August 05, 2004

Patents and Music

Apples Settles with E-Data. Microsoft did earlier this year. E-Data goes after 14 more.

ZDnet 08/04/04: Separately, Apple has brought an end to a legal dispute over the iTunes Music Mtore, E-Data announced on Wednesday. The iPod maker has agreed to license patents from E-Data, which says its owns intellectual-property rights to the process of selling music online. Microsoft has also settled with E-Data.

Related story 1/20/2004

Microsoft settles music download suit
By John Borland
January 20, 2004, 4:48 PM PT

New York company E-Data said on Tuesday that it has settled a patent infringement suit filed against Microsoft and others, based on music download services in Europe.

Last October, the small company sued a European division of Microsoft, along with the HMV Group, Internet service provider Tiscali and digital music company On Demand Distribution (OD2), charging them with violation of a patent that covers the downloading of information onto a tangible object such as a CD. Music download services operated by the four companies allowed consumers to burn downloaded music to a CD.

The settlement terms include past and future rights to use the patent anywhere in the world, E-Data said in a statement. Financial terms were not disclosed.

"We are quite pleased with this settlement, as it further reinforces the scope and validity of (our) patent in Europe," said E-Data Chairman Bert Brodsky in a statement. "While the OD2 service is still in the nascent stagethe agreement sends an important message to other companies infringing upon our intellectual property."

The patent is one of several that cast some financial uncertainty over the young digital media business. Other companies, including Acacia Research and SightSound Technologies, have said that they own broad rights to such processes as streaming digitally archived media such as music or video, or even selling access to audio and video over a telephone line .

E-Data is characterizing the suit's settlement as an explicit shot across the bow of other download services--Brodsky specifically cites Apple Computer's iTunes--that are planning to enter the European market.

"We are currently in talks with a number of prominent companies in Europe infringing upon our intellectual property, and may seek injunctions against these companies if necessary," Brodsky said.

Related Story 8/4/2004

E-Data Commences Litigation Against 14 Companies in the United States; New Litigation Follows Successful Settlement with Apple Computer in Europe

PORT WASHINGTON, N.Y.--(BUSINESS WIRE)--Aug. 4, 2004--E-Data Corporation (OTCBB:EDTA) announced today that it has commenced litigation, and is seeking damages from the following companies: Cinemark USA, Inc.; Regal Entertainment Group (NYSE:RGC); the Thomson Corporation (NYSE:TOC); International Data Group, Inc.;, Inc. (Nasdaq:AMZN);, Inc.; Ticketmaster, L.L.C., Marcus Theaters Corporation, Fandango, Inc., Franklin Electronic Publishers, Inc. (Amex:FEP), The New York Times Company (NYSE:NYT); Hallmark Cards, Inc.; American Greetings Corporation (NYSE:AM); and NewsBank, Inc., in the United States District Court, Eastern District of Texas (Docket: 4 04 CU 256), for having infringed upon its patent (U.S. patent No. 4,528,643) also known as "the Freeny patent," prior to its expiration within the United States in January 2003. The Freeny patent covers the downloading and recording of information from a computer onto a tangible object.

This action follows the company's recent settlement with Apple Computer, Inc. (Nasdaq:AAPL). Additionally, the company has pending litigation against Getty Images (NYSE:GYI) and Corbis in the United States and Europe. The United States litigation has been commenced in the U.S. District Court, Western District of Texas (Docket: A 04 CA 230LY). In Europe, the company has filed litigation in the United Kingdom (Docket: Pat04007 and Pat04008) for infringing upon its European patent (EP 0 195 098 B-1).

Bert Brodsky, chairman of E-Data Corporation stated, "These 14 companies have violated our patents. We have a very strong track record enforcing our intellectual property rights, as evidenced by our favorable decision with the U.S. Court of Appeals, and our recent settlement with Apple Computer. In addition, we have obtained settlements from Microsoft, Tiscali, HMV, and On Demand Distribution, further reinforcing the strength of our patents. We are represented by two of the leading intellectual property law firms--Simon, Galasso & Frantz in the United States, and Howrey Simon Arnold & White, MNP, in Europe. Given our strong representation and recent success, we will aggressively enforce our rights."

Within the U.S., the company has already secured more than 30 domestic licenses and has received a favorable decision by the Court of Appeals for the Federal Circuit on November 6, 2000 - supporting the scope of the company's patents. E-Data has alerted additional companies to their need for a license under the Freeny patent, and is analyzing the activities of others. The company will not hesitate to start additional legal actions if necessary.

Posted by Craig at August 5, 2004 11:30 PM