FinTegrity LLC v. Fenergo Group Ltd

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: FinTegrity LLC (New Mexico)
  • Defendant: Fenergo Group Limited (United Kingdom)
  • Plaintiff’s Counsel: Rabicoff Law LLC
• Case Identification: 2:25-cv-00295, E.D. Tex., 03/12/2025
• Venue Allegations: Plaintiff alleges venue is proper because Defendant is a foreign corporation and has committed acts of patent infringement in the district, causing harm there.
• Core Dispute: Plaintiff alleges that Defendant’s financial software products infringe a patent related to methods for authorizing financial transactions by comparing transaction data with user data from third-party sources.
• Technical Context: The technology operates in the financial technology (FinTech) sector, specifically addressing credit card and transaction fraud by leveraging real-time data from sources like social media to verify a user's identity and location.
• Key Procedural History: The complaint does not mention any prior litigation, IPR proceedings, or licensing history related to the patent-in-suit. The ’117 patent is a continuation of a prior application, which may be relevant for determining the effective filing date of the claimed subject matter.

Case Timeline

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

U.S. Patent No. 8,635,117 - "System and method for consumer fraud protection"

• Patent Identification: U.S. Patent No. 8,635,117, "System and method for consumer fraud protection", issued January 21, 2014.

The Invention Explained

• Problem Addressed: The patent describes the problem of credit card fraud, noting that existing fraud detection systems using complex heuristics are computationally expensive, slow, and can fail to detect fraudulent transactions or incorrectly flag legitimate ones (’117 Patent, col. 1:21-51). These systems often lack access to a user's real-time data, limiting their accuracy (’117 Patent, col. 1:44-45).
• The Patented Solution: The invention proposes a system that authorizes a financial transaction by retrieving data about the transaction (e.g., merchant location) and comparing it to "user-data" retrieved from a "third-party information source," such as a social media network (’117 Patent, Abstract; col. 2:57-65). If the transaction data "substantially matches" the user's data (e.g., the user's social media check-in location), the transaction is authorized; otherwise, it may be denied (’117 Patent, col. 14:48-61). Figure 1 illustrates the overall system architecture, showing communication between a user terminal (108), a third-party source (106), a transaction authorization system (104), and a financial institution (114).
• Technical Importance: This approach seeks to improve fraud detection accuracy by using dynamic, real-time data about a user's activities and location, which is often publicly available on third-party platforms, rather than relying solely on static historical transaction patterns (’117 Patent, col. 5:21-30).

Key Claims at a Glance

The complaint alleges infringement of "one or more claims" and refers to "Exemplary '117 Patent Claims" in its incorporated exhibits, but does not identify specific claims in the body of the complaint (Compl. ¶11). The patent’s key independent claims are a process claim (Claim 1) and a system claim (Claim 16).

• Independent Claim 1 (Process):

  • A computer-implemented process for authorizing financial transactions.
  • Retrieving transaction-data associated with a financial transaction from a financial institution's server.
  • Retrieving user-data from a third-party information source, where the user-data describes attributes of an authorized or unauthorized transaction.
  • Comparing the transaction-data to the user-data to generate an authorization flag or a denial flag.
  • Communicating the generated flag to the financial institution's server to authorize or deny the transaction.

• Independent Claim 16 (System):

  • A transaction authentication system for managing financial transactions.
  • A non-transitory data storage device storing a database linking a financial account with a third-party information source.
  • At least one processor configured to perform the steps of retrieving transaction-data, retrieving user-data, comparing the two, and communicating an authorization or denial flag.

The complaint does not explicitly reserve the right to assert dependent claims, but the broad allegation of infringing "one or more claims" suggests this possibility (Compl. ¶11).

III. The Accused Instrumentality

Product Identification

• The complaint does not identify specific accused products by name. It refers to them generally as "Defendant products" and "Exemplary Defendant Products" (Compl. ¶11).

Functionality and Market Context

• The complaint alleges that Defendant makes, uses, sells, and imports products and services that practice the technology claimed by the ’117 Patent (Compl. ¶11, ¶16). The allegations center on Defendant's products providing technology that infringes the patent's claims for systems and methods of authorizing financial transactions (Compl. ¶16). The complaint alleges that Defendant distributes "product literature and website materials" that induce end users to use the products in an infringing manner (Compl. ¶14). No further technical detail on the operation of the accused products is provided in the complaint itself.

IV. Analysis of Infringement Allegations

The complaint alleges direct and induced infringement of the ’117 Patent but does not provide a claim chart or detailed infringement theory in the body of the pleading (Compl. ¶11, ¶15). Instead, it states that "Exhibit 2 includes charts comparing the Exemplary ’117 Patent Claims to the Exemplary Defendant Products" and incorporates these charts by reference (Compl. ¶16). As Exhibit 2 was not filed with the complaint, a detailed element-by-element analysis is not possible based on the provided documents. The narrative theory is that the "Exemplary Defendant Products practice the technology claimed by the ’117 Patent" and "satisfy all elements of the Exemplary ’117 Patent Claims" (Compl. ¶16).

No probative visual evidence provided in complaint.

• Identified Points of Contention:
  • Technical Questions: A central question will be whether the accused Fenergo products, which are typically used for enterprise-level client onboarding and regulatory compliance (e.g., Anti-Money Laundering), perform the specific function of real-time transaction authorization as claimed. The court will need to determine if the functionality of Defendant's systems aligns with the patent's focus on comparing point-of-sale transaction data against social media-type user data.
  • Scope Questions: The dispute may turn on whether the data sources used by Fenergo's systems qualify as a "third-party information source" as contemplated by the patent. The patent heavily emphasizes "Social Media Networks" as the primary example (’117 Patent, col. 2:2-4), raising the question of whether this context limits the scope of the term.

V. Key Claim Terms for Construction

• The Term: "third-party information source" (Claim 1)

  • Context and Importance: This term is the source of the novel data used for comparison and is fundamental to the invention. The outcome of the case may depend on whether the data sources used by Defendant's products fall within the construed scope of this term. Practitioners may focus on this term because the patent's examples are heavily weighted toward consumer social media, while the accused products likely operate in a corporate or enterprise data environment.
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: The patent states the source represents "one or more third-party websites, networks, applications and/or databases" and gives examples beyond social media, such as "e-mail domains" (’117 Patent, col. 6:66-67; col. 5:10-11).
    • Evidence for a Narrower Interpretation: The patent repeatedly uses "Social Media Network" as the exemplary embodiment throughout the specification, including in the abstract, summary, and detailed description, which could support a narrower construction limited to such platforms (’117 Patent, Abstract; col. 2:2-4; col. 4:32-39).

• The Term: "substantially matches" (Claim 1)

  • Context and Importance: This term defines the core logic of the comparison step that determines whether a transaction is authorized or denied. Its definition is critical for assessing infringement, as it is a term of degree.
  • Intrinsic Evidence for Interpretation:
    • Evidence for a Broader Interpretation: The specification suggests a match can be categorical, not just exact. For example, a transaction for "soccer equipment" may be approved if the user's behavior data indicates an "interest in soccer," even without an exact product match (’117 Patent, col. 12:59-68).
    • Evidence for a Narrower Interpretation: The specification also provides for more precise matching, such as determining if a transaction location is "within a predetermined distance" (e.g., an X-mile radius) of the user's reported location, suggesting a more quantitative and limited meaning (’117 Patent, col. 11:40-42; col. 12:4-6).

VI. Other Allegations

• Indirect Infringement: The complaint alleges induced infringement, stating that Defendant distributes "product literature and website materials" that instruct and encourage customers and end users to use the accused products in a manner that directly infringes the ’117 Patent (Compl. ¶14-15).
• Willful Infringement: The complaint does not use the word "willful," but it lays a foundation for such a claim by asserting that the filing and service of the complaint provides Defendant with "actual knowledge of infringement" and that any subsequent infringement is therefore intentional (Compl. ¶13-14). Plaintiff requests "all appropriate damages under 35 U.S.C. § 284," which includes enhanced damages for willful infringement (Compl. ¶D).

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

1. A central issue will be one of technological application: Do Defendant's enterprise-focused financial compliance and client management products perform the specific consumer-facing, real-time transaction authorization described and claimed in the ’117 patent, which is heavily exemplified by social media check-ins and consumer behavior?
2. The case will also turn on a question of definitional scope: Can the claim term "third-party information source," which the patent repeatedly links to "Social Media Networks," be construed broadly enough to read on the types of enterprise-level data sources likely utilized by the accused Fenergo systems?
3. A key evidentiary question, for which the complaint provides no detail, will be one of infringement evidence: What specific evidence will Plaintiff present to demonstrate that Defendant's products actually perform the claimed steps of retrieving, comparing, and generating an "authorization flag" or "denial flag" to approve or block a financial transaction, as required by the asserted claims?