Delusions Of Grandeur: Yahoo Officially Sues Facebook, Laughably Argues That Facebook's Entire Model Is Based On Yahoo

from the if-that-were-true,-why-is-everyone-using-facebook dept

Already an also-ran laughingstock in the internet space, on Monday Yahoo decided to shoot itself in the remaining foot by following through on its silly threat to sue Facebook for patent infringement. That lawsuit is now official, and apparently even folks within the company are not at all pleased with the decision. As Kara Swisher has been reporting (in much more detail than most folks covering this story), apparently this effort was driven almost entirely by new CEO Scott Thompson with help from legal boss Michael Callahan. Almost everyone else was kept out of the loop. Much of the decision to sue was apparently also driven by an “activist” board member looking to goose the stock.

If that’s the goal, it seems to have failed. The immediate reaction on Wall Street to the news was a collective “meh,” with the stock dropping a bit after close.

Even more ridiculous are the insane hubris and delusions of grandeur found in the lawsuit and the statements about the lawsuit, starting with this whopper:

Facebook’s entire social network model, which allows users to create profiles for and connect with, among other things, persons and businesses, is based on Yahoo!’s patented social networking technology.

Yeah, you see, if that were actually even close to true, then people would be spending all their days on Yahoo!. But they’re not. They’re spending them on Facebook, because Facebook innovated and built a better system while Yahoo languished and did nothing of consequence.

For much of the technology upon which Facebook is based, Yahoo! got there first and was therefore granted patents by the United States Patent Office to protect those innovations. Yahoo!’s patents relate to cutting edge innovations in online products, including in messaging, news feed generation, social commenting, advertising display, preventing click fraud, and privacy controls. These innovations dramatically improve user experience, privacy, and security and enhance the ability to connect with users.

Again, if that’s the case, why does Yahoo have a dreadful user experience that has been causing users to leave in droves for years, and why has it so totally failed to connect with users?

Yahoo! is harmed by Facebook’s use of Yahoo!’s patented technologies in a way that cannot be compensated for by payment of a royalty alone.

Right, because no one cares about Yahoo any more and just tossing a bunch of money Yahoo’s way won’t bring back all the users they’ve lost to Facebook. Why? It’s got absolutely nothing to do with Yahoo’s patents, and has a hell of a lot to do with developing a product users actually want — which is entirely unrelated to patents.

If this plan is actually based on some clueless exec’s idea of how to boost Yahoo’s share price, not only is that sadly mistaken, but it also kills off the only chance Yahoo might have had to boost its sale price going forward. Stupid, anti-innovation patent lawsuits against better, faster, more innovative competitors might seem like a short-term strategy that makes sense, but in Silicon Valley, it’s the death knell of any company. It’s when the last of the smart engineers — the people you actually need if you really want to innovate — know that it’s time to brush up the resume and take jobs at more innovative companies. It’s the last throes of any good Silicon Valley company.

And pretty much everyone realizes it.

As for the patents in question, here’s the list:

Filed Under:
Companies: facebook, yahoo

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Comments on “Delusions Of Grandeur: Yahoo Officially Sues Facebook, Laughably Argues That Facebook's Entire Model Is Based On Yahoo”

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Ninja (profile) says:

Re: Re: Re: Re:

Or you could go slashes.

Yahoo will be a /great/ case study in the future.

Although I sincerely don’t know if it should be /will/ instead of /great/.

In another news: Yahoo Officially Sues Google For Allowing People to Find Pages on the Web Using Mathematical Algorigthms Yahoo! is harmed by Google’s use of Yahoo!’s patented technologies in a way that cannot be compensated for by payment of a royalty alone.

All I can say is: some1 let Yahoo out of their misery and deliver the finishing blow already.

Anonymous Coward says:

When will you get it Mike? It doesn’t matter who innovates and creates the better system all that matters is the person who writes out ~20 convoluted pages referencing the simplest idea possible and adds “on the internet” to it.

Seriously though if you can’t pattern ideas don’t they actually have to patent their method? Why don’t you have to copy their code to get sued instead of just vague random ideas?

Jeremy2020 (profile) says:

on the plus side, it seems like Facebook will fight it and I imagine they can afford better lawyers than yahoo.

Facebook seems like a poor first target. I’m assuming this was a hope that Facebook would panic and pay up to avoid trouble with the IPO. I wonder if they’re hoping facebook will just buy yahoo for the patents.

So the real question is…does yahoo cost more than the lawyers fees to fight their lawsuit?

Anonymous Coward says:

I couldn’t care less about Facebook. I am purging my life of these social networking sites anyway. If I never read another post about where someone I know is dining it will be too soon. I am not alone, there are websites dedicated to this movement to get people off of these distractions from life. In five years Facebook will be like Yahoo, a has-been.

Anonymous Coward says:

Someone made an interesting post on Slashdot (I’ve posted similar stats here on techdirt).

“Among those seeking a doctorate or professional degree, law was the No. 1 choice among men and women. There were nearly three times as many men and women becoming attorneys as there were earning a medical degree”

Thanks to so many confusing laws, becoming a lawyer and suing people (and defending against lawsuits) is a lucrative business model.

Of course, this drives people towards becoming lawyers and away from becoming other things, like doctors and engineers. Then you wonder why America is failing.

Another AC writes
“while there are a ton of crappy law schools that accept even crappier applicants.”

I write –

That’s just a result of the economic forces caused by our legal system. The supply of money that lawyers get is so great as a proportion of time, effort, and money invested relative to other professions, that the educational system compensates by providing for allowing more people to more easily become lawyers. It’s easier to get a law degree than a medical degree because the supply of degrees, due to the demand for lawyers, is greater. The demand for medical doctors is less due to the insane liabilities involved.

Getting a medical degree is hard partly because everyone is afraid of hiring doctors and getting sued and so doctors have to have all this training on how to avoid getting sued. No one wants to hire a doctor that hasn’t had an insane amount of training, with our legal system, it’s too much of a liability. Hiring a sup-par lawyer can still save and make you money since to be a lawyer and sue someone is easy.

What’s amazing, though not surprising, from that article is the following.

“Among those seeking a doctorate or professional degree, law was the No. 1 choice among men and women. There were nearly three times as many men and women becoming attorneys as there were earning a medical degree (MD). …

“Most Popular Doctorate/Professional Degrees for Men

Law 31.5%
Medicine (MD) 10.8% …

Most Popular Doctorate/Professional Degrees for Women

Law 25.6%
Medicine (MD) 9.9%

If you make the laws less favorable to lawyers, by abolishing all these silly patents and making copyright more reasonable and by setting up a less one-sided penalty structure, unlike the one sided penalty structure that favors IP and other plaintiffs (replace that with one that delivers greater penalties to plaintiffs who file frivolous lawsuits and one that delivers reduced penalties against those who infringe and violate silly laws), then fewer people will become lawyers. Some of those would be lawyers would become doctors instead. The demand for lawyers would decrease and so there would be fewer schools teaching law and the quality of lawyers would increase and the demand for other professions, due to decreased frivolous liability issues, would increase as well.

Lets say you have two law schools, law school A and law school B. Law school A charges $300 per student and spends $250 per student and provides a sub-par education. Law school B charges $500 per student and spends $450 per student and provides a better education.

Now you have a firm that needs lawyers. If the demand for lawyers is great, due to a legal system that facilitates a high demand for lawyers (ie: a legal system makes it so that firms can save and make a lot more money by hiring more lawyers) this firm might hire 200 lawyers and would be much more willing to take more sub-par lawyers from law school A. They just need a lawyer, someone who can dedicate all of their time working out the legal aspects of everything they decide to do, the quality isn’t as important, and this is especially true for plaintiffs (given a one sided penalty structure in favor of plaintiffs), though may not be as true for defendants.

As a result of this huge demand, the average lawyer who spends $300 on law school A makes an average of $600 ROI. Law school A can be provided the number of students necessary to exist and continue providing sub-par educations.

Now, if the demand for lawyers were reduced, due to improvements in our legal system, the firm is less desperate for lawyers and now would be less willing to hire as many lawyers and would be less willing to hire sub-par lawyers. Someone who graduates from law school A now only averages a $400 ROI, forget that, they’re either finding another school to go to or finding another profession. Law school A must either increase its quality of education (which requires spending more and charging more) or it must go out of business. This, no doubt, would cause many law schools to go out of business and the ones that remain would provide higher quality degrees that firms want to hire, since firms are less willing to hire lawyers from law schools that provide poor quality degrees.

Anonymous Coward says:

Re: Re: Re:

We do need to reduce the price of lawyers, not by saturating the market with even more lawyers, but by having a legal system that doesn’t create such a high demand for lawyers. Reducing the demand for lawyers will reduce their price tag.

America can’t thrive by pushing worthless paper around and being a nation of litigation, we need to encourage more manufacturing jobs and discourage the kind of (IP) litigation that deters manufacturing.

Pjerky (profile) says:

The Stages of Dying/Grief

Well it looks like Yahoo! has entered the final stages of dying/grief. I believe this is the bargaining stage. All they have left is depression and acceptance. The prognosis isn’t good. I give them a year, maybe two.

So it looks like I need a new spam email account. Damn, I will have to redirect a lot of crap from my Yahoo! Mail now.

Anonymous Coward says:

Yahoo has been failing for years

One chronicle of this may be found at The Brutal Decline of Yahoo.

But those of us who work in the trenches, running web and mail servers, handling DNS, configuring routers, and so on, have seen the same story told another way: Yahoo has systematically fired/laid off all the clueful people. With most operations, we all know somebody who knows somebody on the inside, and we can connect with them, bypassing the bureaucracy to, you know, get shit down. But I’ve noticed over the past several years that NOBODY knows anybody at Yahoo any more. Heck, there was an enquiry on MailOp this week looking for anybody at Yahoo involved in running email…and the only response is the sound of crickets.

If there’s anybody left at Yahoo who’s senior and clueful, they’re hiding rather well. And I hope they’re polishing up their resumes.

Baldaur Regis (profile) says:

Re: Yahoo has been failing for years

It certainly seems like the business plan du jour is litigation. What these 2nd/3rd generation of tech execs forget is that everybody is copying from everybody else. Ideas are easy; implementation is a brass-plated bitch.

Software should never have been patented – at the most, code bases should enjoy copyright protections.

TtfnJohn (profile) says:

Re: Re: Code base copyright

Most code bases do enjoy copyright protection. The trick there is with licensing when and if you can get it.

Various forms of open source licensing exist including the GPL, Apache License, Free BSD license and others which allow expressly for copying and actually encourage it. Something Daryl McBride at SCO failed to understand and probably still doesn’t. Hell even Microsoft issued two, the Ms-PL and Ms-RL. The most complete list is here:

The ones compatible with the GPL can be found here: You have to scroll down to find the incompatible ones.

What our trolls don’t understand in the discussion of strengthened copyright is that , like the “content” industry the tech sector depends on copyright, too, sees no need to lock everything down in walled gardens when something changes. The big problem with walled gardens, of course, is that they don’t get enough sunlight so not much grows well in them if at all. Which might go a long way to explaining Hollywood’s tendency to constantly copy itself.

Difster (profile) says:


If books were just now being invented, we would be seeing patents on different genres of writing and different literary techniques. There would of course be lots of law suits if a little mystery was contained in a romance novel, etc.

It’s time to do away with software patents including retroactively cancelling all existing patents. It seems pretty clear that software patents stifle innovation, not foster it.

Anonymous Coward says:

Why don’t these “broad” patents apply to just about everything else on the web too.
I don’t see them suing Google+ (must be afarid of the G)
I don’t see them sueing myspace (not enough revenue, but it is making a comeback, so maybe in 2015)
Microsoft (Bill Gates to Yahoo exec.”Can’t touch this!!!”)
Apple (Steve Jobs (from the grave) to Yahoo exec. “I’ll F*ckin’ pwn u.”

I think Yahoo is about to see exeactly what kind of monster Facebook is about to become when it is kicked in the nuts on this one


staff says:

another biased article

Masnick and his monkeys have an unreported conflict of interest-

They sell blog filler and “insights” to major corporations including MS, HP, IBM etc. who just happen to be some of the world?s most frequent patent suit defendants. Obviously, he has failed to report his conflicts as any reputable reporter would. But then Masnick and his monkeys are not reporters. They are patent system saboteurs receiving funding from huge corporate infringers. They cannot be trusted and have no credibility. All they know about patents is they don?t have any.

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