Secure Matrix LLC v. Bank Of America Corp

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Secure Matrix LLC (Delaware)
  • Defendant: Bank of America Corporation (Delaware)
  • Plaintiff’s Counsel: Rabicoff Law LLC
• Case Identification: 2:24-cv-00455, E.D. Tex., 06/18/2024
• Venue Allegations: Plaintiff alleges venue is proper because Defendant maintains an established place of business in the Eastern District of Texas and has allegedly committed acts of infringement in the district.
• Core Dispute: Plaintiff alleges that Defendant’s products and services infringe a patent related to methods for user authentication that use a mobile device to verify an interaction initiated on a separate computer.
• Technical Context: The technology at issue involves multi-factor authentication, a security process where a user provides two or more verification factors to gain access to an application or online account, commonly used in financial services to secure transactions and logins.
• Key Procedural History: The complaint does not mention any prior litigation, Inter Partes Review (IPR) proceedings, or licensing history related to the patent-in-suit.

Case Timeline

Date	Event
2012-11-21	’116 Patent Priority Date
2014-03-18	’116 Patent Issue Date
2024-06-18	Complaint Filing Date

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

U.S. Patent No. 8,677,116 - “Systems and methods for authentication and verification” (Issued Mar. 18, 2014)

The Invention Explained

• Problem Addressed: The patent describes a "growing need to authenticate users" accessing secured online portals or real-world devices, as well as a need for "a secure and fast online electronic payment capability" as consumer transactions increasingly move online (’116 Patent, col. 2:19-25).
• The Patented Solution: The invention proposes a multi-device authentication method. A first device (e.g., a computer) displays a "reusable identifier" (such as a QR code) to initiate an interaction. A second, personal electronic device (e.g., a smartphone) captures this identifier and transmits it, along with separate user verification information, to a verification server. This server then evaluates both sets of information to determine if the user is authorized before sending an authorization signal to complete the interaction (’116 Patent, Abstract; Fig. 2).
• Technical Importance: The patent emphasizes the use of a reusable identifier, which it contrasts with conventional single-use tokens, as a way to simplify the process and reduce server computing requirements, since the identifier itself does not need to contain user-specific or transaction-specific information (’116 Patent, col. 6:34-45).

Key Claims at a Glance

• The complaint asserts "one or more claims" but does not specify them, instead referring to an external exhibit not attached to the publicly filed complaint (Compl. ¶11). Claim 1 is the first independent method claim.
• Essential elements of Independent Claim 1 include:
  • Receiving a first signal from a computer, where the signal contains a "reusable identifier" that is assigned for use for a "finite period of time."
  • Receiving a second signal from a user's electronic device, where the signal contains a copy of the reusable identifier and "user verification information."
  • Using a processor to evaluate the first and second signals to determine if the user is authorized.
  • Transmitting a third signal with authorization information to the computer or the electronic device in response to a successful evaluation.
• The complaint's general allegation of infringing "one or more claims" suggests the right to assert dependent claims is preserved (Compl. ¶11).

III. The Accused Instrumentality

Product Identification

The complaint does not name any specific accused products or services. It refers generically to "Exemplary Defendant Products" that are identified in claim charts in an external "Exhibit 2," which was not included with the filed complaint (Compl. ¶11, ¶16).

Functionality and Market Context

The complaint does not provide sufficient detail for analysis of the accused instrumentality's specific functionality or market context. Given the defendant, the accused instrumentalities are presumably related to Bank of America's online and mobile banking platforms that use multi-factor authentication for login or transaction verification.

IV. Analysis of Infringement Allegations

The complaint references infringement claim charts in an exhibit that is not publicly available (Compl. ¶16-17). Therefore, a detailed claim chart analysis is not possible based on the provided documents. The narrative infringement theory is limited to the assertion that the "Exemplary Defendant Products practice the technology claimed by the '116 Patent" (Compl. ¶16).

No probative visual evidence provided in complaint.

• Identified Points of Contention: Based on the claim language and the general nature of the dispute, the infringement analysis may raise several questions:
  • Scope Questions: Claim 1 requires a "reusable identifier" assigned for a "finite period of time." A likely point of dispute is whether the authentication tokens or codes used by the accused systems (which may be generated dynamically for a single session) meet the patent's definition of "reusable." The interpretation of "finite period of time" will also be critical.
  • Technical Questions: What evidence will be presented to show that the accused system architecture maps to the three-signal process of Claim 1? A key question will be whether the system receives a "first signal" from the primary computer and a "second signal" from the user's mobile device as distinct inputs for evaluation by a single "computer system," as the claim requires.

V. Key Claim Terms for Construction

• The Term: "reusable identifier"

• Context and Importance: This term appears in all independent claims and is central to the patent's stated novelty. The outcome of the case may depend on whether the authentication codes used by the accused system, particularly if they are session-specific, fall within the scope of this term.

• Intrinsic Evidence for Interpretation:

  • Evidence for a Broader Interpretation: The specification states the term has its "broadest reasonable interpretation, including but not limited to, an identifier that can be used more than once" and is not for "merely 'one-time-use'" (’116 Patent, col. 9:6-10). This could support an argument that any identifier that is not cryptographically tied to a single transaction is "reusable."
  • Evidence for a Narrower Interpretation: The specification also describes specific embodiments where identifiers are selected sequentially from a "predefined and previously generated list" and used in a "round robin" fashion (’116 Patent, col. 9:26-33, 49-54). This could support a narrower construction limited to pre-generated codes from a static list, potentially excluding dynamically generated session codes.

• The Term: "computer system"

• Context and Importance: In Claim 1, the "computer system" performs the authentication method; it receives the first signal "from the computer providing the secured capability" and the second signal from the user's device. Practitioners may focus on this term because the relationship between the "computer system" and the "computer" it receives a signal from could create an infringement defense if they are found to be the same entity in the accused architecture.

• Intrinsic Evidence for Interpretation:

  • Evidence for a Broader Interpretation: Figures 1 and 2 depict the "Verification Server (60)" as a distinct component from the "Computer (50)" that provides the secured capability, suggesting the "computer system" is the back-end authentication server (’116 Patent, Figs. 1, 2).
  • Evidence for a Narrower Interpretation: A defendant could argue that in its integrated system, the server providing the web portal and the server performing the verification are part of the same logical "system," and thus the system cannot "receive a first signal from" itself in the manner claimed. The patent consistently depicts these as architecturally separate components (’116 Patent, col. 7:1-4).

VI. Other Allegations

• Indirect Infringement: The complaint alleges induced infringement, stating that Defendant distributes "product literature and website materials" that instruct end users on how to use its products in a manner that allegedly infringes the ’116 Patent (Compl. ¶14-15).
• Willful Infringement: The complaint bases its willfulness allegation on post-suit knowledge, asserting that the "service of this Complaint, in conjunction with the attached claim charts... constitutes actual knowledge of infringement" (Compl. ¶13). No allegations of pre-suit knowledge are made.

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

• A core issue will be one of definitional scope: Can the term "reusable identifier," which the patent contrasts with "one-time-use" tokens, be construed to cover the specific authentication codes generated and used by the accused financial systems, especially if those codes are dynamically created for each login or transaction session?

• A second central question will be one of architectural mapping: Can the Plaintiff demonstrate with sufficient evidence that the accused system’s architecture aligns with the specific multi-signal flow recited in the claims, particularly the requirement that a "computer system" receives a "first signal" from a separate "computer providing the secured capability"?

• Finally, given the complaint's reliance on an unprovided exhibit to identify the accused products and articulate its infringement theory, a threshold issue will be whether the plaintiff can provide sufficient factual detail to satisfy federal pleading standards and survive a potential motion to dismiss.