January 21, 2004

E-Data Wins, Innovative Business Loses

Chuck Talk writes "In a rather stunningly foolish move, Microsoft have settled a cause of action filed against them by E-Data Corporation. The amazing thing about this settlement is that it is not so clear what exactly the patent covers, being that the stated wording of the patent seems to cover every act of downloading information and obtaining purchased goods.

In one fell swoop, Microsoft capitulated to the E-Data Corporation without really trying to defend the absurd nature of the patent. Every business throughout the world was placed into harms way by their failure to stand up to this litigation. Now, E-Data Corporation has some precedent established from which to begin suits against anyone who sells anything that is downloaded over the Internet. Such is the state of the business climate in the United States at the moment. It appears that freewheeling litigation without thought of the consequence is more important than creating new business of jobs.

It is rather amazing that E-Data corporation has sued for such patent infringement, especially given that the patent clearly is in dispute with the patents held by AT&T for all forms of electronic payments and E-Pass for electronic commerce devices and systems. I am not a lawyer, but I do foresee a rather large electronic payment Patent War looming.

Who really holds the rights to electronic payments online will ultimately ruin the industry and slow the system of Internet Commerce unless the United States Patent and Trademark Office is finally given the priority for resources it needs to squash patents that are clearly out-of-date and no longer applicable. I was under the impression that patents expire after seventeen (17) years, and the E-Data Corporation seems to have exceeded the term of the Freeny Patent (US #4,528,643) by two years, given that the date of issue was July 9th, 1985. In fact, the E-Data Corporation litigation filing was performed some nineteen (19) years after the date of issue for the original patent."

Link: orangecrate.com

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