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Newegg Scores in Federal e-Commerce Patent Case

After six years of litigation, the online retailer Newegg Inc. has delivered a major blow to Soverain Software LLC, which has raked in tens of millions of dollars asserting patents related to e-commerce. Siding with Newegg in a 25-page decision issued on January 22, the U.S. Court of Appeals for the Federal Circuit invalidated three of Soverain's patents on obviousness grounds. Soverain Software LLC v. Newegg Inc., No. 2011-1009 (Fed. Cir., Jan. 22, 2013) (http://1.usa.gov/ZufJJK).

The patents cover concepts like using an Internet receipt, putting items in an online shopping cart, and using identifiers to keep track of online shoppers. The ruling vacates a $2.5 million jury verdict that Soverain won against Newegg in 2010, and it also casts doubt on an $18 million verdict Soverain won in 2011 against Avon Products Inc. and Victoria's Secret Stores LLC, which Soverain accused of infringing the same three patents.

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