4 October 2013Patents

Kaspersky Lab strikes in NPE battle

IT security company Kaspersky Lab has claimed victory in its patent battle with non-practising entity Lodsys, after settling accusations of patent infringement for nothing just days before a trial on the allegations was set to start.

Lodsys owns patents that it claims cover in-app purchases for Google and Apple apps. According to Eugene Kaspersky, chief executive of Kaspersky Lab, Lodsys also claimed that the patents covered: “(i) standard notifications about new security updates, (ii) assistance given [to] users in downloading and installing security updates, (iii) our cloud technologies (KSN), (iv) in-product purchasing and renewing of licenses, (v) even our interactive support site.”

The 55 defendants in the original case, which was brought at the US District Court for the Eastern District of Texas, included Samsung, Symantec and Hewlett Packard. Apart from Kaspersky Lab, all the defendants settled with Lodsys earlier in proceedings. But with a trial due to start on October 7, Lodsys agree to dismiss the case with no settlement fee on September 30.

“Our 18-month court case with Lodsys (one of the ‘tentacles’ of the world’s largest and most notorious of patent trolls – Intellectual Ventures) was brought to a sudden halt by a full and unconditional capitulation by this abominable patent parasite,” Eugene Kaspersky said in a blog post.

“As per the norm, we won once again alone, with another 54 defendant companies deciding to settle with the extortionist, while others shamefully fled the battlefield altogether. In all the patent troll has shaken down more than 400 IT companies!”

While Lodsys could not be reached for comment on the case, Intellectual Ventures, which sold the patents in question to Lodsys in 2010, gave WIPR a statement: “Lodsys is not a subsidiary of Intellectual Ventures. Lodsys is an independent company who purchased patent assets from Intellectual Ventures.

"Intellectual Ventures sells assets and will continue to sell assets as we refine our portfolio and business strategy. While we cannot disclose specific details about the Lodsys deal due to contractual obligations, we can disclose that patent sales and related revenue account for a small part of our overall business.”

It is the second time in as many years that Kaspersky Lab has faced down a so-called ‘patent troll’. In June 2012, a company called Information Protection and Authentication of Texas agreed to dismiss its claims against Kaspersky Lab with prejudice and with no monetary settlement before a trial could start in the same Texas court. In that case, 34 other defendant companies settled.

A week before the Kaspersky Labs settlement, the Texas court granted Lodsys’s motion to dismiss Apple from a case between Lodsys and 11 app developers. Apple had argued that its licence with Lodsys should prevent the developers being sued by the patent owner. But because the app developers had settled the case, the court ruled Apple’s intervention was moot and should be dismissed.

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