Jury orders Amazon to pay $525 million to Chicago tech firm for patent infringement
CHICAGO (CBS) -- A federal jury in Chicago has awarded $525 million in damages to a Chicago-based tech firm, after finding Amazon Web Services infringed on three of the company's patents.
West Loop-based Kove IO, Inc., had accused Amazon Web Services of infringing on three patents held by CEO John Overton and fellow inventor Stephen Bailey, who met at the University of Chicago while working on their PhDs.
Kove claimed in its lawsuit that Overton and Bailey "developed breakthrough technology enabling high-performance, hyper-scalable distributed 'cloud' storage years before the advent of the cloud."
The lawsuit claimed Kove's technology later "became essential to AWS as the volume of data stored on its cloud grew exponentially and its cloud storage business faced limitations on the ability to store and retrieve massive amounts of data."
Amazon Web Services offers cloud computing services that are used by several other major companies, including Netflix, Facebook, Disney, and Sony.
On Tuesday, a federal jury found Amazon infringed on Kove's patents, although it not do so willfully, meaning it did not know of the patents' existence. The jury awarded Kove $525 million in damages.
"This verdict highlights the importance of protecting intellectual property rights. It is a testament to the significance of Kove's inventions. Kove will continue to grow and succeed through its pioneering technology," Kove attorney Renato Mariotti said in a statement.
Amazon spokesperson Duncan Neasham said they plan to appeal the verdict.
"We thank the jury, which also acknowledged that AWS did not willfully infringe on patents," Neasham said.
The case involved Amazon products DynamoDB and Simple Storage Service. Neasham said those services will not be interrupted or modified because of the verdict, as the patents involved have since expired.
Kove has filed a similar lawsuit against Google, accusing it of violating the same patents. That lawsuit is still pending.