WEST HOLLYWOOD, CA (PRWEB) September 7, 2004
AmericanFone, LLC a leading reseller of telecommunications services, announced today that it has filed a lawsuit against iPayments, Inc (NASDAQ: IPMT) for impeding its business operations. The lawsuit, filed in California Superior Court, County of Los Angeles seeks to recover compensatory and punitive damages totaling $21,000,000.
The lawsuit alleges when iPayments learned a former investor was starting a new business, AmericanFone, which used iPayments for credit card processing, they immediately and without business justification stopped processing credit card transactions for AmericanFone and froze AmericanFoneÂs reserves. As a result, AmericanFone was left without operating capital and had to scramble to find new credit card processing.
AmericanFone eventually did obtain new processing capabilities but at a significantly higher cost and with additional expenditure of resources. Furthermore, the suit alleges that iPayments knew when it stopped processing credit cards it would devastate AmericanFoneÂs business and that was iPayments intention.
Gary H. Hickox, President and CEO, said, ÂWe were shocked when iPayments said they would stop processing. Our returns were well within VISA and MasterCard norms. I have been in this business over twenty years, and there was no logical reason demonstrated for these actions. Then it hit me Âour founder had formed the company that became iPayments and this appeared to be an attempt by iPayments to derail his future success.Â
IPayments, Inc is already being sued on behalf of its investors and its investment bankers for fraud and unfair business practices. IPayments is now being sued for interfering with the business operations of a former investor.
About AmericanFone, LLC
AmericanFone, LLC, is a switchless reseller telecommunication services, including Long Distance Toll-Free, Calling Card and Conferencing services. It offers services to both residential and business customers through its e-commerce platform. The e-commerce platform utilizes advanced online and web-enabled customer relationship management, billing and information systems. By utilizing the technologies of the Internet, AmericanFone is able to offer customers seamless provisioning and maintenance of their own telecommunication services.
Contacts: Miles Woodlief, 415-730-3032
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