Caribou Among Hundreds Facing WiFi Patent Suits

Local IP attorney Brad Pedersen indicated that the case doesn't look promising for the company filing the suits; he says that lawsuits with multiple defendants will be kicked out under a new patent reform act-and the cost of [refiling] the suits one at a time won't be worthwhile for the plaintiff.

Brooklyn Center-based Caribou Coffee Company is among hundreds of defendants being sued by a Delaware company that's pursuing patent litigation against businesses that offer wireless Internet to customers.

Innovatio IP Ventures, LLC began filing patent claims in March against coffee shops and restaurant chains, according to a report by The Patent Examiner-an investigative reporting project of the University of California, Berkeley. Now, it's going after individual branches of some of the largest hotel chains in the United States.

Innovatio has reportedly named several hundred defendants in the 13 infringement lawsuits it has filed to date-and it's demanding a one-time lump sum licensing payment totaling somewhere between $2,300 and $5,000 from each one. According to The Patent Examiner, Innovatio is displaying a new approach in patent enforcement: By demanding only a few thousand dollars from each defendant, the company is ensuring that it won't make financial sense for many of them to take up legal defense.

IP attorney Brad Pedersen of Minneapolis law firm Patterson Thuente Christensen Pedersen, P.A., doesn't think the case looks good for Innovatio. He said in an e-mailed statement that patent lawsuits with multiple defendants filed after September 15 will be kicked out under a provision of the American Invests Act, or patent reform act, that recently took effect. “[T]he cost of [refiling] those lawsuits one suit per defendant will put a quick end to the idea of collecting payments of $2,500-$5,000 per defendant,” he said.

In addition to Caribou, other defendants include Cosi, Panera Bread Company, and numerous hotel companies-Hyatt Corporation, Marriott Hotels, Wyndham Hotels and Resorts, Ramada Inn, Best Western, Days Inn, Super 8 Hotels, Travelodge, and several others.

According to The Patent Examiner, Innovatio is suing for royalties that it says each location owes for unlicensed use of wireless local area network technology features covered by 31 patents it holds.

Considering that the company is suing users of the technology instead of its manufacturers, The Patent Examiner asked Chicago attorney Matthew McAndrews, lead litigator for Innovatio: Will the onslaught of lawsuits hit ordinary, WiFi-using American households? The answer: not yet anyway.

“Innovatio has made a strategic and business judgment at this stage that it doesn't intend to pursue [lawsuits on the basis of] residential use of WiFi,” McAndrews-who won't say who's behind Innovatio-told The Patent Examiner.

Most of the patents Innovatio is asserting in its most recently filed lawsuits were invented in the 1990s and early 2000s by developers who worked for companies acquired by international semiconductor manufacturer Broadcom Corporation, according to The Patent Examiner. The patents have reportedly changed hands several times and landed in Innovatio's hands on February 28-about a week before the string of lawsuits began.