by CIO Staff

Supreme Court Takes Ebay Case

Nov 29, 20051 min
Consumer Electronics

 According to the New York Times, the Supreme Court Monday agreed to hear an appeal by eBay and revisit the rules under which courts grant injunctions against a company found to be infringing another’s patent.

In 2003 a federal court found that eBay had violated three patents owned by MercExchange, fined the online auctioneer $25 million, but refused to issue an injunction barring eBay from using the disputed technology.

This year, that ruling was overturned, the a Federal Appeals Court saying that MercExchange was entitled to its injunction.

In taking the case to the Supreme Court, eBay is arguing that the injunction tilts the playing field in favor of plaintiffs in patent litigation, giving them “tremendous leverage,” encouraging small technology businesses to go into the litigation business.

A brief friendly to eBay, filed by America Online, Google and several other companies, described the rule on injunctions as “a powerful club” that invites “abusive patent litigation.”

MercExchange says that it “worked hard to commercialize the technology” covered by the patents.  

The case will have an enormous impact on the technology field where patents are often in dispute, and one microprocessor can contain thousands of pieces of patented technology.

–David Rosenbaum