MercExchange Saga Over: eBay Just Buys The Patents

from the done-and-done dept

It would appear that the saga of MercExchange and its patents is finally over, as eBay has agreed to buy the questionable patents from the company effectively ending the longstanding lawsuit. The saga began quite a few years ago, when the patent office granted a patent on the concept of online auctions (no, seriously, don't laugh... it happened) along with some other related patents for things like the concept of offering a "buy now at a set price" feature on an auction. Not surprisingly, the guy eventually got around to suing eBay over the patent. Luckily, a court tossed out the online auction claims as being too vague, but did proceed with a patent infringement case over eBay's "Buy It Now" feature -- eventually awarding the guy $30 million, even though the patent office was beginning to question the validity of MercExchange's patents (yes, well after they had granted them).

The case ended up getting plenty of national attention, but not for the main part of the case. Instead, one of the legal questions raised by the case -- whether or not a judge should issue an automatic injunction preventing the use of patented technology when someone is found guilty of infringing -- made it all the way to the Supreme Court, where a judge found (reasonably so) that automatic injunctions don't make sense, and courts should look at a variety of factors in determining if an injunction is necessary. This was an important finding, and it meant that the judge back at the actual case didn't force eBay to stop using its "Buy It Now" feature. However, eBay did still lose the case and was told to pay the $30 million. eBay was in the process of appealing the ruling, but by buying the patents, it's now over. While no amount is given, you'd have to guess that they paid somewhere near $30 million as the ruling required, perhaps a little less as incentive to avoid having to pay lawyers' fees during an appeal. While it still seems silly that eBay had to pay many millions of dollars for daring to let people buy a product at a set price, at least the Supreme Court did get a chance to set a precedent using a part of this case. Of course, now we need to hope that eBay doesn't turn around and sue others for violating the same questionable patents.

Filed Under: patents, settlement
Companies: ebay, mercexchange

Latest Chapter Of MercExchange/eBay Lawsuit: eBay Told To Pay $30 Million

from the ain't-over-yet dept

While you may recall the Supreme Court's decision in the MercExchange/eBay case from a year and a half ago, that was really just over one technical point at issue in the case: should a judge automatically issue an injunction to stop the sale of a product if that product is found to be infringing. Thankfully, the Supreme Court recognized that injunctions don't always make sense. However, once that was decided, the rest of the case still had to proceed. Based on the Supreme Court ruling, it was no surprise earlier this summer that the judge denied an injunction against eBay, but this week he did approve a $30 million judgment against the company -- representing the $25 million earlier award, plus another $5 million in interest.

The case isn't over yet, though. eBay has vowed to appeal the ruling. While the Supreme Court ruling on injunctions was an important one in preventing some of the worst abuses of the patent system, this case is still something of a travesty. MercExchange had claimed patents over all different aspects of online auctions, and while some of those patents were tossed out of the case, eBay was still found to infringe for daring to offer a "buy it now" feature on an auction. What no one has yet been able to explain is how the idea of a "buy it now" option on an auction should ever be patentable. It's simply a feature and a natural offering for any auction site to include at some point or another. It wasn't some brilliant idea that deserves a huge monopoly preventing all others from offering such a simple feature. Yet, tragically, with the way our patent system works, that's what has happened.

Filed Under: buy it now, patents
Companies: ebay, mercexchange

As Expected, Judge Denies eBay Injunction In MercExchange Case

from the no-surprises-there dept

Last summer, the Supreme Court made an important ruling in the eBay-MercExchange patent lawsuit, saying that just because there's patent infringement it doesn't mean that a judge should automatically issue an injunction barring the sale of a product. That was an important decision because it brought back some balance to patent lawsuits, because without that ruling, a tiny component of a product could cause an entire product to be pulled from the market. However, the Supreme Court only said that an injunction might not make sense. It never actually ruled on whether it did in that particular case. Now, the lower court has indeed ruled that no injunction is deserved and eBay can continue to use its "Buy It Now" feature that MercExchange claims a patent on. On a second patent, the court ruled that it made sense to wait for the USPTO to rule on whether or not the patent was valid before making a decision. This is basically half-a-win for eBay, though not particularly surprising. It is still too bad that the concept of "Buy It Now" was considered worthy of patent protection in the first place, but that's an entirely different debate.

Filed Under: injunctions, patents, supreme court
Companies: ebay, mercexchange