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Suit postpones PayPal IPO
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February 6, 2002: 6:15 p.m. ET
New issue from online payment service delayed because of CertCo lawsuit.
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NEW YORK (CNN/Money) - PayPal Inc. postponed its planned initial public offering Wednesday because of a lawsuit from CertCo Inc., a source with knowledge of the situation told CNN/Money.
PayPal had planned to price its $70.2 million IPO late Wednesday but decided to delay the offering. Rival CertCo Inc. filed a lawsuit earlier this week against PayPal alleging patent infringement.
Palo Alto, Calif.-based PayPal is very popular with users of online auction sites such as eBay. Businesses or consumers with e-mail use PayPal to send and receive payments. About 68 percent of dollar volume made through the PayPal system comes from auction sites.
PayPal had planned to sell 5.4 million shares at $12 to $14 each via Salomon Smith Barney. PayPal had expected to begin trading Thursday but decided to hold off, the source said.
However, the IPO is not dead or even close to death, the source said. PayPal could amend the situation by refiling its prospectus with the Securities and Exchange Commission and adding a paragraph about the CertCo lawsuit, the source said.
New York-based CertCo provides security and risk management software for companies doing business online.
PayPal declined to comment. CertCo could not be reached for comment. 
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