E-Data, a company that claims a patent covering music downloads, has secured a global agreement with digital music providers – and may already have moved to enforce its patent against Apple.
The patent covers the downloading and recording of such information as music to a CD or MP3 player. E-Data has now reached a global retrospective and future royalty agreement with online digital music providers.
In Europe, these providers include OD2, HMV, Tiscali and Microsoft. The company has hired international law firm Howrey Simon Arnold & White to aggressively enforce the patent in the ten European countries in which E-Data claims the patent (called the Freeny patent, granted in 1985). The company has secured more than 30 licences from US companies.
Bert Brodsky, chairman of E-Data, said: "We are quite pleased with this settlement as it further reinforces the scope and validity of the Freeny patent in Europe. While the OD2 service is still in the nascent stage, which is reflected in the settlement, the agreement sends an important message to other companies infringing upon our intellectual property".
It's possible that Apple will have to pay dues to E-Data too, Brodsky hinted: "Importantly, OD2's service in Europe parallels the iTunes Music Store, a successful music downloading service developed by Apple in the United States, and which Apple plans to launch in Europe later this year. "
He added: "We are currently in talks with a number of prominent companies in Europe infringing upon our intellectual property, and may seek injunctions against these companies if necessary."
The company's Web site states that "licence fees are calculated based upon a model of usage that includes revenue, volume and several other factors. "
The company’s stock (EDTA) currently stands at $0.10 per share. Little additional information is available, other than the company’s former identity as Interactive Gift Express until November 1995.
Interactive Gift Express was involved in lively litigation with Compuserve in the 90’s – also relating to the Freeny patent. The lower federal court held that the patent could not be expanded to cover the Internet, but an appeal was made.
The appeals court vacated the original decision on the grounds that: "the district court erred in at least one aspect of its construction of each of the five claim limitations upon which the judgment of non-infringement was based".
Archived discussions from the early years of the Internet ask: "The 1985 date on the patent is interesting: the infrastructure was not in place to support the kind of commerce described by the patent. How did Freeny show a working prototype? "
This litigation, along with the recently-reported Eolas suit, may turn out to be the thin end of the wedge for patent-holding companies eager to cash in on other company’s success online.
A Computerworld report from 1995 cites Greg Aharonian, then editor of the Internet Patent News Service, who said: "Throughout the 1980s, a variety of patents were issued that can be generalized to be applicable to the Internet and related forms of electronic sales."