Interval Licensing LLC v. AOL, Apple, eBay, Facebook, Google, Netflix, Office Depot, OfficeMax, Staples, Yahoo!, and YouTube (W.D. Wash. 2010).
Microsoft co-founder Paul Allen started Interval Research in 1992. During the 1990’s, the company filed for several user-interface related patents that were primarily intended to improve a computer user's online experience. The patents focus on what I might call “lightweight” usability ideas such as a occupying the peripheral attention of a user; organizing audio/visual for display in a browser; and alerting users to items of current interest.
When Interval closed its doors, the patents were transferred to Vulcan Patents LLC (presumably another Paul Allen company) and then to Interval Licensing which remains a Paul Allen company.
The patents are well drafted. Of course, even excellent drafting cannot cure obviousness problems. I suspect that the litigation will focus primarily on whether these inventions were obvious back when the patents were filed? In addition to arguing in court, I expect that the defendants will also appeal to the US Patent Office -- asking the agency to take a second look at the patents via reexamination.
Take claim 1 of asserted Patent No. 6,757,682 (filed in 2000) as an example.
1. A system for disseminating to a participant an indication that an item accessible by the participant via a network is of current interest, comprising:
a computer configured to
receive in real time from a source other than the participant an indication that the item is of current interest;
process the indication;
determine an intensity value to be associated with the indication and an intensity weight value, and adjusting the intensity value based on a characteristic for the item provided by the source; and
inform the participant that the item is of current interest; and
a database, associated with the computer, configured to store data relating to the item.
I don’t have any prior art on hand, but the claim sure feels obvious (in hindsight)…
Of course, the system embodied in claim 1 above represents an important core feature of services provided by all of the listed defendants. (A similar story can be told of the other asserted patents.) Thus, if the patents are valid, the damage award could be quite large.
It may be important to note that the complaint does not suggest that any of the defendants copied the invention from Paul Allen's company or that the defendants even knew about the patents before today. Of course, a patentee does not have to show copying in order to prove patent infringement and back-damages can still be available even when the infringement occurred without knowledge of the patent. (Additional punitive damages may be awarded if the infringement was willful).
It will be interesting to see how the Supreme Court’s foray into patent law over the past four-years will impact this case. I look to three important decisions:
- In KSR v. Teleflex, the Supreme Court raised the patentability standard of nonobviousness — making it more likely that these patents will be held invalid as obvious.
- In Bilski v. Kappos, the Supreme Court held that certain business method inventions are not patentable. Some of the claims in the patents-in-suit may be susceptible to a similar attack. However, most of the asserted claims appear to be tied closely to a technological implementation in a way that may avoid problems under Bilski.
- In EBay v. MercExchange, the Supreme Court made it more difficult for patent holding companies (such as the plaintiff here) to obtain an injunction to stop ongoing infringement. Of course, it is unlikely that Interval actually wants to stop infringement — rather, the company is looking for a large license fee.
Final point: The vast majority of patent cases settle. Here, however, all of the parties have large amounts of cash-on-hand. In addition, some of the defendants are repeat patent infringement defendants. Those factors tend to make settlement less likely.