Eight weeks of trying to convince a jury that one of the country’s largest banks wiped out a start-up credit card processing company came to nothing on Wednesday.
Following a complex trial that began in late January, the Jackson County jury returned a defense verdict for U.S. Bank and Multi Service Corp. The plaintiffs had sought approximately $60 million in compensatory damages and at least twice that amount in punitive damages.
Lead defense attorney Peter Carter, of Dorsey & Whitney in Minneapolis, Minn., said his clients were gratified by the result.
“We appreciate the jury’s service in a long and complicated case,” he said. “We have always believed that the claims had no merit, and this verdict is a strong validation of that belief.” Also representing the defense were Jim Wyrsch and Keith Drill, of Wyrsch Hobbs & Mirakian
Todd Graves, of Graves Bartle & Marcus, represented Pier to Pier. Although the verdict was not in his favor, he said he has no regrets.
“There’s nothing we’d do differently,” he said. He said no decision had been made to appeal the case or not.
Pier to Pier created an e-commerce-based credit card processing system targeting the general aviation industry. Its lawsuit, filed in December 2006, claimed U.S. Bank and Multi Service worked together to monopolize the credit card processing industry by promising to use the company’s technology and then putting it on a shelf.
According to court documents, Pier to Pier’s software was licensed to a company called PerfectStop, which formed a partnership with Overland Park-based Multi Service in November 2004. Multi Service was to pay PerfectStop $2 million and promised to incorporate the Pier to Pier system into its existing payment processing solution.
However, the lawsuit said, U.S. Bank and Multi Service had already executed a letter of intent that U.S. Bank would acquire Multi Service’s general aviation market. The acquisition was completed in February 2005.
The bank never implemented the Pier to Pier system. In court documents, the defendants said they had concerns about the Pier to Pier system and alleged problems inside the company, including a lack of money and poor management.
“It really had to do with whether this product was ready for market,” Wyrsch said.
The trial featured about 20 live and videotaped witnesses. Judge Edith Messina’s fifth floor courtroom in the Jackson County Courthouse had a standing order on the door that it was not to be cleaned at night, and banker’s boxes filled the benches.
As if the amount of information in the case wasn’t complicated enough, a simultaneous arbitration on the same facts made the case more difficult, Graves said. PerfectStop had been engaged in mandatory arbitration with U.S. Bank and Multi Service. A decision favoring the defendants came back last week.
Wyrsch said the defense argued that the arbitration decision should have been binding on Pier to Pier’s case in state court. As it turned out, both the arbitrators and the jury came to the same conclusion.
Graves said that to avoid some of the issues being decided in arbitration, the plaintiffs had to be “fairly aggressive in our pleadings.”
“At the end of the day, the jury instructions, we were told by the jurors, were just a bridge too far,” he said. “We weren’t able to reach it.”
The case is Pier to Pier v. U.S. Bank, 0616-CV33734.