The first day of a North Gauteng High Court patent infringement civil case brought against Standard Bank, MTN and MTN Banking, a joint venture between the bank and the cellular network operator, was dominated by legal and technical arguments yesterday.
Standard Bank and MTN, with their mobile banking venture, are alleged to have infringed on an invention by small South African company 3MFuture Africa that permits secure and fraud-proof credit card payments to be made to remote merchants via the internet or telephone.
The invention apparently allows consumers to switch their card on before making a payment and the card is automatically switched off again afterwards, preventing it from being misused by fraudsters.
Standard Bank and MTN claim the invention is not new and that the patent is therefore invalid and subject to revocation.
Judge TM Makgoka adjourned the case until today to hear argument about a few preliminary aspects before the trial commences.
This followed Cedric Puckrin, counsel for 3MFuture Africa, stating he had not previously been advised about a legal point that was being raised by Peter Ginsburg, counsel for both MTN and MTN Banking, that was not in court papers and for which he had not prepared himself for argument.
Puckrin said confusion was the art of defence and these defendants were past masters of this.
The applications related to 3MFuture Africa amending its pleadings to the counter claim of the defendants; an application by Standard Bank regarding security of costs; and an application to set aside subpoenas issued to Standard Bank officials.
Puckrin indicated the application to amend 3MFuture Africa’s pleadings was being withdrawn but counsel for Standard Bank, MTN and MTN Banking said this application could only be withdrawn with the consent of the court.
The application by Lionel Bowman, counsel for Standard Bank, for security of costs was settled on the basis that punitive costs associated with the trial would be sought at its conclusion.
The subpoenas against two Standard Bank officials were withdrawn, but the costs associated with this abandoned application still needed to be decided by the court.
Ginsburg said the application by MTN and MTN Banking struck at the root of 3MFuture Africa’s application, adding that 3MFuture Africa’s patent had three, perhaps four, invalid claims.
He said if MTN and MTN Banking’s application was successful, there would be no point in wasting the court’s time and hearing 3MFuture Africa’s application.
The case has been set down for 10 days in court.
Judge Makgoka said it appeared to him to be convenient to fully hear the preliminary points that were to be raised by Ginsburg on behalf of MTN and MTN Banking, but it appeared Puckrin had not been given notice of this application and should be given an opportunity to prepare himself.