Fintiv sues Apple in U.S. District Court for trade secret theft of ‘monumental’ scale

Fintiv sues Apple in U.S. District Court for trade secret theft of ‘monumental’ scale

Accuses it of falsely pretending to ‘partner’ with companies to steal confidential and proprietary information

Fintiv, Inc. has filed a complaint against Apple, Inc. in the U.S. District Court for the Northern District of Georgia, Atlanta Division, alleging ‘corporate theft and racketeering of monumental proportions’.

It accused the tech giant of pilfering its mobile wallet technology, predecessor, CorFire, as it was unable to develop it on its own.

Fintiv complained, “During 2011-2012, Apple representatives, under the guise of seeking a mobile payment business partnership with CorFire, had numerous meetings with employees. The parties had detailed technical discussions regarding CorFire’s implementation of its mobile wallet solutions and included information that CorFire uploaded onto an Apple maintained share site.”

However, later Apple abandoned its plans to partner with CorFire and used the information gathered during the meetings to launch Apple Pay in the U.S. in 2014, and globally, soon after.

Fintiv added, “Apple fraudulently induced CorFire to enter an NDA enabling Apple to gain access to CorFire’s mobile wallet technology and trade secrets. It then unlawfully exploited that access by incorporating into Apple Pay features previously found only in CorFire’s proprietary secure element and mobile wallet technologies that were protected as confidential trade secrets.”

The complaint further reads that Apple formed an enterprise with credit card processors and banks in order to cash in on Apple Pay, concealing the theft by “’fraudulently advancing the false narrative that it is the developer of Apple Pay.” The relationship with the companies that formed the enterprise led to ‘unlawful conduct’ on a ‘staggering’ scale.

It added, “Apple’s theft of Fintiv’s technology is part of a pattern and practice that Apple has engaged in for years: falsely pretending it wants to ‘partner’ with companies in order to steal confidential and proprietary information under the guise of a working relationship, and thereafter hiring away key employees, to steal the company’s valuable intellectual property and use it to commercialize the business on its own.”

Fintiv cited similar partnership schemes Apple engaged in with Masimo over blood oxygen monitoring technology and with biotech company Valencell, Inc. over heart-monitoring technology.

In a statement, Marc Kasowitz of Kasowitz, LLP, and Fintiv s lead lawyer, said, “Apple’s actions are a colossal case of wrongdoing. It is one the most egregious examples of corporate malfeasance I have seen in 45 years of law practice.”

Fintiv’s claims are brought under the Racketeer Influenced and Corrupt Organizations Act (RICO); the Georgia Racketeer Influenced and Corrupt Organizations Act; the Defend Trade Secrets Act (DTSA); and the Georgia Trade Secrets Act.

Fintiv has been engaged in litigation over its mobile wallet technology for several years.

Recently, PayPal defeated Fintiv’s appeal of a district court decision scrapping the latter’s patent infringement claims against it.

The Court of Appeals for the Federal Circuit (CAFC) also delivered a win for Apple when it dismissed Fintiv’s appeal of a Patent Trial and Appeal Board holding that claims 1–3 of the ‘386 patent were unpatentable. However, in May, the Federal Circuit reversed a district court’s decision granting summary judgment of non-infringement for Apple in Fintiv’s U.S. Patent No. 8,843,125.