What just happened? Back in 2016, IBM sued Groupon over the alleged infringement of four of its patents. Now, at the start of a federal trial, the tech giant has asked a jury to award it $166.5 million in damages from the deals website.
IBM’s lawyers claim that companies such as Amazon, Google, and Facebook have bought licenses for between $20 million to $50 million to use its patented technologies, but Groupon has refused to do so, despite using the same e-commerce tech.
“The new kid on the block refuses to take responsibility for using these inventions,” IBM lawyer John Desmarais told the jury. "IBM spends literally billions of dollars every year on research and development to make our lives easier."
Groupon’s lawyers argue that IBM doesn’t use the patents and claim they are invalid. “A key question for you in this case is whether these patents cover the world wide web,” said J. David Hadden. “They do not and that is because IBM did not invent the world wide web.” He added that IBM “uses its huge stock of patents as a club to get money from other companies.”
Two of the patents originate from the pre-web Prodigy online service that launched in the 1980s. It describes a system for showing applications and advertisements that reduces server loads. IBM says it also patented the “single sign on” technology that lets web users sign into retailers’ sites using their Facebook or Google accounts, while the fourth patent relates to authentication.
Desmarais says IBM was forced to sue Groupon because the firm refused to negotiate a licensing deal. Groupon hit back with a suit of its own in 2016.