BCE Emergis Inc., a seller of electronic bill-pay and presentment services to the financial services and health-care industries, has won the first of what it expects will be several patent infringement settlements from EBPP rivals.
The Montreal company announced Wednesday that it had reached terms with "a major" EBPP vendor, which it would not identify, and promised more such actions.
"We are pleased to have signed this first agreement," BCE president Alan Neely said in the announcement. "This settlement is an important precedent for future actions to realize the value of the patent."
The technology, U.S. patent 6,044,362, was issued in March 1997, according to BCE spokesman Mark Boutet, and covers the manner in which bills are presented to consumers for viewing and payment. "We think it is a fairly important patent," he said. "Our understanding is that our patented technology is the most widely used in the industry."
BCE said it won a bit less than $1 million and a licensing fee in the out-of-court settlement, which resolved a lawsuit filed this year. "We are very pleased with these terms," Mr. Boutet said.
The deal will now become BCE's model and could prove an important source of leverage in future cases. Mr. Boutet said BCE is in discussions with one other EBPP vendor. "Obviously other companies have been identified. If we have reason to believe they are using out technology," BCE will be seeking a settlement, he said. "We are talking to one party at a time."
Beth Robertson, a senior analyst with the market research firm TowerGroup in Needham, Mass., said such a campaign could hamper the industry. Any companies hoping to market an EBPP product or service would have internal revenue models that probably do not include any royalty payments or licensing fees, Ms. Robertson said, and these models would be thrown off if the company had to make a financial settlement with BCE.
The alternative could require revising their designs so as to avoid infringing on the BCE patent, which can take considerable time and expense. "This could disrupt any existing revenue models because it would change the dynamics of the market," Ms. Robertson said. "It could create a problem in the industry."
Representatives for CheckFree Corp., Metavante Corp., and Yodlee Inc., three leading EBPP processors and technology vendors, said their companies were neither parties to any settlement with BCE nor aware of any ongoing discussions with it. But they were paying attention to BCE's moves.
"If they are reaching out to people, I'm sure they will come to us eventually," said David Fontaine, a spokesman for CheckFree, of Norcross, Ga.
Sam Kim, a spokeswoman for Metavante, a subsidiary of the Milwaukee banking company Marshall & Ilsley Corp., recalled hearing about the BCE patent being issued six years ago. "We thought it was bogus that they had patented the actual process," she said.
"The EBPP market is more than 10 years old," said Melanie Flanigan, the director of marketing at Yodlee, in Redwood City, Calif. "It seems hard to believe that someone would have a broad enough patent that would be infringed by all the major players and they would not have come forward until now."
