Yahoo Sues Facebook
Date posted: March 14, 2012
Things are getting ugly in the ever merging search engine/social media sphere, with news that Yahoo is suing Facebook for allegedly infringing on their advertising, messaging and social networks patents.
The allegations claim that Facebook is infringing on patents involving messaging, news feed generation, social commenting, advertising, click fraud and more (for a grand total of 10 patent infringements). Yahoo has a series of patents in this realm, including a patent related to personalized ads and patents allowing users to customize shared information (meaning privacy control).
The lawsuit goes a little further than that though. “Facebook’s entire social network model, which allows users to create profiles for and connect with, among other things, persons and businesses, is based on Yahoo’s patented social networking technology,” the company’s lawyers alleged in the suit, filed on Monday.
“To build a successful website, users need to have been easy access to many functions and tasks such as messaging and privacy options. The website owner needs revenue through functions such as advertising. All of these functions involve Yahoo innovations,” the lawsuit said, claiming ultimately that, “without Yahoo’s achievements, websites such as Facebook would not enjoy repeat visitors or substantial advertising revenue.”
If this all sounds unexpectedly catty and after-the-fact, there’s a reason: Facebook is in the IPO process, and, with billions of dollars on the line, it is unlikely to want to get down into a dirty litigation battle.
There is a precedence for this kind of behaviour from Yahoo, as the company also sued Google for patent infringement just as the search engine giant filed its IPO. Google settled with Yahoo (offering 2.7 million shares), but as Business insider reporter Jim Yarrow writes, there was a reason for that, “The reason Google settled with Yahoo is because Yahoo had a legitimate case on its hands. Yahoo bought search engine Overture, which was the first to come up with auction system for paid click ads in search. In his book on Google, “In The Plex,” Steven Levy writes, Google “adopted” Overture’s idea of pay per click, as well as Overture’s auction system.”
The case is far less open and shut against Facebook, which makes all of this that much more interesting. We’ll have to stay tuned to see how the social media giant reacts.
What do you think?