A client of mine got an email demanding he pay a license fee or stop using "their technology" for having downloadable video profiles on his small (currently free) dating website.
They buy patents and enforce them as a business model, and apparenly have been making large sums and winning court cases regarding their "universal" patent on all digital distributions of video or audio files.
Their patent from 1991 would be laughable if they weren't winning court cases and actually bullying people into their extortion:
A system of distributing video and/or audio information employs digital signal processing to achieve high rates of data compression. The compressed and encoded audio and/or video information is sent over standard telephone, cable or satellite broadcast channels to a receiver specified by a subscriber of the service, preferably in less than real time, for later playback and optional recording on standard audio and/or video tape.
patent link
Its not about any source code of theirs, any programming techniques or codec strategies or a single thing they actually did - and applies for everything from digital cable TV to digital telephone fiber optics to every website with a fraps video capture for download.
From what I read up on the guys, a few years back they started suing adult sites in 2003, since courts didn't like those businesses anyway and got some precedents set that were in their favor.
Now, it seems they are trying to extort respectable business owners too. They even have a policy that the longer you resist them, the higher your royalty fee will be to use "their" idea of transmitting video or audio online.
This client of mine has nothing to do with the adult industry and doesn't even draw an income on anything that uses video files. If it wasn't for all the links I found I would definately had thought this was an internet hoax.
Has anyone heard of these guys or if they've been challanged at all successfully? The practice is so sickening to me it makes me almost physically ill. They won't even try going after microsoft or apple quicktime apparently, because they don't want to be destroyed and think they can feed off the weaker companies. I still can barely believe it.
I am still in shock that these companies are allowed to exist and even profit from such horrible practices.
Does anyone know if they target companies who have their sites hosted in europe?
I've read a lot of patent threads here in these forums so I am curious what people may have heard.