A marketing company that is almost unknown in credit card circles is challenging six of the industry's heavyweights with patent infringement lawsuits.

In two suits fried in U.S. District Court in East St. Louis, Ill., Meridian Enterprises Corp. of St. Louis contends that a patent it obtained in 1991 for a product called MeridiCard has been violated by a certain type of cardholder rebate program.

MasterCard, Chemical Bank, and Shell Oil Co, are named in one lawsuit; Visa U.S.A., Unocal Corp., Ford's Associates National Bank, and MasterCard are the targets of the other.

If Meridian wins, "it could really rock the industry," said Michael J. Auriemma, managing director of Auriemma Consulting Group in Westbury, N.Y. "Meridian must feel pretty confident that it could win [because it is] taking on such big players."

The marketer is waging the potentially expensive legal battle in hopes of collecting royalties. It has been negotiating with the credit card companies and their cobranding partners for almost a year.

Meridian's patent (No. 5,025,372) essentially protects a method of crediting a cardholder's account electronically with points that translate into dollars.

Meridian contends that the Shell-Chemical MasterCard, introduced last November, falls under the patent because it offers cardholders a rebate of up to 3% on purchases, which is automatically credited to the consumer's card balance.

Meridian says the Unocal-Associates National MasterCard and Visa cards likewise are in violation because they give 1% rebates on all purchases, redeemable for gasoline at Unocal stations. Again, the rebate appears on the cardholder's statement.

Michael L. Fraser, Meridian's vice president of operations, suggested in an interview in February that Meridian's patent could be broader than just electronic crediting.

"Electronic crediting would appear on the surface to be part of the infringement," said Mr. Fraser, but "there is the possibility that other areas are being infringed on."

Meridian filed its complaints last December, but the summonses did not go out until this month. Meridian's lawyers would not disclose the reason for the lag, but others familiar with the case speculated that Meridian wanted to be the first to file a complaint to assure that the case would proceed in a court near its base.

Meridian's complaint states that the company has "suffered damages in an amount to be determined at trial in lost profits, lost royalties and other monetary losses."

Visa filed its own complaint about a week later, on Aug. 18, in federal court in San Francisco. It is seeking a non-infringement judgment and wants Meridian's patent invalidated.

Visa also wants Meridian to pay for the association's legal and court costs.

San Francisco-based Visa provided seven examples of card products that it said predated Meridian's patent and employed various forms of electronic crediting. Visa, like the other Meridian defendants, questions the originality of the patented program.

The Visa complaint said, "Meridian has made these claims even though it has been specifically told about the voluminous consumer credit card prior art."

Among the programs cited by Visa is an early version of Citibank's Choice card, which offered a rebate on purchases that appeared on cardholders' statements. This feature was developed around 1980, but is no longer offered.

Other examples included HomeCard, which was issued by Valley National Bank of Salinas, Calif., and offered an automatic 1% rebate on credit card purchases at the time that finance charges were assessed.

Valley National became Household Bank of Newport Beach, Calif., the card issuing unit of Household International Inc., and now there are three versions of HomeCard.

MasterCard has not responded to Meridian's summons. A spokesman said the New York-based association had not yet received notice of the lawsuit, but he added, "Any claim is without merit."

Chemical Bank and Associates National, which is part of the Ford Financial Services Group, would not comment on the lawsuit other than to confirm that a notice had arrived.

In the meantime, the rest of the credit card industry will be watching how the case unfolds.

"There are a lot of other programs in the works right now that are looking at electronic settlement," said Mr. Auriemma. "So the outcome of this case will be pretty important."

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