Newegg scores new victory against "corporate troll" Alcatel-Lucent

By on May 17, 2013, 3:00 PM
lawsuit, newegg, ecommerce, patents, patent troll, alcatel-lucent, online retail

For a few years now Newegg.com has made it policy never to settle with patent trolls. Following up from their victory over Soverain Software in January, who claimed to have invented the online shopping cart, now the retailer has scored another favorable verdict against French telecom equipment maker Alcatel-Lucent over a single patent covering “a way to exchange information with multiple users.”

The case dates all the way back to 2009 when Alcatel-Lucent, using patents it acquired from Bell Labs when the latter shut down in 2006, sought to get $6 million from Overstock.com and $12.4 million from Newegg.com for allegedly infringing on three of its patents. But in 2011 a lower court’s initial ruling said that the online retailers didn’t infringe on any of the patents and even declared one as invalid. That was no small feat considering seven other retailers, including giants like Zappos, Sears, and Amazon had settled before going to trial.

For its appeal, Alcatel-Lucent decided to drop the other two claims and focused on reviving the one that had been killed in court, only to have the three-judge panel uphold Newegg and Overstock’s win in just three days.

Ars Technica spoke with Newegg’s chief legal officer Lee Cheng about the outcome of the trial and his views on patent trolls. "There's good news and there's bad news. The good news is, we won this case on every point. The bad news is, we're running out of lawsuits,” he joked, adding that patent trolls are dismissing their cases against Newegg before any dispositive motions. That’s a vindication of their decision to always fight frivolous lawsuits, as in the company’s view, settling would only encourage others to come looking for their cut.

He went on to lament how Bell Labs’ patents -- a company with roots going back to Alexander Graham Bell -- were sold off for “a few bucks” and now Alcatel Lucent is out to monetize them by throwing a big net and hoping to catch something. According to Chen, their approach has been threatening companies left and right, simply based on the fact that they own 27,000 patents, so there must be something they are infringing.

As a further example of how clueless patent trolls are regarding the technologies they’re supposedly defending, Cheng noted that during trial, Alcatel-Lucent's corporate representative couldn't even name the technology or the patents it was suing Newegg over. “What a joke,” he lamented.

Image via Opensource.org




User Comments: 16

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3 people like this | Burty117 Burty117, TechSpot Chancellor, said:

Good on New Egg, that kind of attitude will help lower the amount of patent trolls out there.

It's a shame Amazon didn't take this approach and just paid though, they have the money to pull it off I would assume?

1 person liked this | howzz1854 said:

Patent trolls need to die

BlueDrake said:

Good on New Egg, that kind of attitude will help lower the amount of patent trolls out there.

It's a shame Amazon didn't take this approach and just paid though, they have the money to pull it off I would assume?

Possibly felt it would negatively impact them in some way, along with a number of others or they felt it's easier to settle than avoid embarrassing, unwanted attention on them. There's all sorts of reasons companies would want to settle out of court.

1 person liked this | Win7Dev said:

So now let's just sue people because we have patents not because we actually know they might be infringing upon them. Can I patent the systematic suing of large companies for profit?

mailpup mailpup said:

As a further example of how clueless patent trolls are regarding the technologies they're supposedly defending, Cheng noted that during trial, Alcatel-Lucent's corporate representative couldn't even name the technology or the patents it was suing Newegg over. "What a joke," he lamented.
No kidding.

cliffordcooley cliffordcooley, TechSpot Paladin, said:

I think patents should have expiration dates. If one is going to profit, they should be confined to an initial time frame. Profiting indefinitely is BS and counter productive where innovations are concerned.

mailpup mailpup said:

US patents do have expiration dates.

captaincranky captaincranky, TechSpot Addict, said:

I think patents should have expiration dates. If one is going to profit, they should be confined to an initial time frame. Profiting indefinitely is BS and counter productive where innovations are concerned.
US patents expire in 17 years. That's the length of time prescription medications hold their users in thrall. And that's how long big pharma has to work on getting another off label use approved or modifying the original drug to qualify for an extension.

Now copyright was 50 years, and is now up to 75.

Here, knock yourself out with Wiki overdose: [link]

VitalyT VitalyT said:

Their logo and name protect them, they got the ballz...

Guest said:

All that comment that these are patent trolls. I would love to see you work all your life for free. See how you like it. For that is what happen here. Some one invented something and a s s h oles like new egg been using it for free for years. And now the justice was not served. It does not matter how the plaintiffs got their hands on a patent or if it was dirt cheap. What maters is that they are owners. All these companies are getting away with murder using others tech and prior art for free and under cutting their business and making good companies die. This is why we have so much cheap s h I t in the markets that break in 6 months. I am glad I did not sell of some of my old stuff. I have a 42 inch tv and a 28 inch monitor that still works after 8 years. 2005. Also have a g5 mac pro that has an 8 year old hard drive in it. My toshiba piece of s h I t hard drive died in 1.5 years in my laptop. I did not even abuse that lap top. I currently have a hitachi hard drive works with no problems and it has 2x density.

1 person liked this | captaincranky captaincranky, TechSpot Addict, said:

All that comment that these are patent trolls. I would love to see you work all your life for free. See how you like it. For that is what happen here. Some one invented something and a s s h oles like new egg been using it for free for years. And now the justice was not served. It does not matter how the plaintiffs got their hands on a patent or if it was dirt cheap. What maters is that they are owners. All these companies are getting away with murder using others tech and prior art for free and under cutting their business and making good companies die. This is why we have so much cheap s h I t in the markets that break in 6 months. I am glad I did not sell of some of my old stuff. I have a 42 inch tv and a 28 inch monitor that still works after 8 years. 2005. Also have a g5 mac pro that has an 8 year old hard drive in it. My toshiba piece of s h I t hard drive died in 1.5 years in my laptop. I did not even abuse that lap top. I currently have a hitachi hard drive works with no problems and it has 2x density.
You go girlfriend...right on...!:p

That was really the point though wasn't it? A bunch of lawyer/parasites didn't "work all their lives" for squat. They leveraged the patents and then decided to get rich filing lawsuits. Unless that is what you call, "working for a living". In which case, spare us the details..

cliffordcooley cliffordcooley, TechSpot Paladin, said:

You go girlfriend...right on...!:p
You know Cap sometimes I have trouble interpreting your sarcasm, but not this time.

There is no need in me saying a word, you said it much more elegant than I would have. My comment would have probably been removed.

:Cheers:

mailpup mailpup said:

It does not matter how the plaintiffs got their hands on a patent or if it was dirt cheap. What maters is that they are owners.
Actually, I could agree with this thought if only you could point out which patent Newegg actually infringed upon. It seems plaintiff Alcatel-Lucent and their attorneys could not. Ruling for the defendant.

1 person liked this | jester376 said:

I find the idea of patents somewhat annoying. I thoroughly enjoy the idea of people being credited for their work and protected against idea and design theft. However, companies should also look at the idea of working with other companies to progress technology faster. I'm pretty sure that technology would progress much faster if we didn't have so many companies fighting over small shit.

captaincranky captaincranky, TechSpot Addict, said:

I find the idea of patents somewhat annoying. I thoroughly enjoy the idea of people being credited for their work and protected against idea and design theft. However, companies should also look at the idea of working with other companies to progress technology faster. I'm pretty sure that technology would progress much faster if we didn't have so many companies fighting over small ****.
Yeah, we should have just one big company that takes care of everything. What could go wrong there?

And everybody will live in peace and harmony, and all the women will, "uphold the ideals of the Miss America Pageant".

While we're extolling the virtues of cooperation, and since we already have nuclear weapons, we should help North Korea to build theirs. If we all work together, think of the great things we could accomplish...

cliffordcooley cliffordcooley, TechSpot Paladin, said:

While we're extolling the virtues of cooperation, and since we already have nuclear weapons, we should help North Korea to build theirs. If we all work together, think of the great things we could accomplish...
Eternal pessimism, lets work together on this one Cap. I promise, I will try to keep up.

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