Lupercal Tags Image Upload in More Mobile Banking Apps

May 11, 2020

Lupercal LLC, an NPE apparently associated with monetization firm IPValuation Partners, LLC (IPVal), has added two more cases to the litigation campaign that it launched just over one year ago. The new defendants are Cullen/Frost Bankers (6:20-cv-00358) and PNC Financial Services Group (2:20-cv-00136), each accused of infringing a single patent broadly directed to a tool for submitting images on a device. With cases against Citibank, Comerica Bank, and Plains Capital Bank having been dismissed earlier this year, and one still open against JPMorgan Chase, Lupercal continues to target image upload in connection with the mobile check deposit features of financial institutions.

The patent-in-suit (9,386,094) issued in July 2016 as part of a family having three earlier members (6,895,557; 7,765,482; 8,612,515) that their owner at the time, Summit 6 LLC, litigated between 2011 and 2015, with mixed results, against Apple, BlackBerry, HTC, Facebook, LG Electronics, Motorola Mobility, Multiply, Photobucket, Samsung, and Twitter. Lupercal and both Citibank and Plains Capital Bank were headed toward a claim construction hearing before Judge Alan D. Albright in the Western District of Texas when the cases appear to have settled, in early March 2020. The July 2019 suit against Comerica, also before Judge Albright, was less advanced when it ended in February 2020.

While Summit 6 saw multiple settlements and a $15M trial verdict against Samsung in its campaign, certain claims of the ‘482 and ‘515 patents were canceled in inter partes reviews (IPRs) filed as part of the campaign. In June 2011, Summit 6 accused BlackBerry (f/k/a Research in Motion), Facebook, Multiply, Photobucket, and Samsung of infringing the ‘482 patent, adding infringement allegations as to the ‘557 patent against Facebook, Multiply, and Photobucket. At issue throughout were the defendants’ purported pre-processing of photos before transmission. The Northern District of Texas handed down a first claim construction order for this family in May 2012. Settlements with Multiply and Photobucket followed that July; with BlackBerry, that October; and with Facebook, the next February.

Samsung proceeded to trial, arguing, among other things, inequitable conduct by Summit 6 for failure to notify the USPTO about potential prior art uncovered as part of related efforts to acquire companies offering and patents covering similar technology. More specifically, Samsung contended that named inventor Scott Lewis and board members/executives Sarah Pate and Peter Yoakum failed to disclose a system with a photo-upload feature that caused them to abandon intentions to acquire a Canadian company because that system’s public availability raised the prospect of an on-sale bar against the company’s US patents. The jury returned a March 2013 verdict in Summit 6’s favor, against Samsung; the court waded through a marsh of post-trial motions to largely affirm the verdict, dispensing with the inequitable conduct defense by imposing a duty of candor to the USPTO only on Lewis, whom the jury could have credibly believed to lack appreciable knowledge of the Canadian system; and the Federal Circuit upheld the result in a September 2015 decision. A satisfaction of the roughly $15M judgment against Samsung was filed in July 2016.

Meanwhile, in February 2014, Summit 6 filed a new Northern District of Texas action hitting Apple, HTC, LG Electronics (LGE), Motorola Mobility (owned first by Google and then by Lenovo), and Twitter. In this case, the plaintiff asserted the ‘482 and ‘515 patents against each defendant, again targeting photo uploading, processing, and sharing mechanisms. The court denied a motion to transfer to the Northern District of California, granted Apple and Twitter motions to sever (but consolidated those severed cases with the original), and, in March 2015, handed down both a second claim construction order for the family and an order denying the defendants’ motion challenging the claims as patent-ineligibly drawn to the abstract idea of “‘pre-processing’ digital content prior to publishing it”. While the LGE case had been dismissed previously (in light of a settlement), the cases against the other four defendants persisted through the orders, with dismissals with prejudice quickly following.

Those dismissals also ended myriad PTAB proceedings brought by Apple and Twitter against the ‘557, ‘482, and ‘515 patents, as well as HTC’s participation with respect to certain other petitions, but other IPRs, triggered by Google and Samsung, continued (IPR2015-00806, IPR2015-00807, IPR2016-00029). Final written decisions there saw claims 12-13, 16, 18-19, 21-25, 35-38, 40-42, 44-46, and 49 of the ‘482 patent and claims 1-2, 6, 10-11, 18-20, 23, 26, 28-30, and 38-39 of the ‘515 patent (all those challenged) canceled as obvious in light of certain prior art. The Federal Circuit affirmed those decisions in a per curiam opinion.

The Summit 6 portfolio originated with PictureWorks, founded in 1994, which was acquired by iPix in 2000 for $175M. In 2005, iPix consolidated to focus on security products and sold the assets to an employee buyout called AdMission, funded by SwiftSure Capital. SwiftSure sold the AdMission operating business in 2008, placing its intellectual property into the newly formed Summit 6, an NPE. Disclosures in the subsequent litigation identified only “Shareholders of Summit 6, LLC” (of uncertain formation) as a nonparty having an interest in the outcome of those cases.

In November 2018, Summit 6 assigned 14 US assets to Lupercal, with Scott Wilson (founder of SwiftSure) signing on behalf of Summit 6 and Jason Bourgeois acting as correspondent for the transaction. Bourgeois is a founding principal of IPVal. Lupercal itself was formed in Delaware in August 2018. IPVal—a Texas monetization firm—has established a pattern of forming litigating affiliates in Texas but certain Delaware entities appear to be connected to the firm.

The ‘094 patent is not the most recent member of this long-litigated family; a fifth related patent issued to Summit 6 in January 2018, with no assignment away from the assignee on the face of the patent appearing in publicly available USPTO assignment records. Prosecution of at least one application in the family, filed in January 2018, continues before the USPTO. 5/1, Frost Bankers, Western District of Texas; 5/1, PNC Financial Services Group, Eastern District of Texas.