Microsoft Co-Founder Allen Sues Apple, Google, EBay

Paul G. Allen, a Microsoft Corp. co- founder who was once the second-richest American, accused 11 companies including Google Inc. and Apple Inc. of infringing patents he holds for online-shopping technology.

A lawsuit filed in Seattle today by Interval Licensing LLC, a business Allen controls, also targets EBay Inc., AOL Inc., Facebook Inc., Netflix Inc., Office Depot Inc., OfficeMax Inc., Staples Inc., Yahoo! Inc. and Google’s YouTube. Interval Licensing is seeking a court order to block further use of the inventions and order unspecified cash compensation.

“This lawsuit against some of America’s most innovative companies reflects an unfortunate trend of people trying to compete in the courtroom instead of the marketplace,” a Google spokesman, Aaron Zamost, said in an e-mail.

Interval Licensing owns the patents of a defunct computer- science and communications research business Allen and David Liddle founded in 1992, according to a statement from the Seattle-based company. The four patents cited in the lawsuit are primarily common electronic-commerce applications for displaying and categorizing product information.

“All of these patents appear to be lightweight inventions that are intended to improve a computer user’s online experience,” said Dennis D. Crouch, an associate professor at the University of Missouri School of Law in Columbia. “That said, the improvements disclosed in these patents represent important core features that Internet users rely upon.”

‘Groundbreaking’ Technology

Facebook, owner of the world’s biggest social-networking website, said the lawsuit is without merit. “We will fight it vigorously,” Andrew Noyes, a spokesman for the Palo Alto, California-based company said in an e-mail.

Interval Research employed more than 110 workers and helped fund outside projects, including work done by Google founders Sergey Brin and Lawrence Page, according to the statement. David Postman, a spokesman for Allen, said in the statement that suing is necessary to protect the “groundbreaking” work Interval Research contributed to the Internet economy.

“Legal risk and patent risk in this day and age is part of the process of doing business,” said Colin Gillis, an analyst at BGC Partners LP in New York. “The most interesting part is it doesn’t include Microsoft or” Amazon.com Inc., he said.

Allen, 57, co-founded Microsoft, the world’s largest software maker, with Bill Gates in 1975 and was once the second- richest American behind Gates, according to Forbes magazine. He now runs Vulcan Inc., a firm he uses to invest in more than 50 companies in the cable, television, telecommunications, sports and biotech industries.

EBay, Apple, AOL

Dana Lengkeek, a spokeswoman for Yahoo, owner of the second-most popular U.S. Internet search engine behind Google, declined to comment.

EBay, the owner of e-commerce sites and the PayPal payment service, said it’s reviewing the complaint.

“We intend to defend ourselves vigorously,” said Johnna Hoff, a spokeswoman for the San Jose, California-based company.

Amy Bessette, a spokeswoman for computer and software maker Apple, said the Cupertino, California-based company doesn’t discuss lawsuits. Steve Swasey, a spokesman for Los Gatos, California-based Netflix, the online movie-rental service, also declined to comment.

Jason Shockley, a spokesman for Office Depot, said in an e- mail that the Boca Raton, Florida-based company won’t comment on pending litigation. Office Depot is the second-largest U.S. office-supply chain, ranking behind Staples and ahead of OfficeMax. Representatives from those two companies weren’t immediately available to comment on the lawsuit.

Tricia Primrose, a spokeswoman for AOL, declined to comment.

The case is Interval Licensing LLC v. AOL Inc., 10cv1385, U.S. District Court for the Western District of Washington (Seattle).

To contact the reporters on this story: Susan Decker in Washington at sdecker1@bloomberg.net; Douglas MacMillan in New York at dmacmillan3@bloomberg.net.