IBM Finally Wins Patent Dispute with Groupon

Technology > IT

IBM won a patent dispute against Groupon for the supposed infringement of Prodigy technology / Photo by Raysonho via Wikimedia Commons


IBM is one of the oldest and the most important IT companies in the world, with its permanent place in tech history. Its history, as it continues to be written, isn’t all smooth sailing, however. Currently, they are having issues with brand awareness and product recognition. Then there’s its long issue with Groupon, an e-commerce company over a patent. The patent issue actually isn’t unique to IBM or to any large tech company for that matter. Since innovations and designs are not really original by nature, having been inspired by those that came before them, there will always be something similar between any two.

This particular lawsuit was launched back in 2016, when IBM claimed that Groupon was infringing on patents that belonged to them, and was constantly rebuffed and refused any form of discussion to license or to come to any form of agreement for these technologies. Because of this, IBM issued legal action and demanded $167 million in damages over multiple accounts of alleged infringement.

Groupon was not the only one that was using this sort of patent, as Google, Amazon, and Facebook have similar patents but these companies pay between $20 million and $50 million in individual licensing agreements. The problem with Groupon is that they refused to pay or even discuss with IBM for any amount with regard to the patent they are using. One of the technologies that was supposedly infringed upon was Prodigy, which was a precursor to the Internet, as well as several others relating to ads and how they are shown to consumers while simultaneously reducing the strain on the servers.

After a long period of time, and over the course of a two-week trial, IBM finally won the patent dispute and was awarded $83 million, which was only half of what they originally asked for. This was further reduced when Groupon decided to enter a licensing deal with IBM for the coming years.