eBay in 'Buy It Now' Patent Dispute

smooth wombat writes "The Office of the Solicitor General of the United States has filed a brief with the Supreme Court, taking the side of MercExchange who is in a patent dispute with eBay over eBays Buy It Now feature. Two lower courts have already upheld MercExchange's patents including finding that eBay had willfully infringed on the Buy It Now patent. Later this month the U.S. Supreme Court will hear oral arguments. The Office of Solicitor General is arguing eBay should be barred from using Buy It Now due to the decision of two lower courts that upheld MercExchange's patents. eBay is arguing that infringements should not automatically result in injunctions and shutdowns."

Comments

The Details

[eldavojohn]

What MercExchange LLC (US) has are a handful of patents that are titled as "consignment nodes" which seem to be completely centered around electronic auctions and commerce.

Where I think eBay is in trouble is that in a few of these patents, MercExchange references the idea of two different specified prices, with "buy at" or "sell at" similar to eBay's "Buy it Now" price. Taken from their patent on dynamic pricing information:

The bid control 614 may provide a link to a web page that allows a participant to place a "buy at" or limit type order to bid into a dynamic pricing system. Here, for example, the navigational dynamic instance may appear at the sub-sub-topic or brand level and the bid control 614 may provide a link to a branded web page 632 of a brand participant that is participating in a dynamic pricing system.

There is a lot to read in their patents but the reason this case is so compelling is that MercExchange patented a very descriptive and complete dynamic pricing scheme and hierarchy to auctioning online in patent US6856967. I'm very confused as to why the date on the patent reads 2005-02-15 unless this is a renewal date.

I'm not a lawyer but I do wish that articles covering patent cases would link to the actual patent documents themselves so that the public can become aware of the extreme legalese that enshrouds patents.

What will be interesting is what the lawsuit may entitle MercExchange to receiving. eBay has had this feature for quite a few auctions and I wonder if MercExchange is going to demand a cut of eBay's cut for each auction transaction completed where this feature was available. That's quite a bit of cash.

Honestly, it looks to me like this will hold up in court. Any real lawyers out there have any comments to make? I'd ask you to read the patent and tell us what you think but I lack the $250/hour you charge.

Re:Non-obvious?

[nickname225]

I'm a lawyer - although patents is not my area of expertise. I've been looking at the upcoming Supreme Court schedule and it is looking to be a banner year for patent cases. In addition to the Ebay case, which centers on the issue of the automatic injunction, there are several cases that will allow the court to review the USPTO practice of granting patents to business processes and algorithms. So this is going to be a very interesting year for patent issues in the Supreme Court. If they get it right - it will resolve many of these problems - of course if they get it wrong....