff alleges that Defendant’s Crypto.com cryptocurrency trading platform infringes three patents related to a consolidated financial trading system that allows users to transact in a preferred currency.
- Technical Context: The patents address technology for cross-currency financial trading platforms, which aim to provide users with price certainty by integrating asset trading with real-time currency conversion.
- Key Procedural History: The three asserted patents are continuations within the same patent family and are subject to terminal disclaimers. The complaint notes that during prosecution, patent examiners considered relevant art classes for financial data processing, which Plaintiff suggests supports the patents' validity and eligibility.
Case Timeline
| Date | Event |
|---|---|
| 2007-04-18 | Priority Date for '107, '863, and '930 Patents |
| 2016-XX-XX | Defendant Crypto.com founded |
| 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 |
| 2023-08-04 | 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's background describes a problem in prior art trading systems where foreign investors had to perform currency conversions in bulk, separate from the actual asset transactions. This created "no certain knowledge of what profit or loss" would result, because the exchange rate at the time of conversion could differ significantly from the rate at the time of the trade, exposing the investor to currency fluctuation risk (’107 Patent, col. 1:53-60). The patent identifies a need for a system that performs currency conversion at a "transactional level" (’107 Patent, col. 1:62-64).
- The Patented Solution: The invention proposes a "three-tier architecture" that integrates a brokerage, a market exchange, and a currency exchange into a single platform (’107 Patent, col. 2:24-28). This consolidated system presents all prices, data, and settlements in a currency preferred by the trader, in conjunction with the market and currency exchanges, so that "a trader always knows exactly what he/she may end up with" (’107 Patent, col. 2:30-35). The platform can also perform currency conversions automatically based on specified conditions (’107 Patent, col. 2:35-38).
- Technical Importance: This approach aimed to reduce the risk and complexity of international trading by providing investors with real-time, "all-in" cost certainty for transactions involving different currencies (’107 Patent, col. 2:1-3).
Key Claims at a Glance
- The complaint asserts independent claim 1.
- The essential elements of claim 1 include:
- Providing a trading server coupled to one or more currency exchange servers and one or more 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 while it is being traded in a different market currency, which involves determining a prevailing exchange rate.
- Conducting a transaction by transmitting a request from the trading server to a market exchange server.
- Receiving a settlement notification and executing the transaction with a prevailing exchange rate calculated "right before the transaction takes place."
- Performing a currency conversion from the market currency to the preferred currency.
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 of the application leading to the ’107 Patent, this patent addresses the same problem: the lack of transactional-level currency conversion in prior art systems, which created uncertainty for investors trading in foreign-denominated assets (’863 Patent, col. 1:57-65).
- The Patented Solution: The patent describes the same integrated three-tier platform solution that displays asset information and executes trades in a user's preferred currency (’863 Patent, col. 2:25-34). The focus is on ensuring a trader knows the exact financial outcome of a transaction by obtaining a prevailing exchange rate "prior to a transaction to prevent uncertainty in currency exchanges in another time" (’863 Patent, Abstract).
- Technical Importance: The technology provides a mechanism to give traders a stable, predictable view of asset prices and transaction costs in their own currency, insulating them from the effects of exchange rate volatility between the time of trade execution and settlement (’863 Patent, col. 1:65-col. 2:2).
Key Claims at a Glance
- The complaint asserts independent claim 1.
- The essential elements of claim 1 include:
- Coupling a trading server to currency and market exchange servers.
- Receiving an indicator of a preferred currency from a trader.
- Causing a client computer to display the asset in the preferred currency while it is traded in a market currency, with the asset's valuation changing in accordance with the exchange rate.
- Displaying all costs and fees in the preferred currency.
- Conducting a transaction of the asset.
- Receiving a settlement notification and executing the transaction using a calculated prevailing exchange rate.
U.S. Patent No. 11,449,930 - Method and Apparatus for Trading Assets in Different Currencies
Issued Sep. 20, 2022
- Technology Synopsis: This patent, also in the same family, describes a system for trading assets across different currencies. It addresses the problem of price uncertainty by integrating market and currency exchanges to calculate and display all costs in a user's single preferred currency and execute the transaction based on a contemporaneously calculated exchange rate.
- Asserted Claims: Independent claim 12 is asserted.
- Accused Features: The complaint alleges that the server architecture of the Crypto.com platform, which it claims couples trading servers with currency and market exchange functions to execute cryptocurrency trades, infringes this patent (Compl. ¶67).
III. The Accused Instrumentality
Product Identification
The "Crypto.com trading platforms and systems," referred to as the "Accused Instrumentalities" (Compl. ¶30).
Functionality and Market Context
The complaint identifies the accused instrumentality as a cryptocurrency exchange platform that allows users to buy and sell over 250 cryptocurrencies using various fiat currencies (Compl. p. 10). A screenshot provided in the complaint shows a list of cryptocurrencies, including Bitcoin and Ethereum, with prices denominated in U.S. dollars, which the complaint appears to treat as the "market currency" (Compl. p. 10). The platform is allegedly accessible to users in the United States via internet web pages and software applications, and Defendant is alleged to generate substantial revenue from its operation (Compl. ¶¶34, 36). A second screenshot depicts the platform's mobile app interface showing a user's total balance in USD (Compl. p. 8).
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 practices and provides a trading server coupled to one or more currency exchange servers and market exchange servers. | ¶35(i) | col. 4:65-col. 5:4 |
| receiving in the trading server an indicator of a preferred currency from a trader | The platform practices and provides receiving an indicator of a preferred currency from a trader. | ¶35(ii) | col. 8:51-53 |
| 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 a client computer to display an asset in a preferred currency while the asset is traded in a market currency. | ¶35(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 platform conducts a transaction by transmitting a request from its trading server to a market exchange server when a trader decides to proceed. | ¶35(iv) | col. 9:5-9 |
| receiving a settlement notification ... wherein ... the trading server is configured to calculate the prevailing exchange rate ... right before the transaction takes place ... and executes the transaction with the calculated prevailing exchange rate ... | The trading server receives a settlement notification, is configured to calculate the prevailing exchange rate right before the transaction, and executes the transaction with that rate. | ¶35(v) | col. 9:10-22 |
| 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 platform performs a currency conversion when the preferred and market currencies are not identical. | ¶35(vi) | col. 9:23-28 |
Identified Points of Contention
- Scope Questions: The patents’ specifications primarily discuss traditional financial "securities" and "assets" like stocks, bonds, and commodities, with examples including NASDAQ and NYMEX (’107 Patent, col. 2:19-24). A central question may be whether the scope of these terms, as understood from the 2007 priority date, can be construed to read on the modern cryptocurrencies traded on the accused platform.
- Technical Questions: The complaint alleges the accused platform calculates a "prevailing exchange rate... right before the transaction takes place" to "prevent uncertainty" (Compl. ¶35(v)). This raises an evidentiary question of whether the Crypto.com platform performs this specific timing and calculation function as claimed, or if its exchange rate mechanism operates in a technically distinct manner. The provided screenshots do not detail this underlying process (Compl. pp. 8, 10).
- Technical Questions: A further technical question is whether the accused system functions as an integrated whole to perform the claimed method. For example, does the Crypto.com platform itself "perform a currency conversion," or does it interface with a separate, third-party service for this step? The claim requires this step to be part of the infringing method.
V. Key Claim Terms for Construction
For the ’107 and ’863 Patents
The Term: "asset" / "security"
- Context and Importance: The construction of this term is critical to determining whether the patents, which were drafted in the context of traditional financial markets, apply to the cryptocurrency markets in which the accused platform operates.
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The specification provides a non-limiting list, stating that securities "include, but are not limited to, a wide array of electronically traded financial assets such as stocks, bonds, options, commodities (e.g., oil, gold), futures/derivatives contracts, funds, index funds, mutual funds, exchange traded funds" (’107 Patent, col. 2:19-24). This exemplary list could support an interpretation broad enough to include other forms of electronically traded financial assets, such as cryptocurrencies.
- Evidence for a Narrower Interpretation: The specific examples throughout the specification are rooted in traditional finance, referencing "US securities," "Charles Schwab," "NASDAQ," and the "NYMEX" (’107 Patent, col. 1:31, 1:42, 6:50-51). An argument could be made that this consistent context limits the invention to the field of traditional securities as understood at the time of invention.
The Term: "preferred currency"
- Context and Importance: The claims require displaying an asset in a "preferred currency" while it is traded in a "market currency." The complaint's evidence shows assets priced in USD (Compl. p. 10). Whether USD is acting as the "preferred currency," the "market currency," or both will be critical to the infringement analysis.
- Intrinsic Evidence for Interpretation:
- Evidence for a Broader Interpretation: The specification describes the preferred currency as one "determined by the trader," such as Japanese Yen for a trader in Japan (’107 Patent, col. 6:36-40). This suggests it is a flexible, user-defined choice.
- Evidence for a Narrower Interpretation: The core problem solved by the patent arises from a mismatch between the trader's local/preferred currency and the market's currency. If a user's preferred currency is USD and the asset is also priced and traded in USD (the apparent market currency on the platform), it raises the question of whether the functionality described in the patent is actually being used in the manner claimed.
VI. Other Allegations
- Indirect Infringement: The complaint alleges inducement based on Defendant’s advertising and provision of the Crypto.com platform, which allegedly instructs and encourages users to perform the steps of the claimed methods (Compl. ¶¶41-43, 57-59).
- Willful Infringement: Willfulness is alleged based on Defendant’s knowledge of the patents following the filing and service of the complaint. The complaint also alleges willful blindness, asserting on information and belief that Defendant has a practice of "not performing a review of the patent rights of others" prior to launching products (Compl. ¶¶44, 60, 76).
VII. Analyst’s Conclusion: Key Questions for the Case
- A core issue will be one of definitional scope: can terms like "asset" and "security", rooted in the patent's 2007-era context of traditional financial instruments, be construed to cover the distinct class of digital assets known as cryptocurrencies?
- A key evidentiary question will be one of technical operation: does the accused Crypto.com platform perform the specific, multi-step process recited in the claims—particularly the calculation of a "prevailing exchange rate... right before the transaction" for the express purpose of preventing uncertainty—or is there a fundamental mismatch between the patented method and the platform's actual functionality?
- A central dispute may also concern the factual premise of infringement: given that the platform appears to primarily denominate assets in USD, can Plaintiff establish that users are selecting a different "preferred currency" and that the platform is performing the claimed conversion from a "market currency" in a way that maps onto the claim elements?