EcommerceBytes-NewsFlash, Number 574 - July 11, 2003     1 of 2

Another Patent Lawsuit Around the Corner for eBay?

Email This Story to a Friend

Sales OnLine Direct Inc. has engaged legal counsel in connection with its online auction patents, including its aiShip shipping calculator for eBay sellers. According to sources, Sales OnLine Direct filed patents for an integrated shipping calculator and demonstrated the technology to eBay in 2001. At the time, sources say, eBay told Sales OnLine Direct that the tool wouldn't be useful.

On June 23, 2003, eBay announced an agreement with UPS to allow eBay sellers to provide buyers the capability of calculating UPS or USPS shipping costs directly from the "View Item" page on eBay. Two weeks later, Sales OnLine Direct publicly announced it had retained the law firm of Hunton & Williams to protect its pending patent application and any patents issuing therefrom. Hunton & Williams recently won a patent lawsuit against eBay for its client MercExchange.

Sales OnLine Direct CEO Greg Rotman said, "We believe that Hunton & Williams' experience in the online auction area will be invaluable to Sales OnLine Direct in terms of protecting our intellectual property. The whole realm of process patents is fairly new. The fact that Hunton & Williams recently won a landmark decision against eBay relating to a process patent illustrates their expertise in the area of process patents and their ability to help protect us against infringement of our intellectual property from any number of parties."

Sales OnLine Direct appears to have issues with eBay's new shipping tools, though their July 9 press release does not state they have plans to sue eBay. But another company has already sued eBay over its expanded deal with UPS:

One day after eBay announced its agreement with UPS to further integrate UPS shipping tools into the eBay system, e-postage service provider sued PayPal and eBay for breach of contract and other claims with respect to the license agreement signed between and PayPal in June 2002. claims it had an agreement with PayPal to develop a service that would allow sellers using PayPal to calculate the exact amount of postage required and print a shipping label with the buyer's information. According to some reports, also believes that eBay has been working behind the scenes with the USPS to develop some alternative shipping solutions.

About the author:

Ina Steiner is co-founder and Editor of EcommerceBytes and has been reporting on ecommerce since 1999. She's a widely cited authority on marketplace selling and is author of "Turn eBay Data Into Dollars" (McGraw-Hill 2006). Her blog was featured in the book, "Blogging Heroes" (Wiley 2008). Follow her on Twitter at @ecommercebytes and send news tips to

You may quote up to 50 words of any article on the condition that you attribute the article to and either link to the original article or to
All other use is prohibited.