PayPal transfers $7.5 Million to Vancouver company in patent dispute

by Rob Lewis

Yesterday LML Patent Corp. Inc., a fully owned U.S. subsidiary of Vancouver-based LML Payment Systems Inc., announced they will receive $7.5 million after settling patent disputes with PayPal. The settlement and licence agreement is payment to allow PayPal to use LML's technology for electronic cheque conversion transactions.

Many of our readers may not be familiar with LML, but you've likely heard of their main subsidiary - Beanstream Internet Commerce.  In 2007 LML acquired Victoria's Beanstream - a provider of authentication and Internet payment processing solutions.

At first glance this is great news for the Vancouver company. But if you dig a little deeper, you'll see that LML is hardly new to collecting on patent infringements.

LML had filed a lawsuit in the Texas court alleging 25 banks and payment processors had infringed a patent related to LML’s system. The lawsuit alleges theses companies infringed a patent related to a point-of-sale system, which is designed to read information from a cheque or credit card and verify the customer has an appropriate balance.

Including the PayPal settlement announced yesterday, LML has collected $28 Million to date from seven banks and payment processers settling patent disputes. In addition to PayPal, the following have settled.

With 18 banks and payment processors yet to settle and an average settlement of $4 Million, at the end of the day this lawsuit could be worth over $100 Million to LML.

It shouldn't come as a surprise that some accuse LML of being a patent troll but 14 years is a long time to wait to cash in.

Company:
Beanstream Internet Commerce
Location:
Victoria, British Columbia, Canada

Beanstream is a privately held company located in Victoria, British Columbia, Canada. We provide payment, risk management and authentication services to more than 5000 businesses and organizations in Canada and the United States. Our client list includes the leading businesses and organizations in every merchant sector in the country in addition to many small and mid-sized businesses. We are... more

Company:
LML Payment Systems
Location:
Vancouver, British Columbia, Canada

We are a leading provider of financial payment processing solutions for e-commerce and traditional businesses. Through our subsidiaries Beanstream Internet Commerce Inc. and LML Payment Systems Corp., we provide credit card processing, online debit, electronic funds transfer, automated clearinghouse payment processing and authentication services, along with routing of selected transactions to... more

Company:
PayPal
Location:
Toronto, Ontario, Canada

At PayPal, we put people at the centre of everything we do. Founded in 1998, we continue to be at the forefront of the digital payments revolution, processing almost 11.5 million payments for our customers per day. With our 162 million active digital wallets, we have created an open and secure payments ecosystem where people and businesses choose to securely transact with each other online, in... more


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Rob Lewis

Rob Lewis

Rob is the President of Techvibes Media and Editor-in-Chief of Techvibes.com.  His diverse background includes stints in International Trade Finance, Web Development, and Enterprise Software and he is a graduate of the University of British Columbia, British Columbia Institute of Technology, and Simon Fraser University. When not running Canada's leading technology media property, Rob can be... more




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