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CU System
Patent Troll's Latest Lawsuit Includes Texas CUs
PLANO, Texas (5/30/13)--A company that has been filing remote-capture-image patent-infringement lawsuits against financial institutions and data processors for over a decade, filed another one Tuesday in a Texas federal court, naming 49 defendants, including four Texas credit unions and several credit union check processors as defendants.

Filed in the U.S. District Court for the Eastern District of Texas, the suit by DataTreasury Corp., names among the defendants  $30 million asset Cherokee County FCU in Rusk, Texas; $636 million asset DATCU CU in Denton, Texas; $1 billion asset Advancial FCU in Dallas; and $718 million asset United Heritage CU in Austin.

DataTreasury's complaint alleges infringement of its "Ballard Patent," which the company said, is "foundational to modern day, image-based check processing, enabling technological improvements that save the banking industry billions of dollars annually." It asks for a permanent injunction to prevent them from employing the technology and asks for damages based on reasonable royalty.

The Credit Union National Association is aware of DataTreasuryand its claims. The company has targeted large financial institutions with patents related to check processing and the digital capture and storage of checks, and has recently begun targeting small and mid-sized financial institutions, including credit unions and community banks.  The Eastern District of Texas, where the lawsuit is filed, is known to be particularly friendly toward patent plaintiffs.

DataTreasury is one of the earliest and perhaps most well-known "patent trolls" of the financial services industry. The company has generated more than $350 million from at least 41 financial institutions through settlements or license agreements. The companies with which DataTreasury has entered into license agreements include JPMorgan Chase, HSBS Bank, UBS, Citibank, Edward  D. Jones & Co., Merrill Lynch & Co., Bank of New York/Mellon, PNC Financial Services Group, Electronic Data Systems Corp., Diebold, and First Data Corp.



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