the benefits of Google Wallet. "Sometimes the behaviors of people and competitors make legal action the only meaningful way for a company to protect one of its most valuable assets -- its trade secrets," PayPal wrote on its blog Thursday. Google spokesman Aaron Zamost said the company isn't commenting until it has had more time to review the suit. Luring Bedier away from PayPal was so important, according to the lawsuit, that both Eric Schmidt, then Google's CEO, and co-founder Larry Page met with him last fall. Page has since replaced Schmidt as CEO. Google made its first formal job offer to Bedier on Nov. 12, according to the lawsuit, which was filed in Santa Clara County Superior Court. That was just three days before Schmidt appeared at a technology conference and talked about the possibility of Google creating a phone that could supplant wallets. In Google's vision detailed Thursday, shoppers will touch their phone screen to select a card, then tap the phone to a credit-card reader in a store or restaurant. Google would make money by selling coupons and advertising that come along with the experience. It's a goal shared by PayPal and others. The Internet search and advertising company also faces tough competition from cellphone companies and payment card issuer Visa Inc. All of them want to play the central role of tying together phones, retailers and banks into a new payment system. This isn't Google's first attempt at electronic payments. The company introduced an online payment service called "Checkout" five years ago. It hasn't posed a serious threat to PayPal. Google views its digital wallet as a way to sell advertising at a pivotal moment: when shoppers are in stores, ready to spend money and even more receptive to coupons and other discount offers. Nick Holland, an analyst at Yankee Group, said that although all parties stand to benefit from Google's system, Google itself has the most to gain. That's because the Google Wallet would allow the company to "own" the market for advertising that's tied to the user's location. Google said it's launching a Google Wallet trial in San Francisco and New York in cooperation with Visa rival MasterCard and Citibank. It will open up the system to consumers later in the summer. It then plans to expand across the country. There has been talk of smart payment systems for years, and Google faces the same hurdles that have stifled previous trials. One is that Google Wallet will initially work on only one smartphone, the Google Nexus S 4G carried by Sprint Nextel Corp. Several smartphone makers, including Research In Motion Ltd., maker of the BlackBerry, are ready to bring out more phones with chips for so-called Near-Field Communications, or NFC, but it's uncertain if they'll work with Google's system. Another hurdle is getting retailers to invest in terminals that can talk to the phones. Google Wallet will connect only to MasterCard PayPass terminals. There are more than 135,000 of those in U.S. stores and restaurants, but that's only a small fraction of the total number. Google's carrot is that retailers will be able to put loyalty cards and coupons in the Wallet, helping them track and engage with their customers. Partners in the trial include Macy's, RadioShack, Subway, Toys R Us, Duane Reade and Walgreens. Yet another problem: Google needs to get cellphone companies on board. Its partner Spr