Allegations that Blackboard Inc., the No. 1 course- management software firm, is using costly litigation to injure a smaller rival, Desire2Learn (D2L), are part of the backdrop to a federal trial set to begin on Feb. 11. Blackboard has sued for patent infringement, which D2L denies.

Based on interviews with lawyers and others familiar with the case, both sides appear to be digging in, and a pre-trial settlement seems unlikely. The next major step is expected to be a full-blown jury trial in federal district court in Lufkin, Texas. Blackboard filed its suit about 18 months ago.

The case has become something of a cause célèbre among ed-tech specialists in colleges and schools because of a strong tradition of using open-source software for eLearning activities.

A legal victory by Blackboard, which dominates the commercial course-management market, would be counter to the goals of leading open-source advocates. To many educators, the ability to generate their own products without commercial interference is considered a fundamental right, and something to be vigorously protected.

Critics of Blackboard also see D2L’s fight against a much larger competitor as a battle between David and Goliath. At D2L, a lawyer for the privately owned Canadian company has stressed repeatedly that, in resisting Blackboard, it is “fighting for the entire community,” as she recently put it. Meanwhile, according to some observers, Blackboard may not have anticipated how strongly its suit against D2L would be contested.

In any case, Matthew H. Small, Blackboard’s chief counsel, said in an interview last week that it was “very clear” that D2L was guilty of patent infringement. He said he was “not even thinking about” a settlement.

Desire2Learn’s lawyer, Diane Lank, also held out little prospect of avoiding a trial.

She said she had been involved in many cases where her client, despite being confident, agreed to settle out of court to avoid additional costs. But she stressed that in the Blackboard case, “we have taken the position … that there’s more at stake.”

Some aspects of the dispute have led to emotional charges on the internet. In a blog that D2L posted on its website toward the end of October–but that it quickly removed after hearing from opposing lawyers–the company accused Blackboard of having been disingenuous in asserting that it only wanted a “reasonable royalty” from D2L.

On the contrary, D2L’s blog declared, “we’ve learned that months before announcing the patent and filing suit, Blackboard and its external advisors and PR firms discussed the ‘public’ purpose of the patent as [being] to protect intellectual property,” when “the ‘real’ purpose was to ‘contain and control’ Desire2Learn.”

The blog claimed that “Blackboard’s litigation strategy appears to be to increase costs of litigation to Desire2Learn through unnecessary discovery and depositions, while deflecting attention from the real, fundamental issues of patent validity, infringement, and equitable conduct.”

D2L also accused Blackboard of seeking information about it through inappropriate means, such as by paying someone to attend a D2L user conference and using a Blackboard employee to misrepresent herself through “a spoofed university eMail address.”

Speaking for Blackboard, Small said D2L had improperly disclosed information that was protected by rules governing the discovery process in lawsuits, and he characterized the blog as “desperate.” Small declined, however, to comment on the substance of D2L’s allegations.

Lank said D2L remained confident of prevailing in a trial. She pointed to a magistrate judge’s ruling last fall, subsequently upheld by a district court judge, that eliminated 35 so-called “system” claims among the 44 in Blackboard’s lawsuit. The nine left open relate to online methodology.

Citing Desire2Learn’s strong belief that its learning-management products do not violate Blackboard’s rights, Lank asserted that the patent “should have never been issued” by the United States Patent and Trademark Office because of at least 15 pieces of “prior art” in online learning.

The Patent Office agreed last year to review challenges to its decision to approve Blackboard’s original patent application. Although the review potentially could lead to revocation of the patent, a decision might not come for another year.

A patent expert who has been following Blackboard’s lawsuit closely said both companies seemed to be so intent on winning that any verdict was likely to be appealed–and the case could drag on for many more months.

“This is a case that should never have gone to trial,” said the expert, James Farmer, a long-time researcher on intellectual property who has ties to the open-source community. Farmer said neither party in the suit seemed inclined to work things out, even though the litigation had already proven expensive for both of them.

In suing D2L, Farmer said, Blackboard was “doing what big companies do” in a competitive world, but it had failed to realize that “that doesn’t work in higher education.” For educators, meanwhile, he contended the stakes were “actually trivial” because even if Blackboard were to win its suit, that probably would not increase prices by more than a few percentage points.

In a development unrelated to the lawsuit but likely to increase its role in education, Blackboard announced on Jan. 14 that it would buy the NTI Group, Inc., a privately held mass communications company, for $182 million.

Links:
Blackboard

Desire2Learn’s Patent Information Blog