SAN FRANCISCO Jan 30 A professor in St. Louis
who says he helped come up with the idea that became
payments-company Square has filed a lawsuit against the company,
alleging fraud and patent infrigement and seeking unspecified
Robert E. Morley, a professor at Washington University in
St. Louis, filed suit in federal court in St. Louis on Thursday
against Square and its co-founders Jack Dorsey and James
"The business now known as Square was not created solely by
Jack Dorsey and James McKelvey," said the complaint. "It was
Professor Robert Morley - and Dr. Morley alone - who invented
the Square card reader, and Dr. Morley co-invented the
corresponding magnetic stripe," the complaint continued.
A Square spokesman said the company would fight the lawsuit.
"It's not surprising that Morley would file another
desperate, baseless patent lawsuit given how poorly his initial
claims have been received by the patent authorities," the
Patents at the heart of Square's technology have been
litigated for several years. McKelvey sued Morley and others in
2010, alleging that his name was left off crucial patents, and
Morley later countersued. That case is pending before the Patent
and Trademark Office.
In his new lawsuit, Morley argues that he, Dorsey and
McKelvey formed a joint venture to focus on a
smartphone-payments business, but then Dorsey and McKelvey
formed a new company and froze him out.
Square, widely considered an initial public offering
candidate for 2014, was valued at $3.25 billion at its last
funding round in 2012 and is now likely worth significantly
Disputes over startup origins are common in the Internet and
technology community. Many people tried to take credit for the
founding of Twitter. Facebook and photo-sharing
service Snapchat both have been the subjects of litigation
surrounding their creation.