Online auction giant eBay is facing a rather serious patent dispute over one of its more popular functions. The so called 'buy it now' feature often seen on auctions allows users to end the auction early at a pre-determined price. The problem is the action is detailed in a patent filed by MercExchange, who've taken eBay to court.
MercExchange's patent was filed in 1995, the same year eBay started operations. It details a method to end and online auction early via set price. 6 years later, the USPTO granted MercExchange the patents. Ebay apparently entered into negotiations with the company regarding its use of the technology, yet failed to reach an agreement and was subsequently sued. In recent developments, the US government has filed brief against eBay, stating that the company should be forced to stop using the Buy It Now function on its websites.
A previous settlement figure floated was around $25m, relatively little in comparison to the recent settlement RIM faced over it's patent problems. However, the case highlights serious worries amongst online business, who fear the financial damage of 'automatic' court injunctions over patent disputes. Patents have become especially potent in the past few years, with a new breed of companies springing up whom hold patents for products they don't actually 'make' or 'use'; MercExchange, for example, doesn't have any business in online auctions.
News source: Arstechnica