Court Says Gap Didn’t Infringe on Gift Card Patents (July 2, 2013)
July 2, 2013
Patent-holding company Alexsam Inc. has been dealt another court defeat in its series of lawsuits against a group of retailers the company claimed infringed on its prepaid gift card patents. Last Friday, a federal jury in Marshall, Texas, ruled that Gap Inc. did not infringe on the technology covered by the patents—which deal with the activation and recharge of prepaid gift cards—rebuffing Alexsam’s request for $34.5 million in royalties.
The one-week trial was the second to take place in U.S. District Court in Marshall over the patent-infringement claims, first brought by Alexsam in 2010 against a group of retailers, including Best Buy, JC Penney, McDonald’s and Home Depot. Last month, a jury ruled that Barnes & Noble did not infringe on the patents. A trial is still pending for Home Depot, while Best Buy reached a settlement with Alexsam in May.
The defendant companies initially joined together in a bid to have the suit thrown out over misstatements Alexsam allegedly made during a 2010 review of the patents, which were issued in 1999 and 2001. The defendants also claimed the patents did not cover an entirely new idea when granted, and thus should be invalidated. In early May, a federal jury in the Eastern District of Texas upheld the patents, freeing Alexsam to move forward with its suits against the individual merchants.