Quinn, Cooley and WilmerHale seal truce in Yahoo!-Facebook patent war

Months of conflict between Yahoo!’s advisers at Quinn Emanuel Urquhart & Sullivan and Facebook’s advisers at Cooley and WilmerHale have come to an end after the technology giants agreed to cross-license patents and collaborate on future projects.

The decision to drop lawsuits and form an advertising alliance ends a high-profile patent war that was started by Yahoo! in March, when the troubled search-engine claimed that Facebook had infringed 10 of its patents covering advertising, information sharing and privacy.

The social networking site counter-sued Yahoo! in April, with general counsel Ted Ullyot issuing a statement that read: “While we’re asserting patent claims of our own, we do so in response to Yahoo!’s short-sighted decision to attack one of its partners and prioritise litigation over innovation.”

Facebook, which went public in May, has been represented by a Cooley team including litigation chair Michael Rhodes and firm chair Stephen Neal, along with William Lee of WilmerHale. Yahoo! turned to litigation giant Quinn Emanuel, advised by trial lawyer Charles Verhoeven.

The original Yahoo! filing was made under the leadership of former CEO Scott Thompson, who was dismissed just two months into his job over a non-existent computer science degree. AllThingsD – which broke the news before it was formally announced – reported that Yahoo!’s interim chief executive Ross Levinsohn had begun to resolve the dispute immediately after taking over.

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“It seemed rather opportunistic and grubby of Yahoo! to lob in patent action before an IPO,” said one IP lawyer, who asked not to be named. “It’s not surprising that the new guy comes in and tries to clean up the mess. This has turned a mistake into a potential positive.”

Earlier this month Yahoo’s long-standing general counsel Michael Callahan resigned from the company, leaving Ron Bell, deputy GC for products and the Americas, to fill his shoes on a temporary basis (3 July 2012).