Bank of America sued over "Keep the Change" program
By Jeremy M. Simon | Published: May 10, 2007
Bank of America is being sued by a Florida company over the bank's "Keep the Change" savings program.
Every Penny Counts Inc. is charging that BofA's savings program infringes on a patent obtained in 2000. Every Penny Counts stated that it spoke with Bank of America in 2004 and 2005 about licensing its "rounder patent." However, Bank of America launched "Keep the Change" on its own.
Under its "Keep the Change" program, BofA rounds up debit card purchases to the nearest dollar and deposits the extra amount into customers' savings accounts. According to a bank spokeswoman, 4.3 million BofA customers have saved $400 million through the program.
The goal of the program is to help customers put away extra change while encouraging debit card transactions, which earn the bank fees.
A lawyer for Every Penny Counts said his client desires a reasonable royalty for the business method it claims resulted in a significant amount of wealth for Bank of America and its shareholders. The lawyer added that EPC has been unable to put its patent to use.
Credit card network Visa is also named in the lawsuit, which was filed in January 2007.
In response, Bank of America said it plans to "vigorously" defend "Keep the Change." BofA called EPC's allegations "without merit," adding that the bank has a pending patent application associated with "Keep the Change" that reflects BofA-created innovations.
The bank had previously declined to comment on the lawsuit, although has said earlier that the idea for "Keep the Change" arose from a customer focus group.
BofA filed in own suit in March 2007, requesting a declaratory judgment in its favor.
To comment on this story, write Editors@CreditCards.com.
More credit card news.
- Equal Credit Opportunity Act: Protection from credit discrimination – An August 2017 discrimination settlement against American Express highlights why regulators and consumers need to be more wary ...
- Credit freeze costs come under fire – Following the data breach at Equifax, consumers, lawmakers ask: Why should we pay for credit bureau's blunder? ...
- Q&A: What to know, what to do about Equifax data breach – The data taken from credit bureau Equifax handed powerful tools for identity thieves, experts say. Here are steps to monitor your accounts and protect your identity from being hijacked ...