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Federal Circuit Affirms Newegg Patent Victory

Weil secured a significant appellate victory for client Newegg Inc. on May 15, 2013 in a patent infringement litigation brought by Alcatel-Lucent USA Inc. regarding e-commerce-related patents. The U.S. Court of Appeals for the Federal Circuit affirmed the lower court’s decision invalidating one of Alcatel-Lucent’s e-commerce patents concerning the exchange of information with multiple users.

In 2009, Alcatel-Lucent sued Newegg, Overstock.com Inc., and eight other online retailers (Amazon, Intuit, Kmart, Land’s End, Netflix, QVC, Sears, and Zappos) in the U.S. District Court for the Eastern District of Texas alleging that the retailers had infringed upon three of its e-commerce patents. Alcatel-Lucent sought $12.4 million from Newegg and $6 million from Overstock, and entered into settlement agreements with the eight other online retailers. Following a four-day jury trial, the district court found that Newegg and Overstock had not infringed upon any of the three patents at issue and held that one of these patents had been rendered obvious, and thus invalid. The appeal focused on the invalidated patent.

Weil Patent Litigation partner Edward Reines argued the case before the Federal Circuit on behalf of Newegg and Overstock (Newegg’s joint defense partner). The decision stands to benefit many other companies, including Barnes & Noble Inc., which currently is defending itself against patent infringement claims concerning some of the same patents in New York federal court.

The Federal Circuit’s decision in Alcatel-Lucent USA Inc. v. Overstock.com, Inc. marks Weil’s second win for Newegg this year. In January 2013, Weil obtained a significant appellate victory on behalf of Newegg in an e-commerce patent infringement case brought by Soverain Software LLC.

In addition to Silicon Valley-based partner Edward Reines, the Weil team representing Newegg included Patent Litigation associate Timothy Saulsbury.

This news appeared in the following outlets (may require registration/subscription):

  • Bloomberg / Bloomberg Businessweek: Overstock.com, Newegg Win Patent Appeal on Alcatel-Lucent (May 15, 2013)
  • The AmLaw Litigation Daily: Weil Wipes Out Alcatel E-Commerce Patent for Newegg, Overstock.com (May 15, 2013)
  • The Recorder: Alcatel Loses Infringement Appeal Against Newegg, Overstock (May 15, 2013)
  • Law360: Fed. Circ. Upholds Newegg-Overstock Patent Win Over Alcatel (May 15, 2013)
  • ArsTechnica: Newegg nukes “corporate troll” Alcatel in third patent appeal win this year (May 16, 2013)
  • Daily Tech: Newegg Legal Chief: "We don't Feed the Trolls"; Defeats Bell Lab Shell Comp. (May 17, 2013)
  • Managing Intellectual Property: Newegg and Overstock defeat Alcatel in e-commerce patent appeal (May 20, 2013)

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