Visa 2008 Annual Report Download - page 194

Table of Contents
VISA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
September 30, 2008
(in millions, except as noted)
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. The appeal was denied on December 18, 2007.
On March 14, 2008, Visa International filed an extraordinary appeal of the preliminary injunction ruling with the Commercial Chamber of the Supreme
Court. On August 6, 2008, the Commercial Chamber of the Supreme Court accepted Visa International's appeal and declared null and void the decision from
the Superior Tribunal that dismissed Visa International's earlier appeal against the preliminary measures granted by the First Instance Tribunal. Pursuant to the
Supreme Court's order, a new Superior Tribunal will issue a new decision on the appeal against the preliminary measures.
Starpay and VIMachine
On May 8, 2003, Starpay and VIMachine sued Visa U.S.A. and Visa International in U.S. District Court for the Northern District of Texas, claiming
that Visa used information provided by Starpay in 2000 to create VbV and to file a Visa patent application on the technology underlying VbV. Two claims are
asserted: infringement of VIMachine's patent and misappropriation of Starpay's trade secrets. On February 23, 2004, Visa U.S.A. and Visa International
answered the complaint and filed a counterclaim for a declaratory judgment that Visa U.S.A. and Visa International are not infringing the asserted patent and/
or that the patent is invalid. On March 16, 2004, Starpay filed its answer to Visa U.S.A. and Visa International's counterclaim.
The Magistrate Judge held hearings on the issue of the construction of various claims of the patent and on January 19, 2006 issued a Report and
Recommendation making findings and recommendations. In February 2006, the parties filed their respective objections to the Report with the District Court
Judge. On September 10, 2007, the District Court issued an order resolving the parties' various objections and finalized the claim construction. The court has
set a schedule that calls for the completion of discovery by April 18, 2008 and the filing of any dispositive motions by May 16, 2008. No trial date has been
set.
On January 7, 2008, Visa U.S.A. and Visa International filed a Motion for Partial Summary Judgment of Non-Infringement and/or Invalidity of U.S.
Patent No. 5,903,878 ("the 878 patent"). The motion was made on the grounds that (1) the accused VbV system lacks the "unique transaction identifier"
element of the claims of the 878 patent; and (2) the 878 patent is invalid in light of at least three prior art patents.
The parties reached an agreement in principle to settle the dispute in January 2008. On May 16, 2008, Visa U.S.A. and Visa International filed a Motion
to Enforce the Settlement Agreement against all parties to the agreement, including the inventor. Briefing is now complete. If the settlement agreement is
enforced, the amount of the settlement is not material to the Company's financial statements taken as a whole.
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
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