Patent dispute settled in favour of online retailers

Thursday, January 31, 2013 - 09:23 by Simon Crisp

Patents are an important tool that allow individuals and companies to protect and license the innovations that they have made for legitimate financial gain.

However, there are some groups that exist solely to exploit patents and make cash from law suits, without doing any real work.

One such suit that was settled this week in the US was threatening the entire e-commerce market and its ramifications could have caused a pervasive change in how retail operates in the online space.

Gizmodo reports that a firm called Soverian Software has been suing a number of major American e-commerce companies over the past decade and its ultimate goal was to try and take home one per cent of every sale made via safe shopping online.

This would amount to billions of pounds from this global market. In fact, the company has already made millions in court from big players, such as Amazon, Victoria's Secret and The Gap.

But an ongoing battle with e-commerce site, Newegg, which the retailer actually won, could prove to be decisive in the cessation of Soverian Software's activities.

The patent in question was to do with shopping cart systems, which remain an essential part of the experience of safe shopping online.

Newegg spokesperson, Lee Cheng, explained that his firm had been unwilling to give up or make any kind of settlement with Soverian Software and had thus been able to fight on and ensure that common sense won the day.

If Soverian did end up with a one per cent stake in every purchase made through an online checkout system, consumers would inevitably take the hit, since most e-commerce sites operate on razor-thin margins at the best of times.

Hopefully, this court ruling will put any other major patent disputes to bed before they cause any disruption.