Paul Allen Sues Apple, Google, Others Over Patents

They're the everyday fixtures of the Internet experience: pop-up stock quotes on a website, suggestions for related reading near a news article, videos along the side of your screen.

Now, Microsoft Corp. co-founder Paul Allen says he owns the technology behind all these ideas, and he's demanding that some of the world's top Web companies pay up to use them.

The 57-year-old software guru on Friday sued much of Silicon Valley, claiming Internet giants such as Google Inc., Facebook Inc. and eBay Inc. have built their businesses around what he says is his technology.

Mr. Allen's suit, filed in federal court in Seattle, asserts those three companies and eight others are using technology developed a decade ago at the billionaire's now-defunct Silicon Valley laboratory. Mr. Allen, a pioneer of computer software, didn't develop any of the technology himself but owns the patents.

His targets vowed to fight. "This lawsuit against some of America's most innovative companies reflects an unfortunate trend of people trying to compete in the courtroom instead of the marketplace," a Google spokesman said. Other companies named in the suit said they planned to defend themselves or weren't available to comment.

Patent litigation in general is on the rise, in what is becoming a lucrative endeavor. Ocean Tomo, a Chicago-based merchant bank that tracks the intellectual-property market, values the licensing market at as much as $500 billion.

Mr. Allen's lawsuit comes amid high-profile successes of firms such as NTP Inc., which enforce patents without making products and have been called "patent trolls" by critics. Courts have tried to rein in patent litigation, with mixed results, and Congress has yet to act on legislation that would do the same.

via Paul Allen Sues Apple, Google, Others Over Patents - WSJ.com.