Summary
IBM has initiated legal proceedings against Priceline and its associated online platforms, accusing them of infringing five of IBM’s patents. The disputed patents cover technologies from the late 1990s through 2009, concerning advertising, website logins, and consumer tracking. IBM alleges that Priceline used these technologies on Kayak and Opentable without a proper licence, generating substantial revenue. The lawsuit seeks both an injunction and compensation for the alleged unauthorised use. This matter highlights IBM’s strategy to monetise its intellectual property amidst changing market dynamics.
Overview
International Business Machines Corporation (IBM) has filed a lawsuit against online travel leader Priceline and its associated websites, alleging infringement of five IBM patents used to build Priceline’s business model. IBM contends that Priceline has repeatedly declined to discuss a licence for the patented inventions and should pay royalties on the revenue generated through the use of those inventions. Priceline declined to comment on the matter.
Nature of the Patents and Claims
Two of the patents allegedly infringed date from the late 1990s; a third is from 2006, and a fourth from 2009. The patents cover technologies relating to online advertising, website login systems, and tracking consumer browsing activity. IBM alleges that Priceline also deployed the patented technology on its travel management website Kayak and on the online restaurant reservation platform OpenTable. IBM has filed proceedings in the US Federal District Court seeking to prevent Priceline from exploiting the patented technology and to recover a licensing fee on the revenue earned through its use.
IBM’s Patent Portfolio and Commercial Strategy
In 2011, Priceline had faced similar allegations from Artificially Intelligent Computer System Company, Watson, which claimed that Priceline had infringed a number of its patents. IBM is the largest US patent holder and seldom needs to submit its patents to formal legal examination. The company has been seeking to convert new innovations into revenue as its sales have declined over the previous three years, while emerging technologies such as cloud computing and data analytics have not grown quickly enough to offset the reduction in demand for its traditional hardware and services. Twitter purchased 900 IBM patents after IBM alleged that Twitter had infringed three of its patents.
Disclaimer
This article is for general information and does not constitute legal advice. Readers should consult a qualified attorney before acting on any matter discussed here.