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Facebook settles business litigation case for undisclosed amount

Companies like Facebook don’t like to throw in the towel, so to speak. They’re used to getting pretty much what they want. However, even a hugely successful company finds that it must pay the piper once in a while. The reported case did not take place in Florida, but it follows general business litigation principles that are instructive.

Facebook was sued by a company called Timelines, Inc. The business dispute was Facebook’s use of the term ‘timeline’ in its historical archive, which includes its recent innovation of having each person with a Facebook page complete a so-called timeline history of his or her life’s major events. The timeline also serves as the person’s location for selected postings.

The Timelines company offered to sell the trademark to Facebook but the offer was refused. The case went forward, with the critical development occurring recently when the court denied Facebook’s motion for a summary judgment. In virtually all business litigation cases that survive the preliminary hurdles, there will be a pre-trial motion for summary judgment. This is most often filed by the defendant, who seeks to have the case dismissed on legal grounds.

It’s usually significant if the defending company loses its motion for summary judgment. This means that it must go to trial and have a jury decide the case. Sometimes this can spell disaster for a company, especially in a case like this where Facebook can likely be portrayed as the bullying giant arrogantly taking what it wants without considering the damages caused. Getting over the summary judgment hurdle in a business litigation case is what most plaintiff companies must accomplish as a prerequisite to receiving serious settlement offers from an opponent.

Here the case was in trial when it settled. Facebook did not have to reveal the amount of the settlement, which is often a condition imposed by the defending company in the settlement terms. Whether in Florida or any other jurisdiction, when a business litigation case is resolved, the parties must present it to the court for approval. In that process, the court reviews, and more often than not approves the terms, including the non-disclosure provisions.

Source: Marketing Land, “Facebook Settles Litigation Over “Timelines” Trademark,” Greg Sterling, May 3, 2013

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