EBay Inc. has settled a seven-year patent dispute with MercExchange that prompted an important intellectual-property ruling from the U.S. Supreme Court.
The San Jose-based online auction company said Thursday that it had bought the three MercExchange patents it had been accused of violating. The price was not disclosed, but EBay said the amount would not materially affect its financial results.
Great Falls, Va.-based MercExchange sued in 2001, arguing that EBay's "buy it now" option -- which lets sellers make items available at set prices -- infringed its patents.
MercExchange's founder, patent lawyer and engineer Thomas Woolston, had patented technologies related to an electronic network of consignment stores.
A jury ruled in MercExchange's favor in 2003, awarding $35 million in damages. A judge reduced the award to $25 million, but with interest the penalty had reached $30 million by December, when a federal judge certified the penalty and EBay was threatening to continue appealing.