Facebook hits back with counterclaim saying Yahoo infringed 10 patents
The counterclaim from Facebook, filed in a San Francisco federal court, comes after Yahoo sued Facebook for patent infringement last month. A Yahoo spokesman could not immediately be reached for comment.
Facebook, the world’s largest internet social networking service, is preparing for an initial public offering that could value the company at up to $100bn (€75.5bn).
According to Facebook’s counterclaim, Yahoo services such as the photostream and the recent activity feature in Yahoo’s Flickr photo-sharing service infringe a Facebook patent related to generating a personalised feed of stories on a social network.
Facebook general counsel Ted Ullyot said the company had indicated that it would defend itself vigorously in the face of Yahoo’s lawsuit.
“While we are asserting patent claims of our own, we do so in response to Yahoo’s short-sighted decision to attack one of its partners and prioritise litigation over innovation,” Mr Ullyot said in a statement.
Yahoo has claimed that Facebook infringed 10 of Yahoo’s patents, including several that cover online advertising technology.
Yahoo has previously said it was seeking licensing fees from Facebook over its patents and that other companies have already agreed to such licensing deals.
Colleen Chien, a professor at Santa Clara Law in Silicon Valley, said companies are usually more vulnerable to patent suits when they are in the IPO process.
Yahoo has used similar timing to its advantage in the past. Google agreed to issue shares to Yahoo nine days before Google went public in 2004 in exchange for a license to Yahoo’s patents. Google later took a $201m non-cash charge related to the transaction.
In the lawsuit, Yahoo says Facebook was considered “one of the worst performing sites for advertising” prior to adapting Yahoo’s ideas.
“Mr Mark Zuckerberg, Facebook’s founder and CEO, has conceded that the design of Facebook is not novel and is based on the ideas of others,” the lawsuit said.
Only two of the 10 patents at issue are directly related to social networking technology. Most focus on online advertising, including methods for preventing “click fraud”, as well as privacy and technology for customising the information users see on a web page.
