Delegations from eBay and MercExchange, two companies engaged in a fierce patent fight, both attended a meeting of eBay's largest sellers in Austin this weekend. PESA is a non-profit trade association. eBay North America President Bill Cobb gave the keynote address on Friday morning, and hours later, the PESA board asked the three MercExchange representatives to leave.
MercExchange had sued eBay, and in 2003, a federal jury found eBay guilty of patent infringement and ordered eBay to pay $35 million in damages to MercExchange. A judge denied MercExchange's request for an injunction against eBay's use of fixed-price listings, a decision that was reversed by an appeals court earlier this year. eBay has taken the matter to the Supreme Court, who has yet to rule on whether it will hear the case. If it does not, the case goes back to the District Court where the judge will have to revisit the injunction request.
Michael May and Tom Woolston (right) of MercExchange at the PESA summit October 27.
MercExchange's Michael Caputo said PESA had invited MercExchange to the Summit when they were in discussions with board members over how to mitigate the effect of a possible injunction against eBay's BIN (fixed-price) feature. Caputo said they had discussed uBid, an online-auction site that licenses MercExchange's patent, with the PESA board members.
MercExchange has been reaching out to eBay PowerSellers for the past 6 months, Caputo said. "By enforcing our constitutional rights (by filing the injunction against eBay), we could alienate ourselves from the community we are trying to serve."
Caputo said they got a positive reception from PESA members and said he met strong leaders of the industry at the PESA summit, calling them "very serious business men and women" who were getting a lot accomplished at the meeting. He said the three MercExchange representatives, Tom Woolston, Michael May and himself, left when asked because, he said, "we didn't want to make it difficult for people to do their business. We were appreciative of being invited."
PESA founder Joe Cortese said the PESA board of directors knew MercExchange would be attending, but he said, "It wasn't clear to us until they got here what their intent was," and said they were telling PESA members about other marketplaces, specifically uBid.
Cortese said PESA discussed the presence of MercExchange with eBay on Friday, but "we aren't under their direction, we are an independent organization. We can think for ourselves." MercExchange's presence was "potentially uncomfortable" given they had sued eBay, Cortese said.
eBay spokesperson Hani Durzy said in an email, " I wasn't there, but I have heard that it was PESA's decision to ask MercExchange to leave the conference, as presumably is their right, since it is their event."
Representatives from other marketplaces besides eBay are in attendance at the PESA summit, and an Amazon executive was slated to give a presentation on Saturday.
Update: Dow Jones Newswire reported on Friday that the Supreme Court is expected to announce Monday whether it will hear the case between eBay Inc. and MercExchange LLC regarding patent infringement. (http://digbig.com/4fcsr)
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