CryptoPeak HTTPS patent cases settled out of court

Justified or not, a number of cases surrounding the use of ECC in HTTPS websites have been settled outside of the courtroom.

Patent-wielding CryptoPeak's spat of rapid lawsuits surrounding HTTPS websites have been met with a measure of success, thanks to a number of firms paying up just to get rid of the problem.

Earlier this week, ZDNet reported on the lawsuits recently filed against both SMBs and enterprise players which use HTTPS protocols on their websites and through online services.

Texas-based firm CryptoPeak, having secured US Patent 6,202,150 which relates to "auto-escrowable and auto-certifiable cryptosystems" suddenly moved into action against a number of companies, alleging their use of the elliptic curve cryptographic key (ECC) on TLS-secured websites infringed upon the patent.

ECC use is very common today to help secure information traveling between computer systems and Web domains.

However, CryptoPeak -- of which little is known beyond lawsuits filed by the company -- claims that approximately 70 firms using ECC should be paying them royalties as the holder of the US patent.

To bring home the point, in the past few weeks the firm filed lawsuits against companies including AT&T, Groupon, Netflix, Experia, Etsy and Yahoo to demand legal costs and damages.

Despite the vague language and protests by some companies accused of intellectual property infringement, such as Netflix, a few firms have ceded to CryptoPeak's demands and agreed to settle out of court.

As noted by The Register, 11 companies in total, including Anthem Insurance and Discover Financial Services have opted for out-of-court settlements. They may have believed their HTTPS websites and use of ECC were covered by the patent -- or just wanted the issue to go away.

However, by settling the matter out of court, CryptoPeak has been given some justification for carrying on with the mass lawsuit filing.

The timing is also of note. It's not usual for firms, even those which could be considered patent trolls, to file so many cases in such a short space of time. However, it is likely that CryptoPeak wanted to get in under the radar before new rules were set in the United States on December 1 making patent trolling more difficult.

The elimination of Form 18, used to file basic patent infringement complaints without any real information, should reduce the rates of mass lawsuits filed in order to cash in based on vague patents.

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