Patents Prove To Be a Contentious Issue in the Online e-Reading Industry

By Kerrie Spencer, staff writer – November 23, 2011

Amazon and Discovery were about to duke it out over a patent infringement issue when they recently agreed to a settlement.

It is always nice when a lawsuit gets settled, as it saves court time and a fair amount of money for the plaintiff and defendants. Settlement is usually also about one side knowing the other has enough evidence to likely swing a verdict in their favor, so it only makes good sense to settle voluntarily rather than have a jury increase the award to an amount they are not prepared to handle. There are times when lawsuits are about the odds of winning, and not about the fundamental issues that launched the suit in the first place. This is just the way the system works.

This particular dispute started back in 2009 when Amazon.com brought a suit in federal court against Discovery Communications. The case began when Discovery, producers of the Discovery Channel and Animal Planet, filed a patent infringement lawsuit against Amazon relating to the Kindle e-Reader’s e-security technology. The particular patent in question is dated 2007, and refers to the “Electronic Book Security and Copyright Protection System”. [1] [2]

The interesting part about the suit that never came to fruition is that Discovery said they were not trying to halt Amazon from selling the Kindle, but wanted legal fees, future royalties and damages. When the suit was first filed, there was an ominous two month silence on the part of Amazon, in which no one was sure how they were going to react. Their reaction was to file a counter lawsuit, alleging Discovery infringed on four of Amazon’s patents for search query and recommendation technologies.

When a person visits the Amazon site and browses for books or e-Readers, the bottom of the page shows a section that also recommends other related items. Recommendation technology is designed to be intuitive for buyers, and in some instances, is quite helpful. For others, it is downright annoying. Search query technology relates to programs that search a site for answers to a demand for information. An example might be if someone was looking for a book by well known lawyer Rusty Hardin. The person would type in the name, and the search string would locate all books written by Hardin.

This is not the first lawsuit filed against Kindle either. It seems they have been making a minor habit of infringing on others patents and intellectual property. Just recently, Amazon was the target of a lawsuit filed by Smartphone Technologies LLC (owned by Acacia Research Corp.), alleging the Kindle Fire tablet infringed on four of its patents. [3] [4] [5] In fact, this might well be one of the quickest lawsuits ever filed after the debut of a new product. It was only two weeks after Amazon launched its new product that Smartphone Technologies filed suit. [6] [7]

The Smartphone Technologies group lawsuits will be interesting to watch, as the company is typically becoming quite notoriously known as a patent troll. Right now they currently have patent infringement lawsuits filed against Amazon, Research in Motion and Apple Inc. [8]

The lawsuits filed seem to focus on commonplace features that most iPads and smartphones have in common, like touching an icon to activate a feature. (U.S. Patent No. 6,956,562) [9] Just how that infringes on Smartphone Technologies patents remains to be seen, and it will likely happen in federal court because the defendants refuse to back off their statements that they did nothing wrong.

Over time, Kindle has raised more than a few serious questions that deal with compensation to authors and publishers for their works. Specifically, their Kindle 2 text-to-voice capability, which renders text orally, would have a significant impact on audio book industry royalties.

This particular issue has resulted in Amazon letting authors and publishers decide whether or not they want to add the talking feature to their e-book titles. The resolution is indicative of how delicate the whole situation can be when new technology crosses the invisible line between copyright and infringement issues. One secretly wonders if the editorial written about this, cheekily titled “The Kindle Swindle”, may have had something to do with their decision to let authors and publishers make their own decisions. [10]

Discovery continues to contend that they stand by their allegations and wish to pursue the matter in court. They also insist that on initially first reading Amazon’s complaint against them, that their lawsuit does not relate to Discovery’s e-book technology. [11] This raises an interesting question – if indeed the lawsuit does not relate to Discovery’s e-book technology, then what is the dispute really about? The best answer may well be that it has to do with who is making the most money. Often lawsuits like this are not so much about whether someone infringed on someone else’s idea or territory, but that the offended party is losing money and wants to put a stop to it.

Generally speaking, patent infringement is when a person or a company uses or sells a patented invention without the benefit of obtaining a license from the original inventor. The definition varies from jurisdiction to jurisdiction, but in many countries patent infringement primarily relates to commercial uses or purposes. What many do not realize is that patents are referred to as territorial, meaning that if a patent is filed in the U.S., then anyone in the U.S. is prohibited from using, selling, making or importing the patented item in question. [12]

There are a number of defenses available against patent infringement, and they include, but are not limited to:
• the patent expired
• the patent is invalid or unenforceable
• the accused has a license under the patent
• the accused was not infringing on the patent in the patent territory
• the plaintiff infringed on the defendant’s patent

Sources
[1] http://www.techflash.com/seattle/2011/11/amazoncom-discovery-settle-patent.html

[2] http://www.techflash.com/seattle/2009/05/Amazon-Discovery_patent_spat_intensifies_45364442.html

[3] http://www.techflash.com/seattle/2011/11/amazoncom-discovery-settle-patent.html

[4] http://www.techflash.com/seattle/2009/05/Amazon-Discovery_patent_spat_intensifies_45364442.html

[5] http://www.techflash.com/seattle/2011/10/kindle-fire-draws-patent-suit.html

[6] http://www.techflash.com/seattle/2011/10/kindle-fire-draws-patent-suit.html

[7] http://www.techflash.com/seattle/2009/02/Authors_Guild_turns_up_heat_on_Kindle_2s_Text_to_Speech_40302597.html

[8] Id.

[9] http://en.wikipedia.org/wiki/Patent_infringement

[10] Id.

[11] http://www.techflash.com/seattle/2009/05/Amazon-Discovery_patent_spat_intensifies_45364442.html

[12] http://en.wikipedia.org/wiki/Patent_infringement

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