With a lot of intricate back-and-forth on the legal front lately, online-learning enthusiasts might be forgiven for wondering whether a high-stakes patent dispute between Blackboard Inc. and Desire2Learn Inc. (D2L)–two companies that make enterprise software for web-based course management–will be resolved anytime soon.

In a recent development, a magistrate judge in a federal district court in Texas challenged terminology involved in Blackboard’s claims in a patent-infringement lawsuit against D2L–invalidating some of the claims, at least for the time being. Some observers saw the magistrate’s opinion, which was issued in early August after a hearing and arguments by both sides, as a major setback for Blackboard, but the company disagreed with that interpretation.

In a separate action, the federal agency that originally granted the patent has agreed to re-examine it–a process that takes an average of about two years to complete. Meanwhile, it is far from clear which party, Blackboard or D2L, might hold the upper hand if and when the lawsuit ultimately goes to a jury. A trial is currently slated for February, and the discovery process has begun.

In the balance are a wide range of potential decisions and products by commercial and nonprofit organizations that generate online-learning software for schools and colleges. Opponents of Blackboard’s action against D2L appear to be somewhat less anxious about the possible consequences than they were when the suit was filed in July 2006, but they remain wary. Representatives of both companies will tell you they’re confident that things will go their way–declarations that are fairly typical of what litigants tend to say in situations like this.

The dispute centers on Blackboard’s claim that D2L is infringing patent rights that Blackboard was granted in January 2006 for its course-management software and other eLearning products. (See “Patent fight hits eLearning“.) D2L, whose position has been widely supported by advocates of open-source applications, strongly denies the accusation while questioning basic aspects of the patent itself.

At the same time, and apart from the lawsuit per se, the United States Patent and Trademark Office, which approved Blackboard’s patent application, has agreed to review challenges that could lead it to reduce or even revoke protections that it originally authorized for the company.

Blackboard, which is based in Washington, D.C., and is publicly traded, dominates the eLearning market. It reported revenue last year of some $216 million. D2L, a smaller, privately owned Canadian company whose revenue could not be determined, is said to realize about half its earnings from U.S. sales.

Blackboard’s suit in Texas is not the only legal action it has initiated over patent rights. On Aug. 3, in an unusual move, the company filed a pre-emptive lawsuit against iParadigms, a California-based business partner that had received its own patent in May for plagiarism-detection software. Blackboard said it feared that iParadigms, whose Turnitin.com anti-plagiarism product is compatible with Blackboard software, was planning to sue Blackboard itself for patent infringement. iParadigms denied that it intended to do so.

On Aug. 14, the reason for Blackboard’s action became apparent, as the company announced the release of its own plagiarism prevention service, which it calls SafeAssign. Nine days later, the Blackboard-iParadigms case was settled out of court.

In Blackboard’s suit against D2L, however, the prospects for a similar agreement seem mixed at best. D2L officials said they were encouraged by the magistrate judge’s ruling, but Blackboard’s chief counsel, Matthew H. Small, did not interpret it as a decisive blow. Noting that the district court could still decide in Blackboard’s favor after considering objections, Small said it was still “very clear that our patent is strong and Desire2Learn infringes it.”

Proceedings in the case have sometimes seemed complicated and arcane, as patent disputes often can be. Recently, for example, after Blackboard filed objections to part of the magistrate judge’s ruling, D2L responded with “conditional” objections to the same ruling–to be considered, it said, only if the ruling were overturned later on. Blackboard then responded to D2L’s conditional objections.

“There’s a lot going on right now,” Small observed.

To many people in the eLearning community, however, the implications of the Blackboard-D2L case extend far beyond a technical squabble over patent rights. If Blackboard were to prevail, critics contend, the outcome could have a chilling effect on competition in online-software development and on the very creativity that underlies advancements in eLearning systems and methods.

Blackboard, on the other hand, has sought to reassure educators and software developers by promising not to use its patents “against the development, use, or distribution of open-source software or home-grown course management systems anywhere in the world, to the extent that such systems are not bundled with proprietary software.”

The company announced its pledge last February, supplementing its commitment with words from a joint statement of appreciation from EDUCAUSE, a nonprofit association that promotes information technology in higher education, and the Sakai Foundation, an open-source eLearning group that has criticized Blackboard’s patent. (See “Blackboard offers patent pledge“.)

Blackboard called its pledge “legally binding, irrevocable, and worldwide in scope.”

Small, the company’s lawyer, said initial concerns in some quarters that Blackboard’s suit against D2L would stifle innovation in software development have receded.

“I haven’t heard any of those complaints since we announced our patent pledge,” Small said, and he suggested that the pending litigation was now widely regarded as little more than “an isolated suit between the two of us.”

The overall online-learning community “really doesn’t care” what happens between two companies, Small said. He added that “there’s a lot of choice in the market right now.”

Comments from D2L officials and open-source eLearning leaders provided a different perspective.

Diane Lank, D2L’s U.S. counsel, reported broad concerns among “a lot of people out there” who have been monitoring the situation. “We’re not just fighting for ourselves,” she said. “The whole [online] software industry is going to be much safer if this patent is defeated.”

Even the very notion that software should be subject to patent protection is still being debated. Joseph Hardin, vice-chair of the Sakai board and director of the University of Michigan’s Collaborative Technologies Laboratory, said he considered patent law in general to be “something that confuses and wastes energy.” And with respect to educational software, he said, patents can threaten innovative alternatives that educators may prefer over commercial products.

Richard Fontana, counsel of the Software Freedom Law Center, which works to advance free and open-source software through legal services, noted that while companies often seek “very broad patents,” only in recent years has software been considered patentable.

Fontana asserted that federal officials whose job is to evaluate applications for software patents “don’t have extensive training in computer science” and are “not very good at finding the evidence” they need to make decisions.

In any case, as important as the Blackboard-D2L case may be to profit-seeking companies and educational institutions alike, final resolution could well be years away, according to several sources.

Blackboard’s chief counsel, for example, sees a time frame of perhaps four years, while John McLeod, D2L’s marketing director, calls the case “one of those things that takes a long time.”

Hardin, meanwhile, saying he was not optimistic about the chances for a settlement soon, called the case a “monumental struggle” that would “continue to plague the creative world” for an indefinite period.

An added factor in the entire dispute could be repercussions from a pending revision of U.S. patent law that the House of Representatives passed on Sept. 7. The controversial legislation, which faces an uncertain fate in the Senate, drew support from major technology companies, such as Intel and Microsoft, that have complained about excessive patent-infringement lawsuits over relatively minor aspects of their products.

Another potentially important factor is a unanimous decision by the U.S. Supreme Court last spring that signaled a stricter approach to granting and defending patents. The decision made it easier to challenge patents on grounds that the products in question were obvious combinations of existing technologies. (“High Court’s patent ruling could benefit ed tech“.)

That view seemed to parallel arguments filed by the Software Freedom Law Center and Desire2Learn that contributed to the Patent and Trademark Office’s decision to reconsider its approval of Blackboard’s patent application.

Chris Coppola, a Sakai board member and president of rSmart, a group that backs open-source software for education, believes that the tide is moving against Blackboard, and that eventually the company will lose its patent.

“It’s just a matter of time,” he says.

Links:

Blackboard

Desire2Learn

Desire2Learn’s Patent Information Blog

United States Patent and Trademark Office

iParadigms

Sakai Foundation

Software Freedom Law Center