Yahoo Says Facebook's Countersuit Doesn't Count Since Facebook Bought Its Patents

from the um-what? dept

Yahoo has now responded to Facebook’s patent countersuit, as the stupid and destructive nuclear war that Yahoo launched against Facebook out of spite and jealousy continues to expand. As you probably know by now, the incredibly desperate Yahoo sued Facebook (as it was laying off 2,000 employees), because it has no clue how to innovate any more, and decided the best course of action was to broadcast as loudly as possible to good software developers that they should work elsewhere (at least that seems to be the general interpretation of Yahoo’s actions here in Silicon Valley). In response, Facebook hit back with a countersuit, claiming that Yahoo violated some of Facebook’s patents.

As we noted at the time, most of the patents that Facebook was using in the counterclaims did not originate with Facebook, but were bought. Yahoo’s response to Facebook’s claims tries to make a big deal out of this, arguing that using such patents is not in “good faith.”

In retaliation for Yahoo!’s good faith allegations of patent infringement, Facebook alleges infringement of ten patents as counterclaims. However, on information and belief, Facebook lacks a good faith basis for most, if not all, of its counterclaims, particularly those patents that it purchased from others.

Facebook purchased eight patents from non-practicing entities: two patents were purchased from “IPG Electronics 503 Limited,” a San Diego-based patent aggregator; two patents were purchased from “Cheah Intellectual Property Licensing,” a California-based patent holding company; one patent was purchased from “Right Point LLC,” a Texas-based patent aggregator; and three patents were purchased from New York University’s intellectual property licensing department. All eight of these patents were purchased by Facebook in the past five months, and several of these patents were purchased (independent of any separate technology acquisition or merger) after Yahoo! filed its complaint in this action. On information and belief, many, if not all, of these patents were acquired by Facebook for purposes of retaliation against Yahoo! in this case.

No employee or officer of Facebook or any affiliated company conceived of, reduced to practice, or developed the alleged inventions claimed in the eight patents acquired from non-practicing entities. In fact, the applications for many of these patents predate Facebook itself.

While all of those do highlight just how silly some of our patent system is, I have no idea what it has to do with the law. There’s nothing in the law that says it’s not in “good faith” to buy patents to assert against others. Though, amusingly, perhaps if Yahoo! wins this argument it could set a bizarre precedent that limits the usefulness of purchased patents — but I can’t see that happening.

Yahoo!’s argument is full of similarly bizarre assertions. For example, Yahoo! seems to have its feelings hurt that Facebook didn’t contact Yahoo! before filing the counterclaims. While I can understand how it’s obnoxious to use before reaching out under normal circumstances, Yahoo! seems to ignore that Yahoo! sued Facebook first. Then it gets upset that Facebook doesn’t want to be all friendly? Really?!?

Yahoo! also claims that the parts of its business that Facebook thinks infringes are areas where the details are secret, so the only way that Facebook would know that Yahoo! infringed is if it “unlawfully acquired Yahoo! confidential business information.” Because of this, Yahoo! actually goes so far as to ask for sanctions against Facebook’s lawyers, which is a pretty extreme move in a case like this.

Yahoo! also goes into great detail to raise some procedural questions about the granting of some of the patents that Facebook is using in counterclaims. In other words, it’s trying to find absolutely anything to hit back with.

Suffice it to say there is no love lost between these two companies at this point.

Oh yeah, just for fun, Yahoo! adds two more patent infringement claims of its own back at Facebook:

  • US patent 7,933,903: System and method to determine the validity of and interaction on a network
  • US patent 7,698,315: System and method allowing advertisers to manage search listings in a pay for placement search system using grouping

What isn’t explained in the filing? How any of this actually helps make Yahoo! relevant again.

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Companies: facebook, yahoo

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Comments on “Yahoo Says Facebook's Countersuit Doesn't Count Since Facebook Bought Its Patents”

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Anonymous Coward says:

“While all of those do highlight just how silly some of our patent system is, I have no idea what it has to do with the law.”

It is really neither.

The patent system isn’t silly at all, rather it shows that patents are things of value, worthy of purchase and resale. It shows a functional system that allows the original patent creator to either use their patent, licence it, or sell it on to others to make the same choice. It’s pretty functional.

What Yahoo is trying to do is pretty much exactly what you do here – throw up a lot of sand in the air, and try to obscure the view.

Legally, it seems to be a fail as well. Yahoo seems to be suggesting that these patents were bought only for purposes of filing suit. Yet, it doesn’t deal with the basic fact that the previous owners had the same choices in front of them. That Facebook now owns the patents doesn’t change Yahoo’s potential liability, it didn’t suddenly change the patents.

It’s nice Mike to see you look at your own standard approach, and realize that it’s just a bunch of dust in the wind.

That Anonymous Coward (profile) says:

Facebook refuses to like Yahoo! comedy ensues.

I don’t have the will to look them all up, but are all of Yahoo!’s patents all from inhouse, or did they acquire any they are using? Because nothing would be funnier to show this to be a battle of purchased/rented patents.

I guess the upside that could come out of all of this is a very public pissing match that can clearly demonstrate once and for all, in terms even Congress can understand, that the patent system is broken. That more time is spent fending off people who managed to patent the overly broad idea and then wait until someone does something remotely like it years later to then pounce and demand huge amounts of cash.

“unlawfully acquired Yahoo! confidential business information.”
Or they could have just looked at how you stopped being relevant and innovating and decided that was a sucky business plan….

Anonymous Coward says:

“Yahoo! also claims that the parts of its business that Facebook thinks infringes are areas where the details are secret, so the only way that Facebook would know that Yahoo! infringed is if it “unlawfully acquired Yahoo! confidential business information.””

So Yahoo! is effectively admitting it’s guilt in it’s counter claim? Otherwise how could Yahoo! have a case on this charge.

GMacGuffin says:


“…many, if not all, of these patents were acquired by Facebook for purposes of retaliation against Yahoo! in this case.”

I’m guessing my patent lawyer friend would say , “And…? So…?” just like the Court.

Yahoo! brings a sour-grapes suit, then complains when it comes back at ’em. I’ve personally been laughing about this since I saw an article elsewhere last Friday.

Anonymous Coward says:

Silly Mike

Have you not learned anything about litigation and search results? Now when Facebook is searched,Yahoo! will appear near the top. That is placement you can not buy. The longer the lawsuit goes the closer to the top Yahoo! gets. This make Yahoo! relevant again. Here you are talking about new business practices and you missed the most obvious one.

Anonymous Coward says:


“And how dos that make them promote progress of science and the useful arts? “

Here’s the simplest explaination for you:

If you are an inventor, and you create a great new idea… say the ultimate mouse trap and roach hotel. The problem? You have the idea, but no way to manufacture or sell it. So you have this idea, you get the patent, and now… what? 20 years of nothing?

The ability to license, transfer, or sell a patent allows the initial inventor to make some money (to pay for more development time, or to pay for the time he spent already), and allows the patent to go on to someone who might have more use for it. So if the inventor sells it on, and the next buyer sells it on, and the third licenses it to 10 companies to build, we have seen progress, we have products in the market, and the inventor has the money to keep on inventing some more.

Progress, it isn’t just measured in short term gain or a single way.

ToFit says:

Big Business Promotion Only

Part of the reason normal people can’t manufacture items anymore is due to the huge legal overhead from patents and other legal costs. This is why internet succeeds and the primary location of new economic growth till now. On the internet the overhead for manufacturing is low, therefore it allows entry of new players and ideas at a minimal cost. The patent system is just a means to control entry of new competitors in established large market businesses. This controlling environment is trying to establish itself into the online world as well. Even something as large and influential as Facebook is having problems these days. What would that mean for smaller players? It is sad that we can’t have true capitalism and competitive marketplaces based on the best refined products and those best able to serve their customers.

Josh in CharlotteNC (profile) says:


Progress, it isn’t just measured in short term gain or a single way.

Yet patents are an attempt to do just that.

In some theoretical perfect world where there are no lawyers and everyone plays fair and acts rationally your simple example works. In the real world? Not so much, as we’ve seen time and time again how patents are preventing progress.

varagix says:


Perhaps. But then there’s the opposite: You have a great new idea… say the ultimate mouse trap and roach hotel. The problem? Another company with a (vaguely) similar idea patented is suing you for more than you own, let alone could make in a life-time.

You’re idea might be a massive improvement on what is available. It might even be a marked improvement over the suing company’s patented idea. But you still get sued, and the big company can demand that you stop pursuing your idea, or give it to them to use. And since you’re a poor inventor and they’re a rich corporation, you don’t have the money to hire lawyers and go to court to contest their claims, or to even negotiate a more favorable deal. Regardless of how this turns out, you and any other inventors like you have lost out on an opportunity to profit from your ideas, and are encouraged to not innovate now or in the future.

Progress, as a whole, is chilled. Not only short term, but for the long haul.

Berenerd (profile) says:


Lets build on this…

I am an inventor, I build the best mousetrap and roach motel. 10 years from now due to some radiation leakage, Mice and Roaches team up and plot the destruction of the world. They have outsmarted your mouse trap. Now what do we do? OH! Someone has come up with a way to make it so the trap you made, with a minor change, will save the human race from eternal servitude from the Mice and Roaches of this world. Doh! They can’t produce it because a Roach in the form of an IP lawyer comes out and says “INFRINGEMENT!!! ZOMG!! PAY UP!!!” Well this poor inventor that came up with a way to better the mouse trap now can’t because the guy who invented the original died to an early invasion force of cute and cuddly pet mice and so a IP bully bought the patent for a hunk of cheese. Look! Now the world is destroyed (from a human point of view)!

rubberpants says:


You seem to feel that since patents have value, that is an end to itself.

Patents have value because they are a government granted monopoly. A monopoly that was granted in the hopes that it will encourage innovation.

The government can create “value” out of thin air by creating laws to limit how it can be used, but that doesn’t mean it’s a good idea.

I fail to see how someone suing someone else for actually innovating simply because they have a piece of paper from the government that says they can helps anyone but the lawyers.

You’re not a lawyer by any chance, are you?

ToFit says:

Holy Patent!

This is far beyond a behavior issue. This is a sacrilege of human progress.

Blind faith works great for religion, but for business practice and oversight such as through government legal recourse- I’ll take free market captialism and independant scientific studies on what actually works.

Patent hoarders are welcoming the dark ages of modern society. It will take an information reformation to bring us out of the darkness of small minded content distributors. Note that I say distributors- since information is not indended to be owned singularly. Inforamtion by nature must pass between two parties to hold any value or meaning. Our current system seems to feel that 1st party ownership should hold value without any distribution, which invalidates the very concept of information transmission.

Anonymous Coward says:


The patent system isn’t silly at all, rather it shows that patents are things of value, worthy of purchase and resale.

“The system isn’t broken because I can attach monetary value to it”

Kind of like how bribes are legal, honest mechanisms of government because there is a favor or political service which someone attaches monetary value to.

The eejit (profile) says:


That’s not how even luminaries of technology saw it: that largest case is that of Edison and Tesla; Edison was known to use somewhat shady tactics for dealing with inventions and standards.

For example, the electrical standards used today are down to both Edison and Tesla, but Tesla thought up the concept of wireless electricity over a century before it could be mechanically done: it took an MIT project ten years to duplicate what Nikola Tesla knew to be true.

But Tesla was bankrupted by legal fees over patents and other lawsuits. With Tesla, we’d quite probably be a fully wireless society. Literally.

Anonymous Coward says:

Holy Patent!

I think memes are a good illustration of what you’re talking about: their value isn’t exclusive and intrinsic, but built on their social impact and influence. Obviously the more a meme is shared the greater its value becomes because this is the social network claiming, through sharing, that “this is of value to us.” Likewise if a person holds some IP over a particular meme, regardless if it’s its image used in the macro, its catchphrase, or its creation, I see no benefit to them in attempting to leverage their copyrights and controlling its use. Recently the mother of the young lady with Downs, whose image is used in the “I can count to potato” meme, is attempting to curtail its use, especially on FB, but getting nowhere. Clearly she doesn’t understand the Internet and social networks in that if something is of value to the individuals of that network they will use it regardless of the legal, and/or moral, right and wrong of it. My pet theory on this is that social behavior systems, like the social construct of value, predate moral and legal systems, which are built out from each other like nesting dolls, and therefor short-circuit the latter systems similar to the way the reptilian centers of our own brains will short-circuit our higher mental functions. In the end all value is a social construct, but ideas and information are heightened forms of it that’s highly dependent on its agency within the group. Thus in trying to secure a cultural artifact as being solely exclusive to the originator one is effectively destroying its primary value to the culture at large.

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