Mobile devices give agents exciting new opportunities for servicing customers, but creativity in the mobile channel could be stymied by a phenomenon known as the “patent troll.”
A patent troll is a company that makes money primarily by suing other companies for patent infringement. Mobile technology is proving to be fertile ground for such companies – and travel companies are among the targets.
Travelocity, UAL, Hertz Are Sued
A Tulsa, Okla., company called Macrosolve has sued 59 companies, claiming infringement of a patent that it was awarded in October 2010. Among the defendants are some of the largest travel companies in the U.S.
American Airlines, Avis Rent A Car System, Continental Airlines, the Hertz Corp., Hipmunk Inc., Hotels.com, Priceline.com, Southwest Airlines, Travelocity.com and United Air Lines were sued on Dec. 21. They have since been joined by Marriott International, Intercontinental Hotel Group and Six Continents, IHG’s corporate predecessor.
Macrosolve has not shied away from taking on other big names – including Facebook, Groupon, Dell and AT&T.
Patent for app transmissions
The patent that is the basis of its lawsuits gives MacroSolve the rights to a process that sends applications to mobile devices for downloading, collects information from users and sends it back to a central database.
That covers any existing or future mobile app that sends data from the app user back to the makers or administrators of the app.
Any booking, purchase or request for information would fall into that category. That makes every transactional travel app a potential target for a lawsuit.
Tricky legal terrain
Patent infringement lawsuits are nothing new in the world of technology. Alexander Graham Bell was sued by several inventors after he produced the telephone. But software patents present some difficulties.
The U.S. Patent Office resisted awarding software patents for a long time, believing it was akin to awarding a copyright for language. You can copyright a book, but you can’t copyright an idea. But several court decisions in the 1990s forced it to change its stance.
The office was then deluged with applications, and according to M-CAM, a patent consultancy, patents for the same “invention” were often granted to different companies. In some cases, the language of the patent is mystifying even to the inventor.
M-CAM chairman Dr. David E. Martin called MacroSolve’s patent “an abysmal monument to the complete failure of the patent system,” noting wryly that the patent hinges on keyword searches “with innovative terms like ‘survey,’ ‘poll,’ ‘collect’ and ‘gather.’”
Macrosolve does market some mobile applications and tools for restaurants, school safety and other categories under the Illume Mobile brand, but it has openly declared that “monetization” of the patent is a priority. It told investors that it has targeted an additional 250 companies for legal action.
In Macrosolve’s most recent filing with the Securities and Exchange Commission, it said it “has received 14 settlements in the form of non-exclusive, perpetual paid-up licenses for licensed products resulting in revenues of over $1 million in 2011, which represented approximately 63% of total revenue in 2011.”