On the day Google, Citi, MasterCard, First Data and Sprint announced and demonstrated the much anticipated Google Wallet, the former was hit by a PayPal lawsuit

PayPal filed the suit in California against Google and two former executives, Osama Bedier and Stephanie Tilenius, claiming that the search giant hired them to obtain trade secrets during work on the Google Wallet project.

On the PayPal blog, Amanda Pires, senior director, PayPal global communications, wrote: “Spending time in courtrooms is generally not our thing. We prefer to compete and innovate, serving our customers by offering the best way to pay and be paid. That’s how you really win. But sometimes the behaviours of people and competitors make legal action the only meaningful way for a company to protect one of its most valuable assets - its trade secrets.”

Google Wallet turns a phone into a wallet so consumers can tap, pay and save money and time while they shop. “Today, we’ve joined with leaders in the industry to build the next generation of mobile commerce,” said Stephanie Tilenius, vice president, commerce and payments, Google, at an event to launch and demonstrate the wallet. “With Citi, MasterCard, First Data and Sprint we’re building an open commerce ecosystem that for the first time will make it possible for you to pay with an NFC wallet and redeem consumer promotions all in one tap, while shopping offline.”

Google Wallet is currently in a field test and will be available to consumers this summer. At the aforementioned event, Google, Citi, MasterCard, First Data and Sprint invited additional issuing banks, payment networks, mobile carriers, handset manufacturers, point of sale systems companies and merchants to join the initiative. The first release is expected to be on the Nexus S 4G on the Sprint network. Additional devices with NFC capabilities will follow.

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