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Patent Question??

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olimits7

Junior Member
What is the name of your state? New Jersey

Hello,

I'm interested in starting a website like Elancecom. However, when I went on their website I saw the following patent "U.S. Patent 7,069,242".

Will I be able to start up a similar website as them??

If I can't how are similiar websites like gurucom, getacodercom, php-freelancersphp still in business?

Why hasn't a lawsuit been brought out on them by elancecom?? They have the same business method as elancecom.

Thank you,

olimits7
 


CraigFL

Member
In order to bring a patent infringement lawsuit, you must:
1. Be infringing on the specifics of that patent
2. The infringee needs to know about it
3. The infringee needs to want to spend the money to do it
4. The infringee must do it within the time limitation statutes

I suspect that companies list things like this just to scare people off. Why don't you check the details of the patent to see what they are actually protecting?

http://www.uspto.gov/
 

olimits7

Junior Member
Hi Craig,

This is what claim 1 states from the patent.

1. A computer implemented method, comprising: accepting a posting on a website of a project that a buyer wants completed; providing a database containing all registered sellers; receiving a bid on the project from any seller, where all registered sellers are qualified to bid on postings in all categories; allowing the buyer to accept the received bid from the seller; and allowing the buyer and the seller to work on the project in a collaborative workspace accessible by only the buyer and the seller, where the seller develops and delivers the project in the collaborative workspace and the buyer can track the project in the collaborative workspace before it is complete.

The only part that confuses me is what they mean by "collaborative workspace". On their website they provide a section where the buyer/seller can upload files and communicate with each other on the elance website.

However, I'm not going to have this on my website so I wouldn't be following their claim 1 step by step, so does this mean I'm still infringing on their patent?? I don't believe I am. What do you think??

Thank you, again.

olimits7
 

olimits7

Junior Member
Hello,

Thank you for your replies. I just have one more question relating to this topic, that I was hoping someone could give me some feedback on.

If one of my business partners lives in Canada, and we open the company based out of Canada instead of the US. Will the company with a US patent be able to come after the Canadian L.L.C. for patent infringement?

I just noticed that a lot of elancecom competitors are all offshore. One is in Portugal, another in Canada, and another in Sweden.

Thank you, again.

olimits7
 

divgradcurl

Senior Member
The only part that confuses me is what they mean by "collaborative workspace". On their website they provide a section where the buyer/seller can upload files and communicate with each other on the elance website.

It's really irrelevant what they actually do on their website -- in order to determine what is meant by "collaborative website," you need to look at the patent claims, then the patent specification, then the prosecution history of the patent, then to "extrinsic" sources to determine what the term "collaborative workspace" would mean to "one of ordinary skill in the art" -- in that order. What they actually do may or may not be what is covered by the patent. In addition, even if what they do IS covered by their patent, they might not be limited to what they do -- the patent may be broader than that.

However, I'm not going to have this on my website so I wouldn't be following their claim 1 step by step, so does this mean I'm still infringing on their patent?? I don't believe I am. What do you think??

It's really quite impossible to tell without a thorough understanding of the patent, its prosecution history, what the industry considers a "collaborative workspace," and what you actually plan to do. This is why a full noninfringement opinion from an attorney can cost upwards of $50,000 -- it's oftentimes a lot of work and research to determine the precise scope of a patent, and whether or not it overlaps a particular implementation.

If one of my business partners lives in Canada, and we open the company based out of Canada instead of the US. Will the company with a US patent be able to come after the Canadian L.L.C. for patent infringement?

It depends -- in general, U.S. patents are national in scope, which means that they are only valid in the U.S. A U.S. patent cannot be enforced in a Canadian court, for example -- only Canadian patents can be enforced in a Canadian court. If you don't have any offices in the U.S., then the U.S. courts have no jurisdiction over the company, and it may be hard to sue for infringement of a U.S. patent.

That said, this is an area of law that is changing, and in the recent Blackberry decisions, a Canadian company (RIM) was found liable for patent infringement of U.S. patents by U.S. courts. RIM did have assets in the U.S., which made them susceptible to being sued in the U.S. But the point is, this area of the law is changing (there is another case on extraterritorial application of U.S. patent laws that was recently granted certioria by the U.S. Supreme Court, and will be heard next year), and even if you are safe now, who knows what might happen in the future.

You might want to consider sitting down with a patent attorney, who can review the patents and your technology and advise you accordingly. If you just get a simple opinion, and not a full-blown noninfringement opinion, it should cost far, far less than the $50,000 quoted above -- and if it turns out that you have little (or nothing) to fear from this patent, that puts you in a better place than relying on having the company located outside of the U.S. to avoid the patent.
 

olimits7

Junior Member
divgradcurl,

Thank you for your reply; it was very helpful, and I appreciate you writing back such a thorough response.

I know this can change in the future, but as of right now it will be harder for the company with a US Patent to do anything if the company is based in Canada, right?

One of my business partners is from Canada and let’s say we register the company in Canada, would I be able to list my name on the LLC if I live in the US?

Also, if we register the business in Canada will I be able to open a business checking account or host the website from the US? Or should I just have the business checking account and host the website from Canada?

From the example you stated in your post above it seems like if I have any type of influence in the US that they might have jurisdiction over the company, so I don’t think having a US business checking account or to host the website in the US will be fine. But I just wanted to double check again. :-)

I know I should be asking these questions to a patent attorney and if my partner & I go forward with this business idea we probably will, but it's nice to just get some type of overview on these issues now.

Thank you again for your help, I appreciate it.

olimits7
 

divgradcurl

Senior Member
One of my business partners is from Canada and let’s say we register the company in Canada, would I be able to list my name on the LLC if I live in the US?

Here's the thing -- an LLC, properly formed and maintained, can shield the members and owners of the LLC from liability in many cases. If the LLC is infringing the patent, then only the LLC is liable for infringement, and your being in the U.S. would be largely irrelevant. However, if the patent and your business is such that you personally are infringing the patent, whether or not the LLC is as well, then it is possible that you could be hauled into court in the U.S. for patent infringement. Whether or not that it likely or even possible in your case would depend on a thorough analysis of the organization and the patent.

Also, if we register the business in Canada will I be able to open a business checking account or host the website from the US? Or should I just have the business checking account and host the website from Canada?

If you have assets of any kind in the U.S., or have any sort of presence on the ground in the U.S., you become susceptible to jurisdiction in a U.S. court. A bank account would likely be sufficient to find jurisdiction, a hosting company probably not, but again, it would take a thorough investigation to know for sure.

From the example you stated in your post above it seems like if I have any type of influence in the US that they might have jurisdiction over the company, so I don’t think having a US business checking account or to host the website in the US will be fine. But I just wanted to double check again. :-)

If you are an owner of the company, and you live in the U.S., you give a U.S. patent owner a "hook" to drag you into court in the U.S. Again, you might want to talk with a lawyer who can review the facts of your particular situation and advise you accordingly.
 

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