More on the PayPal IPO delay ::: From yesterday’s TheStreet.com, an article about PayPal’s delayed IPO. Here’s a priceless quote from the CEO of IPO.com, who probably figured that a little bit of ice would most likely not harm the Titanic:
“The timing of the suit seems kind of interesting,” says [IPO.com CEO Mark] Baum. “But this late in the game, it’s hard to imagine this would undermine the company’s business. It tends to be on patent infringement that there’s usually a payment of some kind. It very rarely seems to put companies out of business,” he said.Excuse me? One of the biggest concerns over PayPal’s business model is its ability to turn a profit. If it has to pay a royalty to CertCo because of CertCo’s patent, PayPal’s already- thin margins get thinner – undermining PayPal’s argument that it can leverage a growing customer base to make money.
In other news, News.com notes that the IPO may be back on again, as PayPal filed an amended S-1 today with the SEC responding to CertCo’s claims. Sure enough, CertCo contacted PayPal the day before the IPO claiming infringement of the 150 patent. PayPal explains in the S-1 that:
all of the patent’s claims have as an element that a system send an “ authenticated” or “verifiable” “payment advice message.” But our service does not send either “authenticated” or “ verifiable” “payment advice messages.” For this reason, among other reasons that may exist, we believe that we do not infringe CertCo’s patent, and that CertCo’s assertions are without merit.