InComm Sues Blackhawk

Lawsuit involves patent-infringement allegations

Angel Abcede, Senior Editor/Tobacco, CSP

MADISON, Wis. -- A lawsuit filed in U.S. district court alleges that a major supplier of prepaid products to the convenience-store channel infringed on a soon-to-be-granted patent owned by a competing vendor. E2Interactive and Interactive Communications International Inc., Atlanta, commonly known as InComm, filed suit in the Western District of Wisconsin for "injunctive relief, damages and recovery of their reasonable costs and attorney fees" against Blackhawk Network Inc., a subsidiary of grocery corporation Safeway Inc., Pleasanton, Calif.

Attorneys for both InComm and [image-nocss] Blackhawk did not return phone calls before press time.

The InComm patent application, which the company said received a "notice of allowance" from the U.S. Patent & Trademark Office, claims the rights to "methods, systems and computer programs for processing a stored-value-card transaction request in a card data-management system." The lawsuit claims that Blackhawk is infringing on the soon-to-be-issued InComm patent "by practicing, making, using, selling or offering for sale in this judicial district and elsewhere the inventions claimed in the patents-in-suit" by operating its gift-card mall program.

In the filing, InComm said it sent a letter to Blackhawk back in July placing the company "on notice" that the patent office would soon issue the patent.

In addition, InComm asked for damages in an amount "to be proved at trial," as well as the potential to increase that amount by three times as authorized by patent rules.

InComm is a marketer, distributor and technology provider of stored-value gift and prepaid products. Its 145,000 partner locations generated nearly $8 billion in retail sales of prepaid products in 2007 and reach hundreds of millions of customers every week. InComm's retail network includes brands in the big-box, grocery, convenience, chain-drug, discount, electronics, office-supply and other categories.

Blackhawk Network is a prepaid and payments network involved in card-based financial solutions and third-party prepaid cards. The company works through grocery, mass, drug, convenience and specialty retailers in the United States, Canada, France, Mexico and the United Kingdom. Its proprietary network includes more than 80,000 stores and reaches more than 165 million consumers each week.

Angel Abcede, CSP/Winsight By Angel Abcede, Senior Editor/Tobacco, CSP
View More Articles By Angel Abcede