Ancient Online Shopping Cart Patent Still Biting Retailers
from the a-tax-on-online-shopping dept
This one goes way back. If you’ve been following the absolute ridiculousness of software patents for a while, you’re probably aware of the infamous Open Market “online shopping cart” patents (7,272,639, 5,715,314 and 5,909,492). While Open Market failed, the patents have lived on. There was an internet company in Chicago, called Divine, that went through more business models than you can imagine, and somewhere along the line it bought the remains of Open Market. In struggling for some way (any way, please!) to make some money, the company realized it had Open Market’s shopping cart patents and announced plans to sue way back in 2002. Next we heard of them, was in 2004, when Amazon was sued over those patents, by a company called Soverain software — who bought the patents in 2003 or 2004 out of bankruptcy from Devine. Because fighting patent battles is costly, Amazon eventually just paid off Soverain.
I hadn’t heard much about the patents, but it appears that Soverain has been busy again, and sued popular online tech retailer Newegg… and, unfortunately, as reader Ron Murphy let us know, a court in East Texas (of course) found that Newegg infringed… though, the details show that the jury did not find “direct” infringement, but rather “indirect infringement.” However, last month, the judge’s ruling sided with Soverain over Newegg, meaning that Newegg may have a huge bill facing it.
Even if Newegg fights this, Soverain has been suing all sorts of companies over the years, with many of them just agreeing to license the patent to avoid having to go through a lawsuit. And, because of that, Soverain has the ability to just keep on suing. The Newegg case originally involved six other companies (including Zappos), though all of the others settled. And since that lawsuit was filed, Soverain, more recently, sued a whole bunch more companies, including J.C. Penney, Amway, HSN, QVC, Shutterfly, Victoria’s Secret and more — and that case is in front of the same judge who just ruled in Soverain’s favor — so it doesn’t look good.
I can’t wait to see how our favorite patent system defenders defend this one. They’ll say that we can’t really say that the idea of an online shopping cart was “obvious” back when these patents were filed, but that’s pretty laughable. It’s pretty ridiculous to see anyone defend what has become a blatant tax on online retail now, from a company that did nothing to advance the space.