RFCyber Corp v. Costco Wholesale: Mobile Payment Patent Dismissed Without Prejudice
RFCyber Corp filed suit against Costco Wholesale in the Eastern District of Texas, asserting US8448855B1 — a mobile payment and NFC e-wallet patent — against the Costco App. The case closed in just 97 days when RFCyber voluntarily dismissed without prejudice, leaving the door open for future enforcement action.
NFC e-wallet patent asserted against Costco App, then swiftly withdrawn
On July 18, 2024, RFCyber Corp — a patent assertion entity holding mobile payment IP — filed a complaint against Costco Wholesale Corp. in the Eastern District of Texas before Judge Rodney Gilstrap, one of the country’s most experienced patent trial judges. The single asserted patent, US8448855B1 (application no. US13/400038), covers NFC-based e-wallet and secure mobile payment technology. The accused product was the Costco App, Costco’s proprietary mobile application used by millions of members for in-store and digital transactions.
The case closed on October 23, 2024 — just 97 days after filing — when RFCyber filed a Rule 41(a)(1)(A)(i) notice of voluntary dismissal without prejudice. Judge Gilstrap accepted and acknowledged the dismissal, with each party ordered to bear its own costs, attorneys’ fees, and expenses. Because the dismissal was without prejudice, RFCyber is not barred from reasserting the same claims against Costco or pursuing the same patent against other defendants in future proceedings.
A resolution in under 100 days is notably swift for E.D. Texas patent litigation, typically suggesting that the parties reached an early understanding — whether a licensing arrangement, a decision to refile in a different forum, or a strategic pause — before substantive motions were litigated. The public record does not disclose whether any commercial terms were exchanged. The without-prejudice posture and the absence of a cost award are consistent with a negotiated or tactical withdrawal rather than a merits defeat.
Filing to Dismissed without Prejudice in 97 days
97 days — well below the E.D. Texas median for patent infringement cases, suggesting early resolution
Dismissed without prejudice: what the voluntary withdrawal means for both parties
Rule 41(a)(1)(A)(i): plaintiff’s unilateral exit before answer
Under FRCP 41(a)(1)(A)(i), a plaintiff may dismiss an action without a court order by filing a notice before the defendant serves an answer or motion for summary judgment. This is the earliest and cleanest exit mechanism available — it requires no judicial approval, though Judge Gilstrap formally acknowledged the notice here. The dismissal carries no merits adjudication: no claim was found valid, invalid, infringed, or not infringed.
No merits rulingRFCyber retains full rights to refile — but faces a two-dismissal trap
A without-prejudice dismissal means RFCyber’s infringement claims survive and can be reasserted in any competent forum. However, FRCP 41(a)(1)(B) provides that if RFCyber previously dismissed the same claim against the same defendant, a second voluntary dismissal operates as an adjudication on the merits — the so-called ‘two-dismissal rule.’ Costco’s counsel should audit whether any prior RFCyber action against Costco on this patent existed before treating this dismissal as entirely consequence-free.
Refile risk remainsCostco walks away — but the patent threat is not extinguished
Costco avoids any infringement finding and pays no damages, but the underlying patent US8448855B1 remains in force. Without a declaratory judgment of non-infringement or invalidity, Costco cannot claim legal certainty over the Costco App’s NFC payment features. RFCyber could refile in E.D. Texas or pursue the same patent against Costco’s technology partners, payment processors, or other retail app operators in parallel proceedings.
No immunity grantedNFC retail payment apps remain exposed to this patent portfolio
US8448855B1 covers foundational NFC e-wallet interactions relevant to a broad range of retail mobile apps and contactless payment implementations. RFCyber’s rapid withdrawal — with no cost award — is consistent with a licensing negotiation or a decision to target higher-value defendants first. Other retailers and mobile payment app operators deploying similar NFC checkout functionality should treat this case as an early signal of potential enforcement activity across the sector.
Sector-wide watchFull party and counsel information
| Role | Name | Type | Detail |
|---|---|---|---|
| Plaintiff | RFCyber Corp | Company | Mobile payment patent assertion entity — holder of US8448855B1 (NFC e-wallet technology)Search in Eureka ↗ |
| Defendant | Costco Wholesale, Corp. | Company | Costco Wholesale Corp. — multinational membership retail chain, operator of the Costco AppSearch in Eureka ↗ |
| Plaintiff counsel | Alfred Ross Fabricant | Attorney | Counsel for RFCyber CorpSearch in Eureka ↗ |
| Plaintiff counsel | Jacob Daniel Ostling | Attorney | Counsel for RFCyber CorpSearch in Eureka ↗ |
| Plaintiff counsel | Justin Kurt Truelove | Attorney | Counsel for RFCyber CorpSearch in Eureka ↗ |
| Plaintiff counsel | Peter Lambrianakos | Attorney | Counsel for RFCyber CorpSearch in Eureka ↗ |
| Plaintiff counsel | Richard Matthew Cowell | Attorney | Counsel for RFCyber CorpSearch in Eureka ↗ |
| Plaintiff counsel | Vincent J. Rubino , III | Attorney | Counsel for RFCyber CorpSearch in Eureka ↗ |
| Plaintiff law firm | Fabricant LLP | Law Firm | Representing RFCyber CorpSearch in Eureka ↗ |
| Plaintiff law firm | Fabricant LLP (NY) | Law Firm | Representing RFCyber CorpSearch in Eureka ↗ |
| Plaintiff law firm | Fabricant LLP (Rye) | Law Firm | Representing RFCyber CorpSearch in Eureka ↗ |
| Plaintiff law firm | Truelove Law Firm | Law Firm | Representing RFCyber CorpSearch in Eureka ↗ |
| Defendant counsel | Marvin Craig Tyler | Attorney | Counsel for Costco Wholesale, Corp.Search in Eureka ↗ |
| Defendant counsel | Ramsey M. Al-Salam | Attorney | Counsel for Costco Wholesale, Corp.Search in Eureka ↗ |
| Defendant counsel | Ruben Tyler Kendrick | Attorney | Counsel for Costco Wholesale, Corp.Search in Eureka ↗ |
| Defendant law firm | Perkins Coie LLP | Law Firm | Representing Costco Wholesale, Corp.Search in Eureka ↗ |
| Defendant law firm | Perkins Coie LLP (Seattle) | Law Firm | Representing Costco Wholesale, Corp.Search in Eureka ↗ |
| Presiding judge | Judge Rodney Gilstrap | Judge | Texas Eastern District CourtSearch in Eureka ↗ |
Official order — verbatim text
The court’s order does not adjudicate any claim on the merits — it accepts and acknowledges RFCyber’s unilateral Rule 41(a)(1)(A)(i) notice, confirming the procedural posture. The phrase ‘dismissed without prejudice’ is dispositive: no finding of infringement, validity, or invalidity was made. The cost-bearing clause — each party pays its own fees — is standard for this dismissal type and does not imply fault or leverage on either side. The denial of all other pending relief as moot confirms no substantive motions had ripened to decision.
US8448855B1 — NFC e-wallet and secure mobile payment technology
US8448855B1 (application no. US13/400038) protects NFC-enabled e-wallet technology — specifically, methods and systems enabling secure contactless payment transactions through a mobile device’s embedded secure element or SIM-based credential store. The patent’s claims are directed at the interaction layer between a mobile application, NFC hardware, and payment network authentication, a technical domain central to modern tap-to-pay and in-app checkout experiences widely deployed in retail environments.
As contactless and mobile payment adoption has accelerated across retail, this class of NFC e-wallet patents has become a significant litigation target. The patent’s broad application to mobile checkout — including retail apps integrating Apple Pay, Google Pay, or proprietary NFC flows — means that its claim scope, if upheld in future proceedings, could affect a wide range of consumer-facing payment implementations. Retailers, payment processors, and mobile SDK vendors should assess exposure independently, as a without-prejudice dismissal against Costco provides no safe harbour for third parties.
Should you run an FTO analysis against US8448855B1?
Any organisation deploying an NFC-enabled mobile payment feature — whether a proprietary retail app, a third-party checkout SDK, or a contactless payment integration — should consider a freedom-to-operate review against US8448855B1. The Costco App’s accused functionality is representative of NFC checkout interactions common across retail, hospitality, transit, and fintech applications. RFCyber’s continued ownership of this patent and its without-prejudice dismissal posture mean enforcement risk has not been resolved.
PatSnap Eureka’s FTO Search Agent can map the independent and dependent claims of US8448855B1 against your product’s technical architecture, flag prior art that may limit claim scope, and surface co-pending continuation applications that could extend the patent family’s reach. For product and IP teams planning NFC payment feature launches or SDK integrations, running this analysis before deployment is materially lower-cost than defending in E.D. Texas post-launch.
Run a freedom-to-operate analysis on US8448855B1 to assess your product’s exposure
Run FTO in Eureka →Similar NFC and mobile payment patent cases in E.D. Texas
Cases involving NFC e-wallet and mobile payment patents litigated in the Eastern District of Texas before Judge Gilstrap — including other RFCyber enforcement actions.
What this case signals for the mobile payment and NFC app IP landscape
A 97-day withdrawal without prejudice in E.D. Texas rarely means the story is over — it often marks a reset.
Early dismissal without prejudice signals unfinished enforcement strategy
RFCyber’s swift exit before any substantive motion practice suggests the filing served a tactical purpose — initiating licensing dialogue, testing forum selection, or coordinating with parallel actions. Patent holders using Rule 41(a)(1)(A)(i) at this stage typically have not abandoned their claims. Retailers and fintech firms with NFC payment apps should monitor RFCyber’s docket activity closely for refiling.
E.D. Texas remains the preferred venue for NFC payment patent assertions
Judge Gilstrap’s docket is consistently among the highest-volume patent forums in the US. RFCyber’s choice of E.D. Texas for US8448855B1 — and the absence of a transfer motion — confirms this jurisdiction’s continued appeal for assertion-focused plaintiffs targeting consumer technology products. Defendants in retail tech should maintain litigation-readiness posture for this forum.
RFCyber v Costco — key questions answered
The dismissal without prejudice means RFCyber voluntarily ended the case under FRCP 41(a)(1)(A)(i) before Costco filed an answer. No merits ruling was made — patent US8448855B1 was neither found infringed nor invalid. RFCyber retains the right to refile the same claims against Costco or assert the patent against other defendants in the future.
RFCyber asserted US8448855B1 (application no. US13/400038), which covers NFC-based e-wallet and secure mobile payment technology. The patent is directed at methods enabling contactless payment transactions through mobile devices using NFC hardware and secure credential stores — technology directly relevant to modern retail mobile app checkout functionality like that offered by the Costco App.
The 97-day duration is notably short for E.D. Texas patent litigation. A voluntary Rule 41(a)(1)(A)(i) dismissal at this stage — before an answer was filed — suggests the parties may have entered licensing discussions, RFCyber may have decided to refile in a different forum, or a tactical pause was warranted. The public record does not disclose whether any commercial terms were agreed.
No. A without-prejudice dismissal in favour of one defendant provides no legal protection to third parties. Other retailers, fintech companies, or mobile app operators using similar NFC checkout technology have no safe harbour from this patent. RFCyber remains free to assert US8448855B1 against other defendants, and the patent’s broad claim scope may read on NFC payment implementations across multiple industries.
The cost-bearing order — requiring each party to pay its own attorneys’ fees and expenses — is standard for a Rule 41(a)(1)(A)(i) voluntary dismissal and does not indicate that either side prevailed or had stronger legal position. It is not an exceptional case fee award under 35 U.S.C. § 285. No adverse inference should be drawn from this provision regarding the merits of either party’s position.
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