Wal-Mart, Disney, Visa, MasterCard Named in E-Commerce Micropayment Patent Lawsuit

Wal-Mart, Walt Disney, Visa, MasterCard and Google are among 20 companies being sued in federal court by a Texas company accusing them of stealing their Patented processing technique in handling their E-Commerce micropayment transactions.

The patent in question is held by a company called Actus and it's a very specific methodology for handling and sharing the revenue associated with smaller purchases such as, according to an example cited in the lawsuit, Wal-Mart MP3 music downloads.

"Each electronic token is associated with monetary value of at least a fraction of a dollar. The user is permitted to select, at the vendor web site, a subset of products or services for purchase from the vendor," the lawsuit said. "The vendor web site computes a total price for the selected subset of products or services. The infringing products or services authorize a purchase transaction without requiring third-party authentication, or a physical manifestation of the user account. If the user account contains electronic tokens having a value equal to or greater than the total price, the user is permitted to purchase the selected subset of products or services without requiring the user to disclose personal information to the vendor. The total price is subtracted from the user account, while the purchase transaction is not subject to a minimum processing fee."

This case is but the latest in a very long line of E-Commerce patent infringement cases, all of which must struggle with proving that the retailer's approach—which is often dubbed as obvious—specifically infringes on the Patent. But most of these cases tend to settle, typically with the retailer agreeing to license the original patent. Hence, buckle in for quite a few more E-Commerce patent infringement filings.

In the section of the lawsuit naming Bank of America, Actus asserts its patent is being infringed by BOA's Cashpay Visa Payroll Cards, Visa Gift Cards and Commercial Prepaid Cards. It makes the same claim for numerous gift, loyalty, rebate, payroll and other type cards issued by the defendants as well as for the Google Checkout online payment service.

Another part of the lawsuit says Actus is the exclusive licensee of a different patent (that bears the same name) issued in July 2007. The defendants named in this section, including Western Union and Google, are accused of making, using, selling and offering to sell products and/or services for conducting E-Commerce in a manner that mimics the Patent.

Documentation included with the lawsuit shows the patents were originally filed by a company called PayByClick and inventor Martin Ling, who could not be reached for comment. Actus wants an injunction barring further infringement and, asserting the patents were willfully infringed, it also seeks payment.