Techcrunch's Ingrid Lunden is reporting that mobile POS company Square has served U.K. competitor (and recent entrant to the U.S. market) mPowa with a cease and desist letter.

The issue isn't a technology or patent issue: It's one image mPowa is using on its website.

Square alleges that mPowa's picture of a male left hand holding an iPhone with an attached card-reading dongle while a male right hand extending from a denim shirt swipes a credit card is too similar to a picture Square uses of a male left hand holding an iPhone with an attached card reading dongle while a male right hand extending from a denim shirt swipes a credit card. (That's almost the exact language used in the C&D letter. Techcrunch has a copy of the missive in its post.)

Square is demanding that mPowa remove the image and is requesting additional information on how such an "intentional and deliberate" use of Square's image happened. The letter also ominously hints that mPowa's copying may extend to other intellectual property.

According to the post, no official response from mPowa is forthcoming.

MPowa is a relative newcomer to the crowded mobile POS field. It launched in the U.K. in January and entered the U.S. market last month. The mPowa reader works on basically the same principle as Square: A card reader plugged into a smartphone's audio jack works with an application on the device to let a user process credit and debit transactions. (That's also the same principle used by every other mobile POS system currently offered by PayPal, VeriFone, ROAM Data, and several dozen other companies both in the U.S. and around the world.) A crucial difference with mPowa is that it reads chip-and-PIN credit cards, as well.

More on this story as it develops.

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