May 13, 2005 11:38 AM PDT

eBay wins stay in MercExchange case

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eBay announced Friday it won the latest round in its patent fight against networking-systems developer MercExchange when a federal appeals court granted the online auctioneer a stay in the case pending a prospective review by the U.S. Supreme Court.

eBay, which was sued in 2001 by MercExchange, is fighting allegations that it violated two MercExchange patents. The case will go before the Supreme Court, which will decide whether it will review the case or send it back to the lower courts.

For eBay, a decision in the case will help resolve the eventual status of its "buy it now" option on its auction site. MercExchange alleges that eBay and its subsidiary knowingly infringed on two MercExchange patents in their implementation of the "buy it now" option.

Last year, a federal district-court jury ruled in favor of MercExchange and ordered eBay to pay more than $25 million in damages.

The U.S. Appeals Court in March threw out one of the two patent infringement claims. Also earlier this year, the U.S. Patent and Trademark Office initially rejected MercExchange's claims involving the two patents.


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