Senniger Powers Wins Appeal in Advanced Software Design Corporation v. Fiserv

The United States Court of Appeals for the Federal Circuit on Thursday handed Advanced Software Design Corporation (ASDC) a significant victory in its ongoing patent infringement litigation against Fiserv, Inc. regarding the use of Fiserv's "Secure Seal" product to validate checks and prevent check fraud. ASDC is the exclusive licensee of patents covering inventions by Calin Sandru directed to the use of encryption and decryption technology to prevent check fraud. The claims of the patent asserted by ASDC and Mr. Sandru against Fiserv covered processes and systems for validating checks printed using that technology. The District Court had construed the preambles of the asserted claims as containing necessary steps directed to the encrypting and printing of checks. In doing so, the district court rejected ASDC's argument that the preambles merely defined the environment in which the claimed processes and systems for validating a check operated. Because Fiserv did not print checks, the District Court concluded there could be no infringement, and granted summary judgment in favor of Fiserv.

The Federal Circuit vacated the District Court's claim construction, finding that "the claims at issue in this case contain preambles that define the environment in which an accused infringer must act or describe capabilities that an accused device must have." The Federal Circuit thus found that Fiserv "could 'use' the method of claim 1 by validating checks even though it does not encrypt and print them" and use the system of another claim "simply by controlling the scanner and the decrypting computer." The Federal Circuit also vacated the District Court's construction of another claim term, adopted the construction proffered by ASDC, and remanded the case to the District Court for the Eastern District of Missouri for further proceedings.