Yahoo! wins verdict in Bedrock patent trial

Credit: Photo credit: flickr/Crow Bead

Jury finds no infringement on the part of Yahoo!

You remember that lawsuit Google recently lost against patent portfolio company Bedrock Technologies, LLC in the United States District Court Eastern District of Texas?

You know the one. That's when Bedrock, which holds patents over processes that are allegedly infringed by Linux, decided to sue two local Texas users of Linux (Softlayer Technologies, Inc. and CitiWare Technology Solutions, LLC) as well as some decidedly non-local users: Google Inc., Yahoo! Inc., MySpace Inc., Amazon.com Inc., PayPal Inc., Match.com, Inc., AOL Inc., and CME Group Inc.

It's the one where Bedrock actually won a jury verdict against the first defendant up in the trial, Google, and was awarded damages of $5 million. This was a paltry amount compared to the original $183 million Bedrock was originally seeking, but this did not stop a lot of people from gleefully predicting the end for Linux was nigh.

I think the doom and gloomers will be a bit tempered this week.

On Tuesday, a jury in the second part of the case, this time against Yahoo!, ruled "none of [Bedrock's] asserted claims were infringed."

Thomson Reuters has a great piece detailing the why Yahoo! won a case that Google lost last month:

"First off, Bedrock had a stronger case against Google. Cawley put on evidence that Google used Bedrock's Linux code on its servers (although Google got rid of the code before trial). Yahoo, on the other hand, used a different form of Linux, and its lead trial lawyer, Yar Chaikovsky and Fay Morisseau of McDermott Will, were able to argue that Yahoo never executed the Bedrock code."

"Yahoo!, the story adds, "also benefited mightily from going to trial second."

And that's certainly true. By watching the Google trial, Yahoo!'s defense lawyers were able to tailor their defense more strategically against a plaintiff that could not change its witness testimony.

Unfortunately, while Bedrock lost this particular round, it appears they may have gotten their greedy hands on what they were probably really after: licensing agreements.

The court docket indicates that on April 29, Bedrock settled its claims against MySpace and AOL and then on May 9, just one day before the Yahoo! verdict came through, also settled its claims against Amazon.com and SoftLayer Technologies. Match.com had already settled with Bedrock on March 28. By my score card, then, that leaves just PayPal, CME, and CitiWare still defending against Bedrock's claims.

Too bad the other defendants didn't wait just a bit longer before settling.

That may not be entirely fair, since the amount of settlement each defendant made with Bedrock in their respective settlements was undisclosed. I am assuming Bedrock gave out some sort of license to each defendant to use the hashing technique with external chaining and on-the-fly removal of expired data asserted in US patent 5,893,120. But that's just an assumption, albeit one very likely to be true.

And the trial is not over. The other defendants are still waiting their respective turns, and Red Hat filed its own declaratory judgment (DJ) suit against Bedrock in December 2009 to get 5,893,120 declared invalid. In June 2010, Red Hat tried to unsuccessfully intervene in this case, too, which Bedrock fought, claiming "this case isn't about Red Hat" and besides, Red Hat had already filed the Dec. 2009 DJ suit. But while Bedrock was successful in its attempts to stave off Red Hat, that DJ suit against 5,893,120's validity could still blow this whole thing out of the water.

In the end, Yahoo!'s win is a sign that patent plaintiffs don't have it entirely their way in the Eastern Texas district, and that this particular infringement claim isn't the slam-dunk people thought it would be after Google's loss.

The whole abuse of the patent system still leaves a bad taste in the mouth, even with a win.

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