Secure Mobile Transactions v. Charles Schwab: Payment Tokenisation Dispute Ends in Dismissal
Secure Mobile Transactions LLC filed suit in the Eastern District of Texas against The Charles Schwab Corporation and nine regional banks, asserting three patents covering payment tokenisation frameworks. The case resolved in 176 days via a joint motion to dismiss — with prejudice on the plaintiff’s claims and without prejudice on defendants’ counterclaims.
Multi-bank tokenisation dispute settled by joint dismissal in E.D. Texas
Secure Mobile Transactions LLC filed this infringement action on 8 April 2025 in the Eastern District of Texas before Judge Michael J. Truncale, targeting The Charles Schwab Corporation alongside nine additional banking institutions — including Bank of Texas, Comerica Bank, Frost Bank, Regions Bank, and three WoodForest entities — over alleged infringement of US11288647B2, US9792596B2, and US10546285B2, a family of patents covering an interoperable payment tokenisation technical framework.
The case closed on 1 October 2025 via a joint motion to dismiss filed by all parties. The court granted the motion in full: the plaintiff’s infringement claims were dismissed with prejudice, permanently barring Secure Mobile Transactions from re-filing the same claims against these defendants. The defendants’ counterclaims and defenses, however, were dismissed without prejudice, preserving their ability to re-assert those positions should circumstances change. Each party was ordered to bear its own legal costs.
Resolution in 176 days — without a merits ruling — is consistent with a confidential settlement reached before substantive motion practice concluded. The asymmetric dismissal structure (plaintiff with prejudice, defendants without) is a standard negotiated outcome that suggests the plaintiff obtained some form of commercial resolution while formally foreclosing re-litigation. The precise terms, including any licensing arrangement, are not disclosed in the public record.
Filing to Case Dismissed in 176 days
176 days — resolved well under the E.D. Texas median for patent cases
Joint dismissal with asymmetric prejudice: what the ruling means for both parties
Dismissal with prejudice extinguishes plaintiff’s claims permanently
A dismissal with prejudice is a final adjudication on the merits for res judicata purposes. Secure Mobile Transactions cannot refile these specific infringement claims against these defendants in any U.S. court. This outcome typically reflects either a negotiated license, a commercial settlement, or a strategic decision to abandon the litigation — none of which are confirmed in the public record here.
Plaintiff claims: permanently barredPlaintiff trades litigation rights for an undisclosed resolution
By agreeing to a with-prejudice dismissal of its own claims, Secure Mobile Transactions has permanently closed the door on these defendants for these patents. This is consistent with a licensing arrangement or settlement payment, though the public record does not confirm either. The patents themselves (US11288647B2, US9792596B2, US10546285B2) remain in force and could theoretically be asserted against other parties not named in this action.
Patents remain enforceable vs. third partiesDefendants’ counterclaims preserved — validity challenges remain open
The defendants’ counterclaims and defenses — which may have included invalidity challenges under 35 U.S.C. §§ 102/103 or IPR petitions — were dismissed without prejudice. This means the banking defendants retain the ability to re-assert invalidity or non-infringement positions if the plaintiff pursues related claims in future. It is a meaningful protective term that the defendants likely insisted upon in negotiations.
Counterclaims: preserved for future useThree tokenisation patents survive intact — risk for the wider banking sector
No court ruling on validity or infringement was issued, so US11288647B2, US9792596B2, and US10546285B2 emerge from this case with their legal status unchanged. Financial institutions deploying payment tokenisation frameworks — particularly those using interoperability specifications similar to those claimed — should treat these patents as active enforcement assets. The breadth of the defendant roster (ten institutions) suggests a wide net casting strategy typical of NPE campaigns.
Patents: active enforcement risk remainsFull party and counsel information
| Role | Name | Type | Detail |
|---|---|---|---|
| Plaintiff | Secure Mobile Transactions LLC | Company | Patent licensing entity — holder of US11288647B2, US9792596B2, and US10546285B2 covering payment tokenisationSearch in Eureka ↗ |
| Defendant | The Charles Schwab Corporation | Company | Major U.S. financial services and banking group offering digital payment and brokerage servicesSearch in Eureka ↗ |
| Plaintiff counsel | Hannah D. Price | Attorney | Counsel for Secure Mobile Transactions LLCSearch in Eureka ↗ |
| Plaintiff counsel | Larry Dean Thompson , Jr. | Attorney | Counsel for Secure Mobile Transactions LLCSearch in Eureka ↗ |
| Plaintiff counsel | Matthew J. Antonelli | Attorney | Counsel for Secure Mobile Transactions LLCSearch in Eureka ↗ |
| Plaintiff counsel | Rehan Mohammed Safiullah | Attorney | Counsel for Secure Mobile Transactions LLCSearch in Eureka ↗ |
| Plaintiff counsel | Zachariah Harrington | Attorney | Counsel for Secure Mobile Transactions LLCSearch in Eureka ↗ |
| Plaintiff law firm | Antonelli, Harrington & Thompson, LLP | Law Firm | Representing Secure Mobile Transactions LLCSearch in Eureka ↗ |
| Defendant counsel | James C. Yoon | Attorney | Counsel for The Charles Schwab CorporationSearch in Eureka ↗ |
| Defendant counsel | Jamie J Yoo | Attorney | Counsel for The Charles Schwab CorporationSearch in Eureka ↗ |
| Defendant counsel | Kathryn Elizabeth Albanese | Attorney | Counsel for The Charles Schwab CorporationSearch in Eureka ↗ |
| Defendant counsel | Lucy Yen | Attorney | Counsel for The Charles Schwab CorporationSearch in Eureka ↗ |
| Defendant law firm | Greenberg Traurig LLP | Law Firm | Representing The Charles Schwab CorporationSearch in Eureka ↗ |
| Defendant law firm | Wilson Sonsini Goodrich & Rosati PC (Palo Alto) | Law Firm | Representing The Charles Schwab CorporationSearch in Eureka ↗ |
| Defendant law firm | Wilson, Sonsini, Goodrich & Rosati, PC. | Law Firm | Representing The Charles Schwab CorporationSearch in Eureka ↗ |
| Presiding judge | Judge Michael J. Truncale | Judge | Texas Eastern District CourtSearch in Eureka ↗ |
Official order — verbatim text
The court’s order grants a joint motion reflecting a negotiated rather than adjudicated outcome — no finding of infringement, validity, or damages was made. The asymmetric prejudice structure is deliberate: the plaintiff accepts finality on its own claims (consistent with having achieved a commercial objective), while defendants retain their counterclaim rights. The cost-bearing order — each party pays its own fees — is neutral and offers no signal of which party held the stronger litigation position.
US11288647B2, US9792596B2 & US10546285B2 — Payment Tokenisation Interoperability
The three asserted patents — US11288647B2 (App. No. 16/773,614), US9792596B2 (App. No. 14/249,761), and US10546285B2 (App. No. 15/706,361) — form a family assigned to Secure Mobile Transactions LLC covering an interoperable technical framework for payment tokenisation. Payment tokenisation replaces sensitive card or account data with surrogate tokens during transaction processing, a foundational technology in mobile and digital banking security. The staggered application dates suggest a continuation strategy designed to extend claim coverage across evolving implementation architectures.
This patent family sits at the intersection of mobile banking security and interoperability standards — an area of intense commercial activity among card networks, fintechs, and banking infrastructure providers. With ten major U.S. banking institutions named as defendants in a single action, the asserted claims appear broad enough to capture widely deployed tokenisation implementations. For competitors and vendors in this space, the family represents a material enforcement asset that has now been tested against — and resolved with — some of the largest names in U.S. retail and commercial banking.
Should your team run an FTO against US11288647B2, US9792596B2, and US10546285B2?
Any fintech, bank, or payments infrastructure vendor deploying a payment tokenisation framework should assess exposure against this three-patent family. The plaintiff’s willingness to pursue ten institutions simultaneously — and achieve a resolution in under six months — demonstrates active enforcement intent. Products using token-based transaction security, particularly those interoperating across mobile and digital banking channels, fall squarely within the technology scope of these patents.
PatSnap Eureka’s FTO Search Agent allows R&D and product teams to map claim language from US11288647B2, US9792596B2, and US10546285B2 against your implementation architecture in minutes. Eureka can also surface prior art relevant to validity assessments, identify related continuation applications still pending, and monitor for new assignments or licensing activity — giving your team early warning before an enforcement letter arrives.
Run a freedom-to-operate analysis on US11288647B2 to assess your product’s exposure
Run FTO in Eureka →Similar payment tokenisation patent cases in E.D. Texas and U.S. district courts
Explore related NPE infringement actions involving payment tokenisation and mobile transaction security patents filed in E.D. Texas and comparable federal venues.
What this case signals for the payment tokenisation IP landscape
A ten-defendant NPE action resolved inside six months points to a deliberate monetisation strategy — and residual risk for every bank not named.
E.D. Texas remains the preferred venue for NPE payment technology actions
Filing against ten banking defendants simultaneously in the Eastern District of Texas is a hallmark of NPE litigation strategy: favourable case management timelines, plaintiff-friendly venue reputation, and pressure on defendants to settle rather than litigate to judgment. Financial institutions should factor E.D. Texas exposure into their IP risk assessments.
With-prejudice dismissal without a merits ruling typically signals a licensing outcome
When a plaintiff agrees to dismiss with prejudice and each party bears its own costs, the most commercially logical explanation is a confidential license or lump-sum payment. Banks and fintechs in the payment tokenisation space should monitor whether Secure Mobile Transactions files follow-on actions against non-settling institutions using the same patent family.
Secure v Charles — key questions answered
The case was dismissed via joint motion on 1 October 2025. The plaintiff’s infringement claims against all defendants were dismissed with prejudice; defendants’ counterclaims were dismissed without prejudice. Each party bore its own costs. No merits ruling on infringement or validity was issued.
Secure Mobile Transactions asserted US11288647B2, US9792596B2, and US10546285B2 — a three-patent family covering an interoperable payment tokenisation technical framework for secure mobile transactions.
Dismissal with prejudice bars Secure Mobile Transactions from re-filing the same infringement claims against the same defendants (Charles Schwab, Bank of Texas, Comerica, Frost Bank, Regions Bank, WoodForest entities, and others named). The patents remain valid and enforceable against third parties not covered by this dismissal order.
This asymmetric structure is a standard negotiated outcome. The plaintiff typically agrees to a with-prejudice dismissal in exchange for a commercial resolution (e.g., a license or settlement payment). The defendants preserve their counterclaims — which may include invalidity challenges — without prejudice so they can re-assert them if the plaintiff pursues future infringement actions on these patents.
Yes. The Eastern District of Texas has historically been a preferred NPE filing venue due to its case management rules, plaintiff-friendly jury pool reputation, and experienced patent docket. Payment technology, mobile security, and software patent cases are frequently filed there, particularly by non-practising entities pursuing multi-defendant licensing campaigns.
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