eBay Settles Patent Suit With MercExchange

eBay and MercExchange have reached a settlement that finally puts to rest a patent dispute that at one time went as high as the U.S. Supreme Court and that started back in 2001.

eBay and MercExchange had been involved in litigation over MercExchange’s patents and eBay’s online auctions and fixed price related ecommerce operations.

As part of the settlement, eBay will buy all three patents involved in the lawsuit, along with additional related technology and a license to another search related patent portfolio that was not named in the lawsuit. eBay says the assets will allow it to enhance its operations and safety efforts on its sites.

In 2003 a jury found eBay’s "Buy It Now" feature infringed MercExchange’s patents for an online marketplace. A jury sided with MerExchange and awarded the company $30 million for infringement, which was later reduced to $25 million on appeal.

"We’re pleased to have been able to reach a settlement with MercExchange," said Mike Jacobson, eBay Senior Vice President and General Counsel.

"In addition to resolving the litigation, this settlement gives us access to additional intellectual property that will help improve and further secure our marketplaces."

Terms of the settlement are confidential and were not released. eBay says it does not expect the settlement to affect its 2007 results or its 2008 financial guidance issued with it fourth quarter earnings in January.