Yahoo just got caught in a major plagiarism scandal and is having to pay up big.

A federal jury in Oakland says the Sunnyvale-based web portal and online services company has to give a software company $15 million for infringing on its search technology patent. A Texas-based software company called Droplets Inc. has a patent on software, dating back to 2004, that lets users reach specific portions of a website without having to download the entire page, as the Chronicle reports.

Other companies have also been up against lawsuits for infringing on that patent in the past. Amazon, Apple, Facebook, Google, and YouTube all ultimately reached licensing agreements with Droplets. But Yahoo decided to go to trial, contending they had developed their own quick-search technology prior to Droplets.


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Yahoo and the investment company that currently holds the controlling stake in the company, Altaba, argued that the platform’s methods were its own, but the jury was not convinced. The jurors didn’t believe, however, that the infringement was “willful,” but they ruled unanimously that Yahoo’s Search Suggest feature infringed on Droplets’ patent. That feature lets users type phrases or individual words to do quick-searches within a web page.

Courtland Reichman, one of Droplets’ lawyers, tells the Chronicle that the victory was an important one.

“This validates decades of effort on their part in that they changed the way the internet works,” Reichman says. “You have to protect inventors, or they’ll stop inventing.”

Woody Jameson, a lawyer for Yahoo, tells the paper that Droplets had sought damages of $260 million and was awarded less than 6% of that. The jurors also threw out claims of patent infringement on four other programs Droplets’ lawyers went after.

“Yahoo took this case to trial because it strongly believes that Droplets’ patent has nothing to do with Yahoo’s technology,” Jameson said in a statement to the Chronicle. “While we certainly hoped for a complete defense verdict, we are pleased that the jury rejected entirely Droplets’ contention that four of the five accused technologies infringed” any patents.

This payout is only the most recent of Yahoo’s financial troubles.

The company agreed to pay $50 million in damages and provide two years of free credit monitoring after what was, at the time, the biggest security breach in history, according to the Associated Press.  

A data breach in 2014 affected 500 million user accounts; a year before that, another hack compromised the information of 1 billion users. Stolen information, the AP reported, included names, email addresses, passwords phone numbers, birthdates, and the answers to security questions.

Yahoo plans to appeal the verdict in its Droplets case.

“We remain confident that when the litigation process is complete, Yahoo will be found to not have infringed Droplets’ patent,” Jameson said about that appeal.

Droplets has another trial coming up in June for a similar lawsuit against Nordstrom, Inc.

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