Intercurrency Software LLC v. Paybis Ltd

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Intercurrency Software LLC (Texas)
  • Defendant: Paybis Ltd. (United Kingdom)
  • Plaintiff’s Counsel: Garteiser Honea, PLLC
• Case Identification: 2:24-cv-00253, E.D. Tex., 04/17/2024
• Venue Allegations: Plaintiff alleges venue is proper because Defendant is subject to personal jurisdiction in the district, has conducted business and committed acts of infringement there, and is not a resident of the United States.
• Core Dispute: Plaintiff alleges that Defendant’s cryptocurrency exchange platform infringes three patents related to systems and methods for a consolidated financial trading platform that executes transactions in a user’s preferred currency.
• Technical Context: The technology falls within the financial technology (FinTech) sector, specifically addressing the complexities of executing and settling asset trades across different national currencies.
• Key Procedural History: The complaint alleges the patents-in-suit claim priority to 2007 and have been cited by patents issued to Bank of America. No prior litigation or post-grant proceedings involving the patents-in-suit are mentioned.

Case Timeline

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

U.S. Patent 10,062,107, “Consolidated Trading Platform,” issued August 28, 2018 (’107 Patent)

The Invention Explained

• Problem Addressed: The patent’s background section describes a problem faced by investors trading assets (e.g., U.S. securities) in a foreign currency (Compl. ¶15; ’107 Patent, col. 1:26-53). Prior systems required separate, bulk currency conversions before and after trading, creating uncertainty about the transaction's final profit or loss due to fluctuating exchange rates. The currency conversion was not performed "at a transactional level" (’107 Patent, col. 1:61-63).
• The Patented Solution: The invention proposes a "consolidated trading platform" based on a "three-tier architecture" comprising a brokerage, a market exchange, and a currency exchange (’107 Patent, col. 2:24-33; Fig. 2B). This platform presents all prices, data, and settlements to the trader in their "preferred currency," allowing the trader to "always know[] exactly what he/she may end up with" at the moment of the transaction (’107 Patent, col. 2:33-35).
• Technical Importance: The claimed system aims to provide price certainty in cross-border financial transactions by integrating real-time currency conversion directly into the trading workflow (Compl. ¶19).

Key Claims at a Glance

• The complaint asserts independent Claim 1 (Compl. ¶35).
• Essential Elements of Claim 1:
  • 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, which involves determining and applying a prevailing exchange rate.
  • Displaying all costs and fees in the preferred currency, which change dynamically with the exchange rate.
  • Conducting a transaction by transmitting a request to a market exchange server.
  • Receiving a settlement notification, wherein the trading server calculates the prevailing exchange rate "right before the transaction takes place" to execute the transaction at that rate.
  • Performing a currency conversion from the market currency to the preferred currency.
• The complaint alleges infringement of "the claims of the ’107 Patent," which may suggest an intent to assert other claims later (Compl. ¶35).

U.S. Patent 10,776,863, “Method and Apparatus for Displaying Trading Assets in a Preferred Currency,” issued September 15, 2020 (’863 Patent)

The Invention Explained

• Problem Addressed: As a continuation of the application leading to the ’107 Patent, the ’863 Patent addresses the same problem of uncertainty in cross-currency financial trading due to the separation of asset trading and currency exchange functions (’863 Patent, col. 1:13-60).
• The Patented Solution: The invention describes a method where a trading server, coupled to market and currency exchanges, displays an asset's price to a trader in their preferred currency by determining and applying a "prevailing exchange rate" (’863 Patent, Abstract; col. 2:25-35). The solution emphasizes the dynamic display of costs and fees, allowing a trader to see the true cost in their own currency before committing to a trade (’863 Patent, col. 8:54-9:20).
• Technical Importance: This technology focuses on the user-facing aspect of the trading platform, ensuring that the information presented to the trader (prices, costs) accurately reflects real-time currency fluctuations (Compl. ¶18).

Key Claims at a Glance

• The complaint asserts independent Claim 1 (Compl. ¶51).
• Essential Elements of Claim 1:
  • Coupling a trading server to one or more currency exchange servers 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 by determining a prevailing exchange rate.
  • The "valuation of the asset in the preferred currency changes in accordance with the prevailing exchange rate updated constantly."
  • Conducting a transaction and receiving a settlement notification.
• The complaint alleges infringement of "the claims of the ’863 Patent," which may suggest an intent to assert other claims later (Compl. ¶51).

Multi-Patent Capsule: U.S. Patent 11,449,930, “Method and Apparatus for Trading Assets in Different Currencies,” issued September 20, 2022 (’930 Patent)

• Technology Synopsis: This patent, also in the same family, describes a method for trading assets across different currencies. It solves the problem of exchange rate uncertainty by having a trading server calculate and display all costs and fees in a trader's selected first currency for an asset traded in a second currency. The system determines a second prevailing exchange rate "right before the transaction takes place" to ensure the final settlement reflects the most current rate, thereby providing transactional certainty (’930 Patent, Abstract; col. 2:15-34).
• Asserted Claims: The complaint asserts independent Claim 12 (Compl. ¶67).
• Accused Features: The complaint alleges that Defendant’s trading server, coupled to one or more currency and market exchange servers, infringes the ’930 Patent (Compl. ¶67).

III. The Accused Instrumentality

Product Identification

• The "Paybis trading platforms and systems," which constitute a "digital and cryptocurrency exchange platform" (Compl. ¶3, ¶30).

Functionality and Market Context

• The accused instrumentality allows users to buy and sell cryptocurrencies, such as Bitcoin, using various payment methods, including fiat currencies like the U.S. dollar via credit and debit cards (Compl. ¶3-4). The platform is alleged to operate in the United States and specifically in Texas (Compl. ¶4). A screenshot from the Paybis website shows an interface where a user can enter a "You Spend" amount in USD to see a "You Receive" amount in BTC, which is the core functionality accused of infringement (Compl. p. 8). This screenshot depicts an interface for buying Bitcoin with a credit or debit card (Compl. p. 8).

IV. Analysis of Infringement Allegations

’107 Patent Infringement Allegations

’863 Patent Infringement Allegations

The complaint alleges that Claim 1 of the ’863 Patent is infringed but provides minimal specific mapping of claim elements to the accused product's features, beyond a general allegation that Defendant "practices and provides a trading server, such as the Defendant trading servers coupled to one or more currency exchange servers... and one or more market exchange servers" (Compl. ¶51). The complaint does not provide sufficient detail for a full claim chart analysis of the remaining elements of Claim 1 of the ’863 patent.

• Identified Points of Contention:
  • Scope Questions: A central question for all asserted patents will be whether the term "asset" or "security," which the patent specification exemplifies with traditional financial instruments like stocks and commodities, can be construed to read on the "cryptocurrencies" traded on the accused platform (’107 Patent, col. 2:20-23; Compl. ¶3).
  • Technical Questions: The claims require a specific "three-tier architecture" including distinct "trading," "market exchange," and "currency exchange" servers (’107 Patent, Fig. 2B). A point of contention may be whether the Defendant's allegedly integrated cryptocurrency exchange platform embodies this specific, arguably segregated, server architecture, or if there is a functional and structural mismatch. Further, the complaint provides limited evidence regarding the precise timing of exchange rate calculations, a key feature of claims like Claim 1 of the ’107 Patent, which requires calculation "right before the transaction takes place."

V. Key Claim Terms for Construction

• The Term: "asset"

  • Context and Importance: The construction of this term is critical. The patents’ examples are grounded in traditional finance ("stocks," "bonds," "commodities") (’107 Patent, col. 2:20-23). The accused platform trades cryptocurrencies (Compl. ¶3). The viability of the infringement case may depend on whether "asset" is interpreted broadly enough to cover cryptocurrencies.
  • Intrinsic Evidence for a Broader Interpretation: The claim language uses the general term "asset" without express limitation. The specification includes "commodities (e.g., oil, gold)," which could be argued to be analogous to cryptocurrencies as an alternative asset class (’107 Patent, col. 2:22).
  • Intrinsic Evidence for a Narrower Interpretation: The background and all specific examples exclusively discuss traditional, regulated financial instruments ("US securities," "stocks," "NYMEX") (’107 Patent, col. 1:31, 1:49; col. 6:16). This context could support an argument that the invention is limited to the specific field disclosed.

• The Term: "market exchange server"

  • Context and Importance: Practitioners may focus on this term because the claims require a trading server to be "coupled to" a distinct "market exchange server" (’107 Patent, cl. 1). It is an open question whether the Defendant's platform, which may function as a self-contained exchange or use aggregated liquidity providers, meets this structural requirement.
  • Intrinsic Evidence for a Broader Interpretation: The patent does not provide an explicit definition that mandates a specific hardware or software separation, which could support an interpretation where any logical module that matches buy and sell orders qualifies, regardless of its integration with the trading server.
  • Intrinsic Evidence for a Narrower Interpretation: The specification’s figures and description consistently depict a "three-tier architecture" with structurally separate elements for the brokerage, currency exchange, and market exchange (e.g., servers 208, 206, and 210 in Fig. 2A of the ’107 Patent). This may support a narrower construction requiring distinct, separately identifiable servers.

VI. Other Allegations

• Indirect Infringement: The complaint alleges that Defendant induces infringement by "advertising an infringing use" and by making, using, and selling services for use in systems that fall within the scope of the patent claims (Compl. ¶40, ¶43, ¶59).
• Willful Infringement: The complaint posits two theories of willfulness. First, it alleges that infringement will become willful upon Defendant receiving notice of the lawsuit (Compl. ¶39, ¶55, ¶71). Second, it alleges pre-suit willfulness, asserting that Defendant was "willfully blind" to Plaintiff's patent rights due to a "practice of not performing a review of the patent rights of others" before launching its services (Compl. ¶44, ¶60, ¶76).

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

• A core issue will be one of definitional scope: can the term "asset", rooted in the 2007-era context of traditional finance, be construed to cover the modern cryptocurrencies traded on the accused platform? The outcome of this question could be dispositive.
• A key evidentiary question will be one of architectural correspondence: does the Defendant’s cryptocurrency exchange platform technically embody the specific "three-tier" server architecture (trading server, market exchange server, currency exchange server) recited in the claims, or is there a fundamental mismatch in technical operation and structure?
• A third question relates to patent eligibility: given that the patents claim methods for conducting financial transactions, a likely defense under 35 U.S.C. § 101 will raise the issue of whether the claims are directed to a patent-ineligible abstract idea and, if so, whether they contain a sufficient "inventive concept" to be transformed into a patent-eligible application.