Big publishers are facing an unexpected legal headache.
Over the past two months, a little-known entity called Rich Media Club LLC has filed lawsuits against major news publishers, accusing them of using online ad tools that it says infringe its patents.
The publishers targeted include Comcast, Guardian Media Group, Gannett, News Corp’s UK publishing arm News Group Newspapers, and MediaNews Group, which publishes dozens of local newspapers.
The legal action comes at a challenging time for web publishers, who are grappling with declining search traffic and a volatile ad market. Fighting such a suit could run up legal costs of more than $1 million each, industry insiders said.
Two legal experts told Business Insider the suits showed the hallmarks of a “patent troll,” while adding that the term is often contested. Some people reserve the description only for companies that buy or file patents with the sole purpose of asserting them against others. Others also use it to describe when “non-practicing entities” — those that own patents but don’t use them in their ordinary business — target companies with infringement claims.
“It certainly does seem to fit the classic patent troll model,” said Mark Lemley, professor of law at Stanford Law School. “Often the strategy is to seek relatively cheap settlements based on the cost and uncertainty of litigation.”
These suits differ from the ordinary patent troll playbook by targeting the end users — publishers — rather than other technology companies, said Colleen Chien, professor of law at the Berkeley Center for Law and Technology.
“It harkens back to the days when anyone who had a scanner was a potential target of a patent infringement lawsuit,” Chien said, referring to a company that targeted small business owners with patent infringement cases for using office scanners to scan documents over a decade ago.
David Berten, counsel for Rich Media Club, disagreed with the “patent troll” description.
“The classic definition of a patent troll is someone who acquires a patent they didn’t invent, then use that patent to find people who are infringing it and try to get payments,” Berten said in an interview. “This is not the case. This case is the original inventors of the technology that is being used.”
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A spokesperson for Guardian Media Group said, “The patents at issue are invalid and this case is wholly without merit.”
The other publisher defendants didn’t respond to requests for comment or declined to comment.
In April of this year, the Daily Mail’s publisher, DMG Media, settled a similar patent infringement lawsuit filed by Rich Media Club in 2022. A DMG Media spokesperson declined to comment.
What is Rich Media Club?
Rich Media Club was founded in 2002 as an IP holding company for patents related to RealVu, its commercial-facing adtech arm. RealVu specialized in technologies to help advertisers and publishers capture “viewable” impressions — ads that are likely to be seen by a human rather than a bot.
RealVu’s tech had some early success, helping address viewability issues and gaining industry accreditations. Writing in a 2009 blog post, David Cohen, who now serves as CEO of industry trade body the Interactive Advertising Bureau, said RealVu’s tech had represented “a giant step forward for the industry,” setting “a new bar for accountability.”
Rich Media Club has several US patents for ad viewability solutions. It also has patents for solutions like “ad refreshing,” where an ad slot can refresh with a new ad after a certain duration, and “lazy loading,” where ads and other content are only rendered as a user scrolls to that area of a page.
While the adtech company NUVIAD now owns RealVu’s operational assets, Rich Media Club continues to hold the patents, enabling it to bring lawsuits against publishers.
Many publishers use lazy loading and ad refreshing on their websites to help improve page loading times and improve the ad experience. Advertisers would much rather pay — and ordinarily demand they only pay — for an ad that was actually seen. Some publishers use their own tech, while others use third-party vendors for these types of technologies.
In the various suits filed across courts in Arizona, Texas, and California, Rich Media Club said it sent letters to publishers that use ad refreshing and lazy loading on their websites to inform them that they had infringed its patents. Rich Media Club said in the suits that these publishers continued to use the technologies after receiving the letters, without entering into licensing agreements with it.
Rich Media Club is seeking damages, claiming lost profits or a “reasonable royalty” from the publishers, to be determined at trial.
A 3-year patent litigation campaign
Rich Media Club’s patent enforcement campaign began in 2022 when it sued Duration Media, a fellow adtech company that provides viewability technology. In legal filings, Rich Media Club said Duration Media licensed RealVu’s patented technology and continued to use similar methods, like ad refreshing, after the license expired.
Duration Media took the dispute to the US Patent Trial and Appeal Board, which invalidated one of Rich Media Club’s patents related to ad refreshing in March of this year. Berten said the matter is currently on appeal to the federal circuit. Rich Media Club still holds other patents related to ad viewability. The pair of companies settled their legal action in March of this year.
Andy Batkin, CEO of Duration Media, said that after defending its patents for two years, it decided to settle with Rich Media Club in order to focus on providing publishers with its patented solutions without legal concerns moving forward.
“When these publishers work with Duration Media, they are now covered by both our real-time viewability patents, as well as from a license we have for the ones that were in question with Rich Media,” Batkin said in a statement.
In recent years, defendants in patent lawsuits have often turned to the “inter partes review” process — a hearing before a panel of experts in the patent office — to challenge the validity of a patent. This route is popular because it’s faster and cheaper than litigating the case in court. (That’s the approach Duration Media chose.)
However, Stanford’s Lemley said Coke Morgan Stewart, interim director of the USPTO, has rejected “hundreds” of these proceedings in the nine months since her appointment in January, making it a less attractive option than it used to be. This could encourage patent troll cases, Berkeley’s Chien said, because it’s harder for companies to challenge patents.
“I would expect, if current trends of elevated refusals to institute IPRs hold, more suits,” Chien said.
The USPTO didn’t provide a comment.
When asked whether Rich Media Club plans to file further lawsuits, Berten said: “Our preference is just to enter license agreements with people to allow them to use the technology without litigation.”
