Skype founders sue eBay for copyright violations

Skype founders Niklas Zennstrom and Janus Friis filed suit today against eBay, the owner of their the intenet telephone technology since 2005, alleging that the auction site violated a copyright agreement that it wouldn’t share the proprietary code powering the service.
The suit is officially being brought by Joltid, another company owned by the duo — which, incidentally, also founded video-sharing site Joost. The trouble started when eBay moved on plans to sell off most of Skype to three private equity firms: Silver Lake Partners, Andreessen Horowitz and Index Ventures for $1.9 billion. Zennstrom and Friis are arguing that the sale would violate eBay’s license to Skype’s peer-to-peer technology, which they still technically own.
Joltid’s goal is to stop the deal and recoup statutory damages — which it estimates at a staggering $75 million a day. It is also suing Index, Silver Lake and Andreessen Horowitz, as well as the Canada pension Plan Investment Board.
This isn’t the first time Joltid has raised this objection. In March, it filed the same suit in British court, where it is expected to go to trial in 2010. So far, eBay has been optimistic about its chances of winning the case, though it has started working on contingency technology in case it has to turn over its license.
Somewhat weakening Zennstrom and Friis’ case is the sheer frequency with which they sue people. They even sued the investment banker who brokered the original sale of Skype to eBay — three times, in the U.S., Holland and Britain, where the case was almost immediately tossed out by the judge. So it’s unclear exactly how much merit their arguments have.
Perhaps complicating matters — Mike Volpi, former chief executive and chairman of Zennstrom and Friis’ Joost, was recently forced out of the company due to its poor performance and involvement in the deal between eBay and the private equity firms. As a partner at Index Ventures, there’s a potential conflict of interest that could be messy to untangle.