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AT&T sues Ebay & Paypal

Unknown
edited March 2004 in Science & Tech
AT&T has filed a legal action against Ebay and Paypal claiming that the auction giant is breaching patents it owns.

According to the law suit, filed in a US federal court yesterday, both Ebay and Paypal technology breaches an AT&T patent for transactions using trusted intermediaries processes payments over the Internet.

The US giant wants Ebay and Paypal to compensate it for using what it claims is its technology.

The patent in question is 5,329,589, which describes "Mediation of Transactions by a Communication System".

Source: [link=http://www.theinquirer.net/?article=12785]The Inquirer[/link]

Comments

  • EnverexEnverex Worcester, UK Icrontian
    edited November 2003
    So basically they are saying they have patented paying for anything over any form of communicating medium? So it is breaching their patent to buy over the phone, or over the internet, or to even talk to someone.... slightly broad to be honest...

    NS
  • kanezfankanezfan sunny south florida Icrontian
    edited November 2003
    funny how they decide this now, right when they cannot call you at home anymore due to the do-not call list.
  • EnverexEnverex Worcester, UK Icrontian
    edited November 2003
    kanezfan had this to say
    funny how they decide this now, right when they cannot call you at home anymore due to the do-not call list.

    They have to piss people off somehow. When one avenue is cut off they simply take another. AT&T just got on my list of "As bad as spammers. Do not ever use".

    NS
  • AranyicAranyic Casstown, OH Icrontian
    edited November 2003
    Hell why not just sue the USPS for money orders :/, how dare they allow people to get guarenteed checks. And they need to sue the banks too, bastards and thier billpay services.

    Seriously though this is ridiculous, I hope a judge stops AT&T in their tracks.
  • Omega65Omega65 Philadelphia, Pa
    edited November 2003
    Software patents for electronic methods of normal commerce is Patently ridiculous (Pun intended)
  • TheSmJTheSmJ
    edited November 2003
    I'll be shocked if AT&T wins this.

    Unless there's more too this patent than what they tell us here (I'm too lazy to look it up ATM) it's just too broad, and will get thrown out, with the patent modified or repealed.
  • Straight_ManStraight_Man Geeky, in my own way Naples, FL Icrontian
    edited November 2003
    Actually, they have legal grounds for what they are doing. At the time the patent was filed, they OWNED most of the electronic telecommunications infrastructure in the US. And this is mediation, not pure processing like you do over the phone or is done with a client direct to bank batch auth with a live preauth as is COMMON for most Credit Card terminals. No, that would not apply here.

    Mediation is using data telecom to pass monetary transactions via a third party, and they USED to get this revenue with Data verified line flow and base rate fees and installation costs to customers. So now they are using what IS theres, just as others have historically done. In this case, they would be foolish NOT to sue. Banks may indeed already be paying fees on the basis of this patent already, if they accept transactions through derivative payment mediation over the Internet (as opposed to fixed number dialin of transactions, which is what the CC companies do, they pay fees for an 800 data dedicated and verified line already and thus are unlikely to be sued. Faintly possible is a suit against Nova, which collects some rather large upfront percentages, though they are LOW enough that third parties can in essence lease merchant credit card processing and make a very tiny part per transaction and RENT terminals to merchants. First Bank, on the other hand, uses mostly dedicated lines and is chaffing at the high cost of Telecomm. First Bank is one of the major Visa core and central processors.

    What eBay did, and this kind of erks me, is to BUY PayPal and run it as a separate operating division of eBay. Thus they own the mediation service they long used and thus ARE mediator and a major transaction source under one umbrella. They make some money with PayPal Visa, but not much as Providian Bank owns that and in fact handles all account security. They, eBay, are now getting a reality check.

    John-- who has never gotten what exactly what was implied on eBay, but has gotten CLOSE a few times and used Providian policies to DEROGGATE the rest peremptorily.
  • LeonardoLeonardo Wake up and smell the glaciers Eagle River, Alaska Icrontian
    edited March 2004
    Yes, this is a rather sleezy lawsuit - legal or otherwise. It's not all AT&T's fault though. There are thousands of tech patents out there that should never have been granted. It has been a very big problem of technology advancing faster than national patent office's understanding of the technology. What we have now are overworked patent abjudicators, accustomed to blueprints, three-dimensional drawings, and prototype engineering samples being faced with the requirement to make decisions about technologies they scarcely understand, that they can't physically examine, or that are not readily apparent after a three-view diagram.
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