Microsoft Co-Founder Sues Major Tech Companies

Microsoft co-founder Paul Allen is reaching back in time to file a lawsuit against some of the best-known technology companies of today. Allen contends that Google, Apple, Facebook and Yahoo all breached patents owned by one of his former start-ups.

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Google, Apple, eBay, Facebook, Netflix and Yahoo all have something in common, and it's not just that they're based in Silicon Valley. Today, all these major tech companies are targets of a multi-million dollar patent lawsuit. The suit is being brought by Paul Allen, who was a co-founder of Microsoft.

NPR's Laura Sydell has the story.

LAURA SYDELL: Back in 1992, Paul Allen co-founded a company called Interval Research. At the time, there was a lot of fanfare and it was known as the place to do cutting edge technology research. But eight years later, Interval closed its doors without having invented anything that got much attention. But Paul Allen now wants to draw attention to some of Interval's work.

David Postman is his spokesperson.

Mr. DAVID POSTMAN: Some of this work was far ahead of the market and then a surge in e-commerce evolved, and it became clear that what Interval had done was being adopted by these big companies.

SYDELL: The complaint against a total of 11 companies was filed yesterday in a federal district court in Seattle. The complaint lists patents like a system that gives you ads related to what you are browsing on the Internet and a system that keeps the ads out of what you are seeing on the main page.

Postman says Interval discovered these systems first.

Mr. POSTMAN: You know, I'm sure you can think of lots of different ways where that shows up.

Professor MARK LEMLEY (Law, Stanford Law School; Patent Attorney): You have to be first, but it's not enough to be first.

SYDELL: That's Mark Lemley, a patent Attorney who teaches at Stanford Law School. Lemley says just because you do something that no one else has done before doesn't mean it's worth a patent.

Prof. LEMLEY: So, somebody was the first person to decide you could sell pet food on the Internet. But if you could sell 20 other things on the Internet, the conclusion, oh, I could sell pet food on the Internet isn't patentable because it's obvious.

SYDELL: Or at least Lemley thinks that certain concepts should not get patents. But the ones cited in the complaint from Interval are patented. Lemley doesn't think that means much because many of the patents were given at a time when the U.S. Patent Office was a mess.

Prof. LEMLEY: When the patent office in this field was pretty notorious for lax control, wasn't doing a very good job of finding and weeding out the good from the bad patents.

SYDELL: Several of the companies targeted in the lawsuit have issued statements. Google said the suit reflects an unfortunate trend of people trying to compete in the courtroom instead of the marketplace. Ebay charged that the suit was without merit. Other companies such as Yahoo, Apple and AOL aren't commenting. Notably absent from the list of defendants is Microsoft, the most famous company Paul Allen helped found, and Amazon, the other major tech company based in Allen's hometown of Seattle.

I asked Postman, Allen's spokesperson, why they weren't on the list.

Mr. POSTMAN: We chose the targets we chose for our own reasons. And beyond that, I'm not going to comment on what we consider to be litigation strategy.

SYDELL: Paul Allen is not an investor in Amazon. But, indeed, patent attorney Lemley thinks keeping it off the list may be a way to make the Seattle court and any possible local jury more sympathetic.

Prof. LEMLEY: If you want to play hometown favorite and sue in Seattle, you're probably better off not suing other hometown favorites.

SYDELL: Within Silicon Valley, there is a lot of speculation about why Paul Allen is bringing this suit 10 years after Interval Research shut down. All Allen's side says is the suit has been in the works for years.

Laura Sydell, NPR News, San Francisco.

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