Pre-paid service in patent controversy

May 23rd, 2005 · Source · No Comments

Pre-paid mobile phone service (aka pay-as-you-go), is currently facing legal trouble in the form of patent infringement lawsuits from Freedom Wireless. Freedom Wireless sued Boston Communications Group, a firm that provides services to many large carriers that provide pre-paid service. The carriers named in the suit were: Cingular Wireless, AT&T Wireless, CMT Partners and Western Wireless. Verizon Wireless was dropped because of an out of court settlement.

$128 million in damages were awarded to Freedom Wireless. Since the verdict, Freedom Wireless filed similar suits against Nextel and Alltel.

Freedom Wireless’ patent concerning pre-paid mobile phone service dates back to 1995 and was approved December 29th, 1998. Quoting the abstract:

This system also allows pre-authorized users to receive and pay for incoming calls as well as purchase additional air time and monthly access fees with convenient pre-paid cards.

In court, defense lawyers argued that the patent was invalid because of prior art. Appeals will be filed as this case is a long way from being over.

[via TechDirt]