Local search player Interchange Corp, which runs the Local.com site, struck a deal with Yahoo! to license technology in one of its patents (U.S. Patent No. 6,269,361) relating to bid-for-placement business model and technology.
Under the agreement, Interchange will pay Yahoo! a fee of $664,000 in installments over 12 months, plus undisclosed royalty payments, payable on a quarterly basis through May 2019, based upon a percentage of gross revenues from Interchange’s direct advertisers. This is the same patent that Miva spent 3 years fighting in court, which finally resulted in a mistrial, and then an $8 million settlement with Yahoo! in August.
Google settled its suit in August 2004, just prior to its IPO, for 2.7 million Google shares, worth $270 million at the IPO.
Because all the suits have been settled before a verdict was reached, the validity of the patent still has not been fully decided in court. The jury in Miva’s case did find invalid two of the main claims in the patent describing the overall method of selling bid-for-placement search ads. But since the trial never reached a verdict, those findings are not legally binding.
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