Google ruled to pay 1.36 percent of revenues from its Adwords to a patent troll company
Previously Virgo won $30 million straight from Google in 2011
This week the federal court in Virginia ruled Google to pay 1.36% of revenues from its AdWords online advertising system to Vringo. The last one is known as the company that owns a part of Lycos’ patents. As expected, patent trolls are never to be underestimated. For those who hear the term for the first time, patent trolls are companies that exist solely to make money from other companies’ business via the use of patents. In all, it’s not the first time Google encounter such trolls on the battlefield, as recently the giant fought against Rockstar- a very dangerous mega-troll with companies like Apple and Microsoft behind its back. Unfortunately, the likes of Google are easily vulnerable to such trollism since they use a wide range of services and products.
For Google, that includes Android, Google+ and a wide range of home automation and robotics. This wouldn’t be possible without acquiring Boston Dynamics and Nest, or as we mentioned- AdWords. Google’s power and the core of its revenue lies in the advertising on its flagship searching engine and a huge part of that is possible thanks to AdWords. Three years ago, Vringo managed to get ownership over patents from Lycos in order to sue Google over AdWords. In a quick reminder, Lycos used to be a real hit site on the web back in the 1990s and its searching engine used to be one of the primary portals. Acquiring advertising related patents from Lycos might be Vringo’s smartest move, as the company has never earned any significant profit from its ringtone business. When there’s nothing else to be done- start trolling
And the worst part is, this works. In fact, Virgo won $30 million straight from Google in 2011 which made Google change its ad auction system in order to avoid further conflicts. Unfortunately for Google, this week the court in Virginia decided that the new version isn’t different enough. According to the Judge, the intellectual property in question affects approximately 20.9% of Google’s AdWords revenue, so Google was made to pay 6.5% of that to Vringo, which can easily amount millions of dollars.