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Meridian Wins $10.5 Million Verdict Against Carlson
By Patricia Odell
PROMO Xtra, Apr 1 2004
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Relationship management company Meridian Enterprises, Inc. has been awarded a $10.5 million judgement against Carlson Marketing Group, Inc. for patent infringement on its card-based incentive program.
Carlson plans to appeal the verdict.
The complaint alleged that Carlson, a competitor of Meridian, infringed on a patent for a card-based incentive system invented by Meridian in 1987. It received a federal patent for the product in 1991. The card is similar to a credit card and is used to reward employees with one point for each $1 spent toward a variety of purchases.
Carlson's sales-incentive programs, Trav Pass, Global Rewards, VIP and Ready Rewards were found by a federal jury in February to have illegally copied Meridian's card-based incentive program.
Carlson Marketing, Minneapolis, which specializes in relationship marketing, declined comment yesterday but did issue a statement: "Carlson Marketing Group has not infringed the patent in question. We also maintain that it is invalid and unenforceable. We believe that the verdict is wrong and we will appeal. Because the issue is still in litigation, we believe it is inappropriate to comment at this time."
Carlson licensed the use of the system from Meridian in February 1996 and then terminated that deal effective April 1997. The patent, known as the '372 Patent, has been licensed to multiple companies nationally, Meridian said.
"Our '372 Patent is a cornerstone for our business," Sam Toumayan, president of Meridian, said in a statement. "Had we not sought protection from this infringement, the value of the patent and our licensing capabilities would have been totally destroyed, effectively erasing more than a decade of effort we've invested."
The case was filed in December 2001 in the U.S. District Court Eastern Missouri Division in St. Louis.
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