A US company has sued business network LinkedIn for allegedly infringing a patent that covers matching buyers and sellers in online markets.
AvMarkets, which allows aviation companies to buy and sell their goods on its site, owns a US patent protecting a method for “generating increased numbers of leads via the Internet”.
The patent says these can be sales leads, and it protects receiving leads for data items, such as numbers of automotive parts; indexing them; listing them as hyperlinks on static web pages; and generating web pages.
In a suit filed at the US District Court for the District of Delaware, AvMarket has targeted a LinkedIn group, ‘buyers and sellers of aircraft spare parts from all over the world’, as the source of the alleged infringement.
According to the suit, the LinkedIn group brings buyers and sellers together by using the patented technology. AvMarkets argues that because LinkedIn generates hyperlinks and web pages about products; that search engines can crawl LinkedIn groups; and that LinkedIn generates revenue for itself and sellers using the site, it should be liable for infringement.
AvMarkets wants damages and pre-judgment interest, which is a sum accounting for the time between the start of the alleged infringement and the date of the lawsuit (it has not specified dates), as well as a permanent injunction.
A spokesman for Niro, Haller & Niro, which is representing AvMarkets in the case, said the date from which the alleged infringement began was “something we will need to look into” but that “we have done our due diligence and believe we have a legitimate claim”.
Steve Auvil, partner at Squire Sanders LLP, said the patent in the suit seems to be a business method invention, adding: “There has been a ton of litigation [involving business method patents] because so many of these patents have validity issues.”
The America Invents Act, signed in January 2011 and which is the biggest US patent reform in more than 60 years, introduced provisions allowing parties to challenge the validity of business method patents.
Auvil said this was because, in the mind of Congress, the patents are seen as having questionable value and the “potential to wreak havoc in the market”.
Chris Larus, partner at Robins, Kaplan, Miller & Ciresi LLP, said because the patent in this dispute is of a business nature, AvMarkets may find it difficult to successfully assert it against LinkedIn.
He added: “The suit is targeting one service, a LinkedIn group, and it will be very difficult to quantify damages because the group is only one feature of the entire LinkedIn system. It will be hard to identify its specific revenue stream.”
This is not the first time AvMarkets has asserted this patent. In late 2011, the company sued aviation company Inventory Locator Service, a subsidiary of Boeing, for patent infringement, settling with the company soon after. Though terms of the deal are confidential, Larus said such an early settlement suggests that AvMarkets’ demands may not have been particularly high, potentially seeking a licence fee that was lower than the cost of litigation.
LinkedIn did not respond to a request for comment.
This article was first published on 18 February 2013 in World IP Review
avmarkets, linkedin, robins kaplan, squire sanders, niro haller