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Friday, May 27, 2011
PayPal And Ebay File Lawsuit Against Google

Just a few hours after Google announced the "Google Wallet," eBay and PayPal filed a lawsuit charging the Internet giant tapped into trade secrets for the mobile payments project.

In court documents filed in the Superior Court of the state of California, PayPal, a wholly-owned subsidiary of eBay, claims that it spent three years trying to work out a deal in which it would handle payments for Android smartphones, to see Google scuttle the talks and hire PayPal lead negotiator Osama Bedier.

"Sometimes the behaviors of people and competitors make legal action the only meaningful way for a company to protect one of its most valuable assets - its trade secrets," said Amanda Pires, Senior director, PayPal global communications.

"We spend a lot of time and energy creating the things that make PayPal unique and a preferred way to pay for almost 100 million people around the world. We treat PayPal's 'secrets' seriously, and take it personally when someone else doesn't. So we made a decision today. We filed a lawsuit against Google and two former colleagues who now work there, Osama Bedier and Stephanie Tilenius," she added.

Defendant Osama Bedier worked for PayPal from December 2002 23 until January 24, 2011. At the time of Bedier's departure from PayPal, he served as Vice 24 President of Platform, Mobile, and New Ventures. Bedier now fills a similar role at Google.

"He is now leading Google's efforts to bring point of sale technologies and services to retailers on its behalf. In the course of his work at Google, Bedier and Google have inisappropriated PayPal trade secrets by disclosing them within Google and to major retailers," PayPal said in the court documents.

Defendant Stephanie Tilcnius also worked at eBay from 2001 to October 28 16, 2009. At the time of Tilenius' departure from eBay, she served as eBay's Senior Vice President of North America and Global Products. Before this, she filled various positions at eBay and PayPal, including Vice President of PayPal Merchant Services from January 2004 to January 2008. Tilenius worked for eBay pursuant to a Consulting Agreement from October i6, 2009 until March 3, 2010. Google hired Tilenius as its first Vice 5 President of Electronic Commerce on February i6, 2010.

"Google hired Bedier after another former eBay executive, defendant Stephanie Tilenius, solicited and recruited him. By doing so, Tilenius violated her contractual obligations to eBay. Before and since his arrival at Google, Bedier has also violated his obligations to eBay by soliciting and recruiting PayPal employees to work at Google," the document reads.

"By hiring Bedier, with his trade secret knowledge of PayPal's plans and understanding of Google's weaknesses as viewed by the industry leader, Google bought the most comprehensive and sophisticated critique of its own problems available," the court filing said.

"Google put Bedier in charge of its mobile payment business, virtually ensuring that Bedier would misappropriate PayPal's trade secrets concerning planning and competitive assessments in mobile payment."

PayPal called on the state court in the California county where both companies are based to order Google to "undo" the misuse of trade secrets and pay unspecified damages.

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