DoubleClick, 24/7 Media, L90 Settle Patent Suits
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After filing a set of five dueling lawsuits over patents for online ad serving technology, DoubleClick, L90 and 24/7 Media on Monday agreed to lay down their swords, settling all of the pending suits.
The companies declined to reveal any terms of the settlements, other than to say that: "24/7 Media and DoubleClick have granted each other certain rights in certain of their respective patents." All of the parties agreed to dismiss the suits "with prejudice," which means that none of them can re-file with the same claims.
"It's a good thing because it removes uncertainty," said Tom Sebastian, chief financial officer of L90, "and it enables us to focus on running the business."
It's an important consideration at a time when investors have looked at online advertising companies with disfavor, and when squabbling over patents is, perhaps, less important than bringing in revenues and rushing to profitability.
Although it's not known whether any money changed hands in the settlement, DoubleClick chief executive officer Kevin Ryan, in a meeting with journalists Monday morning, said he didn't expect the licensing of patented technology to bring in any significant revenues for any players in the online advertising business.
The disputes settled Monday began late in 1999, when DoubleClick filed suit against both L90 and Australian ad firm, Sabela Media, alleging that the two companies had violated its ad serving patent -- number 5,948,061 -- which the company applied for in 1996. When 24/7 Media acquired Sabela, it was dragged into the dispute.
In response to the suit, 24/7 Media filed its own lawsuit in March, 2000, accusing DoubleClick of infringing on its patent -- number 6,026,368 -- which was applied for in July 1995 and covers an "on-line interactive system for providing content and information to a targeted set of viewers."
Just a few weeks later, 24/7 Media subsidiary, Sabela Media, filed another suit against DoubleClick, accusing it of failing to give the U.S. Patent Office important information when it applied for its patent, and alleging that the suit was an anti-competitive move on DoubleClick's part. Not to be outdone, L90 filed a similar suit the same day, alleging that DoubleClick fraudulently obtained its ad serving patent.
"There were a number of companies serving ads before DoubleClick filed their patent application," said John Bohnan, president and chief executive officer of L90 at the time it filed its suit in May 2000. "We feel extremely confident that these prior art examples invalidate their patent."
With the settlements, though, these issues remain undecided, although the future of the online advertising industry appears to be more solid, given that three leading players have now agreed to quit their legal battles. The agreements come just in time to cancel court proceedings for the L90 suit against DoubleClick, which were set to begin on Monday.
Both 24/7 Media and DoubleClick declined to comment on the settlement.