SMS Alerts Over Credit Card Transactions? Patented! Visa Sued
from the innovation-at-risk dept
Let's say you were an engineer at a major credit card company like Visa, and put in charge of watching over new technologies, and thinking about ways that you could make the credit card process better and more secure for card holders. It probably wouldn't take you all that long to come up with a variety of useful measures for checking to make sure certain transactions were legit -- such as alerting cardholders to transactions via SMS. That's nothing particular special or unique, but it's a nice obvious addition, thanks to the fact that SMS text messaging has now become popular. So, you go ahead and implement it... and promptly get sued by some small company that claims a patent on the "invention" of alerting cardholders of transactions by SMS. I'm sure the angry patent system defenders will be quick to show up in the comments claiming that Visa "stole" this "invention," but I'm having a really difficult time understanding how you can support innovation and allow this sort of result to happen.
Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.
Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.
While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.
–The Techdirt Team
Filed Under: credit cards, patents, sms alerts
Companies: cnsc, visa
Reader Comments
Subscribe: RSS
View by: Time | Thread
Seems to me
[ link to this | view in chronology ]
Re: Seems to me
I agree, that some ideas that get the patent nod are more common sense than major innovations. Not sure how to solve that. Like, 1-click buttons, patented (and implemented) by Amazon.
[ link to this | view in chronology ]
hmmm
I'd love to see that one.
[ link to this | view in chronology ]
Re: hmmm
[ link to this | view in chronology ]
Doesn't pass the sniff test
[ link to this | view in chronology ]
WTF??
These scum should be rounded up and shot. I'm sorry, it's just beyond the pale.
[ link to this | view in chronology ]
Amazing
[ link to this | view in chronology ]
Patent type dump!
Patents should only apply to inventions, products, and complex chemistry. It should not apply to concepts such as driving a car or one-click payment systems. It would be like me getting a patent on a handshake an trying to charge people every time they shook someones hand. I also think that if someone can prove that another person/organization came up with something that was patented before another party actually got the patent then the third party patent is automatically revoked.
[ link to this | view in chronology ]
Re: Patent type dump!
[ link to this | view in chronology ]
Sort of like Amazon's "one click purchase" thing. A patent on something that is obvious and common, not unique.
[ link to this | view in chronology ]
Work together to make the patented idea evolve
In other words if you have any kind of patent, use or you might loose it.
To learn more go to http://www.bigsuccess.tv/watch/?contestant=163
[ link to this | view in chronology ]
Re: Work together to make the patented idea evolve
Thanks, but no thanks.
[ link to this | view in chronology ]
Re: Work together to make the patented idea evolve
[ link to this | view in chronology ]
Re: Work together to make the patented idea evolve
Your "unique" idea is taking an existing, well-known technology (solar panels), and an existing implementation (metered private feeds to the energy grid), wrapping it with a common business tool (reward/discount program), and backing it with some simplistic accounting.
Yes, there are several moving parts, but I don't see how any of this is "unique". There are several business models that are close to what you are discussing (rewards/discount programs tied to metered usage of something). You simply have merged this with a different meter-able asset.
Different idea from existing? Yes.
Patentably unique? Absolutely not. Sorry. And having a patent doesn't make the idea patentably unique...just another breakdown of our patent system.
[ link to this | view in chronology ]
Start paying up.
[ link to this | view in chronology ]
Interesting
[ link to this | view in chronology ]
It's the free money bunny!
[ link to this | view in chronology ]
Death to Lawyers
[ link to this | view in chronology ]
Whatever. This patent does not stand a chance on re-exam anymore.
So, I'd say that VISA may settle for something less then the cost of the lawyers fee it would have to pay to go through the reexamination. That is not much for VISA at all.
All of it is so, if the patent is as simple as you are describing, of course...
[ link to this | view in chronology ]
Re: Whatever. This patent does not stand a chance on re-exam anymore.
[ link to this | view in chronology ]
Re: Re: Whatever. This patent does not stand a chance on re-exam anymore.
It sucks when someone sues you, when they have no pretty much case. But it has nothing to do with the patents. Rather, it is about being a successful company.
This is one of the effects of the US system. And it is not all bad -- while we'll have more frivolous suites, we'll also have more "just" suites that would had been rejected by a different system, more prone to rejecting all suites.
We should always try to improve the system, but we should never forget that it is a balancing act.
[ link to this | view in chronology ]
The application should be billed the costs of proving this is good enough to patent. The USPTO should get to do that research on the applicant's dollar before approving or denying these things.
It would cut down on the total garbage patents like this one. It is clear that a patent like this cannot hold up to the basic obviousness tests, and its also clear the patent holder did not attempt to make their idea marketable and get a product out there. It should be thrown out immediately, but more importantly it should have never been issued in the first place.
We need the patent applicant to be responsible for proving their idea is valid, meets the rules, and there is no prior work. They cannot do that in a trustworthy fashion, so we should bill them for the cost of that investigation. You want the rights to an idea? Pay for getting the rights to them all to yourself.
[ link to this | view in chronology ]
Not Clever
In fact, it should be made as standard for all credit card issuers.
This will not only minimize the cardholders risk, but the credit card issuers as well.
Perhaps someone is taking it too far in the name of patented protection.
[ link to this | view in chronology ]
Re: Not Clever
[ link to this | view in chronology ]
Not sure if I am in trouble or innovative
Does this violate someone's patent? If you already have an e-mail system in place sending a text message instead only requires a change of address, sending plain text instead of html and limiting the characters to around 120. How can a functionality that is already built into most systems not be obvious? What happens if I give my bank my text address instead as my regular e-mail address? Is my bank violating this patent? Am I?
[ link to this | view in chronology ]
Re: Not sure if I am in trouble or innovative
Of course you are! Now, be a good corporate subject and pay up. Don't make them unleash the lawyers on you.
[ link to this | view in chronology ]
after
[ link to this | view in chronology ]
Settling lawsuits
[ link to this | view in chronology ]
Re: Settling lawsuits
If 10 Monster companies fight the suite collectively and win, how is it a deterrent against a "poor schmuck" getting sued for something else?
[ link to this | view in chronology ]
[ link to this | view in chronology ]
Re:
[ link to this | view in chronology ]
Re:
The claims are overly simplistic, detailing nothing more than a generic transmit, authorize, notify, process method.
If this is actually the patent CNSC is suing over, there should be no problem having the patent re-examined and thrown out on obviousness.
[ link to this | view in chronology ]
If it as easy as you suggest, then perhaps you may be able to direct the USPTO to a specific piece/pieces of prior art that raise a substantial new question about patentability.
Until you find that art you are expressing an opinion concerning reexamination without any factual predicate.
As for the patent itself, while it may seem after the fact to be somewhat simplistic to you, opinions proferred without following the protocol at 28 above are lacking any substantial basis.
[ link to this | view in chronology ]
Re:
I'm so sick of patent lawyers insisting that prior art = obviousness. They are TWO SEPARATE THINGS. Any reasonable person can tell you that this concept was hardly a breakthrough non-obvious idea in 2005.
[ link to this | view in chronology ]
Re: Re:
[ link to this | view in chronology ]
Re: Re:
"35 U.S.C. 103 Conditions for patentability; non-obvious subject matter.
(a) A patent may not be obtained though the invention is not identically disclosed or described as set forth in section 102 of this title, if the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a person having ordinary skill in the art to which said subject matter pertains. Patentability shall not be negatived by the manner in which the invention was made."
Is this patent one that claims something obvious? There is no intellectually honest way to answer the question without following the above noted protocol to flesh out the salient facts.
[ link to this | view in chronology ]
Re:
To answer your question bluntly, there really should be no need for any specific piece of prior art.
The claims listed in the patent are blatantly generic, and judging by the tone of your comment, it would seem you haven't bothered to actually read it for yourself. Anyone with a passing understanding of cell phones and text messaging would quickly grasp that the process covered by this patent was obvious well before 2005, when it was filed.
[ link to this | view in chronology ]
Re: Re:
FYI, I did take a look at the patent and its claims, and, yes, the allowed claims are likely to raise some eyebrows. However, whether or not the patent defines a new, useful and nonobvious invention does, at a minimum, require consideration of the patent, the cited references and the file wrapper (a compendium of all proceedings before the USPTO pertaining the the application as originally filed).
In the absence of reviewing and assimilating the significance of the above information, one cannot say with any degree of certainty that a patent was wrongly issued, simply because all of the salient facts have not been considered.
An accurate characterization of this patent would be to say "It looks obvious to me, but I need to do some investigating." Anything less is intellectually dishonest.
[ link to this | view in chronology ]
Re: Re: Re:
If by investigating, you mean quickly realizing that the capability to use text messaging to send automatic replies existed well before 2005, then you are correct. And before text messaging, the same process was implemented via email. The patent attempts to take an incredibly basic process, add "via text messaging", and treat it as a new, novel idea. It's really no different than the patents that tacked on "over the internet" to pre-existing concepts.
So stating that the patent covers a process that was obvious at the time of filing is not intellectually dishonest in any way.
[ link to this | view in chronology ]
patent has it's rules
A patent as defined by US and Haya( Den Haag- Holand International tribune) Laws is a process or Academical or Mathematical definition that can be applied to business or research and bears originality and inginuety enough to be considered unique as a process, as a method or as a solution for mathematical, physics, intelectual, business situations and all other life related matters.
Just to claim that you invented an SMS alert is NOT a patent regulated invention
You must prove and your hired spezialized lawyer will guide you that you are providing a solution to one of the above situations
So patent FAKERS bring it on
[ link to this | view in chronology ]
Prior Art, I have some....
We finished this in 2004 and it has been in production ever since.
[ link to this | view in chronology ]
SMS alerts
[ link to this | view in chronology ]
Lots of prior art
This service has been active in India for a long time...
http://www.newswit.com/enews/2003-08-13/1419-india-centurion-bank-launches-sms-alerts/
h ttp://www.v3.co.uk/vnunet/news/2118938/uk-banks-tackle-credit-card-fraud?vnu_lt=vnu_art_related_arti cles
I don't know how can the USPTO be so stupid and grant a patent to an idea that is 3 years old!
[ link to this | view in chronology ]
Online Purchase Text Confirmation
This way if your Paypal Account(and probably email account)gets hacked, hopefully your SMS login was not, enabling you a window to stop the madness.
They text could state: You have made a purchase from http://www.goodreference.biz for $49.99.
You could even add.. Reply with agree or disagree, depending on the time lag.
Paypal can charge it's customers $10 a year, and pay a licensing fee.
[ link to this | view in chronology ]