Groupon Sued For Patent Infringement Of Online Restaurant Management System

By Joseph Mandour on December 28, 2011

LA Patent Infringment Orange County – A company called Mount Hamilton Partners filed two different patent infringement lawsuits against Groupon. The complaint involves U.S. Patent Number 7,904,334, which is entitled “System and method for reducing excess capacity for restaurants and other industries during off-peak hours.” Groupon uses the system in its daily deals. Mount Hamilton Partners seeks damages in both suits.

Mount Hamilton Partners argues in its filings that it suffers irreparable harm when companies like Groupon build direct relationships and increasing loyalty with individual restaurants and consumers by infringing on its patent to fill unused restaurant seats.

Groupon launched in November, 2008. It pioneered local daily deals to become an industry leader with the first mobile application for users. The company features an online deal each day with a discount for eateries, spa services, and other products and activities. It has expanded to 45 countries and has about 10,000 employees. The company grew from a website called The Point, which allowed individual users to contribute to a campaign by donating money as act as a group. The website allowed a group action to occur only after enough people had joined to create a “tipping point” to trigger the action to occur. Groupon applied The Point’s framework to consumers.

Groupon is a veteran of patent infringement lawsuits. In July, 2011 it was sued by SellerBid Inc., a company engaged in e-commerce and specializing in online auctions, for infringing on Patent Number 7,983,616, which related to selling products to groups. In November, 2011, Mobile Commerce Framework sued Groupon for infringing on Patent Number 7,693, 752, which related to presenting information to a subscription-based group via a mobile device.

Mobile Commerce Framework and Mount Hamilton Partners are informally known as patent trolls, companies that purchase and enforce patents against alleged infringers for a primary purpose of obtaining money. Mount Hamilton Partners calls itself an “investor in technology companies.” It sued OpenTable two and a half years ago before it went public. It also filed suit against Google for infringing on the same patent using the technology in Google Offers, its digital coupon business. Groupon said it expects to prevail in the lawsuit.

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