Yahoo!/FindWhat Patent Dispute Headed for Trial

  |  April 4, 2005   |  Comments

A lawsuit centered on the ownership of pay-for-placement ad technology is set to go before a jury later this month.

The patent-infringement suit filed by Yahoo's Overture against FindWhat.com is heading for trial later this month, after surviving the latter firm's efforts to have the case dismissed. A decision in the case could settle once and for all the issue of who owns the bid-for-placement technology that has fueled the paid search advertising boom.

A California judge two weeks ago denied FindWhat's motion to dismiss the case, saying there were questions that needed to be resolved at trial. FindWhat had contended Overture's patent was invalid and was filed too late.

The dispute centers around the bid-for-placement business model and technology used by both Yahoo's Overture division and FindWhat. In July 2001, Overture was granted U.S. Patent No. 6,269,361, "System and method for influencing a position on a search result list generated by a computer network search engine." Yahoo claims the patent protects its bid-for-placement products and another patent it holds protects its account management tools.

FindWhat started the legal battle by filing suit to have Overture's patent invalidated. Overture later sued both FindWhat.com and Google to protect the patent.

Though legal questions have long swirled around the validity of the patent, the issue has never been tested in court. The suit against Google was settled in August 2004, right before Google's IPO, for 2.7 million Google shares, worth $270 million in August.

That settlement called for Overture to dismiss the suit against Google and grant the rival firm a fully paid perpetual license to the patent, as well as to several related patent applications held by Overture.

Pre-trial motions in the FindWhat.com/Overture case are set to be heard by the judge on April 11, and a jury trial is set to begin on April 19, unless a settlement is reached first.

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ABOUT THE AUTHOR

Kevin Newcomb

Kevin Newcomb joined ClickZ in August 2004, covering search marketing and other online marketing topics. He has been reporting on web-based businesses since 2000.

Before the bubble burst, Kevin was a marketing manager for an online computer reseller, handling copywriting, e-mail marketing, search marketing and running the affiliate program.

With a combination of real-world marketing experience and years of business journalism, Kevin brings to ClickZ a unique ability to deliver news and training materials that help online marketers do their jobs better.

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