Limelight Ordered to Pay Akamai $45.5M for Infringement

Akamai Technologies Inc.on Feb. 29 won its patent infringement lawsuit against Limelight Networks Inc. 

Limelight also faces a patent infringement allegations from Level 3 Communications Inc.

A Boston jury said Limelight infringed on four of Akamai’s patents and must pay $45.5 million in damages, plus interest. Limelight said it will appeal the decision.

Both Massachusetts-based Akamai and Arizona-based Limelight specialize in content delivery network (CDN) provisioning; they sell platforms for companies to distribute video, audio and other Web 2.0 technologies.

Akamai’s fight with Limelight started in 2006. The issue was whether providers may patent a general process, not just a specific technology. If Limelight’s appeal doesn’t prevail, Akaimai will have the legal wherewithal to shop its patents for licensing and earn royalties from sales a competitor made using infringed patents, experts have said.

Akamai also said it will request a permanent injunction to keep Limelight from selling “infringing services.” If a judge agrees, Limelight either would have to stop those sales altogether or license the technology from Akamai.

Limelight said it’s disappointed with the infringement verdict.

“We strongly believe that, like other companies that follow long-established Internet standards, we do not infringe the patent in this case,” said Phil Maynard, chief legal counsel for Limelight. “We will continue to remain a competitive choice in the marketplace as we pursue all appropriate legal avenues.”

Limelight’s stocks were changing hands for $4.39, down 29 cents, during early afternoon trading on Monday. The number wasn’t far from Limelight’s year-low of $3.82.

Akamai’s shares were down $1.04 at $34.12.

The Akamai-Limelight verdict comes as other companies with IP portfolios pursue suspected infringers. Sprint Nextel Corp. is suing four small rivals; Verizon Communications Inc. is suing Cox Communications for the same patent infringement it won against Vonage Holdings Corp

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