Sunnyvale, California — Barely two weeks back, web pioneer Yahoo Inc., warned popular social networking outfit Facebook if it does not agree to license patents it owns, the search giant made good on its promise. On Monday, the Sunnyvale, Calif.-based Yahoo filed suit against Facebook in a California court accusing the social media humongous of infringing on 10 patents held by the Internet pioneer, opening the first major legal battle among big technology companies in social circles.
Yahoo, in a 19-page lawsuit filed in a San Jose, California federal court on Monday, marks a major escalation of patent litigation that has already swept up the smartphone and tablet makers and marks a new front in the battles between high-tech stalwarts such as Apple Inc, Microsoft Corp and Motorola Mobility Holdings Inc.
Although Facebook denies the allegation, the move comes in advance of Facebook’s planned flotation later this year. The case filed in the US District Court for the Northern District of California, alleges Facebook of infringing on patents in several areas including advertising, privacy and messaging.
A statement from Yahoo indicates that the web portal believed it has a strong case. The Sunnyvale, California-based Yahoo appealed the court in San Jose to order Facebook to halt its alleged patent-infringing activities and to assess unspecified damages.
“Yahoo’s patents relate to most modern innovations in online products, including in messaging, news feed generation, social commenting, advertising display, preventing click fraud and privacy controls,” its suit said.
Elaborating on the issue the company said, Facebook’s entire social network model, which empowers users to create profiles and connect with, among other things, persons and businesses, is based on Yahoo’s patented social networking technology.
“Yahoo has invested valuable resources in research and development through the years, which has resulted in several patented inventions of technology that other companies have licensed,” Yahoo said in a statement.
The social media network indicated that it believed that Yahoo had not attempted strongly to settle the matter without involving the courts. It described Yahoo’s action as “puzzling”.
Facebook spokesman Jonathan Thaw said Facebook learned of the lawsuit through the media.
“We are disappointed that Yahoo, a longtime business partner of Facebook and a company that has substantially benefited from its association with Facebook, has decided to resort to litigation,” he said.
“These technologies are the corner stone of our business that engages over 700 million monthly unique visitors and represent the spirit of innovation upon which Yahoo is built,” the company said.
“Unfortunately, the issue with Facebook remains unresolved and we are compelled to seek redress in federal court,” it said. “We are certain that we will prevail.”
“Once again, we were informed of Yahoo’s decision simultaneously with the media,” the spokeswoman said. “We will defend ourselves vigorously against these puzzling actions.”
In fact, peeping through these patents, it is clear to see that while Facebook may or may not be in the wrong–let us leave that in the hands of courts to decide that–the social network clearly has a number of features in which Yahoo has got itself worried about.
Here is what some of the the patents speak for itself:
U.S. Patent No. 6907566, 7100111, 7373599 — “Method and system for optimum placement of advertisements on a webpage”
These patents refer to where Facebook places its advertisements, such as “Sponsored Stories” on the right hand side of each page. These three patents, which Yahoo claims a stake in, are described as being able to change and adapt based on the “likelihood that an event will occur” based on other factors, like clicking ‘Like’ on a business page.
U.S. Patent No. 7668861 — “System and method to determine the validity of an interaction on a network”
This patent allows the detection of keywords in a set of data, such as a status update. This could easily relate to tagging names in status updates or tagging other users in photos, for example. Ultimately, it keeps a quiet tab of how often you contact or interact with people to then make them appear higher up in Facebook search rankings, for example.
U.S. Patent No. 7269590 — “Method and system for customizing views of information associated with a social network user”
This patent allows for a user’s personal information to be added to a social network, for which then others within that social network can be brought together by similar personal data, such as “dating, employment, hobbies, and the like”. This gives Facebook the juice to define the experience for its users based on the information they upload, and to display friends’ content more prominently based on many other mitigating factors.
U.S. Patent No. 7599935 — “Control for enabling a user to preview display of selected content based on another user’s authorisation level”
This one allows for two users to interact with each other based on their relationship. It allows a first user to preview content as it would be seen by a second user, provided that second user had a relationship with the first. It means users on Facebook, simply put, share content, messages and items with selected people.
U.S. Patent No. 7454509 — “Online playback system with community bias”
In terms of Facebook, it is a music station that is based on what you and your friends listen to. It grants user entertainment according to a community of similar tastes. The “with a community bias” bit allows fan pages of bands, businesses, and all kinds of other industries to interact with the social network’s users.
U.S. Patent No. 5983227 — “Dynamic page generator”
And here’s the “Timeline” patent, basically. This patent allows a page template — like an empty Facebook profile page — to be filled in with content. While the patent refers to “stock quotes, news headlines, sports scores, weather, and the like”, it apparently also relates to music, photos, and status updates from ordinary users.
U.S. Patent No. 7747648 — “World modeling using a relationship network with communication channels to entities”
This patent allows you to message your friends, and allow them to message you as though it was real world communication. Facebook is ultimately all about whom you connect with — and not just your friends. This patent makes it happen, by giving users a “communication channel” to other people and businesses, events, and communities.
U.S. Patent No. 7406501 — “System and method for instant messaging using an e-mail protocol”
And finally, and simply put — because it’s the easiest of them all — this patent makes communication between an instant messaging client and email work. It allows for an instant messenger user to use an instant messenger, and share messages with an email user who is using an email client, and the two are none the wiser that each other are using different platforms. The experience is seamless. Facebook introduced such a feature when it rolled out Messages last year.
Data Source: (Zdnet)
Among other things, the lawsuit claims that from instant messaging to email patents, to the ones that appear absolutely crucial to the social network’s advertising business model, should Yahoo win, Facebook could be in deep trouble.
Yahoo’s lawsuit comes about five weeks following Facebook’s announcement of plans for an initial public offering that could value the company at about $100 billion.
Once considered as the Internet’s leading light, Yahoo has struggled in recent years to formulate a strongly profitable, growing business out of its huge Web presence and global audience.
Scott Thompson, formerly head of mobile payments firm PayPal, became chief executive at Yahoo at the beginning of this year promising urgent action to turn the company around.
The case in U.S. District Court, Northern District of California is Yahoo Inc. v. Facebook Inc., 12-cv-1212.
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