IBM slams Zillow with second suit over patented search tools

Tech giant said listings portal used 5 patents without licensing deals

Zillow CEO Rich Barton and IBM CEO Arvind Krishna (Getty)
Zillow CEO Rich Barton and IBM CEO Arvind Krishna (Getty)

IBM is escalating its legal battle with Zillow, filing a second lawsuit accusing the listings giant of infringing on patents to build its real estate search engine.

In a July 21 lawsuit, filed in federal court in Washington, IBM claimed the Seattle-based company infringed on five patents that improve searches by ranking results and simplifying content displays, among other things. Despite written notifications, Zillow has engaged in a “policy of willful blindness” and continues to use the technology, IBM alleges.

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Zillow CEO Rich Barton (Credit: iStock, Getty Images)
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“Dozens of similar companies, including Amazon, Apple, Google, and Facebook, have agreed to cross licenses with IBM,” said the complaint. “Unfortunately, Zillow is not among them. Instead, Zillow has chosen to willfully infringe the five patents in this lawsuit without even considering licensing discussions.”

IBM and Zillow have been fighting over patent licensing deals for several years.

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In September, the tech company sued Zillow in federal court in California, accusing it of building its portal with the unauthorized use of seven patented technologies. In that complaint, IBM said it tried for three years to reach a licensing deal with Zillow but wasn’t able to do so. In that case, IBM is seeking “royalties on the billions of dollars in revenue that Zillow has received based on their infringement of IBM’s patented technology.”

IBM, which reportedly invests more than $5 billion a year in research and development, has a history of suing tech companies, including Groupon and Twitter, for patent infringement. In March, it slapped Airbnb with a suit accusing the travel startup of using patents related to improved navigation using bookmarks and advertising in an interactive service.In a statement, Zillow said, “We are aware of the lawsuit filed in federal court. We believe the claims in the case are without merit and we intend to vigorously defend ourselves against the lawsuit.”

Since 2019, the company has bet heavily on home-buying as the future of its business. Last year, Zillow generated $2.7 billion in revenue, including $1.365 billion from its iBuying segment. However, the company lost $305.4 billion, up from $119.9 million in 2018. Zillow temporarily paused home-buying in March amid Covid’s uncertainty.