Facebook Says USPTO Records Debunk Yahoo's Patent Claims (Law360)

By Stewart Bishop

Facebook Inc. on Wednesday hit back at Yahoo Inc.'s claims that two of Facebook's patents are unenforceable due to inequitable conduct, alleging Yahoo's argument is based on demonstrably false information and asking the court to strike the claims from the suit.

Yahoo has argued that Facebook failed to list inventor Joseph Liauw as one of the people behind the two patents-in-suit and that there is no sworn statement from Liauw in the U.S. Patent and Trademark Office records that explains his omission, which renders the patents unenforceable.

However, Facebook says Yahoo's inequitable conduct theory is dead wrong, principally because Liauw submitted a written statement acknowledging he had been mistakenly named as an inventor on the provisional application for the patents.

"Yahoo's allegations are directly contradicted by the publicly available and judicially noticeable prosecution history records at the patent office," the motion said. "Liauw's signed statement ... definitively demonstrates the falsity of Yahoo's assertion."

At issue are U.S. Patent Numbers 8,005,896 and 8,150,913.

Furthermore, Facebook says Yahoo made its allegation without actually reviewing the publicly available patent office records.

In the course of preparing for its motion, Facebook checked the record at the USPTO, which revealed only one request to inspect the provisional prosecution history — the one filed by Facebook, according to the motion.

Yahoo has further argued that inventor Chris Cheah and attorney C. Douglass Thomas failed to inform the patent office that additional text had been added to the application for the '913 patent when it was filed on Aug. 22, 2011. However, Facebook asserts, the revisions to the introductory portions of the application were appropriate because they were supported by the parts of the application that were derived from prior applications.

On May 3, Yahoo informed Facebook that it might be infringing 16 patents in addition to those that Yahoo had already asserted in its lawsuit against the social media company in California federal court, Facebook says.

In a filing with the U.S. Securities and Exchange Commission, Facebook said it had received a letter from Yahoo on April 23 stating that Yahoo believed 16 patents it claims to hold "may be relevant" to open-source technology it alleges is being used in Facebook's data centers and servers.

"Yahoo has not threatened or initiated litigation with respect to matters described in this letter, but it may do so in the future," the filing said.

In March, Yahoo made good on a threat to take action against Facebook if the social media giant didn't agree to a licensing deal, and sued Facebook alleging infringement of 10 patents covering areas like advertising, privacy and social networking.

Yahoo's complaint asks for treble damages and a permanent injunction, claiming Facebook has been aware of the patents since at least Feb. 27, when Yahoo notified it of the alleged infringement.

Facebook struck back with counterclaims in early April, asserting that Yahoo infringes 10 of Facebook's social networking and advertising patents.

Facebook spokesman Andrew Noyes told Law360 that the company had no comment beyond its motion to strike. Representatives for Yahoo were not immediately available for comment Thursday.

The Yahoo patents-in-suit are U.S. Patent Numbers 6,907,566; 7,100,111; 7,373,599; 7,668,861; 7,269,590; 7,599,935; 7,454,509; 5,983,227; 7,747,648; 7,406,501; 7,933,903; and 7,698,315.

The Facebook patents-in-suit are U.S. Patent Numbers 7,827,208; 7,945,653; 6,288,717; 6,216,133; 6,411,949; 6,236,978; 7,603,331; 8,103,611; 8,005,896; 8,150,913.

Yahoo is represented by Charles K. Verhoeven, Jennifer A. Kash and Kevin A. Smith of Quinn Emanuel Urquhart & Sullivan LLP.

Facebook is represented by Stephen C. Neal, Michael G. Rhodes, Heidi L. Keefe and Mark R. Weinstein of Cooley LLP and William F. Lee, Cynthia D. Vreeland, Mark D. Selwyn and Joseph F. Haag of WilmerHale.

The case is Yahoo Inc. v. Facebook Inc., case number 3:12-cv-01212, in the U.S. District Court for the Northern District of California.

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