Google Inc. is facing more patent litigation as it has increased its dominance in the industry, and could spend billions to buy patents or defend itself against litigation. The Palo Alto, Calif.-based company, owner of the world's most popular search engine, the most used operating system platform (Android) for smartphones, and potentially a social network (Google+) that could rival Facebook still faces its share of lawsuits.

Small firm vs. tech giant

Transcenic Inc. is a Lake Charles, La.-based company with an estimated two employees that has been 10 years in the business and has $150,000 in total sales, according to Bloomberg News. Now, Transcenic's principals will have their highest payday yet, if it succeeds in a patent infringement lawsuit it filed against certain tech giants.

Transcenic Inc. has filed a lawsuit in U.S. District Court in Delaware in the United States against Google, Microsoft Corporation, AmericaOnline Inc. (AOL), and MapQuest Inc.

Transcenic holds the patent relating to systems and methods for capturing spatial referenced images and for providing a three-dimensional positional database system for displaying the images and permitting navigation among the images using positional information and commands.

The plaintiff claims that Google, et al., each make use, provide and control third-party access to interactive mapping Web sites and applications that display spatial referenced street-level imagery and provide interactive image navigation controls using systems and methods that infringe technology.

The plaintiff claims that Google Maps , with Street View and its Web-based Google Earth application, Microsoft's Bing Maps with Streetside, and AOL and MapQuest's MapQuest with 360 view Web sites have been infringing on its patents.

Microsoft and Google are already facing allegations from GeoTag that their mapping services infringe GeoTag patents.

Other patent suits

Google has been facing more patent litigation since it moved into mobile and desktop operating systems. More than 33% of smartphones sold carry the Android operating system.

Oracle Corp. has sued Google over Java in Google's development of the Android OS. Oracle claims that "Google's Android competes with Oracle America's Java" and that Google has been aware of Sun's patent portfolio.

Several mobile companies have sued Android partners for patent infringement. Apple has sued manufacturers of Android-based phones like HTC Corp. and Samsung Electronics Co.

Microsoft Corp. also has demanded payments from makers of products that run on Android.

Patents purchases

"One of a company's best defenses against this kind of litigation is (ironically) to have a formidable patent portfolio," Google General Counsel Kent Walker said in April.

Google negotiated with Nortel Networks to buy the defunct telecommunications firm's 6,000 patents that can be used for smartphones. Google opened the bankruptcy court sanctioned auction with its $900 million offer and would have obtained the patents absent higher and better bids. However, the patents generated interest from tech companies. After a four-day auction, Google lost and a $4.5 billion was the winning bid, which was from a consortium comprised of Apple Inc., Microsoft, Research In Motion Ltd., Sony Corp., Ericsson AB and EMC Corp. RIM's Blackberry and Apple's iPhone do not use the Android OS and Microsoft is providing its own OS for future Nokia phones.

Now Google is scrambling to buy patents to defend itself against lawsuits targeting its Android operating system and other products and services.

Google will keep searching for opportunities, mainly for patents related to smartphone technology, Ron Epstein of Epicenter IP Group LLC, a Redwood City, California- based patent brokerage, told Bloomberg News.

Challenging the patents

Google, as well as other tech firms, has urged new laws and lobbied Congress to make it easier to challenge patents.
Last month, Microsoft lost in a U.S. Supreme Court decision that upheld a $290 million jury verdict against the Windows OS developer for willfully infringing a patent of a small Canadian firm.

The suit stood out among observes as Microsoft sought a lower standard of proof for invalidating patents. The Supreme Court, however, rejected Microsoft's contention that it only needs to persuade a jury of a patent's invalidity by a "preponderance of evidence." "While the outcome is not what we had hoped for, we will continue to advocate for changes to the law that will prevent abuse of the patent system and protect inventors who hold patents representing true innovation," a spokesperson for Microsoft said.

Technology companies have been facing a stream of lawsuits involving patent claims, prompting firms like Google, Verizon Communications Inc. and others to support Microsoft.

A patent overhaul bill, the America Invents Act, was passed the Senate in March and is pending in the House. The bill permits third parties to challenge patents, even after they are granted, through administrative proceedings at the USPTO.