PayPal Suing Google (GOOG) Over Mobile Payment Trade Secret Breach (EBAY) (S)

According to a report from Bloomberg, eBay's (Nasdaq: EBAY) PayPal is suing Google (Nasdaq: GOOG), claiming the search-giant misappropriated trade secrets from PayPal's mobile-payment business.

Former PayPal exec Osama Bedier, now at Google, took PayPal's confidential information, according to the suit. Additionally, another Google exec, Stephanie Tilenius, violated her contractual obligations in the recruiting of Bedier.

Bedier is now leading Google's efforts to bring point-of-sale technology to retailers, the suit attests. The suit also alleges Bedier was engaging in employment talks with Google, while simultaneously leading negotiations to implement PayPal in Google's Android Marketplace, thereby breaching his fiduciary duty.

Both PayPal and Google are aiming to take their payment systems from the virtual world to the real world the installation of POS systems next to registers.

Bloomberg notes Google hasn't received a copy of the suit, which was filed yesterday in state court in San Jose, CA. Google will not comment until the company has had a change to review the document.

As announced Thursday, Google, Sprint, and Verifone (NYSE: PAY) are launching a mobile payment system available with the Nexus S running on Sprint's network. Citi (NYSE: C) and MasterCard (NYSE: MA) will also partner in the venture, titled "Google Wallet."

Google and eBay are trading slightly higher ahead of the market.

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