Visa sued over online authentication patent

IDG News Service

Visa USA Inc. and Visa International Service Association have been sued by two technology companies who claim that the credit card companies stole their patented technology for authenticating credit card holders in online transactions. LLC, of Oklahoma, and VIMachine Inc., of Delaware, claim they shared information on a patented payer authentication technology with Visa and that Visa subsequently filed its own application for a patent based on that information. The companies also allege that Visa’s payer authentication service, VPAS, infringes on their patented technology, according to a copy of the complaint filed Thursday in the U.S. District Court for the Northern District of Texas.

Starpay and VIMachine are seeking unspecified damages. No one from Visa USA or Visa International could be reached for comment late Friday.

The patent in question covers a system in which a transaction administrator, such as a credit card company, sits between an online vendor and a buyer to confirm a transaction when a purchase is made. After confirmation, the vendor completes the transaction, according to the description of the patent, number 5,903,878, on the U.S. Patent and Trademark Office Web site.