eBay Ordered To Pay $29.5 Million To Guy Who Did Nothing

from the bad-patent-rules dept

Two months ago, a jury ruled that eBay was infringing on some guy's patents for online auctions. The guy, who never did a damn thing with the patent, claims that "patents help protect the little guy." Protect him from what? He didn't do anything with the idea. eBay didn't steal the idea from him. They just both happened to come up with a similar idea. The difference is that eBay actually innovated and did something with the idea. Following the lawsuit, eBay asked the judge to throw out the jury's decision, but the judge has decided not to. Instead, he's ordered eBay to pay this guy $29.5 million for doing nothing. This encourages innovation how? The $29.5 million is just slightly less than the $35 million the jury recommended. I'm assuming eBay will quickly appeal.


Reader Comments (rss)

(Flattened / Threaded)

  1.  
    identicon
    chris, Aug 6th, 2003 @ 7:31pm

    Software and Process Patents

    Software and process patents should be simply outlawed altogether. There's so much abuse in the form of offensive and defensive patents that the real purpose of patents (ostensibly to reward innovation) is completely lost.
    And besides, this guy patented "Buy it Now!", a rather obvious progression in the course of an auction site. That's sort of like the 1-click Amazon patent or the infamous XOR patent. I remember XOR as an exercise in school!
    However, real reform won't occur until we overhaul the patent office and expel business process patents.

     

    reply to this | link to this | view in thread ]

  2.  
    identicon
    e g, Aug 6th, 2003 @ 7:56pm

    Re: Software and Process Patents

    good point.

     

    reply to this | link to this | view in thread ]

  3.  
    identicon
    Anonymous Coward, Aug 6th, 2003 @ 9:25pm

    Re: Software and Process Patents

    what you should be doing is telling that to your local congressman. We can't do anything, but tell our congressman. most of us already agree with you.

     

    reply to this | link to this | view in thread ]

  4.  
    identicon
    Anonymous Coward, Aug 7th, 2003 @ 7:59am

    Re: Software and Process Patents

    Any local representitive would work. But rather than bombard them with rhedoric, send them links and documentation demonstrating your case. Remember, most elected officials are lawyers, and you are going to need to convince them.

     

    reply to this | link to this | view in thread ]

  5.  
    identicon
    slim, Aug 7th, 2003 @ 8:13am

    He did "nothing"?????

    Your headline suggests ... nay, proclaims ... this guy did NOTHING! How wrong you are. He sat down, thought about a way to conduct a business, patented that process using completely legal, current patent processes (probably tried to convince other companies to license his idea, but they didn't see the future the way he did) ... hired a lawyer, and defended his intellectual property against theft by a multi-billion dollar monopolist (ebay is THE monopolist of the auction business ... online or offline). A jury agreed that HE was right, and that EBAY is an intellectual property thief.

    If this guy had won this suit against Microsoft ... I suspect you'd be writing a "David slays Goliath" story.

     

    reply to this | link to this | view in thread ]

  6.  
    identicon
    Egon, Aug 7th, 2003 @ 8:48am

    No Subject Given

    Nothing says you have to do something with an idea in order to claim patent rights on it. Big companies sue little ones all the time for infringing on their patents, even when they're not doing anything with the patent. The way I see it, what's good for the goose is good for the gander. Fuck eBay - they're a gang of dipshits and I'm not gonna weep for the stupid fuckers. Maybe the problem here isn't that the guy's being compensated for having his patent infringed on, maybe what you're noticing is a fundamental problem with having patent laws in the first place.

     

    reply to this | link to this | view in thread ]

  7.  
    identicon
    Egon, Aug 7th, 2003 @ 8:57am

    Re: He did

    Amen, brother.

     

    reply to this | link to this | view in thread ]

  8.  
    identicon
    Anonymous Coward, Aug 7th, 2003 @ 9:35am

    Re: Software and Process Patents

    Don't waste your time and your politicians time by sending them links and references. THey are not going to research the topic. THey won't follow your links. They simply aren't interested. They get bombarded with complaints all the time and most have a highly trained skill at fobbing off or ignoring annoyances.

    You want real political progress? Follow the professionals - which in this case means lobbyists.

    First: organize. One person equals one vote, but a group is far more noticable and packs more punch.
    Second: develop your issue. Findout what the current laws are, and how to modify them. Research related court cases. Research your opponent, their tactics, funding, and strategy.
    Research pros and cons of your issue, develop workarounds or alternatives for the cons, and coherently organize your issue.
    Third: develop your clout. Raise money, raise awareness in the media and general public on your issue.
    Fourth: lobby your pols. Find out their opinions and biases. Try to get them to work with you (or get them out of office if need be).

    Fifth: stay in this for the long term. It ain't going to be easy, you probably wont win at first, and your opponents won't go away that easily either.

     

    reply to this | link to this | view in thread ]

  9.  
    identicon
    Mike, Aug 7th, 2003 @ 9:42am

    Re: He did

    Your headline suggests ... nay, proclaims ... this guy did NOTHING! How wrong you are. He sat down, thought about a way to conduct a business, patented that process using completely legal, current patent processes (probably tried to convince other companies to license his idea, but they didn't see the future the way he did) ... hired a lawyer, and defended his intellectual property against theft by a multi-billion dollar monopolist (ebay is THE monopolist of the auction business ... online or offline). A jury agreed that HE was right, and that EBAY is an intellectual property thief.

    (a) theft is the wrong word. It's a loaded word and you're using it to distort your argument.

    (b) You're also implying that eBay couldn't have possibly come up with the idea of "buy it now" on their own, and must have *taken* it from this guy. That's a stretch. You don't think it's possible that both came up with such an obvious idea independently?

    (c) I don't believe anyone should get paid just for having an idea. You need to *do* something with that idea and find a market and a way to make money. eBay came up with the same idea and brought it to market. This guy didn't do that, but gets all the money, thanks to a government granted monopoly. It is legal, but it discourages innovation - which has been my point from the beginning.

    (d) Why should only the first person who has an idea get paid for it? What if person B comes up with the same idea, but in a better way? Just because person A couldn't enhance their own product to keep up with the market, why should they get rewarded? If I open a pizza store, and someone else opens a pizza store across the street, but has the bright idea of offering pepporoni on top as an option, I should be able to sue him out of business because, dammit, the pizza store on this street was my idea?

    (e) I don't care who's on what side of how big they are, my position on patents like this one is well established and very clear. Since even you point out that both eBay and Microsoft are "multi-billion dollar monopolists" why would I have treated Microsoft any differently if the case were against them?

     

    reply to this | link to this | view in thread ]

  10.  
    identicon
    mhh5, Aug 7th, 2003 @ 11:14am

    Re: He did

    Everyone should agree on some definitions before arguments over semantics ensues.
    First off, let's agree that there are two kinds of property:
    1) Rival property which is property that only one person at a time can own. eg. a car, house, etc. if you own a particular item, it prevents me from owning it. and vice versa.
    2) Non-rival property which mulitple people may posess simultaneously. eg. an idea. Two or more people can have the same idea, and this situation does not prevent anyone from having the same idea.
    Next, and here's the tricky part, we have to agree on the definition that theft only involves rival property. That is, if I steal your car, that prevents you from having it. But I can't really steal your idea, because I'm not depriving you of having the same idea.
    Now Intellectual property laws are an artificial construct that make non-rival property more like rival property for a temporary amount of time in order to encourage innovation. That's a mouthful, but the way I see it: if IP laws grant outrageous unlimited monopolies, then those monopolies can *stifle* innovation which is the exact opposite of what IP laws are supposed to do. The trick is finding the balance where IP laws do what they're supposed to do.
    In this case, I think it depends on what really happened: If ebay read this guy's patent and said, "hey that a nifty idea, we should do that" then this guy has a right to compensation b/c IP laws make your ideas public in return for protection. And so this guy made his idea public and should be protected. But if ebay came up with this idea independently and can prove that they had this idea independently, then I think there are legal precedents for ebay to continue using the idea without paying the guy. This sort of thing works well for inventions because inventors usually have dated notebooks that can legally prove that an invention was independently made, but it gets messy with business model patents, because no one really creates legal papertrails for when business models are "invented"... they will now, I'm sure.

     

    reply to this | link to this | view in thread ]

  11.  
    identicon
    slim, Aug 8th, 2003 @ 8:26am

    Re: He did

    My response:


    "You're also implying that eBay couldn't have possibly come up with the idea of "buy it now" on their own, and must have *taken* it from this guy. That's a stretch."

    No stretch, really. Our patent laws are specifically designed to prevent monopolists from "supposedly" coming up with an idea "on their own." The rules are that the first guy who patents an idea is the owner of that idea. Whether that's right or wrong is another argument.

    "I don't believe anyone should get paid just for having an idea."

    Nice that you have that opinion, but then why should anyone come up with a better mousetrap? In your world, we'd still be using whips and buggies.
    Our laws are meant to provide an incentive to be creative that goes beyond mere intellectual gratification. You then say: "you need to do something with that idea." This guy DID do something: he probably tried to sell his idea to a lot of different companies. But for our patent laws, any of those companies COULD have just stolen his idea and implemented it. I'm not saying ebay did, but it doesn't matter whether they stole his idea or not - it's his invention to do with what he pleases, according to 100 years of patent law.






     

    reply to this | link to this | view in thread ]

  12.  
    identicon
    Mike, Aug 8th, 2003 @ 10:19am

    Re: He did

    Nice that you have that opinion, but then why should anyone come up with a better mousetrap? In your world, we'd still be using whips and buggies.

    Except that's not true. We've shown time and time again that the reverse is true. In this case it's perfectly clear.

    If eBay didn't do this, we wouldn't have the "buy it now" feature on eBay and there would have been less innovation in the world.

    I'm all for pushing innovation, but the idea that people only invent stuff because of patent protection is laughable. If there's a market, people will create a product and sell it.

     

    reply to this | link to this | view in thread ]

  13.  
    identicon
    mhh5, Aug 8th, 2003 @ 11:04am

    Re: He did

    "I don't believe anyone should get paid just for having an idea."

    I agree with slim here. The inventor didn't "just have an idea". This inventor, by getting a patent, made his idea public knowledge. IMHO, that is equal to marketing his idea -- just that his marketing program is the USPTO office. Let's agree that getting a patent *is* doing *something*. Ok? Now should this inventor be paid? I think he's only entitled to being compensated if his patent is actually violated and if his patent is valid. Assuming his patent is valid, was his patent violated? Maybe, depending on whether ebay came up with his idea independently and prior to this inventor. Is this patent valid? Well, that's a whole other argument. "Buy it now" seems like it should have some sort of prior art or that it should be "obvious" to those skilled in the art of *selling things*.... Also, if ebay can prove that they had the idea for "buy it now" before the inventor assigned by the patent did, then the patent is invalid (at least in the US) because then this guy isn't the first inventor.

     

    reply to this | link to this | view in thread ]

  14.  
    identicon
    mhh5, Aug 8th, 2003 @ 11:32am

    Re: He did

    "I'm all for pushing innovation, but the idea that people only invent stuff because of patent protection is laughable. If there's a market, people will create a product and sell it."

    In my opinion, Mike is missing a big point. Sure, people will invent stuff regardless of whether or not there is a patent system. Before patents, people still invented stuff. (Fire, the wheel, bronze, steel, etc etc...) But without a patent system, inventors won't necessarily write their ideas down for others to study. The way the patent system encourages innovation is by making knowledge public. The USPTO is a huge database of knowledge to be built upon. It can inspire more inventions. But it only exists because of the legal protection it provides inventors. (Not that trade secrets don't exist or that academic journals don't contain some of the same knowledge.) My complaints about the system are that it sometimes allows "obvious" ideas to be protected, it allows for overly broad protection, and it allows some ideas to be protected for too long.

     

    reply to this | link to this | view in thread ]

  15.  
    identicon
    screw ebay, Aug 14th, 2003 @ 4:53pm

    No Subject Given

    ebay sucks.
    they let people sell illegal shit as long as they are powersellers. new sellers they get rid of for breaking some bullshit ebay rule that they want even decscribe for you. they are the epitome of how a monoply works.

     

    reply to this | link to this | view in thread ]

  16.  
    identicon
    ebay scummer, Sep 7th, 2003 @ 12:46am

    Ebay Power Seller special treatment

    Oh Yeah! I see "power puffers" breaking Ebay "rules" like offering more items available outside auction all the time and Ebay won't do crap. But if I try it, Wham, I get slammed almost immediately. Turbo Lister seems like spyware as it hogs up 30MB and requires massive multi MB updates all the time!

     

    reply to this | link to this | view in thread ]

  17.  
    identicon
    Yates, Oct 15th, 2003 @ 3:35pm

    No Subject Given

    Personally, I am thrilled to hear about anyone who obtains victory in a lawsuit against E-bay, PayPal, or half.com. The only thing good about PayPal is that they do have a telephone number.

    As for E-bay and half.com, what kind of mult-billion dollar organization handles all business through e-mail? It's digusting how they blow customers off. You can have hundreds of dollars tied up in a situation and they still request you to communicate through e-mail. Unlike e-bay, normal individuals can not afford to waste months through low budget communication while their money is out of pocket. 20+ million? Good for him. There are a lot of unlucky people out there who've been screwed far worse by e-bay and can do nothing about it.

     

    reply to this | link to this | view in thread ]

  18.  
    identicon
    Anonymous Coward, Oct 15th, 2003 @ 9:09pm

    Re: No Subject Given

    Power sellers are given special treatment, it's without a doubt. They make the money, They can gorillia other users into the ground, and ebay's fine with that as long as they bring in the cash. when creating power sellers ebay really just made it that much harder for a new auctioner to attempt to ebay. Powersellers get all the extra goodies and you're going to have to wait at least 3 months to get up to that spot agian.

     

    reply to this | link to this | view in thread ]

  19.  
    identicon
    FUCK_EBAY, Jan 7th, 2004 @ 5:28pm

    FUCK EBAY

    A special message from me to all of the FUCKING little bitch boys hiding behind there computers at eBay. Faceless little FUCKERS playing god with the millions that have fallen prey to the fucking temptations of trying to sell or buy on a site that has so many FUCKING BULL SHIT RULES, that no one should really be able to sell a thing there with out breaking one of them, and as far as buying goes, I have found better prices by doing a simple search using google on every, and I do mean EVERY item that I have looked at on eBay. Ebay will kill itself and I say good riddens. It's time to take out the TRASH. FUCK EBAY!

     

    reply to this | link to this | view in thread ]

  20.  
    identicon
    Dc, Jun 30th, 2005 @ 11:37am

    Re: Software and Process Patents

    Nobody here mentioned (or did you know) that Yahoo Auctions had a "Buy It Now" feature on their auctions before FeePayEbay did.

    I remember it clearly... when "Buy It Now" appeared on eBay (BTW it was also FREE at first) I said to myself look at them copying Yahoo Auctions!
    Now go and compare eBay's newest features, Want It Now, etc. with a site called iOffer.com. eBay is copying them too. Truly, eBay makes me want to puke, all the things people said here are true. Maybe A.P.E the Agency to Prevent Evil could help!

     

    reply to this | link to this | view in thread ]

  21.  
    identicon
    T, Aug 25th, 2005 @ 6:53pm

    Ebay lawsuit

    It helps because it is the law to protect the original innovator. anyone can hold a patent for years and do nothing with the idea it gives people the time to get money and support to make it happen. Otherwise wal-mart would own the world(pretty close anyway) Ebay should have just bought it outright from the guy for $500,000 instead of stealing the idea that was owned by someone else.

     

    reply to this | link to this | view in thread ]

  22.  
    identicon
    jakal, Sep 1st, 2005 @ 2:46pm

    Re: He did

    Does it occur to anyone that doing something with a patent includes trying to sell it. You all sound like a bunch of communists. Mind if I use your lawnmower since you are not using it. What arrogance to think pooled resources have a right of theft over individuals.

     

    reply to this | link to this | view in thread ]

  23.  
    identicon
    jakal, Sep 1st, 2005 @ 3:01pm

    Re: Software and Process Patents

    Yeah, an maybe get a lobbist to get congress to get rid of the first amendment. Yeah, let's put some energy behind this.

     

    reply to this | link to this | view in thread ]

  24.  
    identicon
    Anonymous Coward, Feb 12th, 2006 @ 9:40pm

    Ebay sucks

    I created a product and sold it on ebay for two years with no problems when Ebay allowed someone to copy it and sell against me ,When i emailed him to get his own idea he sends me threatening emails. when i emailed him back with some ideas on where he could go he sends my emails to ebay and gets me suspended so he can have the entire market and product to himself . I hope ebay gets what it deserves for infriging on someones patent. And i hope the guy from whitetrashland (ky) gets run over by a truck . When someone patents something they own the patent and others that want the patent buy it or get sued for abusing our patent laws. One of the biggest abusers of this was HENRY FORD. The automobile was patented by SELDON and henry THE WHITE TRASH AUTO MAKER thought he did not have to pay the royalties he was legally obligated to pay by law . So after that he went to court claiming his cars were different and broke the patent. HENRY FORD SUCKS and so do YOU ! HOPE A LAWYER RUNS OVER YOU WITH A Lincoln. I hope you live to sue the lawyer and die the day the check comes in the mail Tell EBAY TO PAY UP SUCKERS !

     

    reply to this | link to this | view in thread ]

  25.  
    identicon
    ray, May 16th, 2006 @ 4:50am

    ebay

    Ebay is the riskiest form of transacting business I can think of. Nothing is guaranteed except that Ebay cannot be held accountable for anything. If a person uses Ebay then when, not if, that person has a problem you can bet your baby's life on the action Ebay will take on your behalf and that action is zip. Nada fukking thing will Ebay do to help anybody that has gotten a good fukking on Ebay. And the way I look at it is this: If you're desparate enough to buy something sigt unseen from a comple stranger with absolutely no way of contacting any other party on the deal except email then that person can expect to get fukked out of their money and time. Ebay is no friend of mine and if you'll stop and think about it you'll see that I am right. Look, when you register on Ebay, that means that Ebay has got your credit card information, name, address, phone number, and there ain't one thing that you can do about it when somebody steals that info and starts taking mortages out on your house. If you use Ebay then you are ignorant. You will eventually find out what Ebay is about, and it sure as fuk ain't customer service. Ebay users are taking a chance with their future financial happiness. The best thing that could happen is if Ebay would shut down. The odds of something going wrong with a transaction are very probable. If you use Ebay you are swimming in the waters of fraud ALONE.

     

    reply to this | link to this | view in thread ]


Add Your Comment

Have a Techdirt Account? Sign in now. Want one? Register here
Get Techdirt’s Daily Email
Save me a cookie
  • Note: A CRLF will be replaced by a break tag (<br>), all other allowable HTML will remain intact
  • Allowed HTML Tags: <b> <i> <a> <em> <br> <strong> <blockquote> <hr> <tt>
Follow Techdirt
A word from our sponsors...
Essential Reading
Techdirt Reading List
Techdirt Insider Chat
A word from our sponsors...
Recent Stories
A word from our sponsors...

Close

Email This