Visa 2007 Annual Report Download - page 161

Table of Contents
VISA U.S.A. INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
Lampone Litigation
On May 23, 2006, an action was filed against Visa U.S.A., U.S. Bancorp, eFunds and Wildcard in California state court on behalf of a putative class of
California consumers who were enrolled in the Visa Buxx service and were assessed an "overdraft" fee by U.S. Bancorp. Asserting claims under California
Business & Professions Code Section 17200 and the California Consumer Legal Remedies Act, the plaintiff alleges that the defendants failed to disclose that
a Visa Buxx cardholder can overdraw the Visa Buxx card and that the cardholder could be assessed an overdraft fee. The plaintiff seeks injunctive relief,
restitution and disgorgement.
On May 4, 2007, the parties executed a confidential agreement to settle the case and dispose of all claims. The settlement amount is not considered
material to the Company's consolidated financial statements. On May 30, 2007, the court approved the parties' settlement agreement and dismissed the case in
its entirety with prejudice.
Harding Litigation
In May 2003, Retailers National Bank filed a collection action in California state court against a cardholder for credit card debts incurred as a result of
her Internet gambling (Harding). In August 2003, the cardholder filed a cross-complaint against Visa U.S.A., Visa International, other payment card
companies and several banks, alleging violations of California's unfair competition statute; state and federal gambling laws; California's public policy against
the collection and enforcement of gambling debts; and the USA PATRIOT Act's prohibition on transferring funds intended to be used to support unlawful
activity. Only injunctive relief is sought against Visa U.S.A.
Visa has not yet answered the cross-complaint. In September 2006, the U.S. Congress passed legislation concerning Internet gambling that may affect
the cross-complainant's ability to seek injunctive relief. The parties are currently engaged in settlement negotiations. The potential settlement amount is not
considered material to the Company's consolidated financial statements.
AAA Antiques Mall
On November 13, 2007, a putative class action lawsuit was filed in Maryland state court against Visa U.S.A., MasterCard Worldwide and Discover
Financial Services. Plaintiff AAA Antiques Mall, Inc. alleges that "credit card fees" assessed by defendants as to the state tax portion of a sales transaction
constitute unjust enrichment and/or intentional misrepresentation. At this time, it is too early to make any reasonable evaluation of the claims alleged.
Intellectual Property Litigation
Safeclick, LLC
In December 2003, Safeclick, LLC sued Visa U.S.A. and Visa International in United States District Court for the Northern District of California for
patent infringement. Safeclick alleged that the "Verified by Visa" program (VbV), which authenticates the identity of a cardholder in an Internet transaction,
infringes two claims of Safeclick's "Electronic Transaction Security System" patent. Safeclick indicated that it would seek "reasonable royalty" damages and
injunctive relief.
On December 14, 2005, the court granted Visa's motion for summary judgment, dismissing the case in its entirety. The Court of Appeals for the Federal
Circuit affirmed the dismissal on October 23, 2006. On
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