Content delivery network provider Akamai will receive $51 million in damages from one of its biggest competitors, Limelight Networks, after a Massachusetts District Court judge ruled in favor of Akamai to conclude an almost ten-year patent infringement lawsuit.
The judgment illustrates the continuing importance of CDNs in the internet ecosystem, particularly the role they play in delivering online video content to viewers.
While the judgment will make a dent in Limelight's second-quarter results, there were a couple of bright spots in the decision: the award was reduced by 19 percent from Akamai's earlier request for $63 million in damages; and it escaped the possibility of a permanent injunction, according to CEO Robert Lento.
"Since August of 2015, we have allocated precious resources to eliminate the possibility of a permanent injunction and address our belief that the ultimate damages payable would be considerably less than the amounts requested in this case," said Lento in a statement released by Limelight on Friday. "The final judgment in this case, which removes the possibility of a permanent injunction, validates our effort and represents an important milestone as it brings this long-standing dispute a step closer to finality."
Akamai's patent beef with Limelight dates back to 2006, when the CDN provider filed a lawsuit claiming that Limelight was violating U.S. Patent No. 6,108,703, which describes a method of content delivery. Certain steps within that method, particularly one that involves tagging embedded objects within a web page, were being performed by Limelight, which Akamai said infringed on its patent.
Initially, Akamai won a $40 million judgment in a 2008 jury trial in the U.S. District Court of Massachusetts. But the verdict was reversed following a Federal Circuit review, in Limelight's favor. It was then reversed again, back in Akamai's favor, following an en banc review by the Federal Circuit; and in 2014, the Supreme Court took a look at the case and reversed it once more, in Limelight's favor. (The gritty details are available more in-depth in this wikipedia entry).
In what feels like the longest ongoing game of legal Pong ever -- except with lots more paperwork -- the case went back to the Federal Circuit, which again went back and forth on its decision, finally deciding for Akamai. A certiorari petition to the Supreme Court by Limelight was denied, leading ultimately to the July 1 decision by the original district court.
This may not be the last word on the patent involved, however. Akamai is seeking additional damages from Limelight for ongoing infringement after the 2008 decision, in a new lawsuit scheduled to go to trial in January 2017.
- see this Boston Business Journal article
- see this Limelight release
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