Feeds

Inventor sues Google Wallet over NFC loyalty patent

More than one billygoat headed across that bridge, though

The smart choice: opportunity from uncertainty

Loyalty scheme pioneer Peter Sprogis is taking Google to court, claiming that the search engine's NFC Wallet infringes his 2007 patent on adding loyalty to pay-by-bonk apps.

Sprogis is based in Florida, but the case will be heard in patent-holder-friendly Delaware and was spotted by Startups and IP Strategy. The patent in question covers the use of an NFC tag, and reader, to watch for loyal customers and trigger rewards based on visits, which is odd given that Google Wallet neither watches for, nor rewards, its users.

Image two from the patent document

The company declined to comment on the case, only pointing out that the patent does cover NFC tags tapped against the reader as well as those passing nearby as indicated in the patent diagrams, but Google's decision to store the contents of a Google Wallet in the cloud may provide a clue as to why the Chocolate Factory is being targeted.

The patent in question, US number 7,298,271, covers the use of an NFC reader to log customer visits, and a remote server which stores those visits and decides when the loyalty becomes worthy of reward. But most NFC systems don't use a remote server - that's rather the point as NFC mandates an embedded "secure store" for all that stuff, which would seem to put it beyond the patent with the notable exception of Google.

Having failed to get many cards into its NFC secure store Google hit upon the undoubtedly-clever idea of putting credit cards into the cloud instead. One (Google) card is then stored locally to provide credit for the seconds, or perhaps minutes, when connectivity fails. It's a very clever solution, and one which is being aped (and expanded on) by Inside Secure, which reckons the entire secure element can be cloud based. But this approach does mean that any loyalty scheme could fall foul of Peter Sprogis's patent, which talks a great deal about server-based loyalty schemes.

To be fair to Sprogis, he's no patent troll, having founded Molo Rewards with the explicit intention of "utiliz[ing] my own granted patent for integrating wireless devices with RFID to issue and dispense coupons in any type of retail outlet" according to his LinkedIn profile, and Molo certainly seems to be actively attempting to achieve that. The timing would also belie the idea of a patent troll - a troll would wait until NFC was more popular, when more targets were available and payouts larger, not risk getting embroiled in litigation that could kill off such a nascent industry.

But the patent is far-reaching, and if Google is infringing it then so are half-a-dozen other businesses, with a dozen more hoping to infringe at some point as the patent largely describes their revenue stream. ®

Designing a Defense for Mobile Applications

More from The Register

next story
ONE EMAIL costs mining company $300 MEEELION
Environmental activist walks free after hoax sent share price over a cliff
HP, Microsoft prove it again: Big Business doesn't create jobs
SMEs get lip service - what they need is dinner at the Club
ITC: Seagate and LSI can infringe Realtek patents because Realtek isn't in the US
Land of the (get off scot) free, when it's a foreign owner
Arrr: Freetard-bothering Digital Economy Act tied up, thrown in the hold
Ministry of Fun confirms: Yes, we're busy doing nothing
UK.gov's Open Source switch WON'T get rid of Microsoft, y'know
What do you mean, we've ditched Redmond in favour of IBM?!
Help yourself to anyone's photos FOR FREE, suggests UK.gov
Copyright law reforms will keep m'learned friends busy
Putin: Crack Tor for me and I'll make you a MILLIONAIRE
Russian Interior Ministry offers big pile o' roubles for busting pro-privacy browser
Apple smacked with privacy sueball over Location Services
Class action launched on behalf of 100 million iPhone owners
prev story

Whitepapers

Top three mobile application threats
Prevent sensitive data leakage over insecure channels or stolen mobile devices.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Designing a Defense for Mobile Applications
Learn about the various considerations for defending mobile applications - from the application architecture itself to the myriad testing technologies.
Build a business case: developing custom apps
Learn how to maximize the value of custom applications by accelerating and simplifying their development.