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Mastercard Inc. is facing a legal battle as Massachusetts-based technology startup OV Loop Inc. files a lawsuit against the payments giant. The lawsuit, filed in Boston federal court, accuses Mastercard of obstructing its efforts to develop a “universal” digital wallet solution that can seamlessly operate across various mobile device platforms.
Allegations of Antitrust Violations
OV Loop Inc. seeks over $75 million in damages under U.S. antitrust law, alleging that Mastercard has unfairly denied it access to crucial digital payments technology. The lawsuit claims that Mastercard selectively grants access to tokens necessary for competing in the digital wallet market, akin to those utilized by Apple Pay, Google Pay, and Samsung Wallet.
Company Ambitions and Investment
Will Graylin, founder and chairman of OV Loop Inc., emphasized the ambitious nature of their project. Graylin, known for his involvement in launching Samsung Pay, argues that Mastercard’s actions lack business justification and hinder fair competition.
Legal History and Industry Comparison
This is not the first legal confrontation between OV Loop Inc. and Mastercard. Previously, OV Loop sued Mastercard in Manhattan federal court over patent infringement related to cloud-based card transactions. Graylin’s company aims to develop a comprehensive “super app” for digital commerce, drawing parallels to India’s Paytm app.
Impact on Emerging Technology Companies
OV Loop Inc. accuses Mastercard of engaging in “exclusionary conduct,” resulting in lost profits and missed business opportunities. The lawsuit portrays Mastercard as leveraging its dominance to suppress emerging technology firms that pose a threat to its payment processing networks.
Contrasting Approach: Visa’s Involvement
While OV Loop Inc. criticizes Mastercard’s actions, it notes a comparatively more cooperative stance from Visa. Graylin suggests that Visa has been more open in their dealings, although Visa is not involved in the lawsuit.
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Legal Proceedings
The case, titled OV Loop Inc. v. Mastercard Inc., is filed in the U.S. District Court for the District of Massachusetts. Lawrence Green of Burns & Levinson, Edward Kang of Kang Haggerty, and Oliver Griffin of Griffin Partners represent the plaintiff, while there has been no appearance from the defendant yet.
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