WILMINGTON, Del. A special tribunal rejected a request by a patent company and agreed to consolidate as many as 28 infringement suits brought against credit unions and banks, a move expected to reduce the temptation to settle the suits with expense licenses.
Monday’s ruling by the Judicial Panel on Multidistrict Litigation, “Makes it easier for these defendants to resist signing license deals,” said Bob Stier, a Maine lawyer representing eight community banks targeted by Automated Transactions LLC, a New York patent owner. The company has filed more than 50 civil suits over the past two years claiming banks and credit unions have infringed on its patents to have regular ATMs conduct additional tasks, such as offering airline tickets, movie reservations or sell retail goods.
The lawsuits will be heard by U.S. District Judge Sue Robinson, a federal judge in Delaware experienced with patent cases, who previously invalidated one of Automated Transactions’ basic patents in a suit against 7-Eleven.
Monday’s ruling means that at least a dozen suits filed since last September, including five against credit unions Dannemora FCU, Buffalo Service CU, Buffalo Community FCU, Heritage Family CU and New England FCU, will be combined with those naming bank defendants, according to Stier. One other credit union being sued by Automated Transactions, Erie Metro CU, agreed to a license as part of a settlement last month.
According to Stier, more than 140 credit unions and banks have already agreed to license the technology. “This has been a real money machine for the patent troll,” Stier told Credit Union Journal.
“None of these ATMs can be used to buy airline tickets or send flowers, so my clients do not need a license under the patents,” said Stier. “But they are still threatened with expensive patent litigation if they do not pay. Unless they join together, it is very, very expensive to stand up for their rights.”
The case is not a candidate for the new patent law’s extrajudicial review process before the U.S. Patent Office, according to Stier, who also represents Bath Savings Bank, Northfield Savings Bank, Mascoma Savings Bank, Southfield Savings bank and several others.
Lawyers for Automated Transactions did not return a phone all seeking comment.
