Patent Lawsuit Targets Google Talk

A company that holds patents on the way voice over IP (VoIP) calls are placed said on Friday that it was suing Google over its use of certain technologies within the Google Talk instant message application.

New York-based Rates Technology Inc. has no products. However, it is one of several patent companies now in existence whose entire business is based on collecting royalties from firms that use technologies covered by patents they own.

The company estimates that damages resulting from the case could reach $5 billion based on estimates of a four-year-long fight to win concessions from Google.

RTI president Jerry Weinberger claims that the company does not normally sue other businesses in order to get them to pay up for their patents. Instead, it usually asks for a one-time $5 million fee to cover licensing.

But in the case of Google, "every once in a while we run into utter arrogance," Weinberger says.

The claim of not suing companies to force payment is not completely true, however; the company has a past of only going after larger corporations using its patents.

Mitel Networks is involved in a $945 million suit with RTI, and Alcatel has been sued for $1.155 billion. Hello Direct, GN Netcom and GN have also been sued, but they settled with RTI privately. Also being sued are Cablevision and Vonage, however details of those suits were not available.

Altogether, 25 companies have been sued over the past 15 years, although RTI has successfully negotiated deals with over 700 others. In all, the company has netted billions through licensing alone, and billions more through litigation.

Some of these companies include Yahoo, Microsoft and Verizon, and negotiations are underway with AOL and eBay over its Skype offering.

Mark Evans, a Canadian blogger and writer for the Canadian National Post, took RTI to task earlier this week in his Web log.

"The key issue is whether these broad patents will deter innovation if patent 'trolls' can easily solicit licensing fees out of companies developing new technology," he said, calling for a review into the broad patents that the USPTO awards inventors.

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