New Egg beats patent troll

trollNew Egg has declared a victory against a patent troll who tried to claim its patent covered SSL and RC4 encryption.

For those who came in late, SSL and RC4 encryption is as common as muck and the troll in question has gone against over 100 other companies, and brought in $45 million in settlements.

TQP Development claimed that Newegg’s use of newer versions of SSL server encryption technology infringed on it patents. What is worse is that it managed to convince an earlier court that this was the case Newegg was ordered to pay $2.3 million.

At the time New Egg vowed to fight that result in the appellate courts. It did and it won.

Normally companies pay up and go away, but New Egg has a policy of fighting. It has beaten trolls in the past. In March it duffed up an outfit called MacroSolve which sued dozens of companies (including small app development shops) over patent No. 7,822,816, which it claims covers using questionnaires on a mobile app.

The company fought and won a lengthy battle over a patent on an electronic “shopping cart,” and it has defeated Alcatel-Lucent and Kelora

Lee Cheng, Newegg CLO said that patent trolls were bad for any business out there. They often prey on smaller companies, who would rather pay out than take them on directly in court. These trolls hurt innovation and end up costing everyone. It’s a sad situation as many of these small businesses end in million-dollar lawsuits that force them to close before they can even make it in today’s economy.

“Unfortunately, small businesses and even individual developers/entrepreneurs have been threatened and sued too.

“There are many different troll “species,” and bottom feeders send thousands of claim letters out or file hundreds of lawsuits. Their maths says that it always costs less to give them the money they demand than to mount a legal defence,” he said.