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L.L.P. LAW OFFICES One Arizona Center, 400 E. Van Buren, Suite 1900 Phoenix, Arizona 85004-2202 602.382.6000

Sid Leach (#019519) Brian J. Foster (#012143) R. Lee Fraley (#018355) David G. Barker (#024657) SNELL & WILMER L.L.P. One Arizona Center 400 E. Van Buren, Suite 1900 Phoenix, Arizona 85004-2202 Telephone: 602.382.6000 sleach@swlaw.com bfoster@swlaw.com lfraley@swlaw.com dbarker@swlaw.com Attorneys for Plaintiff Element Payment Services, Inc. IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA

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Element Payment Services, Inc., an Arizona corporation, Plaintiff, vs. Protegrity Corporation, a Cayman Islands company, Defendant.

Civil Action No.

COMPLAINT

Plaintiff Element Payment Services, Inc., for its complaint against Defendant Protegrity Corporation, alleges as follows: PARTIES 1. Element Payment Services, Inc. (EPS) is a corporation organized under

the laws of the State of Arizona with its principal place of business at 500 N. Juniper Dr., Suite 100, Chandler, Arizona 85226. 2. Defendant Protegrity Corporation is a Cayman Islands corporation, with a

principal address of P.O. Box 309, Ugland House, South Church Street, Grand Cayman, Cayman Islands.

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L.L.P. LAW OFFICES One Arizona Center, 400 E. Van Buren, Suite 1900 Phoenix, Arizona 85004-2202 602.382.6000

JURISDICTION AND VENUE 3. This is a civil action is brought pursuant to the Declaratory Judgment Act,

28 U.S.C. 2201 & 2202, and arises under the patent laws of the United States, codified at 35 U.S.C. 1 et seq. This Court has subject matter jurisdiction over the claim for declaratory judgment pursuant to 28 U.S.C. 1331 & 1338(a). 4. Protegrity Corporation is subject to personal jurisdiction in this judicial

district pursuant to Rule 4(k)(2) of the Federal Rules of Civil Procedure. Protegrity Corporation is a Cayman Islands corporation, and is not subject to jurisdiction in any states courts of general jurisdiction. Exercising jurisdiction over Protegrity Corporation in this case is consistent with the United States Constitution and laws. 5. Protegrity Corporation is also subject to personal jurisdiction pursuant to,

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and may alternatively be served in accordance with, Rule 4.2(a) and Rule 4.2(k) of the Arizona Rules of Civil Procedure. 6. Protegrity Corporation is an alien, and venue is proper in this judicial

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district pursuant to 28 U.S.C. 1391(d). 7. On March 19, 2013, Protegrity Corporation filed a complaint in the United

States District Court for the District of Connecticut alleging that EPS infringes U.S. Patent No. 8,402,281 and U.S. Patent No. 6,321,201. Accordingly, an actual, concrete, and justiciable controversy exists between EPS and Protegrity Corporation concerning the validity and infringement of these two patents. 8. The United States District Court for the District of Connecticut does not

have personal jurisdiction over EPS, and venue is improper in that district. Consequently, this declaratory judgment action is the first-filed action that has been filed in a court of competent jurisdiction. In the complaint that Protegrity Corporation filed in the District of Connecticut, venue is predicated solely upon 28 U.S.C. 1391(c). Under that statute, venue is only proper if the defendant corporation was subject to personal jurisdiction at the time the action is commenced. This would require, inter alia, that EPS had minimum

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L.L.P. LAW OFFICES One Arizona Center, 400 E. Van Buren, Suite 1900 Phoenix, Arizona 85004-2202 602.382.6000

contacts with the forum state from which the patent infringement claims arose, i.e., that EPS committed acts of infringement in the State of Connecticut. 9. The District Court in Connecticut does not have personal jurisdiction over

EPS for the patent infringement claim based upon U.S. Patent No. 8,402,281. There are two reasons why the district court in Connecticut does not have personal jurisdiction with respect to that claim. First, U.S. Patent No. 8,402,281 did not issue until March 19, 2013, the same day that Protegrity Corporation filed the civil action in Connecticut accusing EPS of infringing that patent. In order for the Connecticut court to have personal jurisdiction over EPS, the patent infringement claim must arise out of contacts that EPS allegedly has with the forum state. U.S. Patent No. 8,402,281 could not be infringed prior to March 19, 2013, because the patent did not issue until that date. But no acts of alleged infringement occurred in Connecticut between the time that the patent issued, and the time that the civil action was commenced (assuming Protegrity Corporation waited until the patent issued that day before filing the lawsuit). Second, in order to infringe U.S. Patent No. 8,402,281, the patent claims (a) require that specified steps of a method be performed, including the step of maintaining a database having certain characteristics, or else (b) require that the accused infringer use a computer system in Connecticut that, among other things, includes a database meeting certain limitations and a processor configured to perform certain functions. Any database allegedly maintained by EPS would have been maintained in Arizona, not Connecticut. Any computer system of EPS alleged to infringe the patent would have been located and used by EPS in Arizona, and not Connecticut. Thus, putting aside the fact that the patent infringement action was filed the same day that the patent issued, no acts of alleged infringement could have occurred in Connecticut based upon the manner in which the patent claims are drafted and the acts required to have occurred in Connecticut upon which a claim of alleged infringement might arise. 10. Similarly, the District Court in Connecticut does not have personal

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jurisdiction over EPS for the patent infringement claim based upon U.S. Patent No. 6,321,201. In order for the Connecticut court to have personal jurisdiction over EPS in -3-

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L.L.P. LAW OFFICES One Arizona Center, 400 E. Van Buren, Suite 1900 Phoenix, Arizona 85004-2202 602.382.6000

connection with that claim, the patent infringement claim based upon that patent must arise out of contacts that EPS allegedly has had with the forum state. The only remaining claims left in that patent, which have not yet been held to be invalid, are all method claims. Thus, in order to infringe U.S. Patent No. 6,321,201, a defendant must, among other things, perform the step of storing data as encrypted data element values in a first database. Any database in which the accused method steps might have allegedly been performed would be in Arizona, not Connecticut. Thus, based upon the way that the patent claims are drafted, any acts of alleged infringement would necessarily have taken place in Arizona, if at all, and no acts of alleged infringement have occurred in Connecticut. 11. The District Court in Connecticut does not have jurisdiction or venue in

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Civil Action No. 3:13-cv-00375-SRU, filed on March 19, 2013, by Protegrity Corporation. 12. This is an exceptional case entitling EPS to an award of attorneys fees

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incurred in connection with this action, pursuant to 35 U.S.C. 285. COUNT I (Declaratory Judgment Concerning U.S. Patent No. 8,402,281) 13. EPS realleges and incorporates by reference the allegations of the preceding

paragraphs of this Complaint. 14. Protegrity Corporation has accused EPS of infringing U.S. Patent No.

8,402,281 in Civil Action No. 3:13-cv-00375-SRU filed in the United States District Court for the District of Connecticut. 15. An actual, concrete, and justiciable controversy exists between EPS and

Protegrity Corporation concerning the validity and infringement of U.S. Patent No. 8,402,281. 16. EPS continues to use, in Arizona, a system that Protegrity Corporation

alleges to infringe U.S. Patent No. 8,402,281. 17. EPS does not infringe U.S. Patent No. 8,402,281, and the patent is invalid. -4-

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L.L.P. LAW OFFICES One Arizona Center, 400 E. Van Buren, Suite 1900 Phoenix, Arizona 85004-2202 602.382.6000

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EPS requests a declaratory judgment that EPS has not infringed, and does

not infringe U.S. Patent No. 8,402,281, and that the patent is invalid. COUNT II (Declaratory Judgment Concerning U.S. Patent No. 6,321,201) 19. EPS realleges and incorporates by reference the allegations of the preceding

paragraphs of this Complaint. 20. Protegrity Corporation has accused EPS of infringing U.S. Patent No.

6,321,201 in Civil Action No. 3:13-cv-00375-SRU filed in the United States District Court for the District of Connecticut. 21. An actual, concrete, and justiciable controversy exists between EPS and

Protegrity Corporation concerning the validity and infringement of U.S. Patent No. 6,321,201. 22. EPS continues to use, in Arizona, a system that Protegrity Corporation

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alleges to infringe U.S. Patent No. 6,321,201. 23. 24. EPS does not infringe U.S. Patent No. 6,321,201, and the patent is invalid. EPS requests a declaratory judgment that EPS has not infringed, and does

not infringe U.S. Patent No. 6,321,201, and that the patent is invalid. PRAYER FOR RELIEF WHEREFORE, EPS prays for judgment against Protegrity Corporation as follows: 1. For a declaratory judgment that United States Patent No. 6,321,201 is not

infringed by EPS, either literally or under the doctrine of equivalents; 2. For a declaratory judgment that United States Patent No. 8,402,281 is not

infringed by EPS, either literally or under the doctrine of equivalents; 3. For a declaratory judgment that United States Patent No. 6,321,201 is

invalid and unenforceable. 4. For a declaratory judgment that United States Patent No. 8,402,281 is

invalid and unenforceable.

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L.L.P. LAW OFFICES One Arizona Center, 400 E. Van Buren, Suite 1900 Phoenix, Arizona 85004-2202 602.382.6000

5.

For a finding that this is an exceptional case pursuant to 35 U.S.C. 285,

and an award of EPSs attorneys fees; 6. 7. For an award of costs; and That this Court grant, in accordance with Rule 54(c) of the Federal Rules of

Civil Procedure, the relief to which EPS is entitled, even if EPS has not demanded that relief in its pleadings.

DATED this 4th day of April, 2013. SNELL & WILMER L.L.P.

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By: s/ Sid Leach Sid Leach Brian J. Foster R. Lee Fraley David G. Barker Attorneys for Element Payment Services, Inc.

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