The legal battle between American Express and the credit card associations has taken another bizarre turn, with MasterCard International Inc. filing a lawsuit against one of its largest members.

The member, Advanta Corp., had already been sued by Visa U.S.A. for alleged trademark infringement in a marketing alliance with American Express Co., also a defendant in the case.

MasterCard, accusing Advanta and Amex also of unfair competition and breach of contract, finds itself in an especially prickly situation given Advanta's close personal ties to MasterCard.

Advanta chief executive officer Alex W. Hart was MasterCard's president from 1989 until 1994, and Advanta president Richard Greenawalt serves on MasterCard's board.

Each side has now either sued or countersued over the Rewards Accelerator program, in which Advanta, the eighth-largest bank card issuer, lets customers accumulate Membership Rewards points with American Express.

Advanta and American Express issued no comments Tuesday, the day after the MasterCard filing in U.S. District Court for the Eastern District of Pennsylvania. American Express has contended that Visa and MasterCard restrictions on banks' comarketing with American Express are anticompetitive, and that the legal actions lack merit.

Advanta filed last week for a preliminary injunction against Visa - it had not yet been sued by MasterCard - to ensure it could continue offering Rewards Accelerator.

MasterCard and Visa, meanwhile, signed a "standstill agreement" with Advanta that gives them until Jan. 22 to settle their differences out of court. A source said Advanta accordingly will not make Rewards Accelerator solicitations over that period.

The conflicts began Nov. 25 with Visa's lawsuit against American Express in U.S. District Court for the Northern District of California, San Francisco. Advanta responded last Wednesday in the same Philadelphia court where MasterCard filed this week.

Last Friday, Visa added Advanta to its lawsuit against American Express, when it became clear that Advanta did not intend to comply with its order to stop offering Rewards Accelerator.

MasterCard had concurrently, and prior to the suit against Advanta and Amex, ordered Advanta to discontinue the American Express tie-in.

"Frankly, we are surprised that as a member of MasterCard, Advanta would misuse the MasterCard trademark and inappropriately link it with a competitive program," said Alan J. Heuer, MasterCard's U.S. region president.

MasterCard's complaint was nearly identical to Visa's, focusing on the commingling of bank and nonbank brands. "The entire package appears as if it is a joint effort by American Express and MasterCard, when in truth, it is not," MasterCard said in its suit.

Unlike Visa, MasterCard did not amend its operating regulations to clarify its position on the use of its logo.

Also different from Visa's position is MasterCard's claim that American Express is "tortiously" interfering in the association's contractual relationship with Advanta.

In the past, "MasterCard has tried to work things out without trying to take the same approach as Visa," said Anita Boomstein, an attorney with Hughes, Hubbard & Reed in New York.

A potential concern for the card industry is how the associations' collective action against Advanta might affect the Justice Department's antitrust investigation into their membership rules.

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