International Business Machines Corp. (NYSE:IBM) dragged Groupon Inc (NASDAQ:GRPN) to court, accusing it of infringing on some of its patents. IBM filed a complaint with the District Court of Delaware. The report did not indicate the number of patents that were infringed by the accused firm.
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Patents Used Without Authorization
In a complaint filed with the court, IBM accused Groupon of creating a business model with the help of its patents. The tech firm also said that despite prior warnings to the website operator, the company was using its patents without the authorization of IBM.
IBM accused Groupon of willful infringement and enjoying the benefits without having paid IBM for use of its technology. Now, Groupon has to prove before the Court that it has not infringed any of the patents that the tech firm has been claiming. The company is already struggling for revenue growth and suffering losses. Failure to defend its position would invite a hefty penalty that will further harm its bottom line.
Refused To Engage In Discussions
The most significant accusation leveled by IBM specifically is that Groupon failed to engage in any meaningful negotiations with its accusers. That not only raises doubts but also indicates that Groupon lost one of its more valuable opportunities to reach a deal to end spat. That would have also provided some relief to the company as going to court would mean spending more to deal with the cases.
Last year, IBM filed a lawsuit against Priceline Group Inc (NASDAQ:PCLN) charging the latter with infringement of four of its patents. This was in respect of Priceline catering to travel and dining. Meaning, Groupon is not being singled out by the tech giant.