Amazon Sued for Patent Infringement over Personalization

Mark Sakalosky

Updated · Jul 18, 2003

Pinpoint Inc. reportedly sued Amazon and six other major national retailers for allegedly violating its patents on
software that assists online shoppers with their purchasing decisions.

The Fort Worth, Texas-based company filed the suit Thursday in U.S. District
Court in the Northern District of Illinois. In it, Pinpoint claims Amazon and the other companies have violated several of its patents, which cover software that recommends
specific content to Internet users, based on their past behavior. Amazon uses personalization technology to recommend products to shoppers on its site, based upon their previous purchases.

“Amazon’s personalization technology meets each and every limitation of at least one claim of each of the patents-in-suit, either literally or with only insubstantial differences,” the suit reads.

In addition to Amazon, the lawsuit also named certain retail parters including Borders Group, Toys R Us, , Virgin Group and Target . Amazon provides the software to the other retail Web sites.

Amazon has been a vigorous defender of its own patented technologies, and this suit is expected to generate controversy regarding general patents, which some claim cover very broad business processes. In the past, Amazon has defended its patented one-click purchasing technology, and sued in October 1999, claiming that its technology had been copied. The suit was settled in March 2002, but the terms were kept confidential.

Pinpoint’s suit against Amazon isn’t the first time the Internet retailer has been hit with litigation in recent weeks. In early July, Corbis Corp., a leading image licensing company, expanding its online copyright-infringement case to include Amazon. Corbis says that Amazon used and sold thousands of images, for which it holds copyrights. Corbis is owned by Microsoft Chairman Bill Gates and has launched more than a dozen copyright-infringement suits seeking compensation for damages.

On July 22, Amazon will host its quarterly earnings conference call to discuss its latest financial quarter. Amazon’s stock price has tripled in the past year from close to $12 to more than $36.

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