French Loyalty Vendor Wins Patent Suit; Remedy Disputed

By Kuykendall, Lavonne | American Banker, May 24, 2001 | Go to article overview

French Loyalty Vendor Wins Patent Suit; Remedy Disputed


Kuykendall, Lavonne, American Banker


Chip card loyalty software vendors Welcome Real-time and Catuity Inc. have finished the first round in their battle over who owns the rights to place loyalty programs on a chip, but they disagree on how much was won.

Last year Welcome Real-time of Aix-en-Provence, France, sued Detroit-based Catuity in an Australian federal court, claiming that a Catuity transit card loyalty program, CiT/Transcard, violated Welcome Real-time's patent in Australia. In a decision issued last Thursday, the court agreed that Catuity had violated the patent and ordered both parties to appear before it to suggest remedies.

The court's ruling came at a crucial time, during the smart card industry's biggest annual gathering of issuers and vendors. In its haste to get the word out at the CardTech/SecurTech conference, Welcome Real-time issued a press release from Las Vegas, the conference site, in which it misspelled the names of both presiding judge J. Heerey and Catuity, which it rendered as "Fatuity."

Catuity's chief financial officer, Jack Lowry, said the spelling problems were the least of the mistakes. The press release came out before the judge had even released a written judgment to both parties, he said.

Aneace Haddad, president of Welcome Real-time, said his goal is to work out an agreement with Catuity to license Welcome Real-time's software. "We don't want to disturb the market," he said. "We will work with Catuity so the technology can evolve."

He said he hopes that further lawsuits in other countries will be unnecessary. "I think this will settle the issue because Australian law is so similar to U.S. and British law," Mr. Haddad said. "This establishes a precedent that is real solid."

Mr. …

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