Apple ID blocked on iPhone  app updates, Mastercard no longer recognized

All the sudden my Mastercard (canada) is no longer recognized. I checked with my bank and everything seems to be fine from their side.
Every time I type the security code, it gives me the message that " this card cannot be used with the itunes store".
After several attempts, I gave up and modified my account to payment "None" option.
They don't want my money: ...fine
Now what is more annoying is that I can't update my apps anymore on my iPhone. I get the message "Apple ID blocked". However, I am able to visualize my ID on the iPhone. I modified my password. Nothing helped. I tried another ID I have from having lived for many years in Europe. All the time my Canadian ID pops up on the App update function with the message "Apple ID blocked".
Can anybody help with that? If this continues, I am seriously thinking about legal action as I paid for these apps and now I can't access up-to-date functions for a software which I own. Any ideas if there are some consumer defense organizations out there to help with that.
I am seriously fed up with all the time lost with this problems (3 days spending my time working on this problem now!!!!)

So I purchased Navigon app on my iphone 4 with my iTunes account id then got a new iPhone 4s and signed in with the required Apple ID and now Navigon app does not recognize me as its owner.  When I try to restore purchases I make on the app it tells me to buy it first.  The problem seems to be it defaults to my Apple ID when I am asked for a password and does not give me the option of using my iTunes account ID and password which is what I used when I purchased the app.  HELP?

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