Add patent lawsuits to the list of headaches for China’s ByteDance Ltd and its TikTok unit.
The popular video-streaming app has been hit with three patent-infringement lawsuits in a little over a month, including one lodged in late July by Triller Inc, a competitor and potential bidder for TikTok that claims it invented key technology for a way to create synchronised music videos.
The lawsuits have arrived while ByteDance is in talks to sell parts of its TikTok unit in a deal that could be worth tens of billions of dollars.
All three cases were filed in federal court in Waco, Texas, a hub for lawsuits by patent owners looking for a friendly judge and quick litigation. Each of the patent owners claim they’re entitled to royalties from the company, which has US operations in nearby Austin.
“You might get sued more if your face gets in the news as a company, but people don’t sue a face in patent litigation, they sue a pocket,” said Ken Weatherwax of the law firm Lowenstein & Weatherwax LLP in Los Angeles. “The reason they’re being sued is because of the conclusion that there’s money to be made.”
ByteDance is under pressure from the Trump administration to sell TikTok’s US operations, which some inside the White House consider a security concern. Oracle Corp and Microsoft Corp, which has partnered with Walmart Inc, have both submitted bids for TikTok’s US business, and analysts say the price could be in the US$20bil to US$50bil range. The deal has been slowed by the US and Chinese governments, both of which are demanding approval of any sale.
The other two suits were filed by companies with little-used apps. The latest was filed Wednesday by 10tales Inc, a Pennsylvania company that says its patent is used by the recommendation system that underlies TikTok’s “For You Feed”. Dallas-based Pixmarx IP LLC, which sued TikTok Aug 14 and Snap Inc in May, said it owns patents for ways to adds special effects to digital photographs.
TikTok hasn’t responded to any of the lawsuits yet; an answer to the Triller case is due in November. The company said it doesn’t comment on pending litigation.
One legal strategy typically used by companies being sued may be limited for TikTok. Firms normally will file challenges at the US Patent and Trademark Office’s review board, which has a reputation for invalidating a high number of patents.
But the Western District of Texas, where all three suits were filed, is known as the nation’s newest “rocket docket”. Apple Inc, Alphabet Inc’s Google and other tech companies have sued the agency because the board has declined to conduct reviews when district court cases are on a fast track, as they are in Waco.
- Bloomberg
Created by Tan KW | Aug 15, 2024
Created by Tan KW | Aug 15, 2024
Created by Tan KW | Aug 15, 2024
Created by Tan KW | Aug 15, 2024