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eBay sued by Skype founders

Written by Andre Yoskowitz (Google+) @ 18 Sep 2009 1:31 User comments (9)

eBay sued by Skype founders The founders of the Internet phone company Skype have sued eBay today, alleging that the auction giant broke copyright law when they altered and shared the P2P source code behind the software.
Niklas Zennstrom and Janus Friis, the billionaire founders of the software, filed the copyright lawsuit this week. eBay purchased Skype for over $3 billion USD in 2005 but the founders retained ownership of the source code and licensed it to eBay for use.

The founders are seeking an injunction as well as statutory damages that could reach as high as the billions. They two men already filed a similar suit earlier this year in the UK which is expected to go to trial in 2010.

eBay recently announced they would sell most of Skype to a group of private investors for $1.9 billion USD and it is unclear whether the suits will block or delay the sale.

“Litigation often will delay a deal, and there is often a lot of pressure on companies to settle litigation in advance of a deal,” added Michael Klausner, a Stanford Law professor.

eBay spokesperson John Pluhowski added however that the case's basis “are without merit and are founded on fundamental legal and factual errors. We remain on track to close the transaction in the fourth quarter of 2009.”

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9 user comments

118.9.2009 2:11

While I don't like people suing others, I think it's hilarious that eBay was dumb enough to pay $3 billion for the rights to use the software, but not the rights to source code.

218.9.2009 3:02

Keep in mind I am giggling as I write this....

Uhh... ummm... hey pop... just about everyone has done the same thing albeit most didn't pay 3 billion!

318.9.2009 9:26
warriorp
Inactive

uh oh. i guess they will raise seller fees again. and a big f U to paypal.

418.9.2009 11:24

Originally posted by Blackjax:
Keep in mind I am giggling as I write this....

Uhh... ummm... hey pop... just about everyone has done the same thing albeit most didn't pay 3 billion!
Yes, a lot of companies do this sort of thing (where they buy and sell software without the source code rights). I just think it was really stupid of eBay to pay $3 billion without the source code rights.

518.9.2009 11:28

they buy it for $3 billion but sell it for $1.9 billion so they lost $1.1 billion so are they stupid or what?

618.9.2009 12:58

Originally posted by ddp:
they buy it for $3 billion but sell it for $1.9 billion so they lost $1.1 billion so are they stupid or what?
Hey ddp, they plan to sell a majority stake for $1.9 billion, that stake being about 70 percent. Overall the deal values Skype at $2.75 billion, still a significant "haircut" from what they purchased it for in 2005. Not to mention the restructuring costs they must have incurred trying to integrate. Would not surprise me if eBay lost over $500 million investing in Skype when they did.
This message has been edited since its posting. Latest edit was made on 18 Sep 2009 @ 12:59

719.9.2009 1:11

Originally posted by ddp:
they buy it for $3 billion but sell it for $1.9 billion so they lost $1.1 billion so are they stupid or what?
I'd say yes!

@pop- what I meant was we all have bought software at one time and I don't ever recall a user agreement saying you owned the source code i.e. winblows oops windows. As the saying goes first time shame on you second time shame on me. I prefer to be shameless!

819.9.2009 3:18

Originally posted by Blackjax:

@pop- what I meant was we all have bought software at one time and I don't ever recall a user agreement saying you owned the source code i.e. winblows oops windows. As the saying goes first time shame on you second time shame on me. I prefer to be shameless!
Ah, thanks for clearing that up. Yes, we've all done that, probably more than we know it! :P

919.9.2009 5:14

Originally posted by Pop_Smith:
While I don't like people suing others, I think it's hilarious that eBay was dumb enough to pay $3 billion for the rights to use the software, but not the rights to source code.
I also don't like people suing each other but Ebay Deserves it.
Lets see how many people are going to get scammed by paypal in order for them to recover their loses.

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