DataTreasury Corporation

March 07, 2005 15:23 ET

DataTreasury Wins Crucial Phase of High-Dollar ``Check 21'' Case; Judge Again Rules Firmly Against Defendants Accused of Patent Infringement



MARCH 7, 2005 - 15:23 ET

DataTreasury Wins Crucial Phase of High-Dollar ``Check
21'' Case; Judge Again Rules Firmly Against Defendants
Accused of Patent Infringement

MELVILLE, N.Y.--(CCNMatthews - Mar 7, 2005) -

DataTreasury Corporation today announced its most important victory to
date in the landmark legal battle it is waging against one of the
nation's largest financial institutions, several major data-processing
companies and a number of other corporate defendants, all of whom are
accused of infringing DataTreasury's patents. (Denoted as U.S. Patent
No. 5,910,988 and U.S. Patent No. 6,032,137, these patents cover, among
other things, technology used to capture, process, store and transmit
digital images of checks, financial transactions and other documents.)
On Monday, February 28, 2005, Judge David J. Folsom of the Texarkana
Division of the U.S. District Court for the Eastern District of Texas --
a court familiar with patent litigation -- released his final decision
and order after a crucial series of claim construction hearings. Known
in the patent-litigation world as a "Markman" order, this ruling is the
product of nearly two years' worth of courtroom analysis, and it
determines the scope of the property rights covered by DataTreasury's
patents. In issuing this order, the Court has recognized the full scope
of the claim terms envisioned by DataTreasury, verifying the patents'
value and upholding the work undertaken by the U.S. Patent and Trademark
Office before it issued them. It is a giant step forward for
DataTreasury and the roughly 400 investors who have chosen to support
the company in its quest for justice.

This legal victory is particularly important given the recent passage of
the Check Clearing for the 21st Century Act. Popularly known as "Check
21," this law allows financial institutions to exchange digital images
of checks rather than the original paper copies, and, according to a
recent article about DataTreasury's case in The Wall Street Journal, it
"is expected to result in big savings for banks." (J.P. Morgan Is Sued
Over Patents For Check-Processing Technology, The Wall Street Journal,
December 14, 2004,

"DataTreasury and its founder, Claudio Ballard, are receiving some
long-overdue justice," said Ed Hohn, DataTreasury's lead attorney and a
partner of the law firm Nix, Patterson & Roach, LLP. (Mr. Hohn and Nix,
Patterson & Roach were cited in the February 21, 2005, issue of the
National Law Journal for winning a clergy-molestation case which
resulted in one of the 50 largest jury verdicts of 2004.) "These
defendants have profited from the unauthorized use of DataTreasury's
patented technology, and they stand to profit more now that Check 21 has
gone into effect. Should any company infringing these patents fail to
recognize DataTreasury's intellectual property, it can expect swift and
certain litigation."

"The Court's latest ruling validates our position that the DataTreasury
patents are extremely valuable and infringed by the various defendants,"
added DataTreasury's patent counsel, Rod Cooper of the Dallas-based
Cooper Law Firm.

This case is expected to go to trial, based upon a court briefing made
to all parties, sometime during either the third or fourth quarter of

Last year, DataTreasury announced victories in similar lawsuits against
Ontario-based RDM Corp. and Dallas-based Affiliated Computer Services
(ACS). The RDM settlement allowed the company to obtain a nonexclusive
worldwide license for the use of DataTreasury's technology. ACS agreed
to a permanent injunction barring that company's use of DataTreasury's
patented technology. The permanent injunction against ACS also expressly
recites that the electronic archive project, part of a joint venture
between J.P. Morgan Chase and ACS, was covered by the DataTreasury

A privately owned company, DataTreasury was formed in 1998 and is built
around its patents covering its "Global Repository Platform," the
world's most functional and secure informational management system.
DataTreasury was issued the patents in 1999 and 2000 for image capture,
centralized processing and electronic storage of document and check
information, and DataTreasury has many other pending patent applications
surrounding this system. The patents granted in the United States have
also issued in Australia, Egypt, Mexico, Malaysia, New Zealand, the
Philippines, Pakistan, the Russian Federation, Singapore and Taiwan, and
the patents are pending in other nations. DataTreasury's London-based
solicitors will soon begin enforcing the international patents and
making worldwide licenses available.

For a copy of the court order, please contact


Contact Information

    DataTreasury Corporation
    Eric Wetzel, 512-474-7514