Patent infringement cases aren’t much of a surprise these days. They’re more a byproduct of progress and innovation. Even the simple unlocking of your iPhone has become grounds for legal action. And if you think that Apple is the biggest catch for these web wars, you are wrong. Facebook just got poked by Yahoo with a 19-page patent infringement lawsuit lamenting how the former capitalized on a “free ride” on advertising, social networking technology and 10 to 20 patents infringed. In what could be an one of the most epic battles in the history of patent infringement, Yahoo could amass at least $3 billion if they stand a chance of winning.
As the legal matchup reaches headlines, both camps are quick to start a trial by the public, each airing their side of the story.
A portion of the official statement released by Yahoo reads:
“Yahoo! has invested substantial resources in research and development through the years, which has resulted in numerous patented inventions of technology that other companies have licensed. These technologies are the foundation of our business that engages over 700 million monthly unique visitors and represent the spirit of innovation upon which Yahoo! is built. Unfortunately, the matter with Facebook remains unresolved and we are compelled to seek redress in federal court. We are confident that we will prevail.”
Obviously, the largest social network in the world is unhappy about the lack of discussion over the matter prior to filing the case: “We’re disappointed that Yahoo, a longtime business partner of Facebook and a company that has substantially benefited from its association with Facebook, has decided to resort to litigation. Once again, we learned of Yahoo’s decision simultaneously with the media. We will defend ourselves vigorously against these puzzling actions.”
For sure, popularity comes with a price. And with Facebook it’s not only a matter of fame, but its extremely bright future, driven by more than 800 million active users and billions in ad revenue. As Zuckerberg’s company marches towards an IPO, they wait for more than 500 patents to be licensed, on top of the 53 already certified.
But Yahoo has their share of woes when it comes to patent infringement cases. This is not the first time they’ve been involved with charges of this nature. But aside from facing federal courts, the massive web portal is slowed by its unstable market position, shaky finances and a failed $17 billion asset swap, blamed on Alibaba Taobao.
With Facebook’s booming valuation of $100 billion, is it wrong to think that Yahoo’s awkward timing may just be after pre-IPO shares?