Window to the Law: Patent Settlement Protects Industry

Window to the Law: Patent Settlement Protects Industry

Nov 30, 2016
4:26
Light Theme Light Dark Theme Dark

Advertisement

NAR General Counsel Katie Johnson discusses how a successful challenge brought by NAR resulted in a settlement where the owner agreed to not assert its patent against the entire real estate industry, including brokers and MLSs.

Download Slide Presentation (PDF: 217 KB)

Window to the Law: Patent Settlement Protects Industry: Transcript

DDT Patent Troll Victory

November 14, 2016

Does your website have a searchable database that allows users to receive an email alert when something on your website is added or updated? That’s pretty common functionality for websites these days. But if you answered “yes”, then you may be one of the many real estate professionals targeted by the patent troll Digital Distribution Technologies or DDT.

For the last several years, DDT has demanded licensing fees from real estate brokers and MLSs nationwide based on the use of that common functionality on their real estate websites. But I’m happy to report that DDT’s ability to extract fees from REALTORS® has now ended as NAR has obtained an industry-wide settlement that specifically prohibits DDT from making any demands or bringing any litigation against NAR members, associations, MLSs and others.

I’ll take a moment now to tell you how we achieved that great result, but here is the takeaway -- if you are ever targeted by a patent troll, contact your local, state or national association of REALTORS®. Our victories fighting back against patent trolls should diminish, if not eliminate, future attacks on our industry.

So here’s how we defeated DDT. After learning that DDT was targeting members and MLSs across the country, NAR reviewed the patent and determined that it didn’t warrant patent protection because it did not describe a novel invention and it likely covered subject matter that it is not patentable. Therefore, we implemented a two-pronged legal strategy to challenge the patent on behalf of our members.

Step One. NAR filed what’s known as an “inter partes review” with the United States Patent and Trademark Office. The request asked the USPTO to invalidate the patent based on a claim that DDT’s patent is overly broad and not sufficiently inventive.

Step Two. NAR filed a lawsuit against DDT seeking a declaration that the patent is invalid. Even though we knew this litigation would be put on hold while awaiting the outcome of the USPTO action, it was necessary to prevent DDT from suing NAR in a jurisdiction that is favorable to patent troll litigation, such as the eastern district of Texas.

Step Three. There was no step three! DDT surrendered to our attack. In exchange for us dismissing our legal actions, DDT agreed to refrain from enforcing its patent in the real estate industry forever. There was no money exchanged by either party. NAR used an administrative complaint and a lawsuit to fight back on behalf of its members and the patent troll completely capitulated.

This victory against DDT comes after two other NAR-supported attacks against patent trolls that sued members for infringement based on commonly-used website functionality. In 2014, Property Distribution Technologies sued real estate brokerages for infringing a patent that allegedly covered a process of searching an online property database and returning information about the environmental and physical characteristics of those properties. In 2015, POI Search Solutions sued real estate brokerages for infringing a patent that allegedly covered “displaying points of interest” on a digital map. In both cases, NAR’s legal action program provided financial assistance to allow those members who were targeted to fight back by filing motions to invalidate the patents at issue. And in both cases, the patent trolls surrounded by dismissing those lawsuits with prejudice.

In addition to pursuing these legal strategies, NAR is also attempting to effect useful changes in patent law. NAR is an active member of a coalition called United for Patent Reform that is focused on supporting comprehensive patent litigation reform. Additional information about NAR’s legal action program and NAR’s government affairs efforts is available on nar.realtor.

And remember, if you are ever targeted by a patent troll, please let us know.

Thank you.

Notice: The information on this page may not be current. The archive is a collection of content previously published on one or more NAR web properties. Archive pages are not updated and may no longer be accurate. Users must independently verify the accuracy and currency of the information found here. The National Association of REALTORS® disclaims all liability for any loss or injury resulting from the use of the information or data found on this page.
Window to the Law is a monthly video series that provides valuable risk management tips and information to help real estate professionals navigate legal issues facing the real estate industry.
From the advocacy efforts to technology advances and updates on commercial industry trends, the topics in this series all relate to what’s happening in commercial real estate now and what trends are on the horizon.
These webinars and videos are an extension of the New AE Orientation, intended to provide ongoing learning on association management resources and programs to newly appointed AEs.
The hunt is about so much more than the house. Home buying hiccups lead to tough decisions. Guided by the expertise of a REALTOR®, First-Time Buyer puts the real in real estate.
YouTube Play Button Icon

NAR Videos on YouTube

NAR offers additional topics online covering legislation, events, industry news and guides for both NAR members and the public. Visit NAR on YouTube

National Association of REALTORS®

18.5K subscribers

Open YouTube

REALTOR® Party

1.57K subscribers

Open YouTube

REALTOR® Magazine

3.66K subscribers

Open YouTube

NAR Meetings

1.56K subscribers

Open YouTube

Realtors Property Resource® (RPR)

4.58K subscribers

Open YouTube

HouseLogic

1.17K subscribers

Open YouTube

First-Time Buyer

278 subscribers

Open YouTube

That’s Who We R (playlist)

Open YouTube