Case 8:17-cv-01289-AG-KES Document 1 Filed 07/26/17 Page 1 of 11 Page ID #:1
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`HAYNES AND BOONE, LLP
`Kenneth G. Parker / Bar No. 182911
`kenneth.parker@haynesboone.com
`Thomas B. King / Bar No. 241661
`thomas.king@haynesboone.com
`600 Anton Boulevard, Suite 700
`Costa Mesa, California 92626
`Telephone: (949) 202-3000
`Facsimile
`(949) 202-3001
`
`Attorneys for Plaintiff
`mSIGNIA, Inc.
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`UNITED STATES DISTRICT COURT
`CENTRAL DISTRICT OF CALIFORNIA
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`Case No. 8:17-cv-1289
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`COMPLAINT FOR PATENT
`INFRINGEMENT
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`DEMAND FOR JURY TRIAL
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`
`Plaintiff,
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`MSIGNIA, INC., a California
`corporation,
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`v.
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`INAUTH, INC., a Delaware
`corporation,
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`Defendant.
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`COMPLAINT FOR PATENT INFRINGEMENT
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`Plaintiff mSIGNIA, Inc. (“mSIGNIA”, or “Plaintiff”) hereby brings this
`action against Defendant InAuth, Inc. (“InAuth”, or “Defendant”) and alleges as
`follows upon actual knowledge with respect to itself and its own acts, and upon
`information and belief as to all other matters:
`NATURE OF THE ACTION
`1.
`This is a civil action for patent infringement.
`2. mSIGNIA is the legal owner by assignment of U.S. Patent No.
`9,559,852 (“the ’852 Patent”), which was duly and legally issued by the United
`States Patent and Trademark Office (“USPTO”).
`3. mSIGNIA provides computer security products to businesses who
`need to authenticate users and devices. mSIGNIA’s products are based on
`technology that is described and claimed in the ’852 patent. mSIGNIA’s patented
`offerings include its iDNA and 3D Secure products.
`4.
`Defendant InAuth also sells products for authenticating users and
`devices, including products based on the so-called “InAuth Security Platform.”
`However, as set forth below, the InAuth Security Platform infringes one or more
`claims of the ’852 patent, as do any products, systems, and services related to the
`InAuth Security Platform and other related InAuth products that use or relate to
`components of the InAuth Security Platform (“Infringing Products”). InAuth’s
`Infringing Products include but are not limited to InMobile, InBrowser, InRisk,
`InAuthenticate, InExchange, InReach, InPermID, and other products that use the
`InAuth Security Platform.
`5. mSIGNIA brings this action to remedy InAuth’s infringement.
`mSIGNIA seeks injunctive relief and monetary damages as set forth below.
`THE PARTIES
`6. mSIGNIA is a corporation organized and existing under the laws of
`California, with its principal office located at 109 Holiday Court, Suite D7,
`Franklin, TN 37067. Paul Miller, mSIGNIA’s co-founder, Chief Executive Officer
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`and Secretary, resides and works out of this District, at 10 Wandering Rill, Irvine,
`CA 92603.
`7.
`Upon information and belief, InAuth is a corporation organized and
`existing under the laws of the State of Delaware. InAuth claims to have a West
`Coast Office located at 227 Broadway, Suite 200, Santa Monica, CA 90401. (See
`e.g., https://www.inauth.com/contact/.) Upon information and belief, InAuth’s
`West Coast Office is focused at least in part on engineering and product
`development.
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`JURISDICTION AND VENUE
`8.
`This is a civil action for patent infringement arising under the patent
`laws of the United States, 35 U.S.C. §§ 1 et seq.
`9.
`This Court has subject matter jurisdiction over the matters asserted
`pursuant to 28 U.S.C. §§ 1331 and 1338(a).
`10. This Court has personal jurisdiction over InAuth. InAuth has
`infringed the ’852 patent in the Central District of California by, among other
`things, engaging in infringing conduct within and directed at or from this District,
`including, based on information and belief, by developing its Infringing Products
`out of an office in this District and by the advertisement, solicitation of customers,
`marketing, and distribution of services that practice the claims of the ’852 Patent.
`For example, InAuth has purposefully and voluntarily sold one or more of its
`infringing products or services, as described below, into the stream of commerce
`with the expectation that these infringing products or services will be used in this
`District. These infringing products or services have been and continue to be used
`in this District.
`11. Venue is proper in this district and division under 28 U.S.C. § 1400(b)
`at least because InAuth has a regular and established place of business in the
`Central District of California. Specifically, InAuth’s West Coast Office is located
`at 227 Broadway, Suite 200, Santa Monica, CA 90401. (See e.g.,
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`https://www.inauth.com/contact/.) Moreover, InAuth has committed acts of
`infringement in this judicial district because, based on information and belief,
`InAuth’s West Coast Office focuses on engineering and technical development,
`including the development of the Infringing Products, and as such, upon
`information and belief, InAuth has used the Infringing Products in this district. In
`addition, InAuth has developed its websites and services from its offices in this
`judicial district, and additionally, it has purposefully and voluntarily engaged in the
`making, using, selling, offering for sale, or importing in to the United States
`without authority, products, methods, equipment, or services that practice one or
`more claims of the ’852 patent.
`MSIGNIA’S PATENTED TECHNOLOGY
`12. mSIGNIA was founded by Paul Miller and George Tuvell in October
`2010. Mr. Miller is the Chief Executive Officer of mSIGNIA, and Mr. Tuvell is
`the current Chief Product Officer and former Chief Technology Officer. Both Mr.
`Miller and Mr. Tuvell are longtime experts in the field of authentication and
`computer security.
`13. Online identity fraud has been a major problem for many years. Such
`fraud costs online retailers and banks billions of dollars per year in the United
`States and abroad. In 2010, a variety of technologies existed for combatting such
`identity fraud. These technologies are called “authentication” mechanisms. The
`most basic type of authentication involves the use of a user name and password.
`Another type of authentication requires the possession of digital “certificates.”
`Another type of authentication recognizes the device of a user. Yet another type of
`authentication involves the use of “biometrics” (e.g., a fingerprint scanner).
`14. Each of these prior art technologies suffers from some well-known
`drawbacks. Simple passwords can be easily stolen or guessed by computer
`programs. Alternatively, passwords may become too complicated in which case
`they are easily forgotten. Other technologies, such as digital certificates and
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`device recognition, only confirm the identity of a device; they do not confirm the
`identity of the person using the device. And biometric authentication suffers from
`the problem that although a fingerprint may be unique, a digital representation of a
`fingerprint can be intercepted, copied or not available on a new device.
`15. Because of these drawbacks, modern systems often use two or more
`forms of authentication. But many of these secondary authentication techniques
`are said to create customer “friction.” In other words, they are hard for consumers
`to use. For example, many authentication technologies require the input of a
`randomly-generated code that is delivered by text message, by email address, or
`through a separate application. These authentication technologies create user
`frustration and, at least in the e-commerce setting, may actually prevent bona fide
`willing customers from completing a purchase.
`16. By 2010, these problems were well-known and getting worse due to
`the rise of mobile handheld devices. Mobile devices generally do not have anti-
`virus technology installed, and their applications are designed for simplicity, not
`security. In fact, many mobile devices are not even protected by a password. At
`the same time, mobile device users expect their phones to “just work,” and get
`frustrated by authentication technologies that unnecessarily block access to
`resources.
`17. Thus, mobile devices presented a new challenge for combatting
`identity fraud, because they present an inherently unprotected environment in
`which users refused to accept the “friction” that was traditionally used to provide
`authentication.
`18. The founders of mSIGNIA invented a new system that addressed
`these problems. Although mobile devices are insecure, they are also rich sources
`of information. In particular, mobile devices are highly customizable, such that
`shortly after purchase, each device is essentially unique to a user. Thus, a mobile
`device can be used to uniquely authenticate a user because the combination of data
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`values on the mobile device are unique to that user/device.
`19. One major problem with this “device as fingerprint” idea is that
`device data values are subject to change. Unlike a person’s fingerprint or DNA,
`data values on, e.g., a mobile device, change frequently, making it difficult to
`obtain a true “fingerprint” of the device. This dynamically changing data makes it
`especially difficult to apply prior art authentication techniques to mobile devices.
`However, mSIGNIA’s founders realized that by applying complex algorithms and
`anticipating what the device data values would be at a future time, they could still
`use changing data from a device to perform authentication. This technique was
`also useful for encryption. Mr. Miller and Mr. Tuvell developed their technology
`ideas in 2010-2011, and filed a provisional patent application on February 3, 2011.
`20. Around this time, Mr. Miller and Mr. Tuvell were looking for
`potential investors and others to help them commercialize their new technology.
`One of the individuals they contacted was Michael Patterson. Mr. Miller and Mr.
`Tuvell considered Mr. Patterson as a potential candidate to be mSIGNIA’s first
`sales person, but they ultimately decided that he was unsuitable for the position.
`Shortly afterwards, Mr. Patterson contacted Mr. Miller and Mr. Tuvell asking them
`if they would be willing to invest in a new company named InAuth that Mr.
`Patterson was planning to form. Mr. Patterson provided them with an investment
`presentation. The presentation reflected many of the technical ideas and concepts
`that Mr. Miller and Mr. Tuvell had developed.
`21. Recently, mSIGNIA learned that InAuth had not just adapted Mr.
`Miller and Mr. Tuvell’s ideas for its 2011 investor proposals; InAuth had actually
`built its products around the ideas that mSIGNIA had developed. Further
`investigation revealed that InAuth was likely infringing a patent that mSIGNIA
`had recently obtained, U.S. Patent No. 9,559,852. mSIGNIA is bringing this
`patent lawsuit to vindicate those patent rights.
`/ / /
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`COUNT 1: INFRINGEMENT OF THE ’852 PATENT
`22. The allegations of paragraphs 1-21 of this Complaint are incorporated
`by reference as though fully set forth herein.
`23. One of mSIGNIA’s patents, the ’852 patent, was granted by the
`USPTO on January 31, 2017. The ’852 patent is entitled “Cryptographic Security
`Functions Based on Anticipated Changes in Dynamic Minutiae.” A true and
`correct copy of the ’852 patent is attached hereto as Exhibit A.
`24. Paul Timothy Miller and George Allen Tuvell are the named inventors
`of the ’852 patent. mSIGNIA is the original and current owner of the ’852 patent,
`and owns the entire right, title, and interest in the ’852 patent.
`25. The ’852 patent is valid and enforceable.
`26. The ’852 patent generally relates to identifying and authenticating a
`user and their device by using dynamically changing data from a device, such as
`media, geolocation, call information, network information, etc.
`27. As part of its sales literature, InAuth advertises that the Infringing
`Product gives its users the ability to “uniquely and consistently identify and
`authenticate mobile devices across time, users, and apps.” The Infringing Product
`“leverages up to 2,000 device attributes” to allow a customer to “access [] a mobile
`app or website.” According to InAuth, the goal of the Infringing Product is to
`“provide[] frictionless experiences for known good devices.” (available at
`https://www.inauth.com/products/inauth-security-platform/).
`28.
`InAuth has directly infringed and is currently directly infringing the
`’852 patent, literally or under the doctrine of equivalents, by making, using,
`selling, offering for sale, or importing in to the United States without authority,
`products, methods, equipment, or services that practice one or more claims of the
`’852 patent in connection with the Accused Product.
`29. As a non-limiting example, set forth below (claim language in italics)
`is a description of infringement of exemplary claims 1 of the ’852 patent in
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`connection with the Infringing Product. This description is based on publicly
`available information. mSIGNIA reserves the right to modify the description,
`including on the basis of information about the ’852 patent that mSIGNIA obtains
`during discovery.
`a. [1.] An identity recognition system comprising: The Infringing
`Products provide an identity recognition system. InAuth’s website
`states that “[w]hen a customer accesses your mobile app or website,
`InAuth leverages up to 2,000 device attributes to consistently and
`uniquely identify it.” Source:
`https://www.inauth.com/products/inauth-security-platform/
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`b. [1.1.1] a non‐transitory memory storing information associated with
`Products use a client‐server system for identity authentication. The
`is located on the server‐side. InAuth collects device attributes and
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`one or more identities: On information and belief, the Infringing
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`“memory storing information associated with one or more identities”
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`sends them to its servers. The device attributes that the Infringing
`Products collect include data from the device such as accelerometer,
`battery, contacts, data usage, GPS, hardware, media, process, phone,
`wifi, calendar, photos and twitter and device access data. Upon
`information and belief, collecting this information for large numbers
`of devices requires a non-transitory memory.
`c. [1.1.2] wherein the information stored for an identity includes (a)
`data values associated with that identity; and (b) information
`regarding anticipated changes to one or more of the stored data
`values associated with that identity: The Infringing Products collects
`and stores dynamic data values associated with the identity of a
`mobile device. See e.g., https://www.inauth.com/products/inauth-
`security-platform/ (“When a customer accesses your mobile app or
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`website, InAuth leverages up to 2,000 device attributes to consistently
`and uniquely identify it.”) The Infringing Products collect device
`attributes such as accelerometer, battery, contacts, data usage, GPS,
`hardware, media, process, phone, wifi, calendar, photos and twitter
`and device access data. Most of these device attributes involve
`changing data. Upon information and belief, there is at least a
`reasonable likelihood that InAuth also stores data regarding
`anticipated changes to the device attributes that it has already
`collected. At one point in time, InAuth may have referred to such
`data about anticipated changes as being part of a “CR build.” The
`ability to identify anticipated changes is also likely necessary to
`enable the Infringing Products to accomplish their stated purpose of
`using these changing data attributes to “consistently and uniquely”
`identify a device.
`d. [1.2] one or more hardware processors in communication with the
`memory and configured to execute instructions to cause the identity
`recognition system to recognize that the presentation of identity
`information by a computer is authentic, by performing operations
`comprising: On information and belief, the Infringing Products use
`servers to authenticate with mobile devices, which necessarily include
`one or more hardware processors.
`e. [1.3] generating a challenge to the computer, wherein the challenge
`prompts the computer to provide a response based on one or more
`data values from the computer that correspond to one or more of the
`stored data values associated with the identity: As noted, the InAuth
`Security Platform collects device attributes from a device such as a
`mobile device. The Infringing Products prompt the device to provide
`a response to the server with updated versions of the collected device
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`attributes.
`f. [1.4] receiving, from the computer, the response to the challenge:
`As noted, the Infringing Products collect device attributes from a
`device such as a mobile device. The Infringing Products prompt the
`device to provide those attributes as a response to a challenge.
`g. [1.5] determining whether the response is allowable, wherein such
`determining comprises using the stored information regarding
`anticipated changes to the stored data values associated with the
`identity to determine whether a data value used to form the response
`is based on an acceptable change to a corresponding stored data
`value; and recognizing that the presentation of identity information by
`the computer is authentic, according to whether the computer has
`provided an allowable response to the challenge: Upon information
`and belief, InAuth’s authentication process involves comparing data
`values that are received as part of the response to anticipated changes
`to corresponding stored data values. As noted, at one point in time,
`InAuth may have referred to such data about anticipated changes
`being part of a “CR build.” InAuth or its privies then use this
`information to recognize whether the presentation of the identity is
`authentic.
`
`PRAYER FOR RELIEF
`WHEREFORE, mSIGNIA prays for the following relief:
`1.
`A judgment:
`a. that InAuth has infringed one or more claims of the ’852 Patent,
`literally or under the doctrine of equivalents;
`b. that, pursuant to 35 U.S.C. § 283, InAuth and its affiliates, employees,
`agents, officers, directors, attorneys, successors, assigns, and all those
`acting on or behalf of, or in active concert or participation with it, be
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`preliminary and permanently enjoined from (1) infringing the
`Asserted Patent, and (2) making, using, selling, and offering for sale
`the Accused Product;
`c. Awarding damages sufficient to compensate mSIGNIA for
`Defendant’s infringement under 35 U.S.C. § 284, and in any event no
`less than a reasonable royalty;
`d. Finding this case and InAuth’s infringement exceptional under 35
`U.S.C. § 285 and awarding mSIGNIA treble damages as provided by
`35 U.S.C. § 284;
`e. That mSIGNIA be awarded its reasonable attorneys’ fees in this
`action;
`f. Awarding costs and expenses in this action;
`g. Awarding prejudgment and post-judgment interest; and
`Any and all such other relief that the Court may deem to be just and
`
`HAYNES AND BOONE, LLP
`
`By: /s/ Kenneth G. Parker
`Kenneth G. Parker
`Attorneys for Plaintiff,
`mSIGNIA, Inc.
`
`
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`2.
`proper.
`DATED: July 26, 2017
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`DEMAND FOR JURY TRIAL
`mSIGNIA respectfully demands a trial by jury on all issues triable by jury.
`
`
`DATED: July 26, 2017
`
`
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`HAYNES AND BOONE, LLP
`
`By: /s/ Kenneth G. Parker
`Kenneth G. Parker
`Attorneys for Plaintiff,
`mSIGNIA, Inc.
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