The downtown office of USAA. The San Antonio-based company has filed another lawsuit against a banking competitor it says is infringing on its patents for remote check deposit.
USAA has launched another salvo in its five year battle to make its banking competitors pay for their use of remote check deposit technology it helped pioneer and patented in the 2000s.
The San Antonio-based insurance and financial services company filed a federal lawsuit July 29 against Truist Bank, a Charlotte, North Carolina-based chain with more than 2,000 branches, accusing it of infringing upon three patents awarded between 2006 and 2009.
USAA is seeking an unspecified amount of damages, according to the complaint filed in U.S. District Court in Marshall. The company has had success with other lawsuits filed in the same court alleging infringement upon its patents for the technology.
In May, a jury awarded it $218.5 million in a lawsuit it had filed against PNC, a Pittsburgh-based bank that has a growing presence in San Antonio. In 2019 and 2020, juries awarded USAA a combined $302.8 million in damages in two lawsuits against Wells Fargo. The companies later reached an undisclosed settlement to resolve the claims.
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After the PNC verdict, Nathan McKinley, USAA’s vice president of corporate development, said in a statement that the company looked forward “to working with banks to create reasonable and mutually beneficial license agreements.”
Spokespersons for USAA and Truist declined to comment on the latest lawsuit.
Truist operates 2,112 branches across the U.S., according to the Federal Reserve; it is the seventh-largest bank in the nation based on its assets, with $531 billion in domestic assets as of March 31. It operates seven branches in San Antonio, according to its website.
USAA began developing remote deposit technology in about 2004, partly in order to provide more convenience to members of the military stationed in “distant locations around the world with limited access to traditional banking services,” according to the complaint in its suit against Truist.
In 2006, USAA launched a remote check deposit system named Deposit@Home, the complaint says; in 2009, it introduced the Deposit@Mobile application allowing customers to deposit checks by taking pictures of them with smartphones or tablets.
Since then, remote deposit technology, including the “auto capture” process, has become ubiquitous in banking chains across the U.S. In 2017, USAA began reaching out to banks asking them to pay license fees in order to offer such services. USAA spokesman Roger Wildermuth declined to say how many banks have agreed to pay such fees.
The U.S. District Court in Marshall has a reputation for being well-disposed toward plaintiffs filing patent lawsuits, the New York Times reported in 2017. At that time, more than 40 percent of patent lawsuits were filed in the court.
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American Banker, a publication that covers the banking industry, has reported on what it refers to as “patent wars” within the financial services industry. In response to such infringement lawsuits, Truist and other companies have joined a group called the Open Invention Network, whose members commit to share software licensing and not sue each other, the publication has reported.
In May, PNC noted that the validity of one of USAA’s patents would be the subject of proceedings pending before the Patent Trial and Appeal Board, a part of the U.S. Patent and Trademark Office which addresses patent issues.
A spokesperson for PNC said Thursday the appeal board proceedings are scheduled for this fall and early next year.
“We remain confident that we will prevail as to the claims that USAA asserted against PNC,” said PNC spokesman Timothy Miller.
In 2020, the Patent Trial and Appeal Board effectively upheld the validity of one USAA’s patents that had been litigated in one of the cases with Wells Fargo. The board refused to review the patents at issue in the second case, Law360 reported.
USAA has more than 13 million members, according to the complaint against Truist, comprising current and former members of the military.
Richard Webner is a freelance business writer and former real estate reporter for the Express-News. He earned a graduate degree in journalism from the University of Missouri and an undergraduate degree in History from Northwestern University.