One of the biggest online auctioneer and retailer, eBay, seems to have landed in head of trouble, as XPRT Ventures LLC, a Connecticut based company has sued eBay for a whopping $3.8 billion on grounds of patent infringement, that eBay has allegedly used to develop secure online payment portals, such as PayPal. As per the complaint filed by the company, eBay has been accused of stealing information, that was shared in confidence by XPRT, that claims rights to the six patents in the complaint. eBay has said to have used these patents for PayPal Pay Later and PayPal Buyer Credit.

As per the complaint, XPRT Ventures had already filed a patent for the ‘Method and System to Automate Payment for a Commerce Transaction’, when e-Bay filed a similar patent with the U.S. Patent and Trademark Office on April 30th, 2003, but the failed to notify the authorities of a similar pending patent from XPRT. With the help of this innovative payment model, eBay has already generated $2.8 billion of net revenue in 2009, as per the latest annual reports. In the lawsuit filed against eBay, XPRT Ventures is seeking $3.8 billion in monetary damage, along with treble damages resulting from eBay’s alleged “willful and malicious conduct,” punitive damages, and other remedies.

According to Steven Moore (Kelley Drye & Warren LLP),

“This involves a trade secret theft, along with sheer patent infringement. It is bad enough to take someone’s technology, but it is a bit much to use it in your own patent application.”

Via Reuters