In what may end up being a net positive for eBay, albeit possibly an expensive one, a settlement has been reached in the litigation over patent infringement between eBay Inc. (NASDAQ: EBAY) and MercExchange. Financial figures of the settlement have not been disclosed, but a report from Computerworld indicates that eBay shall purchase the three patents which were the subject of the litigation, as well as a number of other related technologies and developments.

Mike Jacobson, eBay senior vice president and general counsel, was quoted by Computerworld as stating: "In addition to resolving the litigation, this settlement gives us access to additional intellectual property that will help improve and further secure our marketplaces." MercExchange founder and CEO Thomas Woolston, is quoted in the same report as stating: "It seemed like the right time to put it behind us."

In May of 2003, a jury in the case found eBay guilty of patent infringement and an injunction was sought and granted. However, in reviewing the US Court of Appeals decision, the Supreme Court unanimously derailed the long standing practice of issuing immediate injunctions in cases of intellectual property infringement, insisting that in the future, such injunctions must meet the requirements of a four-factor test.

Patent trolls are way more scary to U.S. businesses than the kind of trolls you find on message boards, or under bridges. So scary, in fact, that eBay is going all the way to the Supreme Court to argue against their ability to gain injunctions to shut down the businesses of the companies from whom they seek to receive damages.

In this case, eBay has been sued by tiny MercExchange over its Buy-It-Now technology (which eBay says has been altered to avoid infringement, anyway). A jury at the lower court found that eBay was infringing on MercExchange's patent, and then an appeals court upheld the finding, and imposed an injunction barring eBay from using the patented technology.

eBay hopes to make it harder for patent-holders to obtain injunctions (they're "virtually automatic" and can seriously harm a company's livelihood), and to have the court weigh a variety of factors before shutting down a business, for instance, whether or not the patent-holder plans to use its IP for anything other than lawsuits.