Update: In 2013, four years after I posted this blog entry, Eolas lost their court case and subsequent appeals.
Eolas Technologies is a company that manages licensing for patents.
Eolas seeks to return value to its shareholders by commercializing these technologies through strategic alliances, licensing and spin offs. (source)
The problem is that Eolas is generally regarded as a bully trying to enforce a patent (Patent 5,838,906) that many experts feel should not have been issued.
The 906 patent, received in 1998 by the University and licensed exclusively to Eolas, describes ways that a Web browser can use external applications. (source)
(The US Patent and Trademark Office has made notoriously bad decisions relating to Internet technologies, causing many to wonder if they truly even understand the patents they’ve granted. Blackboard vs Desire2Learn is a great example; Blackboard acted much like Eolas, and their patents were eventually nullified by the PTO.)
Eolas sued Microsoft in 1999 for violating Patent 5,838,906, and in a rare show of solidarity, the Web and Open Source communities — normally very anti-Microsoft groups — rallied to Microsoft’s side. This included Sir Tim Berners-Lee, the founder of the Internet. They pleaded with Eolas to release the patent into public domain for the greater good of the global community.
Anybody in the browser field that studies the technology will see that its a very fundamental and basic patent to the World Wide Web. (source)
Despite the overwhelming negative response from the Web and Open Source communities, Eolas would not relent and forced Microsoft to modify Internet Explorer in a way that broke functionality on over hundreds of millions of web pages. Microsoft eventually forked over tens of millions of dollars in a settlement that allowed them to restore the functionality they had been forced to remove.
Other companies and products have used the same technology for years without paying royalties — Mozilla Firefox and Opera being the most well-known — but were not sued by Eolas, who chose to focus on the deep-pocketed Microsoft. (An initial jury verdict in 2003 awarded Eolas $521 million, but an undisclosed settlement was reached in 2007 after the case went through several appeals.)
This week — a year and a half after settling with Microsoft — Eolas has gone on the attack again, filing suit against “Adobe, Amazon, Apple, Argosy Publishing (publisher of The Visible Body), Blockbuster, Citigroup, eBay, Frito-Lay, GoDaddy, J. C. Penney, JPMorgan Chase, ‘transactional’ adult entertainment provider New Frontier Media, Office Depot, Perot Systems, Playboy Enterprises, Rent-a-Center, Staples, Sun Microsystems, Texas Instruments, Yahoo, and YouTube.” (article)
For the record, Eolas was founded by former University of California, San Francisco (UCSF) staff, and the patent they’re suing others for violating was developed at UCSF in the 90s. http://en.wikipedia.org/wiki/Eolas
I work at UCSF and am ashamed of these lawsuits.
The University of California owns Patent 5,838,906 and has licensed it to Eolas. The Regents of University of California are therefore the driving force behind Eolas’ behavior. By extension, UC is a driving force behind one of the biggest and most unpopular disruptions the Internet has known. If UC is really interested in public interests and good will — not to mention good publicity — I hope Patent 5,838,906 will be released into the public domain.
On a side note, knowing the University of California is being hit hard with budget cuts, I wonder if this latest blitz of lawsuits is an attempt at making up for budget shortfalls?