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EBay Subject of Patent Action
spatrick_123 writes "Yahoo! is reporting that a man named Bill Simon is pursuing action against EBay, claiming that he hold patents on essentially every aspect of their operation. Whether or not this is a precedent setting case, it is certainly a large one in terms of what is at stake financially and it will be interesting to watch it play out."
Interesting none the less.
You can't shut us down! The Internet is about the free exchange and sale of other people's ideas!
I just did a quick search on the USPTO and there are indeed a patent listed for "Woolston" (who was named as the inventor in the article). For those interested, the page is
Patent 5,845,265 - Consigment Nodes. It was filed back in 1995. I haven't looked at the claims etc.
While doing the search, I noticed some other auction patents, such as one titled "Distributed Live Auction" that is assigned to Amazon.
it's about a guy called Tom Woolston, not Bill Simon. The latter happens to be the subject of an apparently related headline, where Bill Simon is being sued by eBay and not the reverse.
For the lazy, news.com originally reported the story early September:
eBay, one of the biggest success stories on the Web, is being threatened with a patent infringement lawsuit that could force it to modify its winning auction format.
A loss could compel the Internet auction company to pay millions of dollars inroyalties and damages and even to make significant changes to its business model.
MercExchange founder Thomas Woolston, an inventor and patent attorney who has been granted four online auction-related patents since 1998 and has some 10 others pending, said he sued eBay in 2001 after negotiations broke down over the auction site's offer to purchase his patents.
I don't believe this guy is a nut - I read a couple of weeks ago about this guy and apparently he's been talking with ebay for quite some while now. If I recall correctly, Ebay eventually severed the negotiations a few months ago and hence this guy is now following things up with a suit.
If he's got a legitimate claim against Ebay then don't start cutting him down - my first impression was the same as everyone elses when I first read about this case - but he apparently filed and received these patents years ago - just because Ebay is so big doesn't mean he may not be right.
"MercExchange founder Thomas Woolston, an inventor and patent attorney who has been granted four online auction-related patents since 1998 and has some 10 others pending, said he sued eBay in 2001 after negotiations broke down over the auction site's offer to purchase his patents.
The company first contacted Woolston in 2000 with an interest in buying the patents. E-mail to that effect is expected to figure prominently in the case because it indicates that eBay knew about Woolston's patents but continued to infringe them, he said.
"We expect to be vindicated at trial," Woolston said. "They are rank infringers."
At the heart of the case is patent paperwork Woolston filed less than five months before eBay founder Pierre Omidyar spent Labor Day weekend of 1995 creating the first iteration of his auction site. Today, eBay is one of the most successful online businesses, with nearly $750 million in revenue last year and continued profitability."
Bill Simon is running for Governor of California and created this clever parody site about his opponent, incumbent Gray Davis. Ebay is not too pleased.
Make sure to get the facts
Errr, no.
Those are the claims made by one side.
E-bay claims Woolston came to them trying to sell his patents. They claim the relevant patent claims were added in a revision long after the original filing date - after E-Bay was up and running which would the patent invalid. E-Bay also claims to have found prior art which would also render the patent invalid.
If you want facts, Woolston has also sued Priceline over a different patent (yet to be resolved), and GoTo.com over YET ANOTHER patent (settled out of court).
This guy is making a career of filing patent suits. He has yet to actually win a case.
Even if he did win, many people think this entire class of patents should never be granted in the first place.
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- - You can't take something off the Internet! That's like trying to take pee out of a swimming pool.
A patent is, first of all, not even a constitutional right. The constitution says that congress may provide inventors with certain rights to their invention. This lead Jefferson et. al to set up the first patent board some 200 years ago.
Now, for a patent to be granted, the invention it describes must be:
New
Useful
Nonobvious
For a good definition of new, see new
The useful property is questionable, but the nonobvious is very interesting, see nonobvius
A quote from this link:
It was never the object of patent laws to grant a monopoly for every trifling device, every shadow of a shade of an
idea, which would naturally and spontaneously occur to any skilled mechanic or operator in the ordinary progress of
manufactures. Such an indiscriminate creation of exclusive privileges tends rather to obstruct than to stimulate
invention.
And that kind of sums it up...
Another purpose of the patent idea, combined with licensing, was to open up trade secrets. Let the rest of the world know how we do it, so that all may benefit. But, if you want to use it, you need to license it.
Again, a good idea spoiled by insane capitalism.
Don't get me wrong, I'm a genuine capitalist, but it is scary to see what happens when capitalism goes berserk.
Old hands will recall that RAMBUS used to do that too, and got nailed by that.
The sad part about this story is that the company (EBay) will realise that its not worth their time to fight this, and just settle out of court for a couple of million bucks; a trivial amount to them, but a non-trivial amount to the likes of Mr. Woolston, who will continue to indulge in such "submarine patenting".
It's actually older than that...spreadsheets were used to figure out the movement of the stars for navigantional purposes in the 16 centurie...god knows when the first use was, though.
-- Waht? Tehr's a preveiw buottn?