The National Association of Realtors has upped its financial stake in a mapping-patent lawsuit filed against a Realtor in Pennsylvania. The association said if the lawsuit is successful, more agents and MLSs could be targeted with similar complaints.
Already, the Realtor trade group has contributed about $500,000 to support the defense of its member, Diane Sarkisian, from claims that she violated a patent held by Real Estate Alliance Ltd. And on Monday, the trade group’s board of directors approved an additional contribution of up to $325,000 to support the ongoing litigation.
The relevant patents, granted by the U.S. Patent and Trademark Office in 1989 and 1991, claim “a method using a computer for locating available real estate properties,” and relies on the creation of a database of available real estate properties, a map display for a desired geographic area, and “zooming in on the first area of the displayed map to about the boundaries of the first area to display a higher level of detail than the displayed map,” among other specifics.
Patent-holder Mark Tornetta, a systems engineer, in 1998 filed a lawsuit charging that two Web sites — Moore USA’s cyberhomes.com (now operated by Fidelity National Real Estate Solutions) and Microsoft Corp.’s HomeAdvisor sites infringed upon his patents, though the companies claimed the allegations were false and said they intended to defend against the claims. The lawsuits eventually were dropped.
Tornetta is now a shareholder in the Real Estate Alliance Ltd., and the company renewed its legal fight to defend its patents after receiving a financial commitment from other shareholders. In July 2005, the Real Estate Alliance filed a complaint in U.S. District Court in Pennsylvania against Sarkisian and unnamed others, charging that Sarkisian and other users of the TREND Multiple Listing Service in Pennsylvania have violated its patent because the TREND MLS offers an electronic real estate mapping system.
Lawyers representing Sarkisian in the case could not be reached for comment Wednesday. Court documents filed in Sarkisian’s defense refute the claims in the Real Estate Alliance complaint.
In October, lawyers for Real Estate Alliance filed a memorandum with the court charging that Sarkisian failed to take steps to preserve evidence when she learned about the lawsuit filed against her, “intentionally erased information stored on her personal computers,” “withheld production of documents from her computer, without legitimate basis,” and “intentionally over-wrote data on her computer disks to obscure evidence of her activities.”
Scott Tatro, president and founder of Equias Technology Development LLC, a company that licenses Real Estate Alliance’s mapping technology in the United States, said the backers of the lawsuit seek to apply the patent infringement charges to a very large cross-section of real estate agents — potentially any agent who has ever listed a property on Realtor.com, a property-search site that is operated by Move Inc.
In its support of contributions for the defense of the case, the National Association of Realtors’ Legal Action Committee noted that Real Estate Alliance “has indicated its intent to seek a license from all other TREND MLS users and/or similarly seek patent infringement remedies from all other MLS users. If successful it is likely that (the company) would bring similar patent infringement claims against participants of other MLSs or the MLSs themselves.”
Sarkisian is represented by the DLA Piper Rudnick Gray Cary law firm, based in Philadelphia, Pa. In January, Sarkisian filed a complaint against Tatro, Equias, and shareholders for Real Estate Alliance Ltd., charging that they violated antitrust laws and the Racketeering Influenced and Corrupt Organizations (RICO) Act in claiming patent infringement and pursuing licensing royalties.
The lawsuit also charges defamation, false light, trade libel, intentional infliction of emotional distress, and tortious interference with existing and prospective business relation under state law. Those separate lawsuits are now under the purview of a single judge.
The judge on Nov. 13 called for the parties in the patent infringement lawsuit to present a written summary of their arguments for outstanding issues in the evidence-gathering phase of the trial by Dec. 1, with a court hearing to follow on Dec. 8.
The lawsuit filed by Sarkisian charges that “in light of the failed attempts to sue Microsoft, Mapquest and Moore, and following the period of almost five years in which Tornetta took no steps to enforce the patents, the REAL (Real Estate Alliance Ltd.) principals explored other avenues for reaping profits” from the patents involved in the lawsuit, adding, “Among these avenues were failed attempts to sell licenses to associations, agencies and corporate entities, such as Homestore.com, MapInfo Corp., the New York State Association of Realtors, and numerous other realty companies.”
Real Estate Alliance has actively pursued licenses for its patents, and offers individual real estate agents the opportunity to purchase a license for $10,000. Tatro said Real Estate Alliance representatives have also had discussions with Google and Yahoo lawyers, among others, related to its mapping patents.
Tatro, whose company holds a license for the technology, said he believes the lawsuit against him and shareholders of REAL is a frivolous act.
Some real estate companies have also agreed to purchase licenses for the technology, among them LendingTree and brokerage franchise company Envirian LLC.
