Tyro to settle court action with key rival

Tyro, settlement, court, Kounta

Aussie paytech firm Tyro has announced its intention to settle court action against rival Kounta, a rival point-of-sale (POS) terminal and software developer, after an alleged attempt by the Canadian firm to poach terminal clients from Tyro in the hospitality sector.

As part of the settlement terms, Tyro will be awarded $10 million with the Court’s judgement to be entered in its favour.

Kounta’s appeal, filed in late November 2023, will also be dismissed. This follows a December ruling by the Court that had found Kounta had “breached its contractual and fiduciary obligations to Tyro”.

Initiating proceedings in the NSW Supreme Court last September, Tyro alleged that Kounta had breached its “contractual non-solicitation obligations”, by attempting to sell its new Lightspeed terminals to certain Tyro customers.

Kounta was also alleged to have increased charges for its customers using its POS software if they also kept Tyro’s terminals.

In a statement issued to the Australian Securities Exchange (ASX) last September, Tyro said it had “become aware that Kounta is marketing to Tyro merchants and encouraging them to adopt Lightspeed Payments as their payment solution, including through the imposition of new fees for merchants using a Lightspeed Group POS solution that do not adopt Lightspeed Payments”.

Kounta, founded in Sydney Australia in 2012, was acquired by Canada-based Lightspeed POS Inc. in late 2019, and offers Lightspeed-branded terminals to Australian merchants.

Tyro said that Kounta’s conduct “directly [breached]” its obligations to it, “including its contractual obligations as Tyro’s agent”.

Tyro said it had attempted, before Court action, to resolve the matter commercially with Kounta, however the parties could not reach an adequate resolution that was acceptable to Tyro.

Reinforcing an order issued by the Court on 16 November, Kounta, as part of the settlement terms, will be restricted from “soliciting, inducing, or otherwise attempting to persuade an agreed list of mutual merchants” of both businesses to “become a merchant of any other entity providing acquiring services”.

Targeting the retail, e-commerce and hospitality sectors, the Apple iPad-integrated Lightspeed terminal enables businesses to accept payments from credit cards, debit cards and contactless methods, as well as provide various cashflow management services.

Kounta states that its terminals are used within 10,000 venues across Australia and New Zealand.

The Sydney-based Tyro boasts 68,000 merchant customers in Australia. The firm’s share price jumped 5.2 per cent on news of the settlement, hitting a four-month high of $1.21.