LivingSocial Hit With P2P Advertising Patent Infringement Suit

Patent LawsuitsBlue Calypso Inc. lodged a patent infringement action against LivingSocial Inc. on Friday accusing the online deal company of wrongly taking advantage of its patented technology for peer-to-peer advertising.

The complaint in Texas federal court alleges LivingSocial is infringing U.S. Patent Numbers 7,664,516 and 8,155,679. The ‘516 patent, titled “”Method and System for Peer-to-Peer Advertising Between Mobile Communication Devices,” was issued in February 2010, while the similarly-titled ‘679 patent was issued in April of this year. Both are assigned to Blue Calypso, a digital word-of-mouth marketing company.

“As a technology innovator, it is our duty to protect what we have created from illegitimate use,” Blue Calypso CEO Bill Ogle said in a statement Monday. “The current landscape for social engagement is growing and with that brings interest and need for the platform we developed and operate. It is our plan to monitor for infringing companies and ensure that our assets are protected now and into the future.”

LivingSocial has infringed the patents by deploying a computer program that includes functionality for enrolling both consumers and advertisers and for offering deals to consumers,, based on identification of at least a geographic match between the consumer’s profile information and the advertiser’s deal, Blue Calypso said. After offering the deal to the consumer based on such a geographic match, LivingSocial provides additional functionality for encouraging the consumer to refer the deal to other consumers.

LivingSocial also induces infringement by, for example, encouraging use of its computer-based program by consumers and advertisers through the use of discounts and incentives, Blue Calypso says. The company is seeking damages and a permanent injunction.

In the method disclosed in the ‘516 patent, a subsidy program is set up based on a profile of an advertiser having at least one advertising media, a qualified subscriber is identified for the advertiser based on subscribers’ profiles, and then one or more advertisers and subsidy programs for the qualified subscriber are selected. When a communication transmission is received from a source device, at least one advertising media is associated with the transmission, which is transmitted from a source device to a destination device. The method disclosed by the ‘679 patent is substantially similar.

The LivingSocial lawsuit is the second in a series Blue Calypso plans to file against companies it believes are infringing its patents, the company said Monday. The first was filed against Groupon in Texas federal court in July.




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