August 28, 2010 1:37 am

Microsoft co-founder starts patent lawsuit

Paul Allen, co-founder of Microsoft, on Friday mounted a wide-ranging patent case against some of the best-known internet and technology companies, including Google, Apple and Facebook.

The case, brought in Federal court in Mr Allen’s hometown of Seattle, marks an attempt to enforce an unusually broad set of patents that could touch on a wide range of internet activities.

“They are absolutely key processes that have become part of people’s everyday browsing on the web,” a spokesman for Mr Allen said.

“We believe these are key processes for e-commerce and search.” The attempt to enforce the rights brought immediate condemnation from Google.

“This lawsuit against some of America’s most innovative companies reflects an unfortunate trend of people trying to compete in the courtroom instead of the marketplace,” the search company said.

Among the 11 companies named in the suit are AOL and Ebay, as well as office supply companies Office Depot and Staples.

The lawsuit was brought by Interval Licensing, a company set up to exploit the rights from technology research and development financed by Mr Allen during the 1990s.

The Interval group, which was closed in 2000, was eventually awarded more than 300 patents in a range of technologies, according to Mr Allen’s spokesman.

The decision to enforce the patents now follows a recent effort to sort out the remaining rights in Interval’s portfolio that had not previously been exploited, he added.

The claim, which seeks damages and an injunction to prevent future infringement, names four patents awarded between 2000 and 2004.

One covers a way to present offers to internet users while they are looking at related items – a common technique used by e-commerce companies that are trying to cross-sell extra products.

Another deals with a technique for combining video and text from different sources on to a single web page, an approach that underpins many web services that draw on multiple sources of content.

The broad nature of the patents echoed earlier controversial attempts to claim ownership of widely-used e-commerce techniques, such as Amazon’s enforcement of its “One Click” method for completing an online purchase, legal experts said.

Ironically, Amazon itself, along with Microsoft, was not named in the lawsuit, although Amazon’s use of recommendations to cross-sell products remains one of the most successful in the industry.

Mr Allen is not an investor in Amazon, Mr Allen’s spokesman said. He declined to say why the leading ecommerce company had not been included in the suit.

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