PayPal Sues Google Following Google Wallet Launch

    May 27, 2011
    Chris Crum

Google unveiled Google Wallet yesterday, and it’s already gotten the company a lawsuit. It comes from PayPal, and names two Google executives – Osama Bedier and Stephanie Tilenius, both of which used to work at eBay, and worked on extensively on PayPal.

The suit has actually been in the works for some time, and alleges that Bedier stole confidential information from PayPal and that Tilenius violated contractual obligations. Bloomberg reports:

PayPal also alleges that Bedier, who left the company in January, discussed a job with Google while simultaneously leading negotiations to make PayPal a payment option on Google’s Android Market. He didn’t disclose the job-related talks, a breach of his fiduciary duty, the company said.

Tilenius, who left EBay in 2009, was under contract not to recruit employees, PayPal said. She messaged Bedier on Facebook Inc.’s social-networking Web site, telling him she had a “HUGE” opportunity for him, and sent him e-mails and text messages offering advice while he interviewed for a position, according to the complaint.

The suit itself says Bedier “is now leading Google’s efforts to bring point of sale technologies and services to retailers on its behalf,” and that “Bedier and Google have misappropriated PayPal trade secrets by disclosing them within Google and to major retailers.”

Google Wallet lets users store credit cards, coupons, loyalty, and gift cards on a smartphone, and uses near field communication technology, enabling tap to pay functionality. Google has partnership with Citi and MasterCard in place.

It has been well established that competition in the mobile payments space is going to continue to get fiercer, and with Google officially in the game, things are already getting much more interesting. Wait until Apple and Facebook make their marks in physical world payments. And let’s not forget Square, which just launched Card Case, which allow consumers to use tabs for payments.

PayPal, a leader in the payments space, needs to break out every line of defense it can as the industry in which it’s been pretty comfortable in for quite some time is becoming greatly disrupted at a rapid pace. Tricia Duryee at All Things Digital brings up an interesting point, saying that PayPal is on track to become bigger than its parent company eBay.

Google has yet to comment on the suit.


Chris Crum
Chris Crum has been a part of the WebProNews team and the iEntry Network of B2B Publications since 2003. Follow Chris on Twitter, on StumbleUpon, on Pinterest and/or on Google: +Chris Crum.