Wells Fargo hits back over military bank patent claim

Wells Fargo fought back against a patent infringement complaint yesterday, claiming that patents relating to digital banking that were enforced against the US financial services organisation are invalid.

The bank filed its counterclaim at the US District Court for the Eastern District of Texas to a lawsuit filed by financial services company United Services Automobile Association (USAA) against Wells Fargo in June.

The USAA, which caters for military personnel and their families, is the assignee of patented technology that allows customers to deposit a paper cheque into their bank accounts by taking an image of the cheque on their mobile phones.  

According to the USAA, it has served the military for decades and has “worked to innovate in serving the needs of its members, including a lifestyle that can make getting to a bank branch difficult, particularly if they are out to sea or deployed outside the US”.

In June, the USAA alleged that Wells Fargo’s remote deposit capture systems infringe the patents.

The patents are: “Systems and methods for alignment of check during mobile deposit” (US numbers 8,699,779 and 9,336,517); “Systems and methods for image and criterion monitoring during mobile deposit” (9,818,090); and “Systems and methods for image monitoring of check during mobile deposit” (8,977,571).

According to the claim, “Wells Fargo Mobile Deposit allows Wells Fargo customers to deposit checks using their mobile devices, such as smartphones.”

The USAA demanded a jury trial and sought damages.

However, in its counterclaim filed on Tuesday, August 14, Wells Fargo alleged that each of the patents is invalid. The organisation argued that taking and processing cheque images using a digital camera or mobile device was “well-understood, routine, and conventional” before the asserted patents were registered.  

The banking organisation said that US Congress passed the ‘Check Clearing for the 21st Century Act’ in 2003, which allowed people to process a cheque by taking an image of it.

Wells Fargo has requested damages and asked the district court to dismiss the USAA’s claim.