Facebook IPO could be damaged by Yahoo (YHOO)

In a new claim filed Monday which could add further doubt to the profitability of the upcoming Facebook IPO, Yahoo, Inc. (NASDAQ: YHOO) has demanded Facebook pay licensing fees for use of its technology. The new claim, the first from a large tech company, could potentially immersing the social media giant in patent battles and lawsuits which could cause concern over the affect it could have on potential shareholders of the upcoming IPO.

Yahoo has proclaimed that they own the patents which include the technical mechanisms used in the Facebook’s ads, privacy controls, news feed and messaging service. Representatives from both Yahoo and Facebook met on Monday and the discussion apparently involves as little as 10 to as many as 20 of Yahoo’s patents, although the specific amount of money Yahoo is demanding is still unknown.

Yahoo did not expand on the details in an emailed statement of its discussions with Facebook, but specified that the tech company would not flinch to go to court over the patents with the social networking giant. Yahoo did mention that other companies have already licensed some of the technologies in the claim, and that it would act unilaterally if Facebook refused to pay for a patent license.

Sources from Yahoo were reported as saying that “Yahoo has a responsibility to its shareholders, employees and other stakeholders to protect its intellectual property.

Should Yahoo actually take the upcoming IPO, Facebook, to court and sue for payment of its patent use, it would mark the first major legal battle between technology giants in the social media circle and a major intensification of patent litigation that already has swept up the tablet and smartphone sectors and high-tech advocates such as Apple Inc. (NASDAQ: AAPL), Microsoft Corp. (NASDAQ: MSFT) and Motorola Mobility (NYSE: MMI).

Last updated by at .

0
  Recent Penny Stock News