(Adds comment from Moneygram in third paragraph and updated stock prices.)

 
   DOW JONES NEWSWIRES 
 

Western Union Co. (WU) said a federal jury in Texas awarded it $16.5 million in damages from MoneyGram International Inc. (MGI) for patent infringement.

The suit was filed in May 2007 and alleged MoneyGram infringed the patent of its money-transfer rival for the system of staging transfers.

MoneyGram Associate General Counsel Carolyn Eshleman said the company was evaluating the decision and reviewing its options, including a possible appeal.

The much-larger Western Union reported weaker results in the latest quarter although transaction volume continued to increase. MoneyGram swung to the red on legal costs and loss provisions, but it, too, saw higher transactions.

Western Union's shares recently traded at $19.13, down 27 cents or 1.4%, while MoneyGram stock dropped 10 cents, or 3.4%, to $2.84.

-By Kevin Kingsbury, Dow Jones Newswires; 212-416-2354; kevin.kingsbury@dowjones.com