Of all the people claiming Facebook ripped off their ideas, the one that probably got closest to winning in court is Michael McKibben. In this breathless Youtube video, he claims that “essentially everything you do on Facebook” is infringing a patent issued to his software company, Leader Technologies, in 2003. With the help of King & Spalding, McKibben got himself in front of a jury in 2010–the first jury trial in Facebook’s history. That trial ended in a verdict that Facebook literally infringed Leader’s patent, but that the patent was invalid. Facebook’s lawyers at Cooley and Gibson, Dunn & Crutcher have now gotten that verdict upheld on appeal. McKibben, for his part, has taken to the Web once again to express his outrage.
In a short and sweet 3-0 decision handed down on Tuesday, the U.S. Court of Appeals for the Federal Circuit affirmed the jury’s July 2010 verdict invalidating Leader’s patent based on the “on-sale bar,” which holds that an invention is no longer patentable if it’s been for sale for over one year. The ruling follows a star-studded oral argument that pitted former Deputy U.S. Solicitor General Thomas Hungar of Gibson Dunn against another seasoned U.S. Supreme Court advocate, King & Spalding’s Daryl Joseffer, who argued for Leader.
According to this interview McKibben gave to a local Ohio TV crew in March, his company poured $10 million and nearly 150,000 hours into building the source code for a social network called Leader2Leader back in the 1990s, only to have Facebook CEO Mark Zuckerberg rip him off. Zuckerberg allegedly gained access to the source code by hacking into Harvard University’s computers in 2003 (McKibben’s son attended Harvard at the time, and had documents relating to his father’s invention on the computer in his dorm room). When Facebook debuted, “the wind went out of our sails from a selling standpoint,” McKibben said.
Cooley’s cross-examination of McKibben’s co-inventor, Jeffrey Lamb, may have been the crucial moment both for the 2010 trial and at the Federal Circuit. Lamb admitted on cross that Leader failed to disclose information in its provisional patent application, which was filed in December 2002. Based on that testimony, the jury ignored the provisional patent application, which moved back the date that the on-sale bar applied in the case. That spelled doom for McKibben, because he admitted in interrogatories to trying to sell his software several times in 2002. McKibben presented new testimony at trial, claiming that the version of Leader2Leader he marketed in 2002 didn’t include the patented source code, but the jury apparently didn’t buy it.
On appeal, Leader’s lawyers at King & Spalding made an intriguing argument: The jury ruled for Facebook solely because it discounted McKibben’s testimony at trial. Additional evidence, like expert testimony or source code, was needed to meet the “clear and convincing” standard for invalidating a patent, K&S asserted. The Federal Circuit, in a decision penned by Judge Alan Lourie, rejected that argument, finding that “the record contains substantial evidence” supporting the jury verdict. “At a minimum, McKibben’s lack of credibility fortifies that conclusion and provides an independent basis for disbelieving his factual assertion,” the court ruled.
McKibben’s company lashed out at the court online after the ruling, releasing a press release called “Leader v. Facebook to the U.S. Supreme Court?,” in which McKibben accuses the Federal Circuit of “simply root[ing] around for new evidence to justify not overturning a jury that was fooled by Facebook tricks.” He adds: “this is suspiciously convenient timing for Facebook, coming hours after the Facebook roadshow commenced in New York.”
This isn’t the first time McKibben has tried to win the battle for public opinion. He roundly criticized the jury’s 2010 verdict in statements posted on Leader’s Web site, and he’s been collaborating with a blogger named Donna Kline. A self-styled investigative reporter, Kline has been accusing Facebook and its lawyers of all sorts of deceit and fraud in the case on her blog. She calls Leader’s patent “the source code for the entire Facebook platform,” and had this reaction when Facebook apparently felt that Leader’s lawsuit wasn’t significant enough to disclose in regulatory filings: “WHAT? YOU CANNOT BE SERIOUS!!!”
We hoped to ask King & Spalding’s Joseffer how he feels about his client’s public statements, but he didn’t get back to us. Leader was represented at trial by Paul Andre, who recently left King & Spalding for Kramer Levin Naftalis & Frankel.
Cooley’s Michael Rhodes, who represented Facebook at trial, declined to comment. Gibson Dunn’s Hungar, who came aboard for the appeal, also declined to comment.
This article originally appeared in The Am Law Litigation Daily.
