A federal appeals court has sided with a U.K. payments processing company in a long-running patent dispute with Visa Inc. subsidiary CyberSource Corp.
Retail Decisions Ltd. on Tuesday said that the U.S. Court of Appeals for the Federal Circuit affirmed the Northern District of California's decision to grant it summary judgment against CyberSource.
The ruling, issued Aug. 16, stems from a lawsuit that CyberSource filed in 2004, prior to its acquisition by Visa, against Retail Decisions, accusing it of infringing a patent for detecting credit card fraud in e-commerce transactions.
The U.S. District Court for the Northern District of California in 2009 ruled that CyberSource's '154 patent was invalid on the grounds that the process it described for gleaning information about card transactions by creating a "map" of credit card numbers based on various transactions tied to Internet addresses was not patentable.
CyberSource argued that Retail Decisions' ReD Shield fraud detection product infringed the patent. Retail Decisions' clients include Wal-Mart Stores Inc., Tesco PLC and Virgin Mobile.
CyberSource appealed the decision shortly after that and the Federal Circuit Court affirmed the Northern District Court's decision.
Representatives of San Francisco-based Visa and CyberSource did not immediately respond to emails on Tuesday morning.
CyberSource provides services that allow online merchants to accept card payments and monitor for fraud. Visa acquired the company for $2 billion in July 2010 to bolster its e-commerce capabilities.
Visa generates data processing revenue from CyberSource's services. The number of billable transactions that CyberSource handled in fiscal third quarter ending June 30 rose 38% from a year earlier to 1.04 billion, according to Visa's most recent quarterly report.