Case 7:24-cv-00279-ADA Document 16 Filed 01/10/25 Page 1 of 32
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`UNITED STATES DISTRICT COURT
`FOR THE WESTERN DISTRICT OF TEXAS
`MIDLAND/ODESSA DIVISION
`
`CARDWARE, INC.
`
`Plaintiff,
`
`v.
`
`APPLE INC.,
`
`Defendant.
`
`Civil Action No. 7:24-cv-00279
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`JURY TRIAL DEMANDED
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`DEFENDANT APPLE INC.’S ANSWER
`TO COMPLAINT FOR PATENT INFRINGEMENT
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`Defendant Apple Inc. (“Apple”) respectfully submits this response to the Complaint filed
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`by CardWare, Inc. (“CardWare” or “Plaintiff”). Except as expressly admitted below, Apple
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`denies each and every allegation set forth in the Complaint. Apple responds to the numbered
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`paragraphs of the Complaint and the prayer for relief as follows:
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`INTRODUCTION1
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`Complaint No. 1: Plaintiff CardWare is a leading innovator in the payment ecosystem
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`and has developed groundbreaking patented technology that provides enhanced security for
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`payment transactions, both in-store using Near-field Communication Technology (“NFC”) and
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`online, to securely communicate limited-use payment information with the merchant.
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`Answer to Complaint No. 1: Apple lacks sufficient information to form a belief as to
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`the truth of the allegations set forth in Paragraph 1, and on that basis denies them.
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`1 For ease of reference, Apple has adopted the headings used in CardWare’s Complaint. To the
`extent these headings contain any allegations to which a response is required, Apple denies any
`such allegations.
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`Complaint No. 2: Among other functionalities, CardWare’s patented solution facilitates
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`secure payment transactions by using a limited-use payment information instead of the static,
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`issued card details that leave card details vulnerable to interception by fraudsters. CardWare’s
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`technology has been so innovative that it has resulted in a multitude of patents, including U.S.
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`Patent Nos. 10,339,520 (“the ’520 Patent”); 10,628,820 (“the ’820 Patent”); 10,810,579 (“the ’579
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`Patent”); 11,176,538 (“the ’538 Patent”); 11,328,286 (“the ’286 Patent”); and 11,620,634 (“the
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`’634 Patent”) (collectively, the “Asserted Patents”).
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`Answer to Complaint No. 2: Apple lacks sufficient information to form a belief as to
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`the truth of the allegations set forth in Paragraph 2, and on that basis denies them.
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`Complaint No. 3: Apple is a leading manufacturer of electronic and mobile devices,
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`including smartphones and smartwatches. Apple Wallet and Apple Pay are integrated into all of
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`Apple’s electronic devices, including smartphones, smartwatches, desktop and laptop computers,
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`tablets, and spatial computers, making it easy for users to securely complete online transactions.
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`Apple’s smartphones and smartwatches also offer in-store, tap-to-pay functionality that relies on
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`NFC technology incorporated into such devices, enabling them to wirelessly communicate with
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`nearby NFC-enabled payment terminals for secure, quick, and contactless payments.
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`Answer to Complaint No. 3: Apple admits that it manufactures iPhone and Apple Watch.
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`Apple admits that it offers Apple Wallet and Apple Pay software on certain of its products, but
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`denies that “Apple Pay and Apple Wallet are integrated into all of [its] electronic devices.” The
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`remaining allegations in Paragraph 3 call for legal conclusions and therefore no answer is
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`required. To the extent a response is required, Apple denies the remaining allegations in
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`Paragraph 3.
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`Complaint No. 4: The fundamental security technology that underlies the success of
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`Apple’s Apple Pay and Apple Wallet offerings was developed by CardWare and thus infringes the
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`Asserted Patents. This infringement has been willful, at least because Apple has been aware of
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`CardWare’s technology and related patents since a 2017 meeting with David Wyatt, and because
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`CardWare put Apple on notice of its infringement on or around October 10, 2023.
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`Answer to Complaint No. 4: Denied.
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`Complaint No. 5: With this action, CardWare seeks to recover damages and a reasonable
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`royalty from Apple for its use of CardWare’s patented technology.
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`Answer to Complaint No. 5: Denied.
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`JURISDICTION AND VENUE
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`Complaint No. 6: This Court has subject matter jurisdiction over this action under 28
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`U.S.C. § 1331 because Plaintiff alleges violations of federal law, namely, the Patent Act U.S.
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`Patent Act, 35 U.S.C. §§ 1 et seq.
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`Answer to Complaint No. 6: Apple admits that CardWare purports to bring an action
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`for patent infringement. The remaining allegations in Paragraph 6 contain legal conclusions that
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`require no answer. To the extent an answer is required, Apple denies that any factual or legal
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`basis exists for any of CardWare’s claims against Apple in this action, or that CardWare is
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`entitled to any relief from Apple. Apple denies any remaining allegations of Paragraph 6.
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`Complaint No. 7: This District has general and specific personal jurisdiction over
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`Defendant because, directly or through intermediaries, Defendant has committed acts within this
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`District giving rise to this action; is present in and transacts and conducts business in this District
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`and the State of Texas; and transacts and conducts business with residents of this District and the
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`State of Texas. This Court further has personal jurisdiction over Defendant pursuant to Tex. Civ.
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`Prac. & Rem. Code § 17.041 et seq.
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`Answer to Complaint No. 7: Apple admits that it has conducted business in the State of
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`Texas. Apple admits that it is subject to general jurisdiction in this Court for the purposes of this
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`action but denies that any factual or legal basis exists for any of CardWare’s claims. The
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`remaining allegations in Paragraph 7 call for legal conclusions and therefore no answer is
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`required. To the extent a response is required, Apple denies the remaining allegations in
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`Paragraph 7.
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`Complaint No. 8: Defendant has infringed and continues to infringe the Asserted Patents,
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`directly and through intermediaries, within this District and the State of Texas by making, using,
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`selling, offering for sale, marketing, designing, and/or importing in or into this District and
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`elsewhere in the State of Texas, its products and services covered by claims in the Asserted
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`Patents, including without limitation products that, when made or used, practice the claimed
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`methods of the Asserted Patents. Defendant’s infringement, as alleged above and further herein has
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`been, at least since the filing of this action, willful and in disregard of the Asserted Patents, without
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`any reasonable basis for believing that it had a right to engage in the infringing conduct.
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`Answer to Complaint No. 8: Denied.
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`Complaint No. 9: CardWare’s causes of action arise, at least in part, from Defendant’s
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`contacts with and activities in and/or directed at this District and the State of Texas.
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`Answer to Complaint No. 9: CardWare’s allegation in Paragraph 9 calls for a legal
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`conclusion and therefore no answer is required. To the extent a response is required, Apple
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`denies the allegations contained in Paragraph 9.
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`Complaint No. 10: Venue is proper in this Court under 28 U.S.C. §§ 1391 and 1400(b).
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`Apple maintains regular and established places of business in this District and has committed acts
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`of infringement in this District.
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`Answer to Complaint No. 10: CardWare’s allegation in Paragraph 10 calls for a legal
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`conclusion and therefore no answer is required. To the extent a response is required, Apple
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`denies the allegations contained in Paragraph 10.
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`PARTIES
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`Complaint No. 11: Plaintiff CardWare Inc. is a Texas corporation with its principal
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`place of business located at 111 Congress Ave., Suite 500, Austin, Texas.
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`Answer to Complaint No. 11: Apple lacks sufficient information to form a belief as to
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`the truth of the allegations set forth in Paragraph 11, and on that basis denies them.
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`Complaint No. 12: On information and belief, Defendant Apple Inc. is a California
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`corporation with one or more regular established places of business in this District, at least at
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`12545 Riata Vista Circle, Austin, Texas 78727; 12801 Delcour Drive, Austin, Texas 78727;
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`6800 W Parmer Lane, Austin, Texas 78729, and 3121 Palm Way, Austin, Texas 78758. Apple
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`may be served with process through its registered agent, the CT Corp System, at 1999 Bryan St.,
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`Ste. 900 Dallas, Texas 75201. Apple has been registered to do business in the State of Texas
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`since at least May 16, 1980, and has maintained offices in the States of Texas since at least 1992.
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`As of March 2024, Apple had approximately 10,000 employees in the Austin area, making
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`Apple the fourth-largest employer in the area and making Austin Apple’s second-largest hub
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`outside of California.
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`Answer to Complaint No. 12: Apple admits that it is a corporation organized under the
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`laws of the state of California. Apple admits that it has one or more regular and established
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`places of business and has offices in Austin, Texas. Apple admits that it is registered to do
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`business in the State of Texas and may be served through its registered agent, the CT Corp
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`System, at 1999 Bryan St., Ste. 900 in Dallas, Texas 75201. Apple admits that CardWare
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`purports to cite in footnotes to three public documents, which speak for themselves.
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`RELEVANT FACTS
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`I.
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`CARDWARE’S INNOVATIVE BUSINESS
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`Complaint No. 13: CardWare is an American firm founded by Mr. David Wyatt, a
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`seasoned engineer and inventor with a track record of over 100 U.S. patents. The company
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`develops secure systems for electronic payments including dynamic tokenization systems that
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`enhance the security of mobile and electronic payments.
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`Answer to Complaint No. 13: Apple lacks sufficient information to form a belief as to
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`the truth of the allegations set forth in Paragraph 13, and on that basis denies them.
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`Complaint No. 14: The company was originally founded in California in December 2011
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`but was later moved to Texas to be closer to Mr. Wyatt’s personal residence in Austin and to
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`jumpstart CardWare’s growth. Mr. Wyatt is the architect and driving force behind CardWare’s
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`payment technology. Mr. Wyatt’s expertise spans several technological areas, including the
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`development of software application programing interfaces (“APIs”) that integrate with payment
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`systems and the design of physical cards for secure transactions. His approach centers on creating
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`highly secure, dynamic, and user-friendly solutions for modern payments, addressing consumer
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`concerns about fraud and security. His inventive contributions have helped CardWare provide
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`groundbreaking innovations in the mobile payments market.
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`Answer to Complaint No. 14: Apple lacks sufficient information to form a belief as to
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`the truth of the allegations set forth in Paragraph 14, and on that basis denies them.
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`Complaint No. 15: CardWare’s innovations include its SmartTokenizationTM
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`technology. This technology enhances payment security by enabling payment cards with
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`customizable features, such as generating one-time-use card information (replacing the issued
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`card number and card verification value (“C\T\T”)), setting custom expiration dates, or restricting
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`usage to specific merchants, geographic locations, or payment amounts. These features allow for
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`tailored limits on transactions, adding an extra layer of protection for consumers. The company’s
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`innovation addresses critical vulnerabilities in traditional payment methods—for in-store, card-
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`present (“CP”), and online, card-not-present (“CNP”), transactions—which have been
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`historically susceptible to theft through skimming and phishing. CardWare has also developed
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`and patented a numberless card that secures card details during in-store transactions preventing
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`theft and fraud as compared to traditional credit cards that visually provide card details not only
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`to the merchant but to anyone within reading distance of a presented card.
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`Answer to Complaint No. 15: Apple lacks sufficient information to form a belief as to
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`the truth of the allegations set forth in Paragraph 15, and on that basis denies them.
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`Complaint No. 16: Since moving to Texas, CardWare has hired new employees,
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`presented at and sponsored payment industry events, and continued to innovate and file new
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`patents. For example, in September 2023, CardWare launched version 2.0 of its CardWare
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`SDK,6 which enables developers to leverage CardWare’s secure payment technology in their
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`own products. In February 2024, CardWare launched the Card+ App, through which users can
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`manage and customize their wallet of payment cards, and conveniently perform more-secure
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`online payments. In addition, CardWare offers physical smart cards for use with the
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`CardWareTM SDK, in traditional plastic (Card+ PlastcTM), recycled plastic (Card+
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`BioPlastcTM), and metal (Card+ MetalTM) forms.
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`Answer to Complaint No. 16: Apple lacks sufficient information to form a belief as to
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`the truth of the allegations set forth in Paragraph 16, and on that basis denies them.
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`Complaint No. 17: Overall, CardWare’s technology has significantly advanced the
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`market’s understanding of payment systems and enhanced security and convenience for mobile
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`transactions.
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`Answer to Complaint No. 17: Apple lacks sufficient information to form a belief as to
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`the truth of the allegations set forth in Paragraph 17, and on that basis denies them.
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`II.
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`CARDWARE’S PATENTS
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`Complaint No. 18: CardWare is the exclusive owner by assignment of all rights, title,
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`and interest in the Asserted Patents. Among other benefits, each of the Asserted Patents enhances
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`payment security, and reduces if not eliminates the risk of fraud, for both in-store and online
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`transactions.
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`Answer to Complaint No. 18: Apple lacks sufficient information to form a belief as to
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`the truth of the allegations set forth in Paragraph 18, and on that basis denies them.
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`Complaint No. 19: The ’520 Patent, entitled “MULTI-FUNCTIONAL CREDIT CARD
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`TYPE PORTABLE ELECTRONIC DEVICE” was duly and legally issued on July 2, 2019. A
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`true and correct copy of the ’520 Patent is attached hereto as Exhibit A.
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`Answer to Complaint No. 19: Apple admits that U.S. Patent No. 10,339,520 is titled
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`“Multi-functional Credit Card Type Portable Electronic Device.” Apple admits that a document
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`that purports to be a copy of the ʼ520 patent is attached as Exhibit A to the Complaint. Apple
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`lacks sufficient information to form a belief as to the truth of the remaining allegations set forth
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`in Paragraph 19 and on that basis denies them.
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`Complaint No. 20: The ’520 Patent has been in full force and effect since its issuance.
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`CardWare is the exclusive owner by assignment of all rights, title, and interest in the ’520 Patent,
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`including the right to bring this suit for injunctive relief and damages, and including the right to
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`sue and recover all past, present, and future damages for infringement of the ’520 Patent.
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`Answer to Complaint No. 20: Apple lacks sufficient information to form a belief as to
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`the truth of the allegations set forth in Paragraph 20, and on that basis denies them.
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`Complaint No. 21: The ’820 Patent, entitled “MULTI-FUNCTION ELECTRONIC
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`PAYMENT DEVICE” was duly and legally issued on April 21, 2020. A true and correct copy of
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`the ’820 Patent is attached hereto as Exhibit B.
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`Answer to Complaint No. 21: Apple admits that U.S. Patent No. 10,628,820 is titled
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`“Multi-function Electronic Payment Device.” Apple admits that a document that purports to be a
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`copy of the ʼ820 patent is attached as Exhibit B to the Complaint. Apple lacks sufficient
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`information to form a belief as to the truth of the remaining allegations set forth in Paragraph 21
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`and on that basis denies them.
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`Complaint No. 22: The ’820 Patent has been in full force and effect since its issuance.
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`CardWare is the exclusive owner by assignment of all rights, title, and interest in the ’820 Patent,
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`including the right to bring this suit for injunctive relief and damages, and including the right to
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`sue and recover all past, present, and future damages for infringement of the ’820 Patent.
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`Answer to Complaint No. 22: Apple lacks sufficient information to form a belief as to
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`the truth of the allegations set forth in Paragraph 22, and on that basis denies them.
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`Complaint No. 23: The ’579 Patent, entitled “SMART TOKENIZING PAYMENT
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`CARD AND DEVICE AND TRANSACTION PROCESSING THEREOF, SYSTEM AND
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`METHOD” was duly and legally issued on October 20, 2020. A true and correct copy of the
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`’579 Patent is attached hereto as Exhibit C.
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`Answer to Complaint No. 23: Apple admits that U.S. Patent No. 10,810,579 is titled
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`“Smart Tokenizing Payment Card and Device and Transaction Processing Thereof, System and
`
`Method.” Apple admits that a document that purports to be a copy of the ʼ579 patent is attached
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`as Exhibit C to the Complaint. Apple lacks sufficient information to form a belief as to the truth
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`of the remaining allegations set forth in Paragraph 23 and on that basis denies them.
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`Complaint No. 24: The ’579 Patent has been in full force and effect since its issuance.
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`CardWare is the exclusive owner by assignment of all rights, title, and interest in the ’579 Patent,
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`including the right to bring this suit for injunctive relief and damages, and including the right to
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`sue and recover all past, present, and future damages for infringement of the ’579 Patent.
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`Answer to Complaint No. 24: Apple lacks sufficient information to form a belief as to
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`the truth of the allegations set forth in Paragraph 24, and on that basis denies them.
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`Complaint No. 25: The ’538 Patent, entitled “MULTI-FUNCTION SMART
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`TOKENIZING ELECTRONIC PAYMENT DEVICE” was duly and legally issued on November
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`16, 2021. A true and correct copy of the ’538 Patent is attached hereto as Exhibit D.
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`Answer to Complaint No. 25: Apple admits that U.S. Patent No. 11,176,538 is titled
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`“Multi-function Smart Tokenizing Electronic Payment Device.” Apple admits that a document
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`that purports to be a copy of the ʼ538 patent is attached as Exhibit D to the Complaint. Apple
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`lacks sufficient information to form a belief as to the truth of the remaining allegations set forth
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`in Paragraph 25 and on that basis denies them.
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`Complaint No. 26: The ’538 Patent has been in full force and effect since its issuance.
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`CardWare is the exclusive owner by assignment of all rights, title, and interest in the ’538 Patent,
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`including the right to bring this suit for injunctive relief and damages, and including the right to
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`sue and recover all past, present, and future damages for infringement of the ’538 Patent.
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`Answer to Complaint No. 26: Apple lacks sufficient information to form a belief as to
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`the truth of the allegations set forth in Paragraph 26, and on that basis denies them.
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`Complaint No. 27: The ’286 Patent, entitled “MULTI-FUNCTION ELECTRONIC
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`PAYMENT CARD AND DEVICE SYSTEM” was duly and legally issued on May 10, 2022. A
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`true and correct copy of the ’286 Patent is attached hereto as Exhibit E.
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`Answer to Complaint No. 27: Apple admits that U.S. Patent No. 11,328,286 is titled
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`“Multi-function Electronic Payment Card and Device System.” Apple admits that a document
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`that purports to be a copy of the ʼ286 patent is attached as Exhibit E to the Complaint. Apple
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`lacks sufficient information to form a belief as to the truth of the remaining allegations set forth
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`in Paragraph 27 and on that basis denies them.
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`Complaint No. 28: The ’286 Patent has been in full force and effect since its issuance.
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`CardWare is the exclusive owner by assignment of all rights, title, and interest in the ’286 Patent,
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`including the right to bring this suit for injunctive relief and damages, and including the right to
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`sue and recover all past, present, and future damages for infringement of the ’286 Patent.
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`Answer to Complaint No. 28: Apple lacks sufficient information to form a belief as to
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`the truth of the allegations set forth in Paragraph 28, and on that basis denies them.
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`Complaint No. 29: The ’634 Patent, entitled “MULTI-FUNCTION SMART
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`TOKENIZING ELECTRONIC PAYMENT DEVICE” was duly and legally issued on April 4,
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`2023. A true and correct copy of the ’634 Patent is attached hereto as Exhibit F.
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`Answer to Complaint No. 29: Apple admits that U.S. Patent No. 11,620,634 is titled
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`“Multi-function Smart Tokenizing Electronic Payment Device.” Apple admits that a document
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`that purports to be a copy of the ʼ634 patent is attached as Exhibit F to the Complaint. Apple
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`lacks sufficient information to form a belief as to the truth of the remaining allegations set forth
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`in Paragraph 29 and on that basis denies them.
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`Complaint No. 30: CardWare is the exclusive owner by assignment of all rights, title,
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`and interest in the ’634 Patent, including the right to bring this suit for injunctive relief and
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`damages, and including the right to sue and recover all past, present, and future damages for
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`infringement of the ’634 Patent.
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`Answer to Complaint No. 30: Apple lacks sufficient information to form a belief as to
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`the truth of the allegations set forth in Paragraph 30, and on that basis denies them.
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`III.
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`APPLE’S INFRINGEMENT OF CARDWARE’S PATENTS
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`Complaint No. 31: CardWare restates and realleges the preceding paragraphs of this
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`Complaint.
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`Answer to Complaint No. 31: Apple incorporates its responses to all preceding
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`paragraphs, as if fully set forth herein.
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`Complaint No. 32: Apple manufactures, uses, tests, markets, offers for sale, sells, and/or
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`imports in or into the United States payment cards and electronic devices that are enabled with
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`Apple Pay and/or Apple Wallet for making secure electronic payments.
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`Answer to Complaint No. 32: Apple admits that it offers for sale electronic devices.
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`Apple admits that it offers Apple Wallet and Apple Pay software on certain of its products.
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`Complaint No. 33: Hereafter, the term “Accused Products” refers to all products
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`manufactured, used, tested, imported, or sold by or on behalf of Apple that embody the systems
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`and devices claimed by the Asserted Patents and all processes employed by Apple that practice
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`the methods claimed by the Asserted Patents, consisting of the Apple Card payment card, the
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`Apple Cash digital payment card, Apple Pay, Apple Wallet, and Apple-branded electronic
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`devices that support Apple Pay, and/or Apple Wallet, including by way of example and without
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`limitation, Apple iPhone smartphones, Apple iPad tablets, Apple Watch smartwatches, Apple
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`Mac laptop and desktop computers, and the Apple Vision Pro spatial computer.
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`Answer to Complaint No. 33: The allegations in Paragraph 33 call for a legal
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`conclusion and therefore no answer is required. To the extent a response is required, Apple
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`denies the allegations contained in Paragraph 33.
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`Complaint No. 34: On information and belief, Apple has pre-loaded Apple-branded
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`electronic devices with Apple Pay, Apple Wallet, Apple Card, and Apple Cash-related software
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`prior to offering them for sale to customers, thus allowing their customers to utilize the
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`infringing functionalities of Apple Pay and/or Apple Wallet, with or without an accompanying
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`Apple Card payment card or Apple Cash digital payment card, immediately after purchase. On
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`information and belief, Apple further pushed Apple Pay, Apple Wallet, Apple Card, and Apple
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`Cash-related software updates to purchased Apple-branded electronic devices, thus allowing
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`their customers utilize the infringing functionalities of Apple Pay and/or Apple Wallet, with or
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`without an accompanying Apple Card payment card or Apple Cash digital payment card, to the
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`extent that such functionalities were not available at their time of purchase.
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`Answer to Complaint No. 34: Apple admits that it offers for sale Apple-branded
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`electronic devices. Apple admits that it offers Apple Wallet and Apple Pay software on certain of
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`its products. Apple denies that any of its products, services, or offerings infringe any of the asserted
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`patents.
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`CAUSE OF ACTION
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`IV.
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`FIRST CLAIM – INFRINGEMENT OF THE ’520 PATENT
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`Complaint No. 35: Plaintiff restates and realleges the preceding paragraphs of this
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`Complaint.
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`Answer to Complaint No. 35: Apple incorporates its responses to all preceding
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`paragraphs, as if fully set forth herein.
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`Complaint No. 36: Apple has been on notice of the ’520 Patent and a specific factual
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`basis for its infringement of the ’520 Patent since at least on or around October 10, 2023.
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`Further, Apple has been aware of CardWare’s technology and related patents since at least 2017.
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`Answer to Complaint No. 36: Paragraph 36 contains legal conclusions to which no
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`response is required. To the extent a response is required, Apple denies the allegations contained
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`in Paragraph 36.
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`Complaint No. 37: Apple has, under 35 U.S.C. §271(a), directly infringed, literally
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`and/or under the doctrine of equivalents, and continues to directly infringe, one or more claims,
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`including without limitation at least claim 10 of the ’520 Patent, by making, using, testing,
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`selling, leasing, licensing, offering for sale, and/or importing into the United States the Accused
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`Products. An exemplary claim chart concerning one way in which Defendant’s Accused
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`Products infringe claim 10 of the ’520 Patent is attached hereto as Exhibit G.
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`Answer to Complaint No. 37: Apple admits that Exhibit G purports to be a claim chart.
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`Apple denies the remaining allegations of Paragraph 37.
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`Complaint No. 38: Apple has also indirectly infringed, and continues to indirectly
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`infringe, the ’520 Patent under 35 U.S.C. §§ 271(b) and (c).
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`Answer to Complaint No. 38: Denied.
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`Complaint No. 39: Apple has willfully, knowingly, and intentionally actively aided,
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`abetted, and induced others to directly infringe at least claim 10 of the ’520 Patent under 35
`
`U.S.C. §§ 271(b) (such as its customers in this District and throughout the United States), and
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`continues to do so, by, for example, selling, offering for sale, and encouraging its customers in
`
`this District and throughout the United States to use its Accused Products in an infringing
`
`manner by providing information and technical support, including in promotional materials,
`
`product manuals, brochures, videos, demonstrations, and website materials. See Exhibit G.
`
`Answer to Complaint No. 39: Denied.
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`Case 7:24-cv-00279-ADA Document 16 Filed 01/10/25 Page 15 of 32
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`Complaint No. 40: Apple has contributed to, and continues to contribute to, the direct
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`infringement of at least claim 10 of the ’520 Patent under 35 U.S.C. § 271(c) by, for example,
`
`supplying, with knowledge of the ’520 Patent, a material part of a claimed combination, where
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`such material part is not a staple article of commerce and is incapable of substantial
`
`noninfringing use. For example, Apple Pay is a material part of the claimed combination and
`
`specifically designed and intended to facilitate storing and generating payment information on an
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`electronic device, as claimed. There are no substantial non-infringing uses of Apple Pay other
`
`than as claimed in the ’520 patent.
`
`Answer to Complaint No. 40: Denied.
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`Complaint No. 41: Apple has contributed to, and continues to contribute to, its customers’
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`and/or other third parties’ infringement because, with knowledge of the ’520 Patent, Defendant
`
`supplied, and continues to supply, the technology that allows its customers to infringe the ’520
`
`Patent. See Exhibit G.
`
`Answer to Complaint No. 41: Denied.
`
`Complaint No. 42: Apple’s infringement of the ’520 Patent has been willful and
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`exceptional in view of the above, as well as its failure to take any action, even after being put on
`
`notice, to stop its infringement, or inducement of, or contribution to, infringement by others.
`
`Answer to Complaint No. 42: Denied.
`
`V.
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`SECOND CLAIM -- INFRINGEMENT OF THE ’820 PATENT
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`Complaint No. 43: Plaintiff restates and realleges the preceding paragraphs of this
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`Complaint.
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`Answer to Complaint No. 43: Apple incorporates its responses to all preceding
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`paragraphs, as if fully set forth herein.
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`Case 7:24-cv-00279-ADA Document 16 Filed 01/10/25 Page 16 of 32
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`Complaint No. 44: Apple has been on notice of the ’820 Patent and a specific factual
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`basis for its infringement of the ’820 Patent since at least on or around October 10, 2023.
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`Further, Apple has been aware of CardWare’s technology and related patents since at least 2017.
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`Answer to Complaint No. 44: Paragraph 44 contains legal conclusions to which no
`
`response is required. To the extent a response is required, Apple denies the allegations contained
`
`in Paragraph 44.
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`Complaint No. 45: Apple has, under 35 U.S.C. §271(a), directly infringed, literally
`
`and/or under the doctrine of equivalents, and continues to directly infringe, one or more claims,
`
`including without limitation at least claim 11 of the ’820 Patent, by making, using, testing,
`
`selling, leasing, licensing, offering for sale, and/or importing into the United States the Accused
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`Products. An exemplary claim chart concerning one way in which Defendant’s Accused
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`Products infringe claim 11 of the ’820 Patent is attached hereto as Exhibit H.
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`Answer to Complaint No. 45: Apple admits that Exhibit H purports to be a claim chart.
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`Apple denies the remaining allegations of Paragraph 45.
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`Complaint No. 46: Apple has also indirectly infringed, and continues to indirectly
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`infringe, the ’820 Patent under 35 U.S.C. §§ 271(b) and (c).
`
`Answer to Complaint No. 46: Denied.
`
`Complaint No. 47: Apple has willfully, knowingly, and intentionally actively aided,
`
`abetted, and induced others to directly infringe at least claim 11 of the ’820 Patent under 35
`
`U.S.C. §§ 271(b) (such as its customers in this District an throughout the United States), and
`
`continues to do so, by, for example, selling, offering for sale, and encouraging its customers in
`
`this District and throughout the United States to use its Accused Products in an infringing
`
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`Case 7:24-cv-00279-ADA Document 16 Filed 01/10/25 Page 17 of 32
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`manner by providing information and technical support, including in promotional materials,
`
`product manuals, brochures, videos, demonstrations, and website materials. See Exhibit H.
`
`Answer to Complaint No. 47: Denied.
`
`Complaint No. 48: Apple has contributed to, and continues to contribute to, the direct
`
`infringement of at least claim 11 of the ’820 Patent under 35 U.S.C. § 271(c) by, for example,
`
`supplying, with knowledge of the ’820 Patent, a material part of a claimed combination, where
`
`such material part is not a staple article of commerce and is incapable of substantial
`
`noninfringing use. For example, Apple Pay is a material part of the claimed combination and
`
`specifically intended to generate and convey payment information to be used in place of a card
`
`issuer payment information, as claimed. There are no substantial non-infringing uses of Apple Pay
`
`other than as claimed in the ’820 Patent.
`
`Answer to Complaint No. 48: Denied.
`
`Complaint No. 49: Apple has contributed to, and continues to contribute to, its
`
`customers’ and/or other third parties’ infringement because, wit