SmartMetric Inc. has requested summary judgment on its claim that Visa and MasterCard infringed on its smart card patent.
The Bay Harbor Island, Fla.-based payments and security technology provider's nearly three-year showdown against the card brands will reach a critical point Sept. 25 when Judge Michael Fitzgerald will rule on those questions in Federal District Court in California. SmartMetric seeks damages of $13.4 billion.
The case appeared headed for a jury trial in early September, prior to SmartMetric's requests and the card brands' various motions to dismiss the trial.
"Normally, a jury will decide in cases like these," says SmartMetric CEO Chaya Hendrick. "But, all of the judgment motions will be heard, and if the judge rules in our favor, it would negate the need for a trial by jury."
SmartMetric alleges the card brands have taken SmartMetric's "464" patent, which centers on the technology of connecting a smart card inserted into a reader to one of multiple networks, and put it to use in preparation for future smart-card rollouts.
The company filed a similar complaint regarding contactless card technology two years ago, but federal judge Jacqueline Nguyen in California ruled in favor of the credit card companies in their specific use of contactless card technology. SmartMetric also came up empty in federal appeals court in April of 2012, but vowed to continue to pursue its complaint on the basis of the routing patent for chip-based EMV smart cards.
Nguyen left the door open for such a pursuit in agreeing with SmartMetric's position on network operations for smart card routing.
SmartMetric has completed its discovery and submitted reports supporting its claims against both defendants, Hendrick says.
It was not easy for SmartMetric attorney Patrick Bright and his staff to complete the reports because Visa would not make some requested documents available during discovery until just weeks before the reports were due, Hendrick alleges.
Neither Bright nor the card brands responded to inquiries about the case by deadline.
Hendrick says SmartMetric fared well in so-called Markman hearings, or pretrial hearings in a patent infringement case. The hearings are important, Hendrick says, because they generally allow experts to examine the wording and interpretation of patent claims. Attorneys sometimes encourage a settlement as a result.
Hendrick says she is confident her company will prevail, but she knows what she is going up against.
"We are talking about the two largest financial companies in the world," Hendrick says. "And we based our damages claim on an amount that would translate to the benefit these companies would gain with our technology."
The case originally had a Sept. 9 jury trial scheduled, but the call for summary judgment has superseded that. The lawsuit dates back to 2010, when a court denied early motions from Visa and MasterCard to dismiss the patent infringement lawsuit.