Sezzle, a FinTech based in Minneapolis, is suing GameStop over allegations that the video game retailer broke a contract by dropping Sezzle’s payment services, the Minneapolis/St. Paul Business Journal wrote Monday (July 18).
Sezzle operates a buy now, pay later (BNPL) system letting customers pay for purchases over time. GameStop was one of numerous retailers using Sezzle in the U.S.
The complaint, filed in county court in St. Paul, said the two sides entered into a two-year contract in November 2020. The FinTech offered its digital payment services for GameStop customers and Sezzle took 2.5% and 30 cents for every transaction.
GameStop also had a prominent link and portal for Sezzle on the website.
Sezzle says it put over $2 million into promotional material around the partnership, according to the company in the complaint.
In October 2021, GameStop replaced the Sezzle portal with one for PayPal, court records said. PayPal also offers a BNPL service.
And by January of this year, GameStop had removed all the Sezzle functionality from its retail site, Sezzle claimed.
Sezzle, because of this, sent an invoice for over $1.4 million, for damages from GameStop’s actions, which GameStop allegedly refused to pay.
GameStop did not respond for a request for comment by PYMNTS by press time.
PYMNTS wrote that GameStop has been undergoing a number of changes — for one, it launched a NFT marketplace. And two, it has made several changes to its corporate staff, including letting CFO Mike Recupero go.
See also: GameStop Fires CFO Mike Recupero, Announces Layoffs
The report said Recupero was only hired a year ago. He was let go by Chairman Ryan Cohen for not being “the right culture,” and too “hands off.”
There were also other cuts expected in various departments. Diana Jajeh, then the chief accounting officer, took over as CFO.
The layoffs all concentrated on the corporate side of the company rather than its stores.
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