Document Security Systems, Inc. Initiates Patent Infringement Proceedings before the District Court in The Hague, The Netherlands

ROCHESTER, N.Y., Feb. 18 /PRNewswire-FirstCall/ -- Document Security Systems, Inc. (NYSE /AMEX: DMC) ("DSS"), a world leader in the development and manufacturing of optical deterrent and authentication technologies that secure electronic data and help prevent the use of desktop scanners and copiers in counterfeiting and brand fraud in the market reported today that an infringement suit has been filed in the Netherlands where the European Central Bank ("ECB") failed in its attempt to invalidate a DSS European Patent in an earlier court hearing.  The suit is being lodged against the ECB and two security printing entities with manufacturing operations in the Netherlands, Joh. Enschede Banknotes B.V.; and Koninklijke Joh. Enschede B.V.

Patrick White, CEO of DSS, commented, "It's unfortunate that it has come down to this.  We have reached out to settle the issue but we received no substantive return overtures.  People need to know that we do not take pleasure in this process.  Management really has no choice as we have a fiduciary responsibility to our shareholders and therefore we must do whatever it takes to protect the Company's patent assets and the rights that are associated with our patents.  Patent assets are unique in that they only have value as long as you are willing to defend and utilize the legal protection they provide.  With that said, this infringement suit represents the first time in this litigation process that our claim of infringement will be heard and decided in a court of law.  If we are successful in proving infringement in the Netherlands court then we shall see the impact of the lost royalties.  Our legal right to this litigation stems from the fact the ECB failed in its attempt to invalidate the patent in both Germany and the Netherlands which allows us to legally seek real monetary damages against the ECB (owner of the Euro) and the security printers who we believe have printed the patented technology on billions of various banknotes in the countries of the Netherlands and Germany."

DSS's litigation partner and co-owner of the patent, Trebuchet Capital Partners LLC ("Trebuchet") completed its extensive due diligence and filed the action in the District Court of The Hague.  The ECB's and the security printers have been notified and the court hearing date is tentatively scheduled for January 21, 2011.  DSS will bear no further legal expenses associated with this litigation

On August 1, 2005, DSS originally filed a patent infringement suit in the European Court of First Instance ("CFI") against the European Central Bank ("ECB") alleging that the Euro banknotes produced by the ECB infringe on DSS's patented technology.  The CFI ruled on September 5, 2007 that it was not the correct venue for infringement proceedings, which allows for this current country-by-country infringement litigation.  In March 2006, the ECB initiated proceedings to invalidate the European Patent in nine EU countries.  To date, the DSS Patent has been validated in Germany and the Netherlands and invalidated in the United Kingdom, France, Belgium and Austria and there are pending patent validity decisions in Spain and Italy. The determinations in Germany, The Netherlands, France and Austria are subject to appeal. The Moire inducing patent in question expired in January, 2010.  This expiration has no bearing on the infringement legal process since there are billions of alleged infringing banknotes still in circulation printed prior to the patent's expiration.

About Document Security Systems, Inc.

A rapidly growing security technology company, Document Security Systems is a world leader in the development of optical deterrent technologies that help prevent counterfeiting and brand fraud from the use of the most advanced scanners, copiers and imaging systems in the market.  The Company's patented and patent-pending technologies protect valuable documents and printed products from counterfeiters and identity thieves.  Document Security Systems' customers, which include international governments, major corporations and world financial institutions, use its covert and overt technologies to protect a number of applications including, but not limited to, currency, vital records, brand protection, ID cards, internet commerce, passports and gift certificates.  Document Security Systems' strategy is to become the world's leading producer of cutting-edge security technologies for paper, plastic and electronically generated printed assets.

More information about Document Security Systems can be found at its websites:  www.documentsecurity.com, www.protectedpaper.com and www.plasticprintingprofessionals.com.

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SOURCE Document Security Systems, Inc.