Jury Awards IBM $83 Million in Closely-Watched Patent Dispute with Groupon

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A U.S. jury last Friday awarded International Business Machines Corp. $83 million in a patent dispute with e-commerce company Groupon Inc.

A jury in Delaware said Groupon used IBM’s patented e-commerce technology without authorization following a two-week trial.
“IBM invests nearly $6 billion annually in research and development, producing innovations for society,” IBM spokesman Douglas Shelton said in a statement. “We rely on our patents to protect our innovations. We are pleased by the jury’s verdict.”

“We continue to believe that we do not infringe on any valid IBM patents,” Groupon spokesman Bill Roberts said in a statement. “To the extent these patents have any value at all — which we believe they do not — the value is far less than what the jury awarded.”

The jury said Groupon’s infringement was willful, allowing IBM to ask a judge to award additional damages.

IBM had sought $167 million in damages, saying it developed widely licensed technology crucial to the development of the internet. Two of the patents relate to Prodigy, IBM’s late-1980s precursor to the web.

Groupon argued that some of IBM’s patents should not have been granted because they describe obvious ideas, and said the computing company’s damages request was unreasonable.

Armonk, New York-based IBM has secured more U.S. patents than any other company for the past 25 years.
The case, as closely watched in the technology industry, has allowed IBM to look at its efforts to transfer its large patent portfolio to other companies.

An IBM licensing officer has confirmed that Amazon Inc., Facebook Inc., Alphabet Inc. has paid US $ 50 million to US $ 50 million as part of cross-licensing agreements that allow each of Google, LinkedIn and Twitter Inc. to access their patent portfolio. .

In 2017, IBM generated about $ 1.2 billion in revenue from licensing activities.

During the hearing, Groupon attorney J. David Hadden revealed that he used old fashioned patents to squeeze IBM from other technology companies to file lawsuit suits.

IBM’s attorney, John Desmarais, said that after the company refused to take responsibility for using IBM’s core technology, the company was no more than a suicide.

“The decision is a valid decision for IBM’s degree program,” Desmarais said.

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