The legal battle between Nasdaq and MIAX in the options market has just taken a turn.
The Patent Trial and Appeal Board (PTAB) of the United States Patent and Trademark Office (USPTO) has granted MIAXs petitions for review of three Nasdaq patents (one Nasdaq and two Nasdaq ISE patents). In a related action, the PTAB has dismissed Nasdaqs patent infringement claim with prejudice against MIAX.
In granting MIAXs petitions, the PTAB found that it is more likely than not that the claims of these patents are unpatentable under current law. The patents were asserted as part of Nasdaqs complaint filed against MIAX.
MIAX has filed petitions for review of all of the patents asserted by Nasdaq. To date, the PTAB has decided three of MIAXs six petitions, granting 100% of those that it has reviewed. Three remaining petitions are still pending before the PTAB.
We are gratified that the PTAB has taken the first step to validating our position that these patents are not patentable under the current state of the law, said Thomas Gallagher, Chairman and CEO of MIH, parent and holding company of MIAX. “We are hopeful that the PTAB issues a final determination that these, and the other Nasdaq patents, are unpatentable and therefore cannot be infringed by MIAX.
Gallagher added that according to public reports from the USPTO, more than 80% of patents reviewed after the PTAB grants a petition are ultimately found void. This is a very compelling statistic and one which bodes very well for us going forward. Notwithstanding the distraction, as well as the waste of time, effort and financial resources to defend this baseless litigation, we are pleased with these recent developments and look forward to the PTABs ruling with respect to the remaining three patents and its final determinations, he said.
In other news, MIH and MIAX also announced that Nasdaq voluntarily withdrew and dismissed with prejudice its claims against MIAX that MIAX infringes on U.S. Patent No. 7,599,875, which pertains to systems and methods for quoting securities.
We are also very pleased that Nasdaq voluntarily withdrew its claims after all its bluster, as the patent claims based on U.S. Patent No. 7,599,875 should never have been brought against us in the first place,” Gallagher said. Unfortunately, many smaller, innovative and disruptive companies are too often faced with lawsuits that have no factual or legal merit, driven by certain individuals at larger companies like Nasdaq looking to profit through senseless, costly, and abusive legal tactics when other efforts at competition and innovation are not working.
