posted on July 28, 2007 07:43:06 AM new
Judge Permits eBay’s ‘Buy It Now’ Feature
By THE ASSOCIATED PRESS
Published: July 28, 2007
NORFOLK, Va., July 27 (AP) — A federal judge denied on Friday a request from a small Virginia company to stop the online auction powerhouse eBay from using its “Buy It Now” feature, which allows shoppers to purchase items at a fixed price.
Judge Jerome B. Friedman of Federal District Court denied a motion by the Virginia company, MercExchange, for a permanent injunction to stop eBay from using the feature. The Supreme Court ruled last year that, although eBay infringed upon MercExchange’s patent for the service, it was up to the lower court to decide whether eBay had to stop using it.
In his ruling, Judge Friedman said the company was not irreparably harmed because it continued to make money from its patents, either by licensing them outright or by threatening litigation against those it believed infringed upon them.
“MercExchange has utilized its patents as a sword to extract money rather than as a shield to protect its right to exclude or its market share, reputation, good will, or name recognition, as MercExchange appears to possess none of these,” he wrote.
A federal jury found in 2003 that eBay had infringed on MercExchange’s patent and awarded the company $35 million. The amount later was reduced to $25 million.
Greg Stillman, a lawyer for MercExchange, which is based in Great Falls., Va., called the opinion a double-edged sword.
“It was sort of good news, bad news for both sides,” Mr. Stillman said. He said he was sure that eBay was relieved not to be enjoined but that the judge “made it quite clear that they’re going to have to pay for that right.”
Catherine England, a spokeswoman for eBay, said the company was “extremely pleased” in the decision to deny the injunction.
In the closely watched case, the high court ruled that judges had flexibility in deciding whether to issue court orders barring continued use of a technology after juries found a patent violation. The decision threw out a ruling by a federal appeals court that said injunctions should be automatic unless exceptional circumstances applied.
The case became a rallying point for critics who argue that the federal patent system is riddled with abuse from small businesses that sue established companies to enforce patents for ideas that have never been developed into products.
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There is more to life than increasing its speed. --Mahatma Gandhi
