Tuesday, July 12, 2005

REAL ESTATE AGENTS BEWARE! As this blog has pointed out earlier, one unique feature of patent holding company litigation is that they like to start enforcement efforts by focusing on end-users first to build-up their litigation coffers. Streaming media websites, credit-card processing companies and even commodity market traders have felt the sting of holding companies when they go on the rampage.

Now add real-estate agents to that list.

A Philidelphia estate agent who describes herself as being in the top one per cent of all agents nationwide, has been named in a Federal lawsuit that accuses her of patent infringement by using a computer mapping system without acquiring a license to use the enabling technology.

The lawsuit was filed against Diane Sarkisian of Ambler, Pennsylvania and is believed to be the first of its kind. The suit naming Sarkisian was filed Tuesday in Federal District Court in Philadelphia. Lawyers for the patent owner, Real Estate Alliance, Ltd. (REAL), specifically noted that real estate agents throughout the country may be infringing the patent and subject to legal action.

U.S. Patent No. 5,032,989, titled "Real Estate Search and Location System and Method," was granted by the U.S. Patent and Trademark Office in 1991, at a time when the commercial use of the Internet was in its infancy. It covers a mapping system "for locating available real estate properties for sale, lease or rental using a database of available properties at a central location and remote stations which use a graphic interface," according to the document. The patent also includes a "drilldown" feature, under which specific areas can be displayed in greater detail.

Real estate agents use this method as a valuable tool to locate desirable residential properties every day as they work with their clients. (The National Association of Realtors claims more than 1.11 million members.) The lawsuit states Sarkisian has not obtained a license to use the underlying technology, and asks for unspecified royalties plus court costs.

REAL, for the time being has indicated that they are holding off suing potential defendants like, TRenD, the local multiple listing service, for patent infringement. However, lawyers for REAL said other real estate agents have been notified about their infringement of the company's patent as part of an ongoing process, and said additional civil lawsuits will be filed against agents across the United States who do not voluntarily obtain licenses.

The patent only has one independent claim (Claim 1), and it reads as follows:

Claim 1. A method using a computer for locating available real estate
properties comprising the steps of:

a) creating a database of the available real estate properties;
b) displaying a map of a desired geographic area;
c) selecting a first area having boundaries within the geographic area;
d) zooming in on the first area of the displayed map to about the boundaries of the first area to display a higher level of detail than the displayed map;
e) displaying the zoomed first area;
f) selecting a second area having boundaries within the zoomed first area;
g) displaying the second area and a plurality of points within the second area, each point representing the appropriate geographic location of an available real estate property; and
h) identifying available real estate properties within the database which
are located within the second area.

7 Comentários:

Anonymous said...

How can they sue unless she used their software that THEY created to do this without a license?

If she created or used another service that does database queries for this sort of thing, they have no suit.

They would only be able to sue if she used their patended invention for profit without a license, and unless she aquired their database of homes and data and some how made a tool to create the map using their software that they created, only then.

Wouldn't she had to of stolen their program and data to do this?

Its like going to google and saying, hey, my site shows up in your search engine, pay me something or I'll sue you because your didnt license my site.

On the other hand, if google was selling, say a program I created without my permission, or copyrighted material from the site, then they could be sued.

How can they sue her for selling homes? Most Realtors use MLS files that they have to pay for anyway.

The lawsuit states Sarkisian has not obtained a license to use the underlying technology, and asks for unspecified royalties plus court costs.

But it doesnt say what technology she actually used. How can they prove she used their patened software?

There are tons of realty maps out there and other maps, like google maps, yahoo maps, mapquest, etc. And they dont charge for anyone to use their site. Let alone to sell a house they plotted using their maps. So, the article leaves key info out. Like how she obtained their patened software, and how she used it. What is the name of their software program? And how do you go about getting it in the first place?

It looks to me like they are just looking for money and going after anyone they can.

Anonymous said...

EDITORIAL….. August 1st 2005
Today's legal system often engenders criticism and fear but seldom admiration and respect. For every "villain" that manipulates justice and is set free, there is an innocent "victim" who suffers the law's consequences unfairly. It is the legal system's near impossible onus of having to judge the "heart" or intentions of its citizens that often creates the playing field for this dilemma. Where intentions of the parties are clear, and the facts are readily ascertainable, it is then, that there exists the highest likelihood for JUSTICE. In this writer's view, what you are about to read will challenge your beliefs of "the good guys and bad guys" It is this admirable quest for JUSTICE in which the enforcement of the '989 mapping patent now enters the arena of the real estate industry.

This 1991 patent, "Real Estate Search and Location System and Method" is the focus of the patent holding company, Real Estate Alliance Limited (REAL llc) that has assembled itself into a formidable enforcement entity and re-emerged on the scene in 2005. It should be clear even to the average layperson, that the intent of the inventor of USPTO patent #5032989 (United States Patent and Trademark Office) was to secure rights and royalties for the use of map-driven interface that searches a database of real estate properties for rent, lease, or to own. The claims contained in that patent spell out a particular methodology or process required to qualify the patent for acceptance. Even through its specific and complex filing language, it is clear to see the core of a valuable and unique invention…its "intent". All of the USPTO filing requirements have been met, the patent has been verified, and awarded by the USPTO.

Since the patent is legitimate, some may consider it unethical or a moral "low-road" for an entity to unduly leverage influence, power, money, or legal threats to somehow obfuscate or maneuver around the very rights, including royalty payments, specifically protected by the USPTO…its administrative purpose and "intent". After all, these benefits are the sole reason that any patent holder would disclose their invention and follow the federal filing requirements for a patent with the USPTO in the first place. In this writer's opinion, this kind of 'low road" tactic is being undertaken by HOMESTORE the nation's premier online real estate entity, and the current caretaker of the National Association of Realtors #1 rated site REALTOR.COM.

Records show that HOMESTORE, and the NAR were actively aware of the '989 patent on or before the year 2000. In fact, an executive at HOMESTORE has stated that the company invested more than $2 million dollars in legal funds surrounding the patents like the '989 issue since that time. Since there has been no litigation on the '989 patent by HOMESTORE, those funds would likely correspond to research. That might easily afford 40 hours per week for nearly a year. At the end of that time…it appears that HOMESTORE's counsel determined that the patent was either valid and/or not worth contesting…and REALTOR. COM has made multiple revisions to the mapping process on the site between 1999 and 2005, and has stated this fact to NAR executives and various other parties. According to HOMESTORE, their intentions were to redesign one of their sites and apparently remove…one or more of the five steps contained in the patent…. such as "displaying the second area and a plurality of points". In this way, the REALTOR. COM site would then, no longer be at risk of infringing the patent.

For the better part of a decade, REAL llc, has contended that the REALTOR.COM site needed to acquire licensing on behalf of its users. In late July of 2005, a past KEY executive of HOMESTORE contacted a current senior executive of HOMESTORE and advised that person that the REALTOR. COM site unfortunately continues to include links that allow users to follow step 5 of the patent claims..."displaying the second area and a plurality of points". That step was supposed to have been completely removed in the redesign which happened nearly half a decade before, and formed the basis of the company's claim that REALTOR. COM does not infringe on the '989 patent. The executive was shocked and stated he was unaware of that technology oversight and further stated " oops…looks like they may have us" referring to the patent holding company REAL llc. Since that time, multiple brokers and associations have hired independent IP counsel to review the REALTOR.com site and have unanimously come to the same conclusion. The site apears to follow the claims of the '989 patent.

The implications of this oversight are significant. The enforcement of the '989 patent is targeted at agents and brokers, who have taken on a fiduciary role with their homeowners'. Since most MLS's upload properties to REALTOR. COM, those listings now contribute to a database of available properties that are searchable following the claims of the patent. Thus this online real estate marketing juggernaut appears to place the agent clearly in the position of an infringing user. Although this new information regarding the failed redesign is less than 3 weeks old, HOMESTORE still publicly contends that their site does not infringe on the '989 patent, offering no further explanation for this claim. Although they eliminated a key mapping function on their site within days of their notification of this method on their site.

One might ask then, "what is the intention of HOMESTORE, when they admittedly invested over $2 million dollars in legal counsel that advised that their previous model needed to be redesigned…and that attempt, as it pertains to REALTOR.com appears to have been a dismal failure.

HOMESTORE executives have stated that there are many other sites, that they are aware of, that "obviously" do infringe on the patent. This further establishes their belief that the patent is valid, and that they have a clear understanding of the claims of the patent. It is therefore, all the more perplexing why executives at HOMESTORE have also expressed an interest in making a sizeable "investment" (under $10 million dollars) in REAL llc in exchange for certain considerations which would likely include some type of indemnification for the current REALTOR. COM site. One might question intent.

Many millions of dollars and tens-of-thousands of hours have been invested in research of this '989 issue behind closed doors prior to agents and brokers first learning about it this year. The intentions of the patent inventors remains unwaivering to this day. They are interested in acquiring a reasonable royalty fee from professionals using and benefiting from the search process that they have patented. Numerous offers of settlement have been extended which would allow agents and brokers to pay pennies on the dollar for the current $10,000 enforcement price of the license. Perhaps emboldened by the HOMESTORE assertions, industry leaders have turned a deaf ear to these offers time and time again. Now public relations and posturing sets the stage for a morality play, complete with greedy patent villains and bewildered and innocent "shop-keepers". Every jot and tittle could be exhaustively and aggressively contested in an attempt to call into question the very legitimacy or applicability of a patent whose intentions are clear, pure, and consistent since the day of their inception. Therefore; if the simple, single, original goal and outcome of this circumstance were to be that elusive ideal of "JUSTICE" how might you now see the "INTENT" of a company like HOMESTORE?

Anonymous said...

I'm one of those top producers...but havent seen any of those letters to me or to our offices.

If that editorial is anything close to being accurate we have some very SERIOUS problems. Are there any attorneys out there that can verify any of this stuff? Why isn't the National Association doing anything about this...what are our dues for anyway?

I went to the REALTOR.COM site and saw mapping...but I'm not a lawyer...but something doesn't seem right to hear nothing about this from the industry.

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Anonymous said...

The above editorial looks like it was written by someone from REAL. It's onesided and misleading.

Anonymous said...

Do you have any update on this story? It looks like Diane Sarkisian has filed RICO charges against all of the REAL989 players. I there is a link to there was a story about it on courthousenews.com....but I was never able to find the actual article. Just the below link:

Courthouse News Service | Home
PHILADELPHIA (CN) - Real-estate agent Diane Sarkisian has filed RICO charges
against Andrew Rooke, Mark Tornetta, Lawrence Husick, Scott Tatro, ...
www.courthousenews.com/ - 60k - Jan 16, 2006 - Cached - Similar pages - Remove result

Anonymous said...

It's amazing to me that people think the patent holder, just because the patent is in use by thousands of people, does not have a right to defend his or her creation, nor to profit from it.

The editorial, whether written by someone from REAL or not, contains the facts. We encourage people to create, yet want to punish them for doing so. Such a sad environment we perpetuate.


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