GE, Exxon to Pay Holder of Gas-Card Rebate Patent

Meridian Enterprises Corp. is slowly wearing down bankers' resistance to paying licensing fees for a patent it holds.

This week Meridian settled lawsuits it had filed in September against GE Capital and Exxon claiming they violated a patent protecting an electronic process of crediting gasoline rebates to cardholders' accounts.

St. Louis-based Meridian has taken action against 14 companies that issue or market cobranded gasoline cards. Eight settled, agreeing to pay licensing fees to Meridian. Six cases are pending.

Meridian hopes the remaining opponents will be swayed by the settlements it has reached with such companies as Visa U.S.A., MasterCard International, Associates First Capital Corp., and Union Oil Company of America.

Banc One Corp. and British Petroleum also entered into agreements with Meridian last year, though no legal action had been initiated.

Michael L. Fraser, executive vice president of Meridian, said the bank card industry has shown "resistance to patented intellectual property," but he said the licensing agreements his company had arranged were a step in the right direction.

Chase Manhattan Corp. and Shell Oil Co., the staunchest challengers of Meridian's patent, remain embroiled in litigation with the marketing company that dates back to 1984.

Other holdouts are BankAmerica Corp. and Sun Co., which market the Sunoco credit card, and Fleet Financial Group and Cumberland Farms, which market the Gulf credit card. Meridian sued these four companies last year.

The settlement with GE Capital and Exxon differs from earlier ones because Meridian will provide consulting services in addition to collecting licensing fees. Mr. Fraser said this agreement may be "the start of broader relationships with companies that are using Meridian's patented product."

Meridian hired a former MasterCard and AT&T Universal Card Services executive, Alan Schultheis, to head its consulting division.

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