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.

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Companies: ebay, mercexchange

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Comments on “MercExchange Saga Over: eBay Just Buys The Patents”

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KD says:

Futile, but ...

I know it would be futile, but I’d like to see eBay now sue the Patent Office for malpractice or something like that because they issued a patent based on obviously ineligible claims.

I know it would get tossed out on the usual basis that you can’t sue the government unless they agree you can, but it would make a strong statement that eBay (and many others) are fed up with the malpractice at the Patent Office.

It would be an even better protest if eBay could persuade a number of other companies who have been stung by obviously invalid patents to file similar lawsuits at about the same time.

Of course they might be opening themselves to penalties for frivolous lawsuits, or shareholder lawsuits for wasting company resources, but it is a pleasant fantasy.

PRMan (user link) says:

Sounds like the system worked for once

Wait, let me get this straight…

1. The obvious patent was thrown out as being obvious.
2. The non-obvious part (Buy it Now is not a common auction practice) stood and eBay was ordered to pay for infringing it.
3. The patent was brought by a competitor and not a patent troll.

How did this make TechDirt?

Mike (profile) says:

Re: Sounds like the system worked for once

1. The obvious patent was thrown out as being obvious.

One obvious patent was thrown out of the case, but not invalidated. And it was for being vague, not obvious.

2. The non-obvious part (Buy it Now is not a common auction practice) stood and eBay was ordered to pay for infringing it.

You really think one person deserves an exclusive monopoly for 20 years on the concept of “buying a product at a set price?”

I don’t.

3. The patent was brought by a competitor and not a patent troll.

Bought *from* a patent troll. Not a competitor.

Shane says:


My partner and I have some patents that we have sketched(alot) and have home made prototypes, were not sure where to go from here?! It seems that everything is way to expensive with no guarantees of anything. I know there’s someone out there that invests in patents, buys patents or assists inventors with these concerns.If anyone can help or point us in the right direction, we’d be greatly appreciative!
Thanks in advance.

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