The online auctioneer eBay is being sued for $3.8m over six alleged patent infringements and breaking a confidentiality agreement relating to its PayPal payment service.
According to Reuters, XPRT Ventures claims that eBay incorporated information shared in confidence into the "PayPal Buyer Credit" and "Pay Later" services, and used it in a 2003 patent application.
Photo by Sam Howzit on Flickr. Some rights reserved
"This involves a trade secret theft, along with sheer patent infringement," said Steven Moore, a partner at Kelley Drye & Warren LLP representing the plaintiff. "It is bad enough to take someone's technology, but it is a bit much to use it in your own patent application."
The payments division of eBay generated $2.8bn in 2009, 32% of their $8.73bn total for the year. XPRT seems to be looking for a chunk of this, seeking a minimum of $3.8bn in monetary damages. It is also seeking treble damages resulting from eBay's alleged "willful and malicious conduct", punitive damages, among other claims.
Much like Facebook in the case brought by Paul Ceglia that we reported yesterday, eBay dismissed the complaint as "without merit". A spokeswoman said: "We intend to defend ourselves vigorously."
The news had little imapct on eBay's share price, which closed 3.9% up at $21.01 last night.
