Patent lawsuit leads to claim of bribery

[Metropolitanjury]

Buried deep in the pleadings of a patent infringement lawsuit in Minneapolis is a rare glimpse into a world of corporate intrigue highlighted by allegations of bribery to grab a lucrative foreign contract for producing government identity cards.

The case shows how competitive the $1.2 billion-a-year world of personalized credit and identification cards has become, and it involves one of the market leaders, residing quietly in Minnetonka under the name DataCard Corp.

DataCard contends, and a federal judge agrees, that Card Technology Corp. of New Jersey inflated a contract with the Nigerian government to provide bribes to the officials running the identification program in order to win the business.

The court case remains unresolved, but last week U.S. District Judge Michael Davis ordered Card Technology to pay $34,555 for failure to produce a key Card Technology employee living in Germany who allegedly knew about the purported bribes.

In his ruling granting that sanction, Davis said he would "admit the following facts as established": that Card Technology approved a $3.5 million payment "to be used as bribes" for a contract in the Nigerian national identification project and that Card Technology knew that DataCard was in competition for the same contract and that Card Technology agreed to pay extra to land the job.

Attorneys for Card Technology responded to Davis' finding with alarm.

"The facts established as part of the sanction threaten significant irreparable harm to CT by disrupting the core of its business, which involves contracting with government bodies in the United States and abroad," wrote attorney David Allgeyer in a letter to Davis.

In a statement to the Star Tribune, Kirk Hamilton, CEO of Card Technology parent NBS Technologies, said: "NBS Card Technology denies any wrongdoing in connection with the Nigerian contract."

DataCard and its attorneys declined to comment on the litigation.

By Ms.Bobby Aanand, Metropolitan Jury.