Two-Step Authentication Patents December 2013 CONFIDENTIAL - ATTORNEY WORK - PRODUCT CONFIDENTIAL - ATTORNEY WORK PRODUCT - PRIVILEGED1

Two-Step Authentication Patents December 2013

CONFIDENTIAL - ATTORNEY WORK - PRODUCT

CONFIDENTIAL - ATTORNEY WORK PRODUCT - PRIVILEGED 1

Discussion Topics

About Russ August & Kabat

Analysis Of The ‘360 Patent Family

Licensing Strategy

Discussion

Russ August & Kabat Is A Fit For You



Rapid Growth And A Deep Bench Of Experience

Attorneys From Top Firms And Law Schools Including Harvard, Columbia, Michigan And UCLA

Founded In 1990


4

The Patent Team

Recruited From Top Law Firms –Irell & Manella (11 Attorneys), Munger Tolles, Winston & Strawn

More Than 20 Patent Trial Lawyers

CONFIDENTIAL - ATTORNEY WORK PRODUCT - PRIVILEGED

The Patent Team

Patent Group Chair

Lead Trial Counsel In CWC v. Hyundai Lead Trial Counsel

In Clear With Computers

Nearly 20 Years Of Patent Litigation

Experience

Worked For 5 Years At Microsoft

Clerked For Federal Judge Lawrence

McKenna (Southern District Of New

York)

Litigate Cases Against Google,

Amazon, Cisco, Dell, IBM, LinkedIn

DropBox, Facebook

Broad Experience Negotiating

Licensing Agreements

Litigated Cases In California, Texas, Delaware, New

York, Etc.

Extensive Experience

Representing Patent Holders

5

Exemplar Litigation – CWC

Clear With Computers Litigation

Hyundai's Attorneys Were The 900-attorney International Law Firm Winston & Strawn

Hyundai Spent Over $1.35 Million Just On Expert Witnesses Trying To Defeat The CWC Patent

RAK Obtained An $11.5 Million Judgment, Affirmed By The Federal Circuit

V.

6

Exemplar Litigation - TQP

TQP Litigation

Successfully licensed the technology to 139 companies (over $45 million in licensing revenue)

At trial in November 2013, RAK obtained a $2.3 million judgment


Discussion Topics



Licensing Strategy

Discussion



Russ August And Your Patent

RAK Focuses On Patent Holders

Plaintiff Side Focus Avoids Conflicts Of Interest

Deep Experience Litigating In Key Jurisdictions

Successful Licensing Campaigns In This Field


Russ August And Your Patent

Represent Patent Monetization Entities

IP Navigation Group

Empire IP

Capital Legal Group

Tessera Technologies


Understanding Patent Owner Concerns

Venue And

Joinder

Standing Issues

Patent Damages

Changes In The Law


Efficient Licensing Campaigns

RAK Focuses On Multi-Defendant Cases

TQP v. Merrill Lynch, EDTX, encryption

Clouding IP v. Google, D. Del., cloud computing

Minerva v. Motora, EDTX, smart phones

Linksmart v. T-Mobile, EDTX, dynamic redirection

DataTern v. Oracle, EDTX, rel. db/GUI mapping

PACid v. Cisco, EDTX, encryption

API v. Facebook, EDTX, network distributed media

Data Tech v. Speed, D. Del., memory management


Discussion Topics



Licensing Strategy

Discussion



The ‘360 Patent

Recent And Widespread Adoption Of Two-Step Authentication Using Two Communication Forms

Hardware Makers Financial Services Companies

Website Operators Software Companies


Background On The ‘360 Patent

Prosecution History

Prior Licensing Of The Patent

Your Development Of The Invention

Current Monetization Efforts


U.S. Patent No. 8,589,271

The ‘360 Patent

The ‘360 Patent Family Requires Experienced Plaintiff Patent Counsel

Changes In Patent Law Present Particular Challenges

Avoiding Transfer To Forums Skeptical Of Patents

Section 101 Challenges To Patentability For Authentication Patents


CONFIDENTIAL - ATTORNEY WORK PRODUCT - PRIVILEGED

17

Discussion Topics


Analysis Of The ‘360 Patent

Licensing Strategy

Discussion


Licensing Strategy

‘360 Patent Family Target Analysis

Websites And ApplicationsGoogle, Facebook, Salesforce, Paypal, Dropbox, Twitter, LinkedIn, Duo Security, MicroStrategy, SecurEnvoy, Swift Identity, Secure, Vasco, Dynapass, Encap, Authy, Microsoft, Evernote

Financial ServicesBank of America, Citibank, JPMorgan, Chase, PNC, Fidelity, Visa, Amex, Mastercard

Hardware & Backoffice IBM, Cisco, RSA, SafeNetSwivel, Palo Alto Networks


Licensing Strategy

Jurisdiction Analysis

Where Non-Practicing Entity Cases Were Filed In 2012


Licensing Strategy

Jurisdiction Analysis

District Court Declaratory Judgments Filed In 2012


Licensing Strategy

Jurisdiction Analysis Of Potential TargetsDefendant State of Inc. Principal Place of Business

Google Inc. (Gmail; Google Authenticator)

DE Mountain View, CA

Facebook Inc. DE Menlo Park, CASalesforce.com, Inc. DE San Francisco, CAPayPal, Inc. DE San Jose, CADropbox, Inc. DE San Francisco, CATwitter, Inc. DE San Francisco, CALinkedIn Corporation DE Mountain View, CADuo Security, Inc. DE Ann Arbor, MIMicroStrategy Inc. DE Tysons Corner, VAIBM Corporation NY Armonk, NYSwift Identity N.A. Global HQ: Montreal,

CanadaSwivel Secure, Inc. DE Global/UK HQ: Wetherby, West

Yorkshire; US HQ: Seattle, WAVasco Data Security, Inc.(Digipass)

DE Oakbrook Terrace, IL

Dynapass Inc. DE Costa Mesa, CAEncap Security Inc. DE Palo Alto, CAAuthy Inc. DE San Francisco, CAMicrosoft Corporation (Windows Azure)

WA Redmond, WA

Evernote Corporation DE Redwood City, CACloudFlare, Inc. DE San Francisco, CA


Licensing Strategy

Multiple Wave Litigation

Single Wave Litigation

Target Modest Initial Settlements With Objective Of Longer Litigation Against Key Targets


Deal Structure

Overview Of Deal Structure

Your Obligations

Ensuring Beneficial Tax Structure

Russ August Attorneys Have Experience Structuring Flexible, Tax-Efficient Structure

Various Options For Minimizing Tax Liability


Deal Structure

Benefits Of Our Structure Over Patent Monetization Firm

Focus On The ‘360 Patent

Family

Ensures Top Plaintiff Firm

Representation

Minimizing Risk Of Invalidation

Of The ‘360 Patent Family

Experience In Licensing

Authentication & Encryption

Patents


Timing Concerns

Pending Legislation Could Negatively Impact The ‘360 Patent Family

Supreme Court Decision In Alice Corp. v. CLS Bank Could Have A Large Impact On The ‘360 Patent Family


Discussion Topics



Licensing Strategy

Discussion



Documents

Two-Step Authentication Patents December 2013 CONFIDENTIAL - ATTORNEY WORK - PRODUCT CONFIDENTIAL - ATTORNEY WORK PRODUCT - PRIVILEGED1