Trends have shown that Americans are turning to the internet to pursue new dating prospects, with online dating rates at an all-time high. However, a recently settled lawsuit against an online dating app has caused controversy in the world of intellectual property, and despite the settlement, the case could have potentially far-reaching effects for online dating in general. Spark Networks, a parent company that owns a variety of Jewish-targeted matchmaking platforms including the popular JDate, filed a patent and trademark infringement lawsuit against Smooch Labs, the owner of the competing app JSwipe, and the suit has made waves among legal commentators.
The lawsuit, Spark Networks USA v. Smooch Labs, Inc., involved two main intellectual property claims. First, Spark Networks alleged that JSwipe’s name and branding violate its “J-Family” trademark portfolio. Second, Spark Networks alleged that JSwipe’s matchmaking formula and method violate its patented “Method and Apparatus for Detection of Reciprocal Interests or Feelings and Subsequent Notification” issued in United States Patent No. 5,950,200.
Experts were initially skeptical of the viability of both claims. As pointed out by technology expert Greg Ferenstein, the use of the letter “J” is especially common in Jewish-centered media, including a variety of other dating apps like JCrush, JWed, and JZoog. The central focus of trademark infringement claims is whether or not there is a “likelihood of confusion,” which means that consumers would mistakenly believe a product or service is associated with the source of a different product or service identified with a similar mark. However, with the large amount of “J”-related content available to the public, it was unlikely that the average consumer would wrongfully believe JSwipe was associated with JDate.
The patent infringement case appeared even more dubious. According to Charles Duan, the Director of the Patent Reform Project at Public Knowledge, Spark Networks’ patent is “absurd.” The method, patented in 1999, is essentially a matchmaking algorithm. One user (“Person A”) indicates their interest in a second user (“Person B”) to the system. Person A’s interest in Person B remains hidden until Person B also indicates interest in Person A. A “match” only occurs when the system determines that Person A and Person B both have indicated mutual interest in each other. As Duan points out, this patented method has been in practice for hundreds, if not thousands, of years, and Spark Networks has done little innovation other than filing a patent for a particularly abstract idea.
If this case had not settled, it likely would have been invalidated under the Supreme Court’s abstract ideas doctrine laid out in Alice Corporation v. CLS Bank International. In that case, the Court refused to allow a patent that was simply a “method of organizing human activity,” since that method was too abstract. According to Daniel Nazer, an attorney at the Electronic Frontier Foundation, the Spark Networks patent infringement claim was “not a close case.” Matchmaking methods, much like the currency exchange methods in Alice Corporation, is simply too abstract of an idea to qualify for a patent. However, now that Spark Networks has acquired Smooch Labs and its JSwipe brand, the case is no longer on a docket and a court will not have the opportunity to analyze the validity of its patent.
So now that JSwipe is officially affiliated with Spark Networks and JDate, the controversy should be over, right? Not quite. As of October 2015, Spark Networks’ patent still exists and many large websites are paying to use intellectual properties owned by Spark Networks. For instance, because of the terms of settlement in the 2011 suit Spark Networks USA v. Humor Rainbow, Inc., the Internet giant IAC, which purchased Humor Rainbow during the course of the suit, agreed to pay to use all of Spark Networks’ intellectual properties. Since IAC owns some of the biggest names in online dating, including Tinder, Match.com, and OkCupid, it is safe to assume that Spark Networks is profiting off of the majority of online dating activity.
The apps most affected by this current patent regime are up-and-coming competing dating services like JSwipe that cannot necessarily afford to pay for use of the patent, especially at early stages in their development. Before the settlement, JSwipe and Smooch Labs faced financial ruin, forcing the owners of JSwipe to set up an Indiegogo crowdfunding campaign to cover their legal fees. This threat of litigation can be seen as utilizing courts to impose additional costs on competitors. Potential defendants who wish to defend against Spark Networks’ patent infringement claims face high legal fees – estimated to be between $300,000 and $500,000. Therefore, despite the likely invalidity of Spark Networks’ patent, it is doubtful that a case will get to a point where a court can strike it down any time soon, since defendants like JSwipe will probably settle in a similar fashion or perhaps even shut down entirely.
The losers in all of this are consumers. With former entirely-free-to-use apps like Tinder now offering added benefits to paid subscribers, the number of popular, completely free apps is dwindling. According to David Yarus, the creator of JSwipe, app developers are constantly searching for new “fast, fun, and free” ways to make connections, since “[t]he idea of pay-to-play dating websites doesn’t resonate with millennials.” However, with potential litigation looming over developers’ heads, incentives to create new content is dwindling, and the concentration of ownership among dating apps will likely continue.
With no solution in site, it will be interesting to see how the patent landscape in the world of online dating will continue to evolve. With Spark Networks now having multiple settled lawsuits over its patent under its belt, it is hard to not to begin to view the company as a “patent troll” preying on would-be competitors. We may need a proverbial David to take on the Goliath that is Spark Networks so that a court can finally “swipe left” on its online dating patent once and for all.
Eddie Guers is a J.D. candidate, 2017, at NYU School of Law.