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Providian Fires Back In Online Credit Card Lawsuit

By Robert Conlin & James Hollander
Jul 16, 1999 12:00 AM PT

When it comes to two companies fighting it out for industry supremacy, the traditional sanctity of the court gives way to the immediacy of the press.

Providian Fires Back In Online Credit Card Lawsuit

San-Francisco-based Providian Financial Corp. responded Friday to NextCard's Thursday press release announcing they filed a lawsuit against Providian by saying the suit "is totally without merit."

Both Providian and NextCard market credit cards for Internet purchases. NextCard claims that over two million people have applied for its Internet Visa since 1997, while Providian, a relative newcomer to the business, offers consumer credit through its Aria Visa credit card and consumer loan site, GetSmart.

A Tale of Two Clicks

Thursday, NextCard said it had filed a lawsuit against Providian claiming copyright infringement and unfair business practices. The company said Providian copied one of its banner advertisements to drive consumers to its own site.

Friday, Providian VP for E-Commerce, James Rowe, disputed those claims, saying that the image in question - a thermometer - was not unique to NextCard.

"This lawsuit is totally without merit and we intend to defend ourselves vigorously," Rowe stated. "We have no reason to believe that consumers associate thermometers uniquely with any company or product. The banner in question was tested for a one-week period in July and then discontinued. As one of over 20 banners tested by our Aria.com credit card site, it resulted in less than 3 percent of total visits since our successful May launch."

NextCard claimed that it tried to settle the issue amicably with Providian before filing the suit, but the company refused to do so.

What makes this online legal spat spicier than most is that NextCard CEO, Jeremy Lent, used to be Providian's chief financial officer.

While Providian is a newcomer to the Internet credit card business, it is not a neophyte in the traditional consumer credit industry. The 10th largest credit card issuer in the U.S., it has $16 billion (US$) under management.

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salesforce commerce cloud
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salesforce commerce cloud
salesforce commerce cloud