[A2k] Patent Lawsuit Names Leading Technology Firms

[Soenke Zehle]

January 3, 2007
Patent Lawsuit Names Leading Technology Firms
By JOHN MARKOFF and MIGUEL HELFT
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Correction Appended

SAN FRANCISCO, Jan. 2 =97 In 1997, Jonathan T. Taplin, a veteran film and
television producer, stood up at a cable industry convention and
asserted that in the future all movies would be distributed over the
Internet. He recalls being laughed out of the room.

Mr. Taplin may laugh last. Online distribution of movies has arrived, at
places like Apple Computer=92s iTunes Store. And even though Mr. Taplin=92s
own video-on-demand company, Intertainer, shut down operations five
years ago, it says it deserves some credit =97 and cash.

Last week, Intertainer filed a broad lawsuit asserting that Apple,
Google and Napster are infringing on a 2005 patent that covers the
commercial distribution of audio and video over the Internet.

Founded by Mr. Taplin and two other Hollywood entertainment executives
in 1996, Intertainer developed technology to distribute movies on demand
through cable and phone lines for viewing on televisions and personal
computers. It gained investors including Intel, Microsoft, Sony, NBC and
Comcast.

=93Intertainer was the leader of the idea of entertainment on demand over
Internet platforms before Google was even thought up,=94 said Mr. Taplin,
now an adjunct professor at the Annenberg School for Communication at
the University of Southern California. He and a secretary constitute the
entire remaining staff of Intertainer.

Theodore Stevenson, a partner at McKool Smith, the Dallas firm
representing Intertainer, said the company filed suit against Apple,
Google and Napster because they were perceived as leaders in the market
for digital downloads. He declined to specify the damages that
Intertainer was seeking.

Apple, Google and Napster all declined to comment on the lawsuit.

Intertainer=92s tale is somewhat different than other intellectual
property suits brought by technology licensing firms. By 2002 the
company seemed to have a growing business, with 125,000 Internet
subscribers for its servers and 35,000 TV subscribers through the
Comcast cable system.

But in the fall of 2002, the company shut down its service and filed a
lawsuit against some of the backers of Movielink, a competitor backed by
five Hollywood studios, including Sony, Universal and Warner Brothers.
At the time Mr. Taplin said the studios were using Movielink as a
price-fixing vehicle to kill Intertainer.

An antitrust investigation by the Justice Department into Movielink was
dropped in 2004.

The studios settled the lawsuit last March for an undisclosed sum, and
Mr. Taplin said in a phone interview Tuesday that Intertainer would
henceforth pursue a patent licensing business.

The company holds nine patents, including United States Patent No.
6,925,469, which was issued in 2005 and is intended to cover the
management and distribution of digital media from various suppliers.

Despite initial backing from Microsoft and Intel, Mr. Taplin said the
two companies were not involved in the decision to bring the Apple,
Google and Napster lawsuit. He said that decision was made by
Intertainer=92s board and that none of his original corporate backers have
board seats. Several of the company=92s original investors have taken
patent licenses, he said, but he would not name the companies.

Despite the company=92s decision to file the case in a federal district
court in Texas that has traditionally looked favorably on plaintiffs in
patent lawsuits, several digital media experts said that Intertainer
might have a difficult time enforcing its patent because of its
relatively recent filing date of 2001.

By that time, for example, Real Networks, the Seattle-based pioneer in
streaming digital media, had begun an Internet subscription service for
digital content.

Legal experts said it was difficult to handicap Intertainer=92s claims.
=93There are so many of these lawsuits nowadays,=94 said Eric Goldman,
director the High-Tech Law Institute at Santa Clara University School of
Law. =93It is hard to figure out which ones are a serious threat and which
ones are not.=94

Mr. Goldman also said it was unclear what specific technology or service
was covered by the Intertainer patent.

=93I have the same problem with this patent as so many of the patents of
the dot-com boom days: I don=92t know what it means,=94 Mr. Goldman said.

Mr. Stevenson, the Intertainer lawyer, said the patent covers a system
that can be used by content owners to upload their content and used by
consumers to download it. =93It is pretty basic to the architecture of
digital content delivery nowadays,=94 he said.

Mr. Taplin, who once worked as a road manager for Bob Dylan and produced
several movies, including =93Mean Streets,=94 =93The Last Waltz=94 and =93T=
o Die
For,=94 has a history of activism on technology issues. In 2002, he
encouraged those attending a technology conference to urge the Federal
Communications Commission to ensure that broadband providers would not
be able to block specific Web sites =97 an early version of a hot-button
issue that has become known as network neutrality.

Earlier that year, he testified before the Senate against legislation
that would have forced high-tech manufacturers to incorporate technology
to prevent piracy in their software and hardware.

Correction: January 4, 2007

A headline in Business Day yesterday about a lawsuit brought by
Intertainer, a digital media company, against Apple Computer, Google and
Napster misstated the nature of the litigation. It involves a patent,
not a copyright.