nFinanSe Seeks to Halt New Debit Card Network by InComm, Alleges Price-Fixing Conspiracy

ATLANTA, Jan. 17, 2012 /PRNewswire/ -- nFinanSe, Inc. (OTCBB: NFSE)( www.nFinanSe.com),  a leading provider of general purpose reloadable (GPR) prepaid debit cards, today filed a motion for preliminary injunction to prevent card distributor Interactive Communications International, Inc., or InComm, from operating its new Vanilla Reload Network because the network constitutes an illegal price-fixing conspiracy.

In the motion, nFinanSe argues that the injunction is necessary to protect consumers from price-fixing by InComm and to prevent harm to nFinanSe's business. The motion further alleges that InComm's Reload Network is illegal under federal antitrust law because it requires competitors – other prepaid card providers – to fix the reload price paid by consumers for GPR cards that would otherwise compete on price.

"InComm has not only caused nFinanSe to suffer lost business opportunities and exclusion from key markets," nFinanSe argues in its motion, "but it has threatened to sever the parties' entire business relationship and effectively drive nFinanSe out of business for nFinanSe's refusal to participate in... a Network that InComm could not lawfully form and that nFinanSe could not lawfully join."

On Oct. 31, 2011, nFinanSe, of Tampa, FL, filed an antitrust suit (Case No. 1:11-CV-3728) in U.S. District Court in Atlanta against Atlanta-based InComm, accusing it of trying to coerce nFinanSe into joining its new network and of punishing nFinanSe when it refused to join.

nFinanSe's prices for the increasingly popular cards are widely recognized as the lowest in the industry, which totals approximately $100 billion in annual funds loaded. In order to join the Vanilla Reload Network, nFinanSe would have had to agree to raise its reload fee from $2.95 to $3.95 – the uniform fee that the brief alleges all network participants must charge. nFinanSe recognized that it was illegal for competitors to fix prices and so refused to join. The motion alleges that, in retaliation, InComm has refused to distribute nFinanSe's cards to new retail outlets, in violation of its longstanding distribution contract, and is threatening to stop distributing all nFinanSe cards.

InComm is the industry's largest distributor of cards and it also provides cards of its own that compete directly with nFinanSe's. nFinanSe, which relies on InComm to distribute 90% of its GPR cards, contends that InComm saw nFinanSe's low fees as a threat to its own higher-priced cards and so wielded its dominant market position as a sledgehammer.

"Even though nFinanSe declined InComm's invitation to join the Reload Network, nFinanSe has not escaped its consequences," the motion alleges. "Because nFinanSe rejected InComm's demands that nFinanSe raise its prices, including by joining the Reload Network, InComm has breached the parties' distribution contracts and threatened to dissolve the parties' business relationship, which will exclude nFinanSe's competing GPR cards from vast retail market segments."

InComm touts the Vanilla Reload Network as a way to improve efficiency and provide retailers who sell GPR cards with a common platform through which they can offer reloads for the cards. nFinanSe argues that there is no business reason to require network participants to charge uniform prices.

"Safe Harbor" Statement under Private Securities Litigation Reform Act of 1995

This press release contains certain forward-looking statements based on nFinanSe Inc.'s, or, the Company's current expectations, forecasts and assumptions that involve risks and uncertainties. Forward-looking statements include statements regarding the Company's expectations, beliefs, intentions or strategies regarding the future and can be identified by forward-looking words such as "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "should," "will," and "would" or similar words and include statements regarding the anticipated benefits of the Company's products and the anticipated roll out of the Company's products. Forward-looking statements in this release are based on information available to the Company as of the date hereof. The Company's actual results may differ materially from those stated or implied in such forward-looking statements due to risks and uncertainties associated with the Company's business, which include the Company's ability to execute its business strategy and the other risk factors disclosed in the Annual Report on Form 10-K for the year ended January 2, 2010 on file with the Securities and Exchange Commission. The Company assumes no obligation to update the information included in this press release, whether as a result of new information, future events or otherwise.

About nFinanSe Inc.

nFinanSe Inc. (OTC Bulletin Board: NFSE) is an innovative financial services company and provider of stored value and prepaid card solutions headquartered in Tampa, Florida. nFinanSe has developed the nFinanSe Network™, a secure, reliable value load and activation platform that connects with retail merchants and other value load stations located throughout the United States. For more information, visit www.nFinanSe.com.

SOURCE nFinanSe, Inc.