Fintiv Files RICO and Trade Secret Misappropriation Suit Against Apple Stemming from Alleged Theft of Mobile Wallet Technology Used to Create Apple Pay

AUSTIN, Texas--(BUSINESS WIRE)--Fintiv, Inc., a global leader in patented, digital wallet ecosystems, announced today the filing of a civil lawsuit against Apple, Inc. in the Northern District of Georgia, Atlanta Division, alleging violations of the Racketeer Influenced and Corrupt Organizations (RICO) Act, Georgia's RICO Act, The Defend Trade Secrets Act, and Georgia's Trade Secret Act. The lawsuit, filed by Kasowitz LLP, alleges that Apple engaged in a pattern of racketeering activity, including wire fraud and trade secret misappropriation, in furtherance of a scheme to steal Fintiv's proprietary mobile wallet technology and trade secrets that Apple used to create Apple Pay, a service that generates billions in annual revenue and has been a major force in growing Apple's market valuation to more than $3 trillion.

As alleged in the complaint, Apple approached CorFire (Fintiv's predecessor) more than a decade ago under the pretense of forming a mobile payment business partnership. Between 2011 and 2012, it is alleged, Apple attended multiple meetings with CorFire representatives and received confidential technical information under non-disclosure agreements (NDAs). The purpose of those meetings was to enter into an agreement in which Apple would license CorFire's mobile wallet technology, for which CorFire would receive licensing fees, according to the complaint. Instead, it is alleged, Apple stole Fintiv's confidential information and later hired away key CorFire employees, before launching Apple Pay in 2014. Fintiv asserts in the court filing that Apple Pay's core features including secure element technology, NFC technology, and trusted service management platform were based on CorFire's innovations.

The complaint further alleges that Apple, in order to convert Fintiv's stolen mobile wallet technology and trade secrets into cash, set up a fence by forming an association-in-fact enterprise with leading credit card issuing banks, like JP Morgan Chase and Citibank, and payment processing networks, like Visa and Mastercard, for the purpose of enabling and processing the billions of transactions and trillions in payments that Apple Pay users engage in annually. By utilizing Fintiv's stolen mobile wallet technology and trade secrets in Apple Pay, it is alleged Apple and the other RICO enterprise members earn tens of billions each year servicing the Apple Pay transactions.

"The scale of Apple's unlawful conduct has been staggering," the complaint alleges. "By modifying Apple Pay for use on four separate categories of its devices, Apple has repeated and compounded its theft by knowingly utilizing Fintiv's stolen technology in the hundreds of millions of iPhones, iPads, Apple Watches and MacBooks it has sold worldwide," the complaint alleges.

As further alleged in the complaint, "Apple Pay is the engine" that drives the RICO Enterprise. "Without the on-going benefit of Fintiv's stolen mobile wallet technology and trade secrets," the ability of Apple "to generate billions utilizing Apple Pay would be severely compromised."

The complaint further alleges, "Apple's theft of Fintiv's technology is part of a pattern and practice that Apple has engaged in for years – falsely pretending 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, all in order to steal the company's valuable intellectual property and use it to commercialize the business on its own."

As examples, the complaint cites "a similar pernicious scheme" to steal trade secrets from Masimo Corp. "which had developed non-invasive technology related to blood oxygen monitoring which Apple believed was key to overcoming performance issues with its Apple watch." Apple, it is alleged, perpetrated a similar scheme against a biotech company named Valencell Inc., where it entered into discussions and negotiations under the guise of seeking to license Valencell's active heart- monitoring technology. Apple's alleged scheme was – as with Fintiv and Masimo – not to partner or license with Valencell, but to steal Valencell's technology and incorporate it into Apple's own products, which Apple then marketed and sold on its own without paying a nickel to Valencell," according to the complaint.

Likewise, according to the allegations in the complaint, Apple never licensed Fintiv's trade secret and proprietary mobile wallet technology but has realized tens and tens of billions of dollars in value and revenues from Apple Pay.

Marc Kasowitz, Fintiv's lead lawyer, calls Apple's alleged theft of trade secrets from Fintiv and its on-going racketeering, as the complaint alleges, "a colossal case of wrongdoing that is one the most egregious examples of corporate malfeasance I've seen in 45 years of law practice. By this action, Fintiv intends to hold Apple responsible for the full extent of its alleged illegal activities."

About Fintiv

Fintiv, a global leader of patented, white labeled Web2 to Web3 digital solutions for merchant payments, cross border and digital asset tokenization having deployed over 100 ecosystems in more than 35 countries. Fintiv has built one of the most significant and relevant patent portfolios globally and is now managing over 150 patents. Learn more at https://fintiv.global