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Groupon to pay $57 million over patent litigation

Written by Demi- Leigh Mason, a student at Southampton Solent University on 19 November 2018

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Back in March 2016, the technology company IBM filed a complaint against the online platform Groupon which alleged that the company infringed on four US patents (5,796,967; 5,961,601; 7,072,849 and 7,631,346).

In a Delaware court, a jury found that Groupon had infringed the patents that were alleged and the court ordered Groupon to pay damages to IBM of $82.5 million.

It was reported that originally IBM tried to encourage the courts to double the damages to be paid by Groupon for the patent infringement ranging from $82.5 million and $165 million. This was because the infringement that took place was done deliberately.

After the court hearing, District Judge Leonard Stark stated he would be “inclined” to dismiss the after-trial motions from both Groupon and IBM. However, during the post-trial motion, enhanced damages were seen to be necessary due to Groupon’s ‘continuously resistant and dilatory misbehaviour, extending through discovery, expert reports, summary judgements and trial’. This motion requested $13.6 million for pre-judgement interest.

However, on 1st October 2018, a settlement agreement was announced stating that Groupon are to pay $57 million to IBM in order to resolve the issue.

Groupon and IBM have entered into a long term patent agreement ensuring some Groupon products may become available for IBM employees. The Vice President of Global Communications at Groupon, Bill Roberts, has said; “The licence we have acquired to IBM’s patent portfolio will enable Groupon to continue to build amazing products for consumers and small businesses around the world. We look forward to sharing these products directly with IBM employees.”

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