Capital One 2015 Annual Report Download - page 238

CAPITAL ONE FINANCIAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
219 Capital One Financial Corporation (COF)
As noted above in the section entitled Mortgage Representation and Warranty Liabilities, the Company’s subsidiaries establish
reserves with respect to representation and warranty litigation matters, where appropriate, within the Company’s overall
representation and warranty reserves. Please see above for more details.
Anti-Money Laundering
Capital One has received requests for subpoenas and testimony from the New York District Attorney’s Office (“NYDA”) with
respect to certain former check casher clients of the Commercial Banking business and Capital One’s anti-money laundering
(“AML”) program. In early 2015, we received similar requests from the U.S. Department of Justice (“DOJ”) and the Financial
Crimes Enforcement Network (“FinCEN”) of the U.S. Department of Treasury. Capital One is cooperating with all agencies
involved in the investigation.
Intellectual Ventures Corp., et al.
In June 2013, Intellectual Ventures I, LLC and Intellectual Ventures II, LLC (collectively “IV”) sued Capital One Financial Corp.,
Capital One Bank (USA), N.A. and Capital One, N.A. (collectively “Capital One”) for patent infringement in the U.S. District
Court for the Eastern District of Virginia. In the Complaint, IV alleged infringement of patents related to various business processes
across the Capital One enterprise. IV simultaneously filed patent infringement actions against numerous other financial institutions
on the same and other patents in several other federal courts. Capital One filed an answer and counterclaim alleging antitrust
violations. In December 2013, the court dismissed Capital One’s counterclaim and decided the parties’ arguments on claim
construction. IV agreed to dismiss two patents in suit, and following claim construction, asked for a stipulation of non-infringement
for one patent with an opportunity to appeal the court’s decision regarding claim construction. In April 2014, the court granted
Capital One’s motion for summary judgment and found that the two remaining patents were either unpatentable or indefinite. In
May 2014, IV appealed to the Federal Circuit, which affirmed the district court’s dismissal of all three remaining patents in July
2015.
In January 2014, IV filed a second suit against Capital One for patent infringement in the U.S. District Court for the District of
Maryland. In the complaint, IV again alleges infringement of patents related to various business practices across the Capital One
enterprise. In March 2015, the court granted Capital One’s motion for leave to add a counterclaim for antitrust violations. IV
voluntarily dismissed one of the patents against Capital One and in September 2015, the court granted summary judgment in favor
of Capital One on the remaining four patents and dismissed IV’s claims. IV has appealed the dismissal of its claims to the Federal
Circuit.
Other Pending and Threatened Litigation
In addition, we are commonly subject to various pending and threatened legal actions relating to the conduct of our normal business
activities. In the opinion of management, the ultimate aggregate liability, if any, arising out of all such other pending or threatened
legal actions will not be material to our consolidated financial position or our results of operations.