PayPal transfers $7.5 Million to Vancouver company in patent dispute

Posted 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
Website:
http://www.beanstream.com
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 generally regarded as... more

Company:
LML Payment Systems
Website:
http://www.lmlpayment.com/
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 third party... more

Company:
PayPal
Website:
http://www.paypal.ca
Location:
Toronto, Ontario, Canada

At PayPal, we put people at the center of everything we do. Founded in 1998, we continue to be at the forefront of the digital payments revolution, giving people direct control over their money. Through our innovations, we make life better for our over 148 million active accounts in 26 currencies and across 203 markets, processing more than 9 million payments daily. An eBay Inc.(Nasdaq: EBAY) company, PayPal is... 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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