Tumbleweed Settles URL Lawsuit

Redwood City, Calif.-based Tumbleweed Communications settled a patent infringement lawsuit this week in the U.S. District Court for the Northern District of California against service providers DST Systems, Inc. and NewRiver, Inc.

The settlement amount was not disclosed, although there will be a royalty of four cents per each delivery of electronic information using a personalized, trackable URL.

According to a spokesperson for Tumbleweed, that fee will be paid in perpetuity.

Tumbleweed is a provider of secure messaging applications for businesses and government organizations using the Internet. The company’s patents, both pending and granted, pertain to the delivery of secure communication over Internet standards.

Tumbleweed has instigated a slew of patent infringement lawsuits against numerous Internet-based companies over the past few years, including greeting card service eUniverse, each time claiming that Tumbleweed’s delivery technology was unlawfully used.

The basis of the lawsuit against DST Systems and New River was that neither company had successfully secured licenses from Tumbleweed before using its No. 6,192,407 patent, which relates to ‘Private Trackable URLs’ for direct document delivery.

The Tumbleweed spokesperson explained that the essence of the lawsuit involved the sending of email notifications that then link back to a Website URL. The main argument in the DST/NewRiver suit was whether or not documents fell under the definition of “data,” which is covered under Tumbleweed’s patent.

“It’s a fundamental patent,” said the spokesperson. “Its away of binding content and identity as part of a service offering.”

In May of this year, Tumbleweed filed a patent infringement suit against PayPal in U.S. District Court for the Northern District of California charging that PayPal infringed on two of its patents, both related to electronic notification processes and document storage and retrieval.

Last year at an SEC filing, PayPal dismissed Tumbleweed’s claims by saying: “We believe that Tumbleweed’s assertions are without merit. We believe that our service does not infringe the patents and that we therefore do not require a license.”

Tumbleweed also filed a similar suit against Yahoo! this year, alleging that the Internet portal infringed on its Private Trackable URLs patent.

The outcome of the Yahoo! and the PayPal suits are still undetermined.

In a move that will strengthen Tumbleweed’s future patent disputes, earlier this week Tumbleweed was granted a new patent by the U.S. Patent and Trademark Office.

Patent No. 6,487,599, titled “Electronic Document Delivery System In Which Notification Of Said Electronic Document Is Sent To A Recipient Thereof,” is a continuation of No. 6,192,407, which is the patent that so far has been at issue in many of Tumbleweed’s lawsuits.

“Essentially, the U.S. Patent and Trademark Office affirmed today that Tumbleweed’s patents cover the use of personalized, trackable URLs to deliver ‘data’ and ‘electronic information’ as well as ‘documents’ – a term used in the earlier patent claims,” said Bernard J. Cassidy, Tumbleweed’s Vice President and General Counsel.

“We believe that the new patent will strengthen our position in litigation, including Tumbleweed v. PayPal, Inc. and Tumbleweed v. Yahoo! Inc.,” continued Cassidy. “The defendants will not be able to avail themselves of the argument, which has been advanced by some companies, that their communication methods don’t infringe our patents because they deliver data – but not documents. We believe the Patent Office has plainly recognized that Tumbleweed’s inventions, as described in our patents, broadly extend to the electronic delivery of any type or form of data.”

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