Facebook launches patent counterattack against Yahoo

Tue Apr 3, 2012 3:40pm EDT
 
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By Dan Levine and Alexei Oreskovic

SAN FRANCISCO (Reuters) - Facebook fired back on Tuesday in its legal battle with Yahoo by accusing the Web pioneer of infringing 10 of Facebook's patents, according to a court filing.

The counterclaim from Facebook, filed in a San Francisco federal court, comes after Yahoo a sued Facebook for patent infringement last month.

The dueling claims mark an expanding web of patent litigation that has already caught up the smartphone and tablet sectors and high-tech stalwarts such as Apple Inc, Microsoft Corp and Motorola Mobility Holdings Inc.

Yahoo's lawsuit against Facebook came at a delicate time, as the world's largest Internet social networking service is preparing for an initial public offering that could value the company at up to $100 billion.

Observers have said that companies are usually more vulnerable to patent suits when they are in the IPO process, as investors scrutinize the risks involved in the business.

But Facebook's counterclaim comes as Yahoo addresses its own challenges: the Web pioneer has seen declining revenue, and newly installed Chief Executive Scott Thompson is facing a contentious proxy fight with activist hedge fund Third Point.

Yahoo spokesman Eric Berman said Facebook's counterclaim is "nothing more than a cynical attempt to distract from the weakness of its defense."

Five of the patents asserted by Facebook target features related to Yahoo's online advertising business, which Facebook pegged at 80 percent of Yahoo's 2011 revenue, according to the counterclaim.   Continued...

 
An illustration picture shows the log-on screen for the website Facebook, in Munich February 2, 2012. REUTERS/Michael Dalder