IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`MARSHALL DIVISION
`
`Civil Action No. 2:21-CV-110
`
`JURY TRIAL DEMANDED
`
`)))))))))))))))))
`
`UNITED SERVICES AUTOMOBILE
`ASSOCIATION
`a Texas reciprocal inter-insurance exchange,
`
`Plaintiff,
`
`v.
`
`PNC BANK N.A.,
`
`Defendant.
`
`COMPLAINT
`
`Plaintiff United Services Automobile Association (“USAA”), by its undersigned counsel,
`for its Complaint against defendant PNC Bank, National Association (“PNC”), states as follows,
`with knowledge as to its own acts, and on information and belief as to the acts of others:
`1.
`This lawsuit is brought to address PNC’s use of USAA’s patented technology
`relating to remote check deposit for mobile banking systems. This patented technology enables
`USAA to connect members of the military and their families across the globe to financial services.
`USAA developed this technology as part of its mission to improve the financial security of its
`members. In its decades of serving the military community, USAA has worked to innovate in
`serving the needs of its members, including a lifestyle that can make getting to a bank branch
`difficult, particularly if they are out to sea or deployed outside the United States. PNC has chosen
`to use USAA’s patented technologies without permission for its own commercial gain. This
`lawsuit seeks remedies for PNC’s misconduct.
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`II.
`
`THE PARTIES
`2.
`Plaintiff USAA is a reciprocal inter-insurance exchange and unincorporated
`association organized under the laws of the State of Texas having its principal place of business at
`9800 Fredericksburg Road, San Antonio, Texas 78288. The USAA family of companies is
`dedicated to the financial well-being of members of the military and their families through the
`provision of insurance and banking products and services, and investing services. USAA does
`business in this judicial district.
`3.
`On information and belief, PNC is a national banking association organized under
`the laws of the United States of America. PNC does business throughout the United States,
`including in this judicial district.
`III.
`JURISDICTION AND VENUE
`4.
`Subject matter jurisdiction is based on 28 U.S.C. § 1338, in that this action arises
`under federal statute, the patent laws of the United States (35 U.S.C. §§ 1, et seq.).
`5.
`The Court has personal jurisdiction over PNC because it has substantial, systematic
`and continuous contacts with this judicial district. PNC has a regular and established place of
`business in the State of Texas and in the Eastern District of Texas, including operating several
`physical branches in this judicial district, and conducting business with customers residing in this
`judicial district both through its branches and its mobile banking services. PNC has committed
`acts of patent infringement and, as detailed below, contributed to or induced acts of patent
`infringement by others in this judicial district. PNC is registered to do business in Texas and
`maintains an agent authorized to receive service of process within Texas.
`6.
`Venue is proper under 28 U.S.C. § 1400(b) because PNC has committed acts of
`infringement and maintains a regular and established place of business in this judicial district.
`7.
`PNC occupies several permanent, physical places within this District from which
`PNC carries out its business. For example, PNC has physical “solution center” branches in the
`following locations in this District: (1) Allen Solution Center, 829B W Stacy Road, Suite 100,
`Allen, Texas 75013; (2) Denton Solution Center, 2310 W. University Drive, #1540, Denton, Texas
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`76201; and (3) Plano Solution Center, 7300 Dallas Pkwy, Suite A140, Plano, Texas 75024. PNC
`conducts business from these solution centers using physical equipment and employees located
`within the District. For example, on information and belief, each of these solution center branches
`allows customers to obtain certain banking services from PNC via in-person appointments with
`PNC employees. In addition, each of these locations offers customers the opportunity to conduct
`banking business via video tellers and/or traditional ATM machines. As a further example, PNC
`maintains several additional ATM locations in this district.
`IV.
`BACKGROUND ALLEGATIONS
`USAA’s Investments And Pioneering Innovations
`This is an action for infringement of patents awarded to research and development
`8.
`teams at USAA for their years of work developing and improving technologies that, among other
`things, allow banking customers to easily and conveniently deposit paper checks into their
`accounts from their smartphones – wherever they might be in the world.
`9.
`USAA has been serving present and former members of the U.S. military and their
`families since 1922 and is one of America’s leading insurance and financial services companies.
`USAA offers its members a wide range of insurance and banking products and services, and
`investing services designed to help them meet their financial security needs. Headquartered in San
`Antonio, Texas, with offices in several states and Europe, USAA employs more than 33,000
`people to provide for the financial well-being of over 12 million members.
`10.
`Unlike traditional banks, which usually maintain a network of brick-and-mortar
`bank branches or ATMs for customers to use, USAA typically interacts with its members remotely,
`either by mail, telephone, or with increasing frequency through its usaa.com website or USAA’s
`mobile application. USAA’s online and mobile presence is critical to its members’ well-being,
`particularly as USAA’s military members are often stationed in distant locations around the world
`with limited access to traditional banking services.
`11.
`Driven by its mission to serve its members, starting in or around 2004, USAA
`invested substantial research and development resources into developing and implementing
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`systems and methods that would provide USAA’s members with a real-time capability to deposit
`a financial instrument from just about anywhere. These pioneering systems and methods resulted
`in a prototype developed by 2005, and the launch in 2006, of a consumer device remote check
`deposit system under the name Deposit@Home®. In 2009, USAA launched an application
`branded as Deposit@Mobile®, which today is available and used worldwide on devices such as
`iPhones, iPads and Android-based mobile devices. For the first time in banking history, USAA’s
`patented systems allowed customers to deposit checks anytime, anywhere by taking photographs
`with consumer electronics that consumers actually own or can easily acquire, such as a mobile
`phone’s digital camera. USAA has invested millions of dollars and thousands of employee-hours
`in the development and implementation of its mobile deposit technologies.
`The Asserted USAA Patents
`This action involves two of the patents that protect USAA’s investments in its
`12.
`mobile deposit technologies: U.S. Patent Nos. 10,013,605 (the “’605 Patent”) and 10,013,681
`(the “’681 Patent”) (collectively, “USAA Patents”).
`13.
`The ’605 Patent is entitled “Digital camera processing system,” and its inventors
`are Charles Lee Oakes III, Randy Ray Morlen, Michael Frank Morris, Reynaldo Bartlette Medina
`III, Greg Alan Harpel, Gabriel Glenn Gavia, Bharat Prasad, Frank Kyle Major, and Jeffrey Neal
`Pollack. The ’605 Patent derives its effective filing date from an application that USAA filed on
`October 31, 2006.
`14.
`The ’605 Patent’s claims solve discrete, technological problems associated with
`computing systems used as part of capturing images of checks for deposit, representing new, novel
`and useful improvements over the existing and/or patentably distinct means and methods. For
`example, the inventions in the ’605 Patent’s claims provide improved functionality over
`conventional techniques, resulting in an enhanced user interface for the customer’s mobile device
`and enhanced performance. As another example, the ’605 Patent’s claims improve the quality of
`captured check images by using the mobile device’s display and camera systems to provide
`instructions to the user while the user is attempting to capture check images. Additionally, the ’605
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`Patent’s inventions help to make remote check deposit systems commercially viable by reducing
`error rates, reducing fraud, and improving security, for example, through validation of check
`information and error detection, and logging of information related to the check, such as an image
`of the check in a particular format, or authentication of the user. The ’605 Patent’s improvements
`to mobile check depositing systems are further described in its specification.
`15.
`On March 22, 2021, the ’605 Patent overcame a petition for Inter Partes Review
`(“IPR”) (IPR2020-01742). The Patent Trial and Appeal Board (“PTAB”) denied institution,
`finding no reasonable likelihood that Mitek would prevail in proving any claim of the ’605 Patent
`unpatentable. According to the PTAB, Mitek had not shown its combined references “achieve[]
`more security, mobility, and accuracy over the mobile check deposit process,” which were the
`goals and benefits of the ’605 Patent. Id. at 22-23. This is the second time that the ’605 Patent
`overcame post-grant review.
`IPR,
`institution of
`16. When denying
`characterization of the ’605 Patent and its benefits:
`The ’605 patent describes a system for depositing checks remotely from a handheld
`(cid:80)(cid:82)(cid:69)(cid:76)(cid:79)(cid:72)(cid:3)(cid:71)(cid:72)(cid:89)(cid:76)(cid:70)(cid:72)(cid:17)(cid:3)(cid:40)(cid:91)(cid:17)(cid:3)(cid:20)(cid:19)(cid:19)(cid:20)(cid:15)(cid:3)(cid:70)(cid:82)(cid:71)(cid:72)(cid:3)(cid:11)(cid:24)(cid:26)(cid:12)(cid:15)(cid:3)(cid:21)(cid:29)(cid:22)(cid:22)(cid:237)(cid:24)(cid:23)(cid:15)(cid:3)(cid:27)(cid:29)(cid:22)(cid:21)(cid:237)(cid:22)(cid:23)(cid:17)
`
`following
`
`the PTAB provided
`
`the
`
`Figure 1 of the ’605 patent is reproduced below.
`
`Figure 1 above illustrates a system for remote check deposits. System 100 includes
`server 131 located at financial institution 130, publicly accessible network 120, and
`general purpose computer 111 coupled to image capture device 112. Id(cid:17)(cid:3)(cid:68)(cid:87)(cid:3)(cid:22)(cid:29)(cid:22)(cid:25)(cid:237)(cid:23)(cid:26)(cid:17)(cid:3)
`For example, account owner 110 (a bank customer), who has account 160 at
`financial institution 130, may use general purpose computer 111 to generate images
`of a check and send the images to server 131, via publicly accessible network 120.
`Id. General purpose computer 11 “may be in a desktop or laptop configuration.” Id.
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`(cid:68)(cid:87)(cid:3)(cid:22)(cid:29)(cid:25)(cid:24)(cid:237)(cid:25)(cid:25)(cid:3)(cid:11)(cid:72)(cid:80)(cid:83)(cid:75)(cid:68)(cid:86)(cid:76)(cid:86)(cid:3)(cid:68)(cid:71)(cid:71)(cid:72)(cid:71)(cid:12)(cid:17)(cid:3)(cid:41)(cid:76)(cid:81)(cid:68)(cid:81)(cid:70)(cid:76)(cid:68)(cid:79)(cid:3)(cid:76)(cid:81)(cid:86)(cid:87)(cid:76)(cid:87)(cid:88)(cid:87)(cid:76)(cid:82)(cid:81)(cid:3)(cid:20)(cid:22)(cid:19)(cid:3)(cid:80)(cid:68)(cid:92)(cid:3)(cid:73)(cid:82)(cid:85)(cid:90)(cid:68)(cid:85)(cid:71)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:76)(cid:80)(cid:68)(cid:74)(cid:72)(cid:3)(cid:82)(cid:89)(cid:72)(cid:85)(cid:3)
`network 125 to one or more other entities 140, 150, which may be associated with
`account 170 on which the check was drawn. Id(cid:17)(cid:3)(cid:68)(cid:87)(cid:3)(cid:22)(cid:29)(cid:24)(cid:24)(cid:237)(cid:24)(cid:27)(cid:17)(cid:3)
`
`Figure 4 of the ’605 patent is reproduced below.
`
`Figure 4 above illustrates an exemplary network architecture for connecting a
`general purpose computer to financial institution in a distributed computing
`environment. Id(cid:17)(cid:3)(cid:68)(cid:87)(cid:3)(cid:22)(cid:29)(cid:23)(cid:237)(cid:27)(cid:15)(cid:3)(cid:26)(cid:29)(cid:24)(cid:20)(cid:237)(cid:24)(cid:24)(cid:17)(cid:3)(cid:36)(cid:70)(cid:70)(cid:82)(cid:85)(cid:71)(cid:76)(cid:81)(cid:74)(cid:3)(cid:87)(cid:82)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:182)(cid:25)(cid:19)(cid:24)(cid:3)(cid:83)(cid:68)(cid:87)(cid:72)(cid:81)(cid:87)(cid:15)(cid:3)(cid:87)(cid:75)(cid:72)(cid:3)(cid:70)(cid:82)(cid:81)(cid:81)(cid:72)(cid:70)(cid:87)(cid:72)(cid:71)(cid:3)
`devices may be computers, digital devices such as Personal Digital Assistances
`(“PDAs”), televisions, MP3 players, software objects such as interfaces,
`communication objects, and the like. Id(cid:17)(cid:3)(cid:68)(cid:87)(cid:3)(cid:27)(cid:29)(cid:21)(cid:27)(cid:237)(cid:22)(cid:23)(cid:17)(cid:3)
`
`Id. at 3-5.
`
`17. Wells Fargo Bank, N.A. (“Wells Fargo”) previously filed a petition for Covered
`Business Method review (“CBM”) against the ’605 Patent (CBM2019-00029) in March 2019. The
`PTAB denied institution, finding that the claims of the ’605 Patent were directed to technological
`features that are novel and unobvious over the prior art and solve technical problems using
`technical solutions and were thus ineligible for CBM review. According to the PTAB, “capturing
`an image of a check of sufficient quality with a mobile device so that data may be accurately
`extracted from the image to perform a mobile check deposit is a technical solution to a technical
`problem.” Id. at 21.
`18.
`The ’681 Patent is entitled “System and method for mobile check deposit,” and its
`inventors are Charles Lee Oakes III, Randy Ray Morlen, Bharat Prasad, and Troy Bartlette Huth.
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`The ’681 Patent derives its effective filing date from an application that USAA filed on October
`31, 2006.
`Among other things, the ’681 Patent’s claims solve discrete, technological
`19.
`problems associated with computing systems used as part of capturing images of checks for
`deposit, representing new, novel and useful improvements over the existing and/or patentably
`distinct means and methods. The inventions in the ’681 Patent’s claims provide improved
`functionality over conventional techniques, resulting in an enhanced user interface for the
`customer’s mobile device and enhanced performance. For example, the ’681 Patent’s claims
`improve the quality of captured check images by using the mobile device’s display and camera
`systems to provide instructions to the user while the user is attempting to capture check images
`and helping the user place the camera at the proper distance away from the check to capture valid
`check images for depositing. Additionally, the ’681 Patent’s inventions help to make remote check
`deposit systems commercially viable by reducing error rates, reducing fraud, and improving
`security, for example, through validation of check information and error detection, and logging of
`information related to the check, such as an image of the check in a particular format, or
`authentication of the user. The patent’s improvements to mobile check depositing systems are
`further described in its specification.
`20.
`The ’681 Patent has also overcome two post-grant review petitions at the PTAB.
`On March 9, 2021, the PTAB issued a decision denying institution, finding no reasonable
`likelihood that Mitek would prevail in proving any claim of the ’681 Patent unpatentable.
`21. When denying institution of IPR, the PTAB provided the following
`characterization of the ’681 Patent and its benefits:
`The ’681 patent recognizes that “[c]hecks typically provide a safe and convenient
`method for an individual to purchase goods and/or services.” Ex. 1001, 1:4–5. The
`’681 patent states that, “[although] a check may provide a payor with a convenient
`and secure form of payment, receiving a check may put certain burdens on the
`payee,” one of which is the “time and effort required to deposit the check.” Id. at
`1:50–53. For instance, depositing a check by visiting a local bank branch and
`physically presenting the check to a bank teller requires a certain time commitment
`on behalf of the payee. Id. at 1:53–60. The ’681 patent also states that “[a] check
`may pose other burdens for the payee.” Id. at 1:61. For instance, a payee may be
`limited in how it uses funds from a check because purchasing goods and/or services
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`using the check requires the payee to endorse the check and then have a third party
`accept the check; such transactions often are disfavored because the seller of the
`goods and/or services may not be “willing to accept the risk that . . . [there are]
`insufficient funds to cover the check.” Id. at 1:61–2:3.
`
`The ’681 patent purports to address these burdens by providing “a convenient
`method of remotely depositing a check while enabling the payee to quickly access
`the funds from the check.” Ex. 1001, 2:8–10. Figure 2 of the ’681 patent,
`reproduced below, illustrates one embodiment for depositing a check using a
`customer-controlled general purpose computer. Id. at 2:64–67. ‘
`
`Figure 2, reproduced above, begins with delivering or downloading a software
`component to the customer-controlled general purpose computer at step 200. Id. at
`6:48–49. After downloading the software component, and assuming the customer-
`controlled general purpose computer has an appropriate image capture device, the
`customer begins the deposit transaction by, for example, using a browser
`application to access a bank website “where a link may be available that causes the
`bank server to initiate a deposit transaction [at step] 201.” Id. at 7:17–23.
`
`As further shown in Figure 2, reproduced above, the customer identifies the account
`into which he/she wishes to deposit the check at step 202, identifies the amount of
`the check he/she wishes to deposit in the selected account at step 203, and then
`endorses the check at step 204. Ex. 1001, 7:25–26, 7:42–44, 7:48–49. The customer
`uses the image capture device to provide an image of the check at step 205. Id. at
`7:50–52. For example, “[i]f the customer is instructed to take a digital photograph
`of the check using a digital camera, the customer may be instructed as to the
`position and orientation of the check, lighting, angle of [the] camera, distance and
`focal length (zoom) of [the] camera, and so forth.” Id. at 7:55–60. The software
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`component next causes the image of the check to be presented to the customer for
`editing (e.g., “by asking the customer to crop and/or rotate the check image to a
`predetermined orientation [at step] 206”). Id. at 8:22–25.
`
`In another embodiment, after the user receives an image of the check, Optical
`Character Recognition (“OCR”) may be performed on the Magnetic Ink Character
`Recognition (“MICR”) line location of the check to determine information, such as
`the payor bank’s routing number, the account number, and the check number. Ex.
`1001, 9:17–22. The ’681 patent explains that the use of the OCR process permits
`reading (1) the bank’s routing number on the check itself so that it may be validated
`against a list of valid routing numbers, (2) both sides of the check to confirm that
`the check image includes a front image and back image (to avoid the problem where
`two front sides are scanned), and (3) the check amount location so that it may be
`compared to an amount previously indicated by the user, such as in step 203. Id. at
`9:23–27, 9:35–46, 10:36–44.
`
`The process illustrated in Figure 2 continues by placing “[a]n appropriately edited
`image of the check” in a storage location at step 207 and, if further images of the
`check are necessary at step 208, steps 205–207 may be repeated. Ex. 1001, 8:33–
`35. A log file also may be generated at step 209 “to collect data for processing or
`troubleshooting the deposit transaction” and placed in a storage location, along with
`the various images of the check. Id. at 8:40–44. After receiving and editing the
`desired image of the check, it is delivered to the bank server for processing the
`deposit at step 210. Id. at 8:45–47. If the bank server determines that the image of
`the check and any corresponding data “are sufficient to go forward with the deposit,
`the customer’s account may be provisionally credited, and a confirmation page may
`be delivered to the customer via the customer’s browser application [at step] 212.”
`Id. at 8:49–54.
`
`Id. at 4-7.
`22. Wells Fargo had previously filed a petition for CBM review against the ’681 Patent
`(CBM2019-00028) in March 2019. The PTAB denied institution, finding that the claims of the
`’681 Patent were directed to technological features that are novel and unobvious over the prior art
`and solve technical problems using technical solutions and were thus ineligible for CBM review.
`According to the PTAB, the ’681 Patent’s claims “recite technological features that solve a
`technical problem using a technical solution by capturing electronic images of a check using a
`digital camera and a portable device for remote deposit.” Id. at 27.
`23.
`Together, the USAA Patents are directed to improved computing systems that
`enable commercially-viable remote check deposit systems used today by PNC. The USAA Patents
`solve technological problems associated with earlier systems used for capturing images of checks.
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`These innovations allowed USAA, for the first time in banking history, to allow users to transform
`general-purpose consumer devices that they have in their homes or are otherwise easy to acquire
`into a check-image capture device. This had a profound impact on USAA’s members and USAA’s
`ability to accept deposit of remote checks, including because it eliminated the need for consumers
`(many of whom have limited means) to acquire or access specialized check processing equipment
`to deposit checks remotely.
`24.
`Prior to USAA’s inventions, checks were processed for deposit using specialized
`check scanning machines, which typically were located in bank facilities or leased to businesses
`for use in their back offices. High-tech equipment manufacturers sold a variety of check scanning
`machines that cost up to tens of thousands of dollars.
`25.
`The passage of the Federal “Check 21 Act” in 2003 increased the technical risks
`associated with check imaging. A report by Alogent entitled “The Client Business Case for Remote
`Deposit Capture” explained how, under Check 21, items would be returned due to poor image
`quality, either on the digital image, or the printed Image Replacement Document (IRD).
`26.
`The deposit of check images requires compliance with certain technical
`specifications, such as the “Specifications for Electronic Exchange of Check and Image Data,”
`also known as DSTU X9.37-2003: a technical specification published by the Accredited Standards
`Committee X9, Inc. that spells out the file sequences, record types, and field formats to be used
`for the electronic exchange of check MICR line, associated check processing data and check
`images.
`An industry white paper entitled “Check 21: Controlling Image Quality at the Point
`27.
`of Capture” was published in 2004. The white paper acknowledges that one challenge facing
`remote deposit capture (“RDC”) is that the human eye does not have the ability to distinguish
`between a check image that meets digital processing criteria and one that does not. For example,
`the white paper points out that what is an acceptable image to one person may be unacceptable to
`another. The white paper discussed the importance of ensuring that an acceptable image of a check
`is captured at the first point of entry to the check clearing process, as a check image with quality
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`issues is likely to be unpayable and represents a liability to the bank. Further, the report identified
`and discussed basic measurement metrics to ensure that a check image may be successfully
`cleared. Also in 2004, the FSTC, a financial industry technical group, published a report entitled
`“Image Quality and Usability Assurance - Phase I Project.” The report discussed a number of
`factors such as image size, skew, lightness/darkness, focus, and noise, among others that can lead
`to a failed image. Other publications discussing the perceived challenges of remote deposit include
`statements made in 2005 by CIT Engineering Team, who designs specialized scanners for the RDC
`process, the RDC process is so delicate that small insights and/or small oversights are what
`distinguish an outstanding check scanning product from a mediocre one.
`28. When USAA introduced its novel technology to the market, it was met with both
`delight and concern because of its disruptive force. For example, in September 2009, AdAge
`published a report entitled “How Mobile Technology Is Changing Banking’s Future,” which
`observed that “USAA represents the bleeding edge of mobile banking technology” and described
`its pioneering system as a “technological development [ ] that allow[s] for deposits by iPhone and
`mobile payments.” As another example, in June 2009, Celent published an article entitled
`“USAA’s Mobile Remote Deposit Capture Initiative.” The article stated that mobile RDC is so
`disruptive that many banks might pass on the idea. The report acknowledged that USAA’s mobile
`RDC provided a compelling competitive advantage over other banks.
`29.
`By facilitating and improving remote mobile deposit, the innovations of the USAA
`Patents facilitate significant cost savings and provide many other financial benefits to banks. For
`example, in 2011, NCR published a white paper entitled “Mobile Remote Deposit Capture.” The
`white paper reported that the average cost of processing a paper check transaction at a bank branch
`is $3.75, and that a mobile deposit costs just $0.14.
`30.
`As another example, in 2015, Celent published a report entitled “State of Remote
`Deposit Capture 2015 - Mobile Is the New Scanner.” The abstract of the report observed that
`mobile RDC was becoming the alternative to specialized check scanners, with banks racing to
`offer mobile RDC, which Celent predicted would have a profound effect on the branch channel.
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`The report also observed that USAA’s systems result in a substantial improvement over the
`existing marketplace of complex, expensive check scanning machines and that by the date of the
`report mobile check image capture users outnumbered those using specialize desktop devices by
`more than 40 to 1. As another example, in 2016, an article entitled “Mobile Check Deposits - Pro
`Tips to Ensure They Go Smoothly” was published by an industry technology analyst on
`nerdwallet.com. The article acknowledged that mobile check deposit had become the most popular
`feature of mobile banking, estimating that there are about 87 million people in the U.S. depositing
`checks using mobile check deposit.
`PNC Bank’s Infringement
`PNC is one of the largest full-service consumer and commercial banking providers
`31.
`in the United States. According to PNC’s website, PNC customers now deposit on average over 2
`million checks per month using their mobile devices.
`32.
`PNC’s mobile remote deposit capture systems, including but not limited to PNC
`Mobile Deposit and PNC Deposit On-Site Mobile® are referred to herein, along with any other
`infringing instrumentalities that include similar functionality, as “PNC Mobile Deposit.” PNC
`states that users “can easily deposit a check right from your smartphone” using PNC Mobile
`Deposit, touting that deposit can be done “quickly, conveniently, and securely with mobile deposit
`and our mobile banking apps”:
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`PNC also promotes PNC Mobile Deposit with video advertisements, including
`33.
`commercials specifically touting mobile deposit, and has offered special promotions to customers
`to encourage them to try mobile deposit.
`34.
`PNC receives mobile check deposits from customers who, for example, download
`its application for iPhone or Android devices and use the application and device as instructed by
`PNC, including as detailed on PNC’s website and in its user guidelines.
`35.
`PNC did not release PNC Mobile Deposit until years after USAA had already
`implemented and released its patented technology to widespread adoption, demonstrating the
`commercial viability of USAA’s patented technology.
`36.
`PNC had actual knowledge of its infringement of the USAA Patents before the
`filing of the Complaint. For example, on October 22, 2020, PNC confirmed that it had actual
`knowledge of the USAA Patents, acknowledging that it was aware of a prior litigation in which
`USAA asserted the USAA Patents against Wells Fargo. As another example, on September 30,
`2020, USAA filed a Complaint in Case No. 2:20-cv-00319-JRG (E.D. Tex.) regarding PNC’s
`infringement of U.S. Patent Nos. 10,482,432 (the “’432 Patent”) and 10,621,559 (the “’559
`Patent”), which expressly discuss the ’681 Patent.
`37. Moreover, since at or shortly after the time of its issuance, the USAA Patents have
`been publicly known and widely publicized in the banking industry, including in major
`publications read by PNC employees. For example, the American Banker, a publication which
`describes itself as “the essential resource for senior executives in banking and financial services,
`keeping its users updated on vital developments and focusing sharply on their most important
`concerns” ran an article, published in January 2020, discussing the jury verdict finding Wells Fargo
`liable for infringing the USAA Patents and awarding USAA $102.8 million in past damages. The
`article reported “Wells Fargo has lost a [] mobile deposit patent lawsuit brought against it by
`USAA,” noted that “other banks should be on alert if they use the same technology,” and
`specifically referenced USAA’s Deposit@Mobile product. Similar articles appeared in other major
`publications such as Bloomberg and Business Insider. Indeed, some of the news coverage of
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`USAA’s mobile deposit patents specifically references PNC Mobile Deposit. For example, S&P
`Global, a market intelligence publication covering commercial banking, published a November
`2019 article about another prior jury verdict against Wells Fargo for infringement of USAA mobile
`deposit patents that stated “other banks with apps for mobile check deposit could also be on the
`hook,” and specifically listed “PNC Financial Services Group Inc.” Upon information and belief,
`PNC monitors these industry publications. For example, PNC’s website has specifically touted
`and cited coverage from the American Banker, Bloomberg, Business Insider, and S&P Global.
`38.
`In addition to the widespread coverage of USAA’s lawsuits against Wells Fargo,
`USAA’s Deposit@Mobile® technology has been well-known and publicized for years, and USAA
`receives widespread acclaim for its pioneering innovations in mobile deposit. For example, a 2020
`report by Javelin Strategy and Research named USAA “as an overall ‘Leader’ in both mobile and
`online banking,” and also evaluated PNC. Upon information and belief, PNC is aware of this and
`other acclaim for USAA’s Deposit@Mobile® products, including because it was widespread in
`the industry and because some of the press surrounding USAA also referred specifically to PNC.
`As an example, a 2011 article in the Washington Post entitled “PNC launches mobile bank
`deposits” noted that “USAA Federal Savings first introduced mobile deposit in 2009.” PNC has
`previously cited articles from the Washington Post on its website and, on information and belief,
`closely monitors media coverage discussing its own products.
`39.
`USAA is further informed and believes that PNC has actual and constructive
`knowledge of the USAA Patents as a result of its awareness of USAA’s Deposit@Mobile®
`products and USAA’s patent marking. For example, USAA marks its Deposit@Mobile® products
`pursuant to 35 U.S.C. § 287 through the USAA mobile application. As a further example, the
`Deposit@Mobile® mobile application contains a “United States Patents” section also specifically
`listing the USAA Patents by number.
`40.
`Further, to the extent that PNC contends it lacked actual knowledge of any aspect
`of its infringement of the USAA Patents before the time of service of this Complaint, it was also
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`willfully blind by deliberately avoiding an investigation. Further, PNC has additional actual
`knowledge of its infringement of the USAA Patents by virtue of this complaint.
`41.
`As detailed below, PNC’s conduct with respect to Mobile Deposit constitutes
`willful infringement of the USAA Patents. PNC’s use of the USAA Patents is not licensed or
`authorized by USAA in any way.
`42.
`PNC has profited, and continues to profit, including by providing its infringing
`mobile deposit service to millions of PNC customers without USAA’s permission and without any
`compensatio