The two firms are competitors in the specialist security print area of cheque production.
The case has been going on since 2017, and related to an encryption system designed to trap and reject fraudulent cheques.
Communisis is the registered owner of UK Patent No GB2512450B, filed in 2013, which involves the use of a printed code as a security feature on a cheque (or other credit slip) to prevent fraud by the fraudulent alteration of personal details and the addition of new, fraudulent details relating to a different account.
Communisis claimed that Tall Group had infringed its patent, while Tall Group counterclaimed for invalidity.
In a judgement of more than 14,000 words handed down last week at the High Court of Justice Intellectual Property Enterprise Court, Her Honour Judge Melissa Clarke found in Tall Group’s favour, following a two day hearing that took place over the summer.
She dismissed the Communisis claim of infringement.
Martin Ruda, group managing director at Tall Group, told Printweek: “We are delighted but not surprised by the outcome as it was very clear to Tall all the way along that we were right. I am surprised they [Communisis] sought to pursue the case.
“It is challenging to be threatened with infringement allegations and the time, effort and cost in dealing with it is not a small thing. But one has to defend one’s position.”
The judge noted that the that the Communisis patent, which involves conversion of numerical input to a higher base, was akin to a translation of a word from one language to another and “not at all sophisticated” cryptographically speaking, “and that is why both experts consider it to provide such poor security”.
She said Tall Group’s methodology was “much more secure and effective”.
Bizarrely, Charles Brewer, the expert witness used by Communisis, described the security provided by its method as “frankly pretty awful” in his oral evidence.
However, in a statement Communisis said that the length of the case meant that it related to an older and now outdated version of its fraud prevention methodology.
The firm stated: “Communisis brought a case for patent infringement relating to two of the six Claims within our patent for UCN, these were Claim 1 (method) and Claim 6 (product). The court has found against Communisis in respect of these two Claims. While this was disappointing it should be noted that this action has been in progress for a number of years and relates to UCN which is an older and now outdated version of the now upgraded fraud prevention methodology Communisis currently uses with its clients – this being eUCN.
“We are confident that our eUCN product provides comparative security to methods used by our competitors and therefore Communisis is in no way at a disadvantage in terms of fraud prevention on cheques and nor does it detract from our position as a very strong player in the cheque market. Communisis believes that when considered alongside our experience in Risk & Compliance within the Financial Services sector we continue to offer an enhanced service to clients.”
Tall Group uses a method called UCN Plus which is a joint initiative between the security printing group and DIA Europe / Kappa, a specialist company that focuses on fraud prevention in payment systems.
With UCN Plus the variable payment data including payee name, amount and date, is encrypted and hidden within a QR code printed on the face the cheque.
Ruda said that UCN Plus was “a good example of our continuing commitment to developing better and better client fraud prevention tools” and that it was also available for other providers to use via an API.
“I’ve felt for some time that strong methodologies should be available to the industry as a whole,” he added.
Ruda said that Tall Group had “held its own” during the Covid-19 pandemic, with the business proving its resilience.
The Tall Group of companies is headquartered in Runcorn and includes Tall Security Print, Checkprint in Hinckley, and DLRT in Lisburn. The group had sales of £11.4m in its most recent accounts, for 2018.
Ruda said Tall Group was also looking forward to recovering at least some of its “significant six-figure” costs, which will be determined by the court in a few weeks’ time.
Communisis was acquired by US group OSG two years ago and had sales of £196.4m last year.
