AWS must pay $525M to cloud storage patent holder, says jury

Computing giant will appeal ruling, which found infringement was not 'willful'

Updated A jury has ordered Amazon Web Services to pay $525 million for infringing distributed data storage patents in a case brought by a technology outfit called Kove IO.

Kove, which styles itself as a pioneer in high-performance computer storage and data management technologies, filed its original complaint [PDF] in 2018. It claims that AWS is infringing on three Kove-held patents in cloud services, such as the Amazon S3 storage platform, as well as in its DynamoDB database service, and in other related products and services.

The trial came to a close on April 10, with the jury finding in favor of Kove and awarding it damages of over half a billion dollars. AWS said it intends to appeal the verdict, which acknowledged that the company had not willfully infringed on the patents in question.

The technology at the center of the case relates to distributed hash tables, a decentralized system used to store and retrieve data, with the data in this instance being the location information for specific data files in a scale-out data storage platform.

Those patents in question are US Patent numbers 7,814,170 ('170) "Network Distributed Tracking Wire Transfer Protocol"; 7,103,640 ('640) "Network Distributed Tracking Wire Transfer Protocol"; and 7,233,978 ('978), aka "Method and Apparatus for Managing Location Information in a Network Separate From the Data to Which the Location Information Pertains."

Kove names Dr John Overton and Dr Stephen Bailey as the inventors of the technology involved, with Overton serving as the company's CEO.

In its complaint, Kove states that the pair "realized that storing location information associated with data files across multiple servers would reduce the processing time to find a data file." Likewise, it says that the inventors "understood the need to efficiently identify which of the multiple location information servers stored the location information for a particular data file."

The result was distributed hash values that point to a location information server. While the server may not have the location information for the file the user is requesting, it will reroute to another server that does have the information.

This system "enabled hyper-scalable cloud storage and improved upon the scalability limitations of conventional storage systems," Kove states.

In its complaint, Kove claims that its technology "became essential to AWS as the volume of data stored on its cloud grew exponentially and its cloud storage business faced limitations on the ability to store and retrieve massive amounts of data."

AWS issued a fairly hefty 56-page packet of denials and counterclaims [PDF] in 2020, denying it had infringed the patents in question and arguing that the patents were actually invalid and therefore unenforceable.

In particular, AWS referred to a paper entitled "Consistent Hashing and Random Trees: Distributed Caching Protocols for Relieving Hot Spots on the World Wide Web," by David Karger et al, which it cited as prior art to the '978 patent.

However, when it came to trial, the AWS counterclaims of non−infringement, invalidity, unpatentability, and unenforceability of the three patents were all dismissed.

A spokesperson for AWS told The Register: "We disagree with today's ruling and intend to appeal. We thank the jury, which also acknowledged that AWS did not willfully infringe on patents."

It is notable that none of the Kove patents in the case were actually granted by the US Patent and Trademark Office before the launch of Amazon S3, the first AWS service, on March 14, 2006. However, Kove states in its complaint that applications relating to these patents were filed on July 8, 1998, perhaps implying that Amazon should have been aware of the filings before the launch of its cloud platform.

The damages of $525 million will be a drop in the ocean to Amazon, however, which recently reported overall revenue of $170 billion for Q4 of its financial year 2023, of which $24.2 billion was contributed by AWS. ®

Updated to add on April 12:

Kove told The Reg in a statement that the three patents cover "breakthrough technology that allow cloud storage to scale unlimitedly." Kove founder and CEO John Overton added: "Yesterday's success highlights the importance of protecting intellectual property rights... By doing so, we create an environment where innovation and creativity can flourish, benefiting not only our company but also our customers and the industry as a whole."

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