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eBay sued for $3.8 billion in patent infringement case

Connecticut company XPRT Ventures LLC filed suit [complaint, PDF] Tuesday against eBay [corporate website] in the US District Court for the District of Delaware [official website], claiming the infringement of six patents [materials] for online auctions and payment systems. According to the complaint, which also names PayPal, Bill Me Later, Shopping.com and StubHub [corporate websites] as defendants, XPRT alleges [press release] that eBay misappropriated information shared in confidence by the inventors of XPRT's patents and incorporated it into eBay's existing payment systems. Additionally, eBay allegedly filed a subsequent patent application [text] with the US Patent and Trademark Office (USPTO) [official website] incorporating the concepts of XPRT's patents and trade secrets. XPRT seeks a minimum of $3.8 billion in damages for eBay's unjust enrichment and the lack of compensation to the inventors and patent holder, based on the estimated value of the patents.

Recently, eBay has been scrutinized for various intellectual property infringements. In April, a federal appeals court ruled [JURIST report] that eBay is not required to actively monitor its website for the sale of counterfeit goods. The US appeals court ruling marked a dramatic contrast with other recent rulings in Europe. In February, the Paris District Court [official website, in French] ordered [JURIST report] eBay to pay LVMH Moet Hennessy Louis Vuitton (LVMH) [corporate website] 200,000 euros (USD $275,000) in damages for paying search engines to direct customers to counterfeit LVMH products. In a separate case in September, the European Court of Justice (ECJ) [official website] issued an advisory opinion against LVMH [JURIST report] in its suit to collect damages from Google for Google's AdWords system, which allows companies and individuals to purchase advertising space when a user searches for a product or brand name. In 2008, a French court ordered eBay to pay LVMH USD $63 million [JURIST report] for failing to prevent the sale of counterfeit luxury goods.

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