Having finally worked its fraud and underwriting issues to a commercial conclusion, Square got underway just a few months ago. Now the company is in a patent dispute with one of the inventors of Square’s magnetic card reader. Apparently, one inventor’s name is on the patent and the other, Square’s Chairman, is not. That means critical IP is not under Square’s control. It’s all because the parties couldn’t decide on how much Square stock the patent holder should have. It would have been better to have that one, with apologies, squared away beforehand. Oops.
To be more precise, the subject of the lawsuit is the fact that McKelvey – who serves as Square’s Chairman – is not listed as a co-inventor of U.S. patent no. 7,810,729, entitled “Card reader device for a cell phone and method of use”.
Read the TechCrunch post and the court filing here: http://techcrunch.com/2010/12/02/jack-dorseys-square-embroiled-in-nasty-litigation-over-card-reader-patent/