eBay asks for new patent trial

Difference of opinion over infringement

By Lucy Sherriff • Get more from this author

Posted in Developer, 6th October 2004 12:37 GMT

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eBay has asked an appeals court for a new trial over claims that its online auction house infringes patents held by Virginia-based MercExchange.

After a month-long trial last year, a jury ruled that eBay's direct sales transactions, the "buy it now" option, did involve an already patented process. The court ordered eBay to pay $35m to MercExchange, a sum later reduced to $29.5m.

eBay now says the jury had not been properly instructed at the time of its ruling, and that claims of patent infringement are unfounded. It argues that the MercExchange patent covers the transfer of ownership and that this part of a sale is not featured anywhere in an eBay transaction.

Jeffrey Randall, acting for eBay, told the appeal court judges that although there was no agreement about the date of invention, the jury had not been properly instructed about exactly when Woolston said he developed his ideas.

However, Thomas Woolston, patent lawyer and head of MercExchange, filed for his patent in 1994, a year before eBay was born. His legal representation countered that "the jury did not need to be instructed on something that is of no consequence", and called it a "red herring".

Woolston originally claimed that eBay's main auction system was covered by his patent but this was thrown out by a judge. ®