Intercurrency Software LLC v. Tradesanta Global Ltd

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Intercurrency Software LLC (Texas)
  • Defendant: TradeSanta Global Limited (Republic of Armenia)
  • Plaintiff’s Counsel: Garteiser Honea, PLLC
• Case Identification: 2:24-cv-00390, E.D. Tex., 05/29/2024
• Venue Allegations: Plaintiff alleges venue is proper because Defendant is subject to personal jurisdiction, has regularly conducted business in the district, and is not a resident of the United States, allowing suit in any judicial district.
• Core Dispute: Plaintiff alleges that Defendant’s automated cryptocurrency trading platform infringes three U.S. patents related to financial trading systems that conduct transactions in a user's preferred currency.
• Technical Context: The technology operates in the financial technology (FinTech) field, specifically addressing the complexities of executing asset trades across different currencies by integrating currency conversion into the transaction process itself.
• Key Procedural History: The patents-in-suit belong to the same family, with the later patents being continuations of the application that led to the first. The complaint notes that three different patent examiners allowed the patents and preemptively argues for their validity and patent eligibility over the prior art.

Case Timeline

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

U.S. Patent No. 10,062,107 - "CONSOLIDATED TRADING PLATFORM," issued August 28, 2018

The Invention Explained

• Problem Addressed: The patent’s background describes a problem in prior art financial systems where an investor trading an asset in a foreign currency had to perform the currency conversion separately from the asset purchase or sale (Compl. ¶15; ’107 Patent, col. 1:38-54). This separation created uncertainty regarding the final profit or loss, as the exchange rate could fluctuate between the time of the trade and the time of the currency conversion (’107 Patent, col. 1:54-60). The complaint states that the prior art failed to perform currency conversion "at a transactional level" (Compl. ¶16).
• The Patented Solution: The invention is a "consolidated trading platform" that integrates a brokerage, a market exchange, and a currency exchange into a "three-tier architecture" (’107 Patent, col. 2:23-33). This platform displays all prices, data, and potential settlements to the trader in their pre-selected "preferred currency" by obtaining a prevailing exchange rate in real-time. When a transaction is executed, the system performs the necessary currency conversion as part of the transaction itself, thereby giving the trader "certain knowledge" of the exact cost or proceeds in their own currency (Compl. ¶19; ’107 Patent, col. 2:33-35).
• Technical Importance: This approach aims to eliminate the financial risk and uncertainty associated with exchange rate fluctuations in cross-border asset trading by tightly coupling the asset transaction with the currency conversion (’107 Patent, col. 2:50-55).

Key Claims at a Glance

• The complaint asserts independent claim 1 (Compl. ¶35).
• The essential elements of claim 1 include:
  • Providing a trading server coupled to currency exchange and market exchange servers.
  • Receiving an indicator of a preferred currency from a trader.
  • Displaying an asset's price in the preferred currency, which involves determining a prevailing exchange rate.
  • Conducting a transaction by transmitting a request to the market exchange server.
  • Receiving a settlement notification and calculating a prevailing exchange rate "right before the transaction takes place" to execute the transaction.
  • 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 September 15, 2020

The Invention Explained

• Problem Addressed: The ’863 Patent, a continuation of the application leading to the ’107 Patent, addresses the same issue of exchange rate uncertainty in cross-currency financial trading (’863 Patent, col. 1:50-60).
• The Patented Solution: The solution is again a consolidated trading platform that integrates asset and currency exchanges. The focus remains on allowing a trader to view and execute transactions in a preferred currency, with the system performing a just-in-time currency conversion to provide transactional certainty (’863 Patent, Abstract; col. 2:25-38).
• Technical Importance: The invention provides a mechanism for transparent, real-time, cross-currency trading that removes the risk of subsequent, unfavorable exchange rate movements (’863 Patent, col. 2:50-55).

Key Claims at a Glance

• The complaint asserts independent claim 1 (Compl. ¶51).
• The essential elements of claim 1 include:
  • Coupling a trading server to currency and market exchange servers.
  • Receiving an indicator of a preferred currency.
  • Displaying the asset in the preferred currency by determining a prevailing exchange rate and dynamically changing the displayed costs and fees.
  • Conducting a transaction of the asset.
  • Receiving a settlement notification after executing the transaction with a prevailing exchange rate calculated "right before the transaction takes place."

U.S. Patent No. 11,449,930 - "METHOD AND APPARATUS FOR TRADING ASSETS IN DIFFERENT CURRENCIES," issued September 20, 2022

• Technology Synopsis: This patent also describes a method and system for trading assets across different currencies. The technology aims to solve the problem of exchange rate uncertainty by providing a platform that calculates and displays all costs in a user's preferred currency using a real-time exchange rate and executes the transaction based on that rate, ensuring the user knows the exact financial outcome at the moment of the trade (’930 Patent, Abstract; col. 1:59-68).
• Asserted Claims: The complaint asserts independent claim 12 (Compl. ¶67).
• Accused Features: The complaint alleges that Defendant’s provision of a trading server coupled to one or more currency exchange servers and market exchange servers infringes this patent (Compl. ¶67).

III. The Accused Instrumentality

Product Identification

• Defendant's "TradeSanta platforms and systems," which the complaint collectively refers to as the "Accused Instrumentalities" (Compl. ¶30).

Functionality and Market Context

• The Accused Instrumentalities comprise an "automated digital crypto currency trading" platform (Compl. ¶3, 30). This platform allows users to create "automated trading rules and strategies for major crypto exchanges" (Compl. ¶30). The complaint includes a screenshot from Defendant's website, which markets the product as an "Automated crypto trading bot for everyone" and promises users the ability to "Trade crypto like a pro" using "powerful trading bot and algorithmic strategies" (Compl. p. 8). The complaint alleges the platform is sold to end-users in the United States via the internet and generates "substantial financial revenues" for the Defendant (Compl. ¶¶4, 34).

IV. Analysis of Infringement Allegations

’107 Patent Infringement Allegations

’863 Patent Infringement Allegations

The complaint does not provide sufficient detail for a full claim-chart analysis of U.S. Patent No. 10,776,863. It asserts infringement of claim 1 but only provides a specific factual allegation for the first element, stating 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 proceed to map the remaining elements of claim 1 to specific functionalities of the Accused Instrumentalities.

Identified Points of Contention

• Scope Questions: The patents describe a "three-tier architecture" of a brokerage, a market exchange, and a currency exchange, based on examples from traditional finance. A potential point of contention is whether the architecture of the accused cryptocurrency trading system maps onto this claimed structure. It raises the question of whether a single "crypto exchange" in Defendant's system performs the functions of both the "market exchange server" and the "currency exchange server" as recited in the claims, or if the nature of crypto-to-crypto trading falls outside the scope of "currency" as contemplated by the patents.
• Technical Questions: The claims require calculating a prevailing exchange rate "right before the transaction takes place" to eliminate uncertainty. A key technical question is what evidence the complaint provides that the TradeSanta platform performs this specific, just-in-time calculation and execution. The analysis may turn on whether the accused system uses a live rate for an atomic, integrated transaction or, alternatively, uses a recently cached rate or performs the currency conversion as a distinct, subsequent step after the asset trade settles.

V. Key Claim Terms for Construction

• The Term: "currency exchange server"

  • Context and Importance: The infringement theory relies on the accused crypto platform having distinct components that meet the definitions of a "currency exchange server" and a "market exchange server." The construction of this term is critical to determining whether the patent's architecture, conceived in the context of fiat currencies, can read on the accused cryptocurrency platform where a single entity (a crypto exchange) may facilitate both asset trading and token swapping.
  • Intrinsic Evidence for a Broader Interpretation: The specification provides a functional definition, stating the server represents "a bank, an exchange agency, a multibank portal or a matching service providing a currency exchange rate to buy or sell a type of currency for another" (’107 Patent, col. 5:1-4). This language may support an interpretation that covers any system facilitating the exchange of one unit of value for another.
  • Intrinsic Evidence for a Narrower Interpretation: The patent’s background and examples consistently refer to traditional, government-issued fiat currencies like the U.S. Dollar, Japanese Yen, and Euro (’107 Patent, col. 1:41-45, col. 5:36-39). This context may support an interpretation that limits the term to servers exchanging fiat currencies, potentially excluding crypto-to-crypto exchanges.

• The Term: "right before the transaction takes place"

  • Context and Importance: This temporal limitation is a core aspect of the invention's solution to eliminating exchange rate uncertainty. The infringement analysis will depend heavily on the precise timing of the exchange rate calculation in the accused system. Practitioners may focus on this term because it creates a high evidentiary bar for the plaintiff to prove the accused system’s timing mechanism is identical to what is claimed.
  • Intrinsic Evidence for a Broader Interpretation: A party could argue this term means "as close in time as is commercially and technically feasible to prevent material fluctuations," not requiring absolute simultaneity.
  • Intrinsic Evidence for a Narrower Interpretation: The specification’s repeated emphasis on preventing "uncertainty in currency exchanges in another time" (’107 Patent, col. 9:18-21) suggests a requirement for a very tight, and perhaps atomic, temporal link between the rate calculation and the trade execution to fulfill the stated purpose of the invention.

VI. Other Allegations

• Indirect Infringement: The complaint alleges that Defendant induces infringement by providing the Accused Instrumentalities and encouraging their use through advertising and user instructions (Compl. ¶¶ 40, 43, 56, 59, 72, 75). The allegation is that Defendant knows or should know its customers' use of the platform constitutes direct infringement.
• Willful Infringement: The willfulness claim is based on two theories. First, it alleges that infringement will become willful upon Defendant's receipt of the complaint, establishing post-suit knowledge (Compl. ¶¶ 39, 55, 71). Second, it alleges pre-suit willful blindness, based on the assertion that Defendant has a "practice of not performing a review of the patent rights of others" before launching its products (Compl. ¶¶ 44, 60, 76).

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

• A core issue will be one of architectural mapping: can the "three-tier" system recited in the claims, which envisions distinct "market exchange" and "currency exchange" servers from the world of traditional finance, be construed to cover the accused cryptocurrency platform, where such functions may be integrated within a single crypto exchange?
• A key evidentiary question will be one of temporal precision: does the accused TradeSanta platform in fact calculate and apply an exchange rate "right before the transaction takes place" in a tightly integrated manner as required by the claims, or is there a functional or temporal separation in its process that places it outside the claim scope?
• The case may also test the definitional boundaries of terms like "currency" and "brokerage" as technology evolves, raising the question of whether claim language drafted for one financial paradigm can be extended to capture the fundamentally different operations of a decentralized, automated cryptocurrency trading system.