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Netflix sues Blockbuster

Claims breach of business method patents

Internet Security Threat Report 2014

A patent infringement dispute has erupted between rival DVD rental services Netflix and Blockbuster over an alleged breach of Netflix business method patents by the older firm's internet arm, Blockbuster.com, according to reports.

In general, Netflix operates by allowing subscribing members to choose DVDs – the number allowed depends on the subscription plan chosen. These are then posted out to members for viewing and return.

The most popular plan costs $17.99 per month, for which members can rent as many DVDs as they like and keep them for as long as they want, but can only have three DVDs out at any one time. The firm does not charge for late returns.

Netflix has obtained two patents, one granted only on Tuesday, in order to protect its method of doing business. According to the BBC, the first patent covers the selection, delivery and return process, while the second relates to the no-late-fees policy and the way in which clients amend their movie lists.

The firm is now claiming that Blockbuster’s online service infringes upon these patents, and has filed suit in a San Francisco District Court. The action seeks damages and a court order to prohibit any further infringement.

Blockbuster has made no comment on the action so far.

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