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Overture Files Patent Infringement Lawsuit Against Google

 5:39 pm on Apr 5, 2002 (gmt 0)

The lawsuit charges Google with infringement of Overture's U.S. Patent No. 6,269,361. The '361 Patent protects various features and innovations relating to bid-for-placement products and Overture's Pay-For-Performance search technologies including its DirecTraffic Center account management system and tools.

PR [corporate-ir.net]



 7:38 am on Apr 6, 2002 (gmt 0)

A "Web community" led by Sequoia Capital and Kleiner Perkins [google.com] ?


 7:41 am on Apr 6, 2002 (gmt 0)

As a truly objective observer ,Google has every right to do what they are doing with adwords and overture has aboslutely no say in the matter. Google can charge whatever they want for their content.

Say I open up my own pay-for-subscription message board do I owe every person who opened up a pay-for-subscription site a royalty? Who owns the patent for selling an e-book online?

This is a ridiculous lawsuit... Does the first person who freezes lemonade and then licks it, own the rights to the pop-sickle?



 7:56 am on Apr 6, 2002 (gmt 0)

Mike Maclkin wrote.. "...A "Web community" led by Sequoia Capital and Kleiner Perkins ?..."

Yes absolutely. I wrote "at this time" and "perception IS reality" for those very reasons. At present I believe (and that is a perception by itself) that Google is pereived at this time to have strong brand strengths which revolve around objectivity, fairness, usability, and community.

Depsite upcoming IPO's, and Sequoia Capital and Kliener Perkins notwithstanding, Google has been "adopted" by many and is a cuddly, politically correct (eg: gun ads), pop cultural (eg thread on West Wing dialogue), and is the darling of the community "free press" based Web log community.

Im not saying that this is how things should be, or that it is a correct reflection of reality.

What im saying is that it is the perception. And in this brand-crazy world where spins and propaganda are powerful opinion leaders..., perception is much stronger than reality.

Attack a popular brand that is seen to be of a value to a community as a whole, rather than t its shareholders and direct clients only, and you are looking for a PR disaster.


 8:06 am on Apr 6, 2002 (gmt 0)

Overture has done exactly the same thing it has always done since day one. They invented the ppc listing model. No one was doing what they were doing when they started. Everyone said they would not last a year. Here we are four years later and what are they doing? The exact same thing they did when they started. The terms of operation haven't changed one bit.

Overture filed for and was granted a patent [patft.uspto.gov] on that invention. Law suits are not sport. They have a duty to themselves and their stock holders to defend that patent which they invented and feel is being infringed upon. Whether they will win or not is up to the courts to decide. It's neither a frivolous action or without merit. I'd say their chances of winning are pretty good.


 8:42 am on Apr 6, 2002 (gmt 0)

Given that Overture have a patent, the responsibility falls on Google to prove that they are not in violation of that patent. Given the timing, and that that Overture may have deeper pockets that Google, I would hazard a guess that this may never make it to court.


 9:34 am on Apr 6, 2002 (gmt 0)

I can't agree with BT on this one. If Gov have such a good case, then why didn't they take out e-Spotting, Kanoodle and all the others in their infancy?

These are all FAR closer to the Gov model than Google's is. And then thereis L$. Why didn't they wait a week or two to see what is on the agenda there?

No, this looks like a quasi business-political decision, fueled by some of the factors above and probably a feeling that they have to do SOMETHING to combat Google's advances. My feeling is that it has little to do with the merits of the case itself.

Looking down the line, I suspect they looked at their own crude PPC model, pitched directly against Google's PPC+true-relevence search offering and saw only one outcome.... a bleak one for them. This suit was one of only a few options available.

Whether it is right that the law should be used so readily to seek business advantage rather than to seek justice is another matter.


 9:38 am on Apr 6, 2002 (gmt 0)

The patent [patft.uspto.gov], was filed in 99, but not granted until july of last year. As we've seen, they did file against other se's (FindWaht). Espotting is not in the United States where the patent was granted.

Mikkel Svendsen

 10:41 am on Apr 6, 2002 (gmt 0)

> Espotting is not in the United States where the patent was granted.

Good point Brett!
Most of this kind of patents can't be made in Europe. In Europe, most software fall under the copyright laws - not the patent laws. So Overture will most likely not be able to sue any PPC-engines over here in the way they do it in the US.


 11:02 am on Apr 6, 2002 (gmt 0)

>google's fan brigade..

Don't get me wrong, I'm a fan of Google - and any search facility which provides accurate results - and agree with its' perceived position as the 'honest' people in an increasingly commercial marketplace. However Google is not in existence as a hobby - it needs money too. It has crossed over into another player's territory and this action (which I agree with Brett is not completely without merit) is their first public shot across the bows in the hard world. It is (as I said) going to be interesting to see how Google responds. It may reveal something of their real game plan.


 11:57 am on Apr 6, 2002 (gmt 0)

Someone else mentioned it previously, but this could have a major impact on Looksmart (and therefore MSN) as they move to the PPC model. Are we going to see an 'Overture Tax' on all Looksmart and Google PPC listings?

And what about all those smaller engines that use the Smart Search PPC software - are they going to be next?


 2:53 pm on Apr 6, 2002 (gmt 0)

File your U.S. application before you commercialize, publish, or otherwise publicly disclose the invention.

This is the thrust of the argument presented by FindWhat that may topple all claims Overture has to the patent.

According to the countersuit, the model was in use in beta and as a finished product before the application for patent was filed. If it can be proven that any revenue was generated before the patent was issued, Overture is on really shakey ground. If an Overture press release can be found publicising their model prior to the issuance of a patent, once again, they may have shot themselves in the foot.

All legal actions have implications and repercussions but that doesn't mean they aren't frivolous. If Google's model is significantly different from Overture's then the suit may indeed be without merit. Action and reaction can't be patented. At first glance, it appears that Overture is trying to patent exactly that. More monies paid equates to a more prominent listing. That isn't patentable. Classified ads have made that model public domain for years.

There seems to be an underlying current of thought that because they have a patent that Overture only needs to prove that the patent is infringed. What they may have done is opened the door and allowed for a review of the validity of the patent by more than one company in open court. They may have been hoping for a quick settlement by Google in hopes of that decision reinforcing their position in the FindWhat suit. That follows the basic tenet followed by all lawyers, if your position is tenous, attack.

It's entirely possible as well that Overture is quite wrong, and will win in court anyway. It's happened with far more significant patents than a PPC model. Just ask any elementary student who invented radio. Unless you're in Serbia, you will more than likely get the wrong answer.



 3:44 pm on Apr 6, 2002 (gmt 0)

I think one core thing we are forgetting, is that if you read the patent, it includes and discusses search result list:

...influencing a position on a search result list generated by a computer network search engine

Google is not doing that. They are selling pure advertising, not a search result list - there is actually no search involved in Googles advertising displays.

Also remember, Overture sued (then Goto.com) Disney's Go.com and won.


 6:45 pm on Apr 6, 2002 (gmt 0)

I belive that the keyword-based advertising model is considered to be a search result.

Search keywords are analysed and then corresponding results are presented to the user. The relevancy metrics used include the $ figured paid to Google.

Google doesn't have enough of a defensive patent protfolio to protect against this sort of suit by threatening counter-suits.


 8:11 pm on Apr 6, 2002 (gmt 0)

>>Most of this kind of patents can't be made in Europe. In Europe, most software fall under the copyright laws - not the patent laws. So Overture will most likely not be able to sue any PPC-engines over here in the way they do it in the US. <<

Sound like those folks in Europe have much more common sense than here in the US.

The legal arguements are interesting and will, of course, ultimiately decide the outcome, along with lots of "Spin" and maybe some "expert testimony".

There ought to be a supreme court of common sense that has the power to toss out court cases and ruling that are contrary to the public interest.

While Overture is at it, maybe will sue LookSmart and get an injunction that would put a halt to the new small business "upgrade" everyone is getting. I for one would be heartbroken should such an event occur.:)


 12:48 am on Apr 7, 2002 (gmt 0)

Also remember, Overture sued (then Goto.com) Disney's Go.com and won.

That was about a trade mark graphic logo, not a patent, which are two completely different animals. Or did they sue (and win) them twice?


 9:35 pm on Apr 7, 2002 (gmt 0)

...influencing a position on a search result list generated by a computer network search engine

Google have fully clarified on their home page of what they are selling

Advertise with Google's cost-per-click Adwords Select

this does not say get better search results by paying money - it says advertise.

So if OverTure sue Google for this, then are they going to sue all those people who sell banner ad space per click? - I don't think so!

<rant>But then, he who has the most money wins the court case...</rant>

Cheers, Jaze


 3:34 am on Apr 8, 2002 (gmt 0)

>>So if OverTure sue Google for this, then are they going to sue all those people who sell banner ad space per click? - I don't think so!<<

I would suspect that if those people were determining which banners to display depending on the results of your search that the answer might well be yes.


 5:31 am on Apr 8, 2002 (gmt 0)

I have to disagree slightly with the lawsuit-not-sport idea. It seems that lawsuits are today's equivalent to duels. Instead of drawing guns and blood, we draw lawyers and money...

About the case, Overture has to prove that the patent pertains to a specific idea/product. If their patent is precise and encompassing, they have a chance. The way it seems, however, is that they have a loose patent, which won't stand up. All that Overture has patented is e-bribery, and bribery has been around for millenia.

As seen in the recent Windows vs. Lindows suit, even an extremely recognisable brand name like Windows may be too loose of a patent. If Microsoft can't win this case, Overture has no chance. Technology companies have been given loose patents at an alarming rate because the area is so new. There is no authoratative sources for the patent granters to seek out to find commonality, previous usage, or non-patentable areas since technology changes too quickly. By the time they compile their information, the landscape has changed drastically.

Patents are useful, but it seems like these days, they are being used to stifle competition and innovation.

Let's look at recentpatents: Microsoft Windows (windows was a commonly used term for similar OS-types at the time), Amazon 1-Click (ridiculous patent), and my favorite, the man in Australia who just recently patented the wheel.

There are so many cures to diseases that would be found already if it weren't for patent abuse in the pharmaceutical sectors - they can patent an idea for a drug or treatment. No other company will attempt a similar treatment of research for risk of losing it all to a lawsuit...


 6:22 am on Apr 8, 2002 (gmt 0)

In our haste to villify those whom we don't quite agree with, lets not forget that patents are a legal necessity in the times we live in. They serve to protect those who, having done the necessary thinking and research, need protection from others who would profit at the expense of these thinkers and doers.

It is up to the courts to decide if Google has violated Overtures patent, but the fact remains, Overture do have the patent and the legal protection that goes with it.

Its easy to toss off a line saying there is nothing original with Overtures idea, but that is head in the sand thinking, since they were the first to do PPC, are the most successful at it, and have, like it or not, built a system whose market reach has now eclipsed Googles. In other words they are successful and there is no denying they are among the most profitable search entities in existence.

I find it strange that those who on the one hand say Google is great because they are not tainted by money, and that Overture sucks because they are not willing to provide free search, are now saying why shouldn't Google be able to do the same thing as Overture if they want to.

Google recognizes the advantages of the system and has attempted to mimic it in order to make themselves profitable. The question is have they stepped over the line or not?


 9:19 pm on Apr 8, 2002 (gmt 0)

since they were the first to do PPC
for search engine placement maybe, but what about sites/companies who charge per click for a banner ad?

I think Google is somewhere in the middle.


 3:33 pm on Apr 9, 2002 (gmt 0)

I have been sitting around thinking about how Google can fight Overture. When we were considering Overture, we declined because they did not provide proof that the clicks were not coming from our competitors. Is this still the case?

If so, that seems to be a point upon which Google could fight them. If Google were to provide this kind of service, they have differentiated/improved their product from Overture's patented business model significantly...which should be considered in a patent infringement case.


 3:48 pm on Apr 9, 2002 (gmt 0)

>Is this still the case?

Letting that stand in the way of using a good advertising resource is like not investing in Walmart [investor.walmartstores.com] because they can't provide proof that of the 962,000 employees a few will not be involved in theft.



 7:16 pm on Apr 9, 2002 (gmt 0)

That wasn't the only reason.

>Letting that stand in the way of using a good advertising resource is like not investing in Walmart because they can't provide proof that of the 962,000 employees a few will not be involved in theft.

Actually, it's more like not doing business with WalMart because they won't guarantee that the products they sell aren't made by children in Chinese sweatshops.


 8:51 pm on Apr 17, 2002 (gmt 0)

I just saw Danny Sullivan's analysis of the Overture vs. Google patent suit in the latest Search Engine Update, which brought me over here.

When doing infringement analysis it's important to note that the part of the patent you look at to see if it reads on a potentially infringing product/method/process would be the claims of the patent.

The quotes I've seen here and in SEUpdate from the patent have been from the abstract of the patent, which doesn't really even count legally (although some judges have used it for clarification as to what the claims mean, in case the meaning of the claims isn't clear).

What FindWhat.com is doing is trying to invalidate the patent based on what's called a Section 102(b) "On Sale Bar", which bars an invention from being patentable if the application to file (including any priority dates) a patent on the invention was filed more than one year after the invention was first sold to the public (in simple terms - there are a lot of issues on how all this is determined, including publications, etc.)

In any event, in doing a cursory review of claim 1 of the Overture patent, they do appear to have the basis of a case against Google...



 9:17 pm on Apr 17, 2002 (gmt 0)

Thanks for stopping in and for the clarification PatentGuy.

So in otherwords, you need to apply for a patent *before* selling an invention. Thanks.


 9:43 pm on Apr 17, 2002 (gmt 0)


Not really - you just need to file before a year has gone by after you first offered your invention publicly for sale in the U.S., although typically people/companies will file patents at the same time as they unveil their inventions for public consumption.



 9:34 am on Apr 19, 2002 (gmt 0)

hmmm... i guess it could go either way, but even if google does lose, surely all they have to do is "relocate" to another country then carry on as normal? it wouldn't necessarily mean moving all staff and equipment, just having the company officially registered in timbuktu (or anywhere else that suits) should cure the problems shouldn't it?


 5:29 pm on Apr 19, 2002 (gmt 0)

Patent infringement is based on where the infringement occurs, not where the companies are located. For example, a particular product may be okay to sell in Taiwan, but importing it into the U.S. could result in an infringement situation if a U.S. patent covers that product. So, Google moving would have no effect if users in the U.S. still had access to their search engine and the Overture patent were upheld as a valid and applicable U.S. patent.

However, patent infringement on the Internet, i.e. where the infringing activity occurs, is something of a gray zone - I don't believe there've been any rulings on geographical jurisdiction in Internet-site specific patent ligitation cases as of yet.



 9:30 pm on May 1, 2002 (gmt 0)

What's the latest on this - any news or do these law suits take forever to get off the ground?

Even more interested now that AOL has changed from OverTure to Google!


 9:35 pm on May 1, 2002 (gmt 0)

Lawsuits like this take a long time to get to trial - from my experience, about 2-3 years from when the suit is first filed.

Even though AOL dropped Overture, I just got an e-mail from Overture saying they had signed a long-term deal with Yahoo. Don't know if this is merely posturing (rehashing old news) or real new news though.



 6:52 am on Jun 20, 2002 (gmt 0)

The follow-up on Bloomberg [quote.bloomberg.com]

This 62 message thread spans 3 pages: < < 62 ( 1 [2] 3 > >
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