Newegg nukes “corporate troll” Alcatel in third patent appeal win this year

[DainBramaged]

In 2011, Alcatel-Lucent had American e-commerce on the ropes. The French telecom had sued eight big retailers and Intuit, saying that their e-commerce operations infringed Alcatel patents; one by one, they were folding. Kmart, QVC, Lands' End, and Intuit paid up at various stages of the litigation. Just before trial began, Zappos, Sears, and Amazon also settled. That left two companies holding the bag: Overstock.com, and Newegg, a company whose top lawyer had vowed not to ever settle with patent trolls.

Then things started going badly for the plaintiff. Very badly. Instead of convincing the East Texas jury to hand Alcatel the tens of millions they were asking for—$12 million from Newegg alone—they got a verdict of non-infringement. And as for the one patent they had argued throughout trial was so key to modern e-commerce, US Patent No. 5,649,131—the jury invalidated its claims.

Alcatel-Lucent was scrambling. The company's patent-licensing operations were contentious but lucrative, and it surely had plans to move on from those eight heavyweights to sue many more retailers. The '131 patent, titled simply "Communications Protocol" and related to "object identifiers," was its crown jewel.

Alcatel-Lucent went all out on appeal. With upwards of $19 billion in revenue, the company was easily able to amass legal firepower not available to your average patent troll. For its appeal, it hired Wilmer Hale, the kind of top law firm that handles high-stakes appeals with lawyers that have their own Wikipedia pages.

http://arstechnica.com/tech-policy/2013/05/newegg-nukes-corporate-troll-alcatel-in-third-patent-appeal-win-this-year/