The Norman Transcript

Community News Network

January 27, 2014

Google wins $1 victory against patent owner harassing customers

WASHINGTON — A $1 victory for Google could mean a whole lot more in savings for some of its customers.

A federal jury in Marshall, Texas, said Jan. 23 that patent-licensing company Beneficial Innovations breached a settlement agreement with Google by suing its customers. The jury awarded nominal damages of $1, which was all Google sought because its main goal was to make clear that its customers were covered by the license.

The case illustrates how technology companies are fighting patent-licensing firms that sue their customers. Companies such as Google and Adobe are increasingly challenging patents in courts and before the U.S. Patent and Trademark Office, and are asking Congress to pass legislation to discourage lawsuits against the users of technology.

"We have the resources, we understand the technology, we know how our product is supposed to be used, and we're in the best position to defend our customers," said Dana Rao, associate general counsel at Adobe, which has sued patent- licensing companies on behalf of its customers.

Closely held Beneficial, incorporated in Nevada, filed patent-infringement suits against Google in 2007 and 2009, and the two sides reached an agreement in which Google paid for a license to the patents. That 2010 accord also covered customers using Google's DoubleClick advertising product including Autotrader.com and Demand Media, Mountain View, Calif.-based Google said.

"Beneficial went back on the terms of its own license agreement, pursuing our customers for simply using our licensed services," Matt Kallman, a Google spokesman, said in a statement. "This is a great outcome that the jury worked hard to get right."

The patents relate to playing games on a network and a networking system for advertising. Beneficial argued that the customers were only licensed under certain circumstances, which didn't apply in this case, according to court records. Beneficial lawyer Elizabeth DeRieux of Capshaw DeRieux in Gladewater, Texas, didn't provide a comment.

The tactic by technology companies of claiming customers are covered by a patent license has its limits. Apple sought to invalidate patents asserted against developers of applications for its iPhone and iPad tablet computer. The patent owner, Lodsys LLC, settled with all of Apple's customers, thus pushing Apple out of the case, and then proceeded against other developers.

Federal law says suits can be filed against anyone who makes, uses, sells or offers to sell a product that infringes a U.S. patent. Sometimes the product manufacturer can't be identified, isn't subject to the jurisdiction of U.S. courts because it only operates overseas, or the product is modified by the customer.

In those instances, users or sellers have to be sued, said Robert Stoll of Drinker Biddle in Washington, who formerly ran patent operations at the patent office.

It's only been since 2011 or so that firms who buy up patents to seek royalties, known by the pejorative "troll," have been going after the users of products made by well-known companies like Google and Adobe, Rao said.

The technology companies can be made to cover any lawsuit costs incurred by their customers, so resolving a single suit avoids multiple payouts. It also just makes good business sense.

"People want to make sure they've got their reputation maintained with their user community," Stoll said. "I wouldn't be buying their products if they didn't step in to protect me."

If a company proves its product doesn't infringe a patent, then all of its customers are off the hook. Should the company invalidate the patent, then anyone sued by the patent owner would be in the clear. Adobe has several trials scheduled for this year, Rao said.

"We'll use all of the tactics to try to take down the patent trolls," Rao said. "The problem is that, while we're able to step in and defend our customers in many district courts, the pace of these litigations is just growing."

Congress is considering legislation that would put suits against end users on hold until litigation is resolved between the manufacturer and patent owner.

In the meantime, more suits like those filed by Google and Adobe, could be in the offing.

"It makes good company sense," Stoll said.

1
Text Only | Photo Reprints
Community News Network
  • Wal-Mart to cut prices more aggressively in back-to-school push

    Wal-Mart Stores plans to cut prices more aggressively during this year's back-to-school season and will add inventory to its online store as the chain battles retailers for student spending.

    July 21, 2014

  • Hospitals let patients schedule ER visits

    Three times within a week, 34-year-old Michael Granillo went to the emergency room at Northridge Hospital Medical Center in Los Angeles because of intense back pain. Each time, Granillo, who didn't have insurance, stayed for less than an hour before leaving without being seen by a doctor.

    July 21, 2014

  • Starved Pennsylvania 7-year-old weighed only 25 pounds

    A 7-year-old Pennsylvania boy authorities described as being so underweight he looked like a human skeleton has been released from the hospital.

    July 21, 2014

  • Malaysians wonder 'Why us?' after second loss of airline jet

    It was all too familiar. Grieving families rushing to airport. The flashing television graphics of a plane's last radar appearance. The uncomfortable officials before a heavy thicket of microphones.
    For many Malaysians, the disappearance of Flight 370 in March has been a long trauma from which the nation has not yet recovered.

    July 18, 2014

  • A quarter of the world's most educated people live in the 100 largest cities

    College graduates are increasingly sorting themselves into high-cost, high-amenity cities such as Washington, New York, Boston and San Francisco, a phenomenon that threatens to segregate us across the country by education.

    July 18, 2014

  • Your chocolate addiction is only going to get more expensive

    For nearly two years, cocoa prices have been on the rise. Finally, that's affecting the price you pay for a bar of chocolate - and there's reason to believe it's only the beginning.

    July 18, 2014

  • Facebook tests button to let people shop from its website

    Members on desktop computers or mobile devices can click a "buy" button to make purchases through advertisements or other posts on the world's largest social network, the Menlo Park, California-based company said Thursday in a blog post.

    July 17, 2014

  • The terrible history of passenger planes getting shot out of the sky

    What is more clear is that, if initial reports are true, this would be the deadliest incident of a civilian passenger plane being shot down in modern memory. In some instances, the causes of the disaster are still shrouded in mystery. Here are some of the worst events.

    July 17, 2014

  • 130408_NT_BEA_good kids We're raising a generation of timid kids

    A week ago, a woman was charged with leaving her child in the car while she went into a store. Her 11-year-old child. This week, a woman was arrested for allowing her 9-year-old daughter to go to the park alone. Which raises just one question: America, what the heck is wrong with you?

    July 17, 2014 1 Photo

  • web_starbucks-cof_big_ce.jpg Starbucks sees more Apple-like stores after Colombia debut

    This week Starbucks opened its first location in Colombia — a 2,700-square-foot store with a heated patio, concrete columns, mirrors on the ceiling and walls of colorful plants.

    July 17, 2014 1 Photo