Tech company NCR fights antitrust lawsuit over crypto ATMs

A bitcoin ATM is seen at a stand during the Bitcoin Conference 2022 in Miami Beach, Florida, U.S. April 6, 2022. REUTERS/Marco Bello/File Photo

(Reuters) – Banking and financial technology company NCR Corp has asked a California federal judge to dismiss a lawsuit from payment processing provider U.S. Alliance Group Inc alleging antitrust violations in the cryptocurrency ATM market.

NCR’s lawyers said in a court filing on Friday that California-based U.S. Alliance had only offered “bald and conclusory” allegations against NCR, and that the complaint, filed last month, failed to show sufficient factual allegations to prove any violations of competition law.

U.S. Alliance’s lawsuit alleged NCR’s purchases of ATM operator Cardtronics last year and Florida-based LibertyX, a cryptocurrency software provider, in January “cut out other ATM servicers and providers from the crypto-ATM space.” In Friday’s filing, NCR’s lawyers at Kilpatrick Townsend & Stockton defended the two deals as pro-competitive.

“Courts have repeatedly explained that mergers and acquisitions often have a negative impact on displaced suppliers and distributors, but that does not constitute antitrust injury, or make the transaction anticompetitive,” Kilpatrick partner Douglas Gilfillan wrote. “This is true even when the complaining entity is terminated and loses all the business.”

Gilfillan and a representative from Atlanta-based NCR on Tuesday did not immediately respond to messages seeking comment.

U.S. Alliance and a lawyer for the company, James Huber of Global Legal Law Firm, also did not immediately respond to similar messages.

The complaint alleged NCR’s acquisition of Texas-based Cardtronics and LibertyX “will lessen competition in the cryptocurrency ATM market” and lead to increased prices for merchants and customers. U.S. Alliance Group’s lawsuit said cryptocurrency ATMs entered the market in 2014 and allow consumers to buy or sell digital currency.

U.S. Alliance Group (USAG) alleged NCR last year “knowingly orchestrated a scheme to disrupt, interfere, and end USAG’s contractual alliances with LibertyX and Cardtronics.” The plaintiff said it lost money, business assets and market capitalization, as well as other vested interests in the ATM cryptocurrency market.

NCR’s attorneys said in filings that U.S. Alliance Group “alleged nothing more than the loss of existing contracts, which standing alone, does not demonstrate that a competitor has monopoly power.”

NCR also asserted the plaintiff had failed to specify a “plausible relevant market.” NCR said U.S. Alliance Group’s cryptocurrency ATM market “seems to be an amorphous soup of products and services provided to merchants and/or consumers.”

A hearing is scheduled for July 28 before U.S. District Judge Fred Slaughter in Santa Ana federal court.

The case is U.S. Alliance Group Inc v. NCR Corp, U.S. District Court, Central District of California, No. 8:22-CV-00980-FWS.

For U.S. Alliance Group: James Huber of Global Legal Law Firm

For NCR: Douglas Gilfillan of Kilpatrick Townsend & Stockton

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