[IMGCAP(1)]
InComm Inc., an Atlanta-based prepaid card marketer, has sued Blackhawk Network in federal court, charging Blackhawk with patent infringement.
InComm accuses Blackhawk, a Pleasanton, Calif.-based prepaid card and payments network, of infringing on InComm's 439 patent, which is a computer-implemented method for processing stored-value card transaction requests, according to the lawsuit, which InComm filed last Thursday in U.S. District Court in Madison, Wis.
The lawsuit says the U.S. Patent and Trademark Office on Aug. 25 issued the patent to e2Interactive Inc., InComm's Atlanta-based parent. In the lawsuit, which includes pages of detailed exhibits, InComm accuses Blackhawk of infringing on its patent through the operation of Blackhawk's Gift Card Mall.
The displays, which are placed near cash registers, are found in supermarkets operated by Safeway Inc., Blackhawk Network's parent. Safeway, which also is based in Pleasanton, is the nation's third-largest supermarket chain based on store locations.
InComm said it mailed a letter July 31 to Blackhawk warning the company that it was infringing on InComm's patent. "Blackhawk's infringement has been and continues to be deliberate, willful and intentional, and with knowledge of the existence of the 439 patent, and plaintiffs accordingly are entitled to recover enhanced damages as well as attorney fees and other expenses of litigation," InComm's attorneys say in the lawsuit. The lawsuit seeks to permanently enjoin Blackhawk from infringing on the patent. A Blackhawk Network spokesperson declined to comment on the lawsuit. An InComm spokesperson also declined to comment.
InComm has 150,000 prepaid card reload locations, and Blackhawk Network has 60,000 reload locations, according to the 2010 edition of the ATM&Debit News 2010 EFT Data Book (ADN 9/24). Both companies, however, face the same growth problem because most of their reload locations are in retail environments, which offer high penetration into the market. But only so many locations exist, says Gwenn Bezard, research director at Aite Group LLC, a Boston-based consulting firm. ATM
