Visa 2007 Annual Report Download - page 69

Table of Contents
On July 26, 2007, Visa International requested the removal of the First Instance Judge from the case and such request was granted on September 25,
2007. A new judge was assigned to finalize the discovery phase of the case. On November 1, 2007, Visa International filed its written conclusions explaining
how the evidence collected during discovery supports its arguments. On November 21, 2007, Visa International filed an appeal of the decision denying
suspension of the preliminary injunction with the newly assigned judge. The plaintiff filed a response to this appeal on November 26, 2007, and Visa replied
to that response on December 3, 2007.
PrivaSys
On June 20, 2007, PrivaSys, Inc. filed a complaint in U.S. District Court for the Northern District of California against Visa International and Visa
U.S.A for patent infringement. PrivaSys alleges that Visa's contactless payment technology infringes U.S. Patent No. 7,195,154, which we refer to as the 154
patent, entitled "Method for Generating Customer Secure Card Numbers." Visa U.S.A. and Visa International filed their respective answers and counterclaims
on August 21, 2007 alleging that Visa did not infringe the 154 patent, that the 154 patent is invalid and that the patent is unenforceable due to inequitable
conduct and prosecution laches. On September 28, 2007, PrivaSys filed a motion requesting leave to file an amended complaint adding J.P. Morgan Chase
and Wells Fargo as defendants. Visa U.S.A. and Visa International opposed this motion on October 26, 2007 and asked the court, in the alternative, to stay all
proceedings against Visa issuing financial institutions pending resolution of the issue of whether the Visa technology infringes the PrivaSys patent. On
November 14, 2007, the court granted PrivaSys's motion for leave to file the amended complaint. On December 5, 2007, Visa U.S.A. filed an answer to the
amended complaint. The parties have reached an agreement in principle to settle the dispute.
Every Penny Counts
On July 17, 2007, Every Penny Counts, Inc. filed a complaint in the U.S. District Court for the Middle District of Florida against Visa U.S.A.,
MasterCard and American Express for infringement of four of its patents. Plaintiff amended its complaint on September 27, 2007 to add Green Dot Corp. as a
party and to add a fifth patent to its suit. The Complaint now alleges that the defendants' "open" prepaid card products infringe U.S. Patent No. 5,621,640
("Automatic Philanthropic Contribution System"), U.S. Patent No. 6,112,191 ("Method and System to Create and Distribute Excess Funds from Consumer
Spending Transactions"), U.S. Patent No. 6,088,682 ("Funds Distribution System Connected with Point of Sale Transactions"), U.S. Patent No. 6,876,971
("Funds Distribution System Connected with Point of Sale Transaction") and U.S. Patent No. 7,171,370 ("Funds Distribution System Connected with Point of
Sale Transactions"). Visa U.S.A. filed a Motion to Dismiss, or in the Alternative for a More Definite Statement, based on the plaintiff's failure to identify
which products or services offered by Visa U.S.A. purportedly infringe which of the plaintiff's patents on October 12, 2007. The court denied the motion on
October 29, 2007. On November 13, 2007, Visa U.S.A. filed its answer and counterclaims alleging that Visa does not infringe the plaintiff's patents, that the
plaintiff's patents are invalid, and that the plaintiff's patents are unenforceable due to prosecution laches and inequitable conduct. The court issued an order on
December 13, 2007 setting procedural deadlines for the claim construction and scheduling a Markman hearing in May 2008.
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