Serial “patent troll” takes retailers to court over payment systems

US patent office

A Texan company has filed lawsuits against retailers including Weight Watchers and Chipotle Mexican Grill, claiming that they infringed its search, online ordering and payment patents.

Landmark Technology LLC, a non-practising entity that is essentially a proxy for owner Lawrence Lockwood, has filed lawsuits against nine companies with the US District Court for the Eastern District of Texas. In addition to Chipotle and Weight Watchers, these include Panera Bread, the travel companies Allegiant and Choice Hotels, and the stock photography site Shutterstock.

Lockwood, a former infomercial producer, has previously filed similar suits against Dunkin’ Donuts, Abercrombie & Fitch, Harley-Davidson and Rubbermaid, and has been accused by many observers of “patent trolling.” He has been particularly busy this year, with Landmark filing no less than 22 suits in the first four months of the year alone.

Since May, he has been embroiled in a legal battle with eBay, with had asked the US Patent and Trademark Office to re-examine three of his patents which apparently attempted to claim ownership to simply “paying with a credit card online”. The USPTO agreed that one of the patents raised serious concerns – and Lockwood took revenge by suing eBay for abuse of process and malicious prosecution. This is the same (failed) argument that Lockwood attempted to use when suing law firm Sheppard Mullin in 2009. The case was dismissed.

In 1997, Lockwood famously took American Airlines to court over its SABREvision technology, which was used by travel agents to access travel itineraries and book fares. Lockwood said that this made use of four sets of patented technology belonging to him. The court ruled in favour of American Airlines, and the ruling was upheld at appeal.

Lockwood, who has licensed his intellectual property to over 100 companies in the past, has always maintained that he is the victim of “unscrupulous” law firms and corporates. In an interview with Inventors Digest in 2011, he said of the patent re-exam process that has knocked the value out of some of his patents: “this isn’t what inventors and patent filers bought into. This isn’t the American Dream.”

However, owners of the scores of smaller businesses that have been on the receiving end of Lockwood’s lawsuits tend to disagree. E-commerce entrepreneur Andrew Dickson, director of one of the 11 companies sued by Lockwood-owned Pangea in 2002 for infringing a patent relating to automated credit checks for online payments, echoed the sentiment that Lockwood is simply casting his net as wide as possible to see what he can catch.

If they’re going after us … they have to be going after everybody in the whole U.S. with a Web site,” he told Macworld.

 

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