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Bid for Position, LLC v. AOL, LLC et al Doc.

1
Case 2:07-cv-00582-WDK-TEM Document 1 Filed 12/13/2007 Page 1 of 26

rr m

IN THE UNITED STATES DISTRICT COURT


FOR THE EASTERN DISTRICT OF VIRGINIA
Alexandria Division

BID FOR POSITION, LLC,

Plaintiff,

v.

AOL, LLC,
Serve:
Corporation Service Company CASE NO. A\ Ol
Registered Agent /
11 South 12th Street, PO Box 1463 Jury Trial Demanded
Richmond, Virginia, 23218-0000

GOOGLE, INC.,
Serve:
Corporation Service Company
Registered Agent
11 South 12th Street, PO Box 1463
Richmond, Virginia, 23218-0000

MICROSOFT CORP.,
Serve:
Corporation Service Company
Registered Agent
11 South 12Ih Street, PO Box 1463
Richmond, Virginia, 23218-0000

and

MIVA, INC.,
Serve:
Secretary of the Commonwealth

Defendants.

COMPLAINT FOR PATENT INFRINGEMENT

Dockets.Justia.com
Case 2:07-cv-00582-WDK-TEM Document 1 Filed 12/13/2007 Page 2 of 26

Plaintiff Bid For Position, LLC ("Bid For"), by counsel and pursuant to Federal Rule of

Civil Procedure 8(a), alleges the following in support of its Complaint against Defendants AOL,

LLC ("AOL"); Google, Inc. ("Google"); Microsoft Corporation ("Microsoft"); and MIVA, Inc.

("MIVA") (collectively "Defendants") for patent infringement:

I. INTRODUCTION

1. Plaintiff Bid For owns the invention described and claimed in United States

Patent No. 7,225,151 entitled "Online Auction Bid Management System and Method" (the

"Konia patent").

2. Each defendant has used, and continues to use, the technology claimed by

Plaintiffs Konia patent in methods and systems that the defendant makes, uses, sells, and offers

to sell, without Plaintiffs permission.

3. Plaintiff seeks damages for each Defendant's infringement of the Konia patent

and seeks an injunction preventing all of the defendants from making, using, selling, or offering

to sell the technology claimed by the Konia patent without Plaintiffs permission.

II. PARTIES

4. Plaintiff Bid For Position, LLC, is a Florida limited liability company with its

principal place of business at 21413 Fairfield Lane, Boca Raton, Florida, 33486.

5. Upon information and belief, Defendant AOL is a Delaware limited liability

company with its principal place of business at 22000 AOL Way, Dulles, Virginia, 20166. AOL

has appointed the following as its agent for purposes of receiving service of process in Virginia:

Corporation Service Company, 11 South 12th Street, PO Box 1463, Richmond, Virginia, 23218-

0000.

6. Upon information and belief, Defendant Google is a Delaware corporation with

its corporate headquarters and principal place of business at 1600 Amphitheater Parkway,
Case 2:07-cv-00582-WDK-TEM Document 1 Filed 12/13/2007 Page 3 of 26

Mountain View, California, 94043. Google has appointed the following as its agent for purposes

of receiving service of process in Virginia: Corporation Service Company, 11 South 12th Street,

PO Box 1463, Richmond, Virginia, 23218-0000.

7. Upon information and belief, Defendant Microsoft is a Washington corporation

having its principal place of business at One Microsoft Way, Redmond, Washington, 98052.

Microsoft has appointed the following as its agent for purposes of receiving service of process in

Virginia: Corporation Service Company, 11 South 12th Street, PO Box 1463, Richmond,

Virginia, 23218-0000.

8. Upon information and belief, MIVA is a Delaware corporation with its principal

place of business at 4220 Summerlin Commons Boulevard, Suite 500, Fort Myers, Florida,

33907.

III. JURISDICTION AND VENUE

9. This action arises under the patent laws of the United States, Title 35 of the

United States Code, Sections 271 and 281, et seq. This Court has original subject matter

jurisdiction over this patent infringement action under 28 U.S.C. §§ 1331 and 1338(a).

10. Venue is proper in this district under 28 U.S.C. §§ 1391(c) and 1400(b). On

information and belief, each Defendant has transacted business in this district, and has

committed, contributed to, and/or induced acts of patent infringement in this district.

11. On information and belief, Defendants are subject to this Court's specific and

general personal jurisdiction consistent with the principles of due process and/or the Virginia

Long Arm Statute, due at least to their substantial business in this forum, including: (i) at least a

portion of the infringements alleged herein, including using, selling, and offering to sell

products, methods, and systems that infringe the claims of the Konia patent; and (ii) regularly
Case 2:07-cv-00582-WDK-TEM Document 1 Filed 12/13/2007 Page 4 of 26

doing or soliciting business, engaging in other persistent courses of conduct, and/or deriving

substantial revenue from goods and services provided to individuals in Virginia and in this

judicial District.

COUNT I
INFRINGEMENT OF THE KONIA PATENT

12. Plaintiff incorporates by reference each of the allegations contained in paragraphs

1 through 11 above, and further alleges as follows:

13. The United States Patent and Trademark Office issued the Konia patent on May

29,2007. A true and correct copy of the text of the Konia patent is attached to this Complaint as

Exhibit A. Plaintiff is the owner of all rights, title, and interest in the Konia patent, including all

rights to pursue and collect damages for past infringements of the patent.

14. Without a license or permission from Plaintiff, Defendant Google has infringed

the Konia patent and, unless enjoined, will continue to do so, by making, using, providing,

selling, and offering for sale products, methods, and systems that infringe the claims of the Konia

patent including, without limitation, the products, methods, and systems of Google's AdWords.

Google is thus liable for infringement of the Konia patent pursuant to 35 U.S.C. § 271.

15. Without a license or permission from Plaintiff, Defendant AOL has infringed the

Konia patent and, unless enjoined, will continue to do so, by making, using, providing, selling,

and offering for sale products, methods, and systems that infringe the claims of the Konia patent

including, without limitation, the products, methods, and systems of AOL's Search Marketplace.

AOL is thus liable for infringement of the Konia patent pursuant to 35 U.S.C. § 271.

16. Without a license or permission from Plaintiff, Defendant Microsoft has infringed

the Konia patent and, unless enjoined, will continue to do so, by making, using, providing,

selling, and offering for sale products, methods, and systems that infringe the claims of the Konia
Case 2:07-cv-00582-WDK-TEM Document 1 Filed 12/13/2007 Page 5 of 26

patent including, without limitation, the products, methods, and systems of Microsoft's adCenter.

Microsoft is thus liable for infringement of the Konia patent pursuant to 35 U.S.C. § 271.

17. Without a license or permission from Plaintiff, Defendant MIVA has infringed the

Konia patent and, unless enjoined, will continue to do so, by making, using, providing, selling,

and offering for sale products, methods, and systems that infringe the claims of the Konia patent

including, without limitation, the products, methods, and systems of MIVA's Advertiser

Solutions. MIVA is thus liable for infringement of the Konia patent pursuant to 35 U.S.C. § 271.

18. As a result of Defendants' infringement of the Konia patent, Plaintiff has been

damaged by and will continue to suffer additional, irreparable damage, in an amount not yet

determined, and will suffer an impairment of the value of its patent rights unless Defendants are

enjoined from continuing to infringe the Konia patent.

19. Pursuant to 35 U.S.C. § 281, Plaintiff is entitled to recover damages from the

Defendants to compensate it for Defendants' infringement of the Konia patent.

20. To the extent that facts learned in discovery show that Defendants' infringement

is or has been willful, Plaintiff reserves the right to request such a finding at the time of trial.

21. Plaintiff demands trial by jury of all issues relating to this claim.

PRAYER FOR RELIEF

WHEREFORE, Plaintiff prays for relief as follows:

1. A judgment in favor of Plaintiff that Defendants have infringed, directly or

indirectly, the Konia patent;

2. A decree preliminarily and permanently enjoining Defendants, their officers,

directors, employees, agents, and all persons in active concert with them, from infringing, and

contributing to or inducing others to infringe the Konia Patent;


Case 2:07-cv-00582-WDK-TEM Document 1 Filed 12/13/2007 Page 6 of 26

3. A judgment and order requiring Defendants to pay Plaintiff compensatory

damages, costs, expenses, and pre- and post-judgment interest for Defendants' infringement of

the Konia Patent, as provided under 35 U.S.C. § 284;

4. A judgment and order finding that this patent infringement case is exceptional

within the meaning of 35 U.S.C. § 285 and awarding Plaintiff its reasonable attorneys' fees; and

5. Any and all other relief to which Plaintiff may be entitled.

Dated: December 12, 2007 Respectfully Submitted,

BID FOR POSITION, LLC

By Counsel

Craig T. Mfrritt (VSB #20281)


R. Braxton Hill, IV (VSB #41539)
Nichole Buck Vanderslice (VSB #42637)
Counselfor Plaintiff
CHRISTIAN & BARTON, LLP
909 East Main Street, Suite 1200
Richmond, Virginia 23219
cmerritt@cblaw.com
bhill@cblaw.com
nvanderslice@cblaw.com
Tel.: (804)697-4100
Fax: (804)697-4112

Gregory S. Dovel (CA Bar #135387), Of Counsel


Christin Cho (CA Bar #238173)
DOVEL & LUNER, LLP
201 Santa Monica Blvd., Suite 600
Santa Monica, California 90401
Tel.: (310)656-7066
Fax: (310)656-7069
Counselfor Plaintiff
Case 2:07-cv-00582-WDK-TEM Document 1 Filed 12/13/2007 Page 7 of 26

US007225151B1

United States Patent (io) Patent No.: US 7,225,151 Bl


Konia (45) Date of Patent: May 29,2007

(54) ONLINE AUCTION BID MANAGEMENT 6.907,405 B2» 6/2005 Brett 705/37
SYSTEM AND METHOD 2003/0236739 Al* 12/2003 Boigeson et al 705/37

* cited by examiner
(76) Inventor: Brad S Konia, 1500 Bay Rd. Suite
838, Miami Beach, FI. (US) 33139 Primary Examiner—Hani M. Kazimi
Assistant Examiner—Stcfano Karmis
(*) Notice: Subject to any disclaimer, the term of this (74) Attorney, Agent, or Firm—Ivan Posey; Chan law
patent is extended or adjusted under 35 Group LLP
U.S.C. 154(b) by 0 days.
(57) ABSTRACT
(21) Appl. No.: 09/491,747
A method and system for automatically managing an auction
(22) Filed: Jan. 27, 2000 for determining relative priority for a service in a system
wherein priority is based on the relative value of related bids
(51) Int.Cl. is disclosed. The method comprises checking for whether a
G06Q 40/00 (2006.01) first bid exceeds a second bid in an auction for determining
(52) U.S. Cl 705/37; 705/26; 705/35 continuing priority for providing an ongoing service for at
(58) Field of Classification Search 705/36-37.
least a first and second bidder, wherein the relative priority
705/25-27,5-6,38, 39, 90, 35
for providing the service for the first bidder is dependent on
whether the value of the first bid exceeds the value of the
See application file for complete search history.
second bid, and wherein the relative priority* for providing
(56) References Cited the service for the second bidder is dependent on whether the
value of the second bid exceeds the value of the first bid. The
U.S. PATENT DOCUMENTS
method further comprises incrementing the first bid to a
5.794.219 A 8/1998 Brown 705/37 value exceeding the second bid if the first bid does not
5.818.914 A 10/1998 Fujisaki 379/93.12 exceed the second bid, thereby causing the relative priority
5,826.244 A 10/1998 Hubcrman 705/37 for providing service for the first bidder to exceed the
5,835.896 A • 11/1998 Fisher et al 705/37 priority for providing service for the second bidder. The
5.890.138 A 3/1999 Ciodin et al 705.26 steps of checking and incrementing may be executed a
5.905.974 A 5/1999 Fraser el al 705/37
plurality of times. The system may pause for ;i fixed period
5.905.975 A 5/1999 Ausubcl 705/37
of time between each series of steps of checking and
6,023.685 A • 2/2000 Brett el al 705/26
incrementing.
6.216,114 Bl* 4/2001 Alaia el al 705/1
6.269.361 Bl • 7/2001 Davis et al 707/2
6.601.044 Bl • 7/2003 Wallman 705.36 24 Claims, 11 Drawing Sheets

ISO
Search Engine
Serverl

150a
ISO
V. \Seaidi Engine
u
Server 3

World Wide Web

130-

Online Bid
ISO Management
V. Search Engine System
Server n 175b

175a

Bidder 3
C
150
Search Engine
Server 1 a?

9
150a
150
\ \Search Engine u
Servers
SB
Case 2:07-cv-00582-WDK-TEM

World Wide Web


Online Bid Management Server
130'

Online Bid s*

ISO Management *9
Document 1

V {Search Engine System


Servern 175b

Bidder3

C
Filed 12/13/2007

Is)
Page 8 of 26
Case 2:07-cv-00582-WDK-TEM Document 1 Filed 12/13/2007 Page 9 of 26

U.S. Patent May 29,2007 Sheet 2 of 11 US 7,225,151 Bl

FIG. 2

*j For each quarter day

f For each search engine


]

[ For each term bid for \

208

Increase bid to achive Yes/ Position Reduce bid to achive


desired position. Do not lower than desired position. Analyze
exceed maximum bid. desired? next bid.

Recheck position

position achieved?

Last term
H Notify Bidder \ forcurrentsearch
engine?

Last search engine


for current bidder?

226 JYes

Last bidderi

Yes r-228
Quarterdayt

230~*-] Timer subroutine


Case 2:07-cv-00582-WDK-TEM Document 1 Filed 12/13/2007 Page 10 of 26

U.S. Patent May 29,2007 Sheet 3 of 11 US 7,225,151 Bl

302 304

System enables bid System enables bid


Does the
queries and bid
updates via direct
Yes ^current search engine queries and bid
support a direct database updates via search
database interface engine's manual Web
interface?
with search engine interface

FIG. 3

1002
Buyer places order

1004
Buyer receives bids

1008
Access record for vendor \J
with highest priority

1010
*-f While order not filled completely ~\f

1012
Attempt to order as many products \S
as possible from current vendor

1016

1
1014

1016
Access next vendor order

FIG. 10
152
Golf Club 177
Golfer 1 Golfer2
Reservation FIG. 4
Reservation Reservation ft
Server 1
Terminal Terminal

177a
152 Goiter 3
Golf Club Reservation
Reservation Terminal
Server3
Case 2:07-cv-00582-WDK-TEM

©
100 o

Online Bid Management Server

Online Bid
Document 1

152 Management
Golf Club System
u Reservation
Servern 177b

152a
Golf Club
Reservation
Server 3
G
Filed 12/13/2007

104'-y "X. -4

( RDBMS J
Page 11 of 26
Case 2:07-cv-00582-WDK-TEM Document 1 Filed 12/13/2007 Page 12 of 26

U.S. Patent May 29,2007 Sheet 5 of 11 US 7,225,151 Bl

FIG. 5

Start

T~ 500
•f For each quarter day

502-
[ For each goffer

504^
{ For each golf dub

512 (—510
506

Increase bid to achieve Reduce bid to achieve


priority. Do not exceed desired priority. Analyze
maximum bid. next bid.

Last golf du
for current
golfer?
In
154 179 179
Frequent Flyer v^ Frequent Flyer Frequent Flyer
FIG. 6 so
Server 1 Bidder Bidder
Terminal 1 Terminal2
I
154a
154
Frequent Flyer
Frequent Flyer Server2
u
Server 3 2
Case 2:07-cv-00582-WDK-TEM

100 O

Online Bid Management Server

102 V)
Online Bid
154 Management
Document 1

System
VJ Frequent Flyer
Servern
179b
Frequent Ffyer
Bidder Terminal 4 179a
102
Online Bid \*_\Frequent Flyer
Management
L/
Bidder
System Terminal 3
Filed 12/13/2007
Page 13 of 26
Case 2:07-cv-00582-WDK-TEM Document 1 Filed 12/13/2007 Page 14 of 26

U.S. Patent May 29,2007 Sheet 7 of 11 US 7,225,151 Bl

FIG. 7

{ For each quarter day

f For each frequent flyer)

f For each airline

Increase bid to achieve Yes / Priority Reduce bid to achieve


priority. Do not exceed tower than desired priority. Analyze
maximum bid. desired? next bid.

Recheck priority \

Frequent
flyer's failure
priority achieved?
notification
on? *-*

Yes
722

"^Lastairiine
+-\Notify frequent flyer] forcurrentfrequen
flyer?

726 1 Kef

Last frequent flyer

Yes r-728
Quarterdayl

Timer subroutine
c
In

156a
Case 2:07-cv-00582-WDK-TEM

100
World Wide Web

130
Online Bid Management Server
CA

Online Bid
Document 1

Management
00
Buyer System o

Server n
181b
VJ
181a

Terminal3
Filed 12/13/2007

104
{ RDBMS j

6S
Page 15 of 26
Case 2:07-cv-00582-WDK-TEM Document 1 Filed 12/13/2007 Page 16 of 26

U.S. Patent May 29,2007 Sheet 9 of 11 US 7,225,151 Bl

FIG. 9

I For each vendor \

906

Decrease sales offer to Increase sales offer to


Yes/ Priority \ No
achieve safes priority. lower to desired sales
lower than
Do not exceed priority. Analyze
desired?
maximum bid. next bid.

Recheck priority \

916
Vendors
notification priority achieved?
on?

Yes

*-{ Notify vendor

924 i Yes
——.

Last buyer?

930—\ Timer subroutine


In

FIG. 11

158a
Online
Store 2
SB
Case 2:07-cv-00582-WDK-TEM

100

Online Bid Management Server


CA
102
Online Bid
Document 1

Management
System

183b

183a
VJ Vendor
Terminal 3
G
Filed 12/13/2007

104

Cd
Page 17 of 26
Case 2:07-cv-00582-WDK-TEM Document 1 Filed 12/13/2007 Page 18 of 26

U.S. Patent May 29,2007 Sheet ll of ll US 7,225,151 Bl

FIG. 12

1200
[ For each month

[ For each vendor

1204-^
[ For each vendor's product sold in the online store \-*

1206
1208 -^ 1214
r
For each online store No For each online store
listing the product listing the product

Increase bid to achieve


higher listing priority. Decrease bid to lower
Do not exceed to desired listing priority.
maximum bid.

No No

Last prod,
for the current
vendor?
Case 2:07-cv-00582-WDK-TEM Document 1 Filed 12/13/2007 Page 19 of 26

US 7,225,151 Bl
1 2
ONLINE AUCTION BID MANAGEMENT ofsearch terras. The steps of checking and incrementing are
SYSTEM AND METHOD executed for a plurality of search engines for the plurality of
search terms.
BACKGROUND OF THE INVENTION A syslem fi|J. automalica||y managjng lhe ^,„ far

„ , ,. . . . . __,.,. 5 determining relative priority for the service in a system


For convention onluic auctions such as that by EBAY by wherejn ^ . based , , . , f ^
ebay, Inc. of San Jose, Calif., each item can only be so Id . r _. ,. .' . n
onci to the highest bidder. When the bid is accepted, lhe ' ^e <lisclosed. The system may compr.se a processor
auction is over electrically connected to a network, which is electrically
„ . ' . . , , . , ..... r , ,n connected to the plurality of search engines. A database is
Continuous auctions include those for bidding for Internet 10 , . ■ „ . ■. ... r ■ 1
. ■ , . . . fi.!.-.. electrically connected to the system for storing and manae-
search engme key-phrases in order to achieve the highest . . ' ' * »"™»
possible rankings on a search engine. The search engine m*
foundatGOTO.COMbyGoto.com, Inc. of Pasadena, Calif. A system and method for automatically managing an
is an exemplary continuous auction. In this type of auction, auction for determining relative priority for vendors for
the search engine lists web-page search results for a key- IS selling to several buyers based on the relative value of
phrase search in the order of bid prices from advertisers. The related bid is further disclosed. The system comprises a
advertiser with the highest bid for a given key-phrase processor electrically connected to a network for checking
appears first in the list, the next highest bidder appears for whether a first bid is lower than a second bid in an
second, etc. Since key-phrases are intangible, the same auction for determining priority on a server electrically
key-phrase can be sold to an unlimited number of users and 30 connected to lhe network for ranking selling priority fora
the auction runs continuously with the rankings changing first and second vendor, wherein the relative priority for
according to the current bids from advertisers. ^ning by the lirst vendor is dependent on whether the value
As these and other types of continuous auctions become of the first bid is lower than the value of the second bid, and
more common in many areas of commerce, it will become wherein the relative priority for selling by the second vendor
more difficult for bidders to monitor bids in several different -5 js dependent on whether the value of the second bid is lower
auctions. than the value of the lirst bid. The processor is further for
There exists a need for a system that monitors the current decrementing the first bid to a value lower the second bid if
rankings in auctions and automatically adjusts its bids the (irst bid is not lower than the second bid. thereby causing
according to the rules defined by its user. J0 ^,e relative priority for the first vendor to exceed the priority
for the second bidder.
SUMMARY OF THE INVENTION

BRIEF DESCRIPTION OF THE DRAWINGS


A method and system for automatically managing an
auction for determining relative priority for a service in a » ,. ... , ,. . , . . ,
system wherein priori^ is based on the relative value of M lor a f""" understanding of the mventmn. reference is
related bids is disclosedThe method comprises checking for madc lo lhe lollowln8 *»cnptHm taken in connection with
whether a first bid exceeds a second bid in an auction for the accompanying drawmgs, in wh.ch:
determining continuing priority for providing an ongoing FIG. I is a block diagram illustrating an exemplary
service for at least a first and second bidder, wherein the 40 system architecture for one embodiment of the present
relative priority for providing lhe service for the first bidder invention:
is dependent on whether the value of the first bid exceeds the VK is 2-3 are flow diagrams illustrating a method per-
value of the second bid, and wherein the relative priority for formed by the system of FIG. 1:
providing the service for the second bidder is dependent on ..... ....... „ . ,
whether die value of die second bid exceeds the vdueof the 45 HCl- 4 's n blocfk dlaVT •»«*»«« ™ exemplary
first bid. The method fiirther comprises incrementing the svslcm architecture for another embodiment of the present
first bid to a value exceeding the second bid if the first bid invention;
does not exceed the second bid, thereby causing the relative FIG. 5 is a flow diagram illustrating a method performed
priority for providing service for the first bidder to exceed by the system of FIG. 4:
the priority for providing service for the second bidder. The J0 FIG. 6 is a block diagram illustrating an exemplary
steps of checking and incrementing may be executed a system architecture for another embodiment of the present
plurality of times. The system may pause for a fixed period invention:
of time between each series of steps of checking and ,:IG 7 is a ,,ow diagram illuslrming a melhod performed
incrementing. by the system of FIG. 6;
The service provided to the bidders may comprise pro- 55 no. 8. is a block diagram illustrating an exemplary
viding ranking ol hypertext links to web pages in search tcm ^j^^ for anolher embodiment l(f,he present
results in an on-line web page search engine, wherein invention;
ranking of a first hypertext link to a lirst web page for U10 ... „'.,,.. ■„ • . . r .
first bidder is higheVthan the ranking ofa second hypertex. . '' ° 9 ls a "TL^01 >»"^'"«g » ""-thed performed
link 10 a second web page lor lhe second bidder if the firsl «, Dy "le syMcm ol MU' *•
bid is higher than the second bid FIG-10-ls " 11ow diagram illustrating the steps performed
The method may comprise placing bids on a plurality of by » buycr scrver of thc s>'stem of FIG 8:
search terms which may be typed into the search engine by I'10 H. ls a bIo(* diagram illustrating an exemplary
search engine users wherein different milking is determined system archileclure for another embodiment of the present
for each search term, wherein the ranking of thc first 65 invention; and
hypertext link is higher than the second hypertext link if the I'lCi. 12 is a flow diagram illustrating a method performed
first bid is higher than the second bid for each of the plurality by the system of Flli. II.
Case 2:07-cv-00582-WDK-TEM Document 1 Filed 12/13/2007 Page 20 of 26

US 7,225,151 Bl

DETAILED DESCRIPTION OF HIE different rankings are determined for each search term for
PREFERRED EMBODIMENTS each of a plurality of bidders.
One of the plurality of search engines 150a may be
With reference to FIG. 1, a block diagram illustrating an directly electrically connected lo the online bid management
exemplary system architecture for one embodiment of the 5 SCvcr 100 to facilitate faster updating of ranking of hypertext
present invention is shown. The system comprises a server links on the search engine 150a. Similarly, a bidder terminal
100 comprising an online bid management system 102 for nsa raay be directly electrically connected to the online bid
automatically managing an auction for determining relative management server 100 so that bids may be updated Taster
priority for a service in a system wherein priority is based on t0 the online bid management system 102
the relative value of related bids ">
As an alternative lo having a centralized bid management
The bid management server 100 comprises a processor tcm ,02 the onUne bid mmg/mm systcm * ^
electncally connected to a network. As those sk.llcd ,n the stt)red |ocal| on one or more b*idder ,emlina|s )75h
art would recognize, me onluie bid management server 100 ^ bidder termina, 175A „ rf or js e|cctrjcal,v

may comprise a standard RISC or CISC processor running


connected to, a RDBMS 104 which keeps track of bids
the NT operating system by the Microsoft Corp. ol Red- is mde on the bjdder te|mina| ,75fc b ^ of scvera,
"*«* The system on the bidder terminal 175ft works in
PRISE Server by Sun Microsystems of Palo Alto, Calif., or similjv fashion t0 mat on ,he onHne hid managcmen,

an AS400 System by the IBM Corporation, USA.


server 100
Bids are made from bidder terminals or computers 175
(called bidder terminals herein) which may comprise Inter- 20 i r fl°* dla»ram '"ustra"nS a
net terminals with keyboards a one skilled in the art would f lhe.I0,nlinc b'd ^B^nt systems
shown, llie method is for automatically

management system 102 pnonti/es the bids

for their bids received from the bidder terminals 175 are 30
bidder's bids £f"
nt system 102. At step
, the systcm loops through each search engine 150 for
dependent on whether their bids exceed the value of other .. ... 3 _. . r... . .j - .. . ■
.. Lui.-i.-j j i. i i- t.

which the particular bidder has bid on terms for ranking their

The server 100 may further comprise a database 104


comprising a relational database management systcm
jessing moves temporary U> HO. 3. where the system
(RDBMS) 104 for storing bids and data relating to the 35 chccks to «* if the current search engine in the loop
service provided to the bidders. Bidders may further enter iUPP?ns a dlrcct da1abasc lnterface- steP 30°- Wlth "^P^'
maximum and/or minimum bids into the bidder terminals t0 tms slfP- certa™ «««* «'8"les ma-v comPlv with the
175. The online bid management svstem 102 keeps track of ^stem- allowin» lhe «nl!ne b"J management system 102 lo
the maximum and minimum bids for each user who enters dlrect|y acccss and "P^ bld rankm8s on thelr search
bids into the bidder terminals 175 into RDBMS 104. The 40 «*«■.If fuch ls u'e case' proeessmg moves to step 302
online bid management system 102 will increment the lower whlch. «np'ements the direct querying and updating of the
bids until they reach desired bidding positions entered by the
search engine 150. Otherwise, processing moves to step 304
bidders as long as the bids do not exceed maximum values for wluch ** onlme bld management system 102 affects
entered by the respective bidders. Urns, the online bid <iuc"es and ^tes ,'° thu f^!1 "»* ""O"* the Par"
management system 102 causes the relative priority for 45
ticular search engine s web interface. After enabling access
providing service to each bidder to exceed the priority for {? if*' iearch cn»oe 1S0- P^^sing moves to step 206 in
providing service with respect to other bidders as long as the
maximum bid is not exceeded, or until a desired position is '" s'ep 206. the system loops through each term that the
reached. Ilie online bid management system 102 is further b'dder has bid on in the current search engine 150 of the loop
programmed to check and increment the bids a plurality of so established in step 204. The system checks for whether the
times, pausing for a fixed period or time between each bidder's desired position is met for die particular web page
checking and incrementing. and lerm- Sll-T 208- for example, the system checks for
For the embodiment oflTG. 1, the service provided to the whether the bidder's bid exceeds all other bids in the auction
users of bidder terminals 175 comprises providing ranking for determining continuing priority for listing the bidder's
of hypertext links to web pages in search results in an online 55 wet> pa»e- Another example allows the bidder to choose a
web page search engine stored either on the online bid position, such as fourth in die results listing. If die system
management server 100. or in one or more of several search finds 'hat 'he bidder has achieved the proper position in the
engines 150 stored on a plurality of servers, wherein the s«lrch engine with respect to the current term being pro-
users bid on ranking results for their web pages for terms cessed, the system may reduce the bid to a minimum wluch
typed into the one or more search engines ISO. ITie search 6» allows 'he bilWer lo kecP lhe pos'<'°i>- step 210. Otherwise.
engines rank hypertext links in search results presented after lhc system increases the bid without exceeding lhe maxi-
a search term is entered. The web pages of bidders that bid mum bid entered by the bidder, step 212.
higher than other bidders having web pages bidding for the The system re-checks lhe position held by the bidder, step
same term are ranked higher on the search results, lhe 214. If the desired position is mil achieved, step 216. the
online bid management system 102 receives maximum and 65 system checks to see if the bidder had set a notification Hag
minimum bids on a plurality of search terms thai may be so that the bidder would be notified if the desired position
typed into the search engine by search engine users wherein had not been achieved, step 218. Ill lie bidder had desired to
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be notified, the bidder is notified, step 220. Notification may ment the bids a plurality of times, pausing fora fixed period
be by a standard technique such as e-mail. of time between each checking and incrementing.
The system checks lo see if the last term for the current For the embodiment of F10.4, the service provided to the
search engine has been checked, step 222. If the last term has users of bidder terminals 177 comprises providing ranking
not been checked for the current search engine, then pro- 5 of priority for golf course tee-off times on one or several golf
cessing moves back to step 206. Otherwise, the system courses having golf club reservation servers 152. On their
checks to see if the last search engine has been addressed for reservation servers 152. golf courses may rank premium
(he current user, step 224. If not, then processing moves back tcc-off times based on what their members, or the public for
to step 204. Otherwise, the system checks to see the last of public courses, are willing to pay. Tor example, a premium
the bidder's positions have been checked, step 226. If not, 10 tee-off time may be 9:00 am Saturday morning. Bids may be
then processing moves back to step 202. Otherwise, the bid accepted for Ihe 9:00 am tee-off time, the highest bidder
management system 102 checks to sec of the last bidder has receiving the 9:00 am time, with other bidders bidding less
been processed, step 226. If not, then processing moves back than the highest bidder receiving tee-off times as close to the
to step 202. Otherwise, the system checks Ihe timing loop, 9:00 am time as possible for each particular bid. The online
in this case a quarter day, for whether it is time to process all is bid management system 102 receives maximum and mini-
of the bidders' positions again, steps 228-230. Once the mum bids on a plurality of golf courses wherein lec-off times
timer has determined (hat it is time to check the bidders' arc determined by bidding,
positions again, processing moves back to step 200. One of the plurality of reservation servers 152<i may be
With reference to FIG. 4, a block diagram illustrating an directly, electrically, connected to the online bid manage-
exemplary system architecture for another embodiment of 20 ment sever 100 to facilitate faster updating of ranking of golf
the present invention for managing golf course tee-off time reservations on the reservation server 152a. Similarly, a
reservations is shown. The system comprises ;i server 100 bidder terminal 177a may be directly electrically connected
comprising an online bid management system 102 lor auto- to the online bid management server 100 so that bids mav be
matically managing an auction for determining relative updated faster to the online bid management system 102.
priority for a service in a system wherein priority is based on 25 As an alternative to having a centralized bid management
the relative value of related bids. system 102, the online bid management system 102 may be
As with the server 100 of FIG. 1, the bid management stored locally on one or more bidder terminals 1776. The
server 100 comprises a processor electrically connected to a bidder terminal 1776 comprises, or is electrically connected
network. As those skilled in the art would recognize, the to, an RDBMS 104 which keeps track of bids made on the
online bid management server 100 may comprise a standard .in bidder terminal 177A by one or several golfers, lite system
RISC or CISC processor running the NT operating system on the bidder terminal 177A works in similar fashion to that
by the Microsoft Corp. of Redmond, Wash., or a suitable on the online bid management server 100.
UNIX server such as an ENTERPRISE Server by Sun With reference to FIG. 5 a flow diagram illustrating a
Microsystems of Palo Alto, Calif., or an AS400 System by method performed by the online bid management systems
the IBM Corporation, USA. 35 102 of FIG. 4 is shown. The method is for automatically
Bids are made from bidder terminals 177 (called golfer managing the auction for determining relative priority for a
reservation terminals in FIG. 4) which may comprise Inter- service in a system wherein priority is bused on Ihe relative
net terminals with keyboards as one skilled in ihe art would value of related bids. The system is programmed into a series
recognize. A user may enter a bid into the online bid of nested loops. The outer loop, starting at step 500, com-
management system 102 through a bidder terminal 177, 40 prises a timing mechanism which times Ihe updating of bids
which transmits Ihe bid to the bid management server 100. fora plurality of search engines 150. At step 502. Ihe system
As it receives bids from bidder terminals 177. the online bid loops through the bids for each golfer who made bids for tec
management system 102 prioritizes the bids periodically. off times on one or more golf courses on the bid manage-
The online bid management system 102 determines continu- ment system 102. At step 504. the system loops through each
ing priority for providing an ongoing service to Ihe bidders. 45 bid for each golf club for Ihe golfer.
The relative priorities for providing the service for bidders The system checks for whether the golfer's desired posi-
for their bids received from the bidder terminals 177 are tion is met for tee-off time priority on a particular course,
dependent on whether their bids exceed the value of other step 506. For example, the system checks for whether the
bills. golfer's bid exceeds all other bids in the auction fur deter-
The server 100 may further comprise a database 104 so mining priority for a preferred tee-time. Another example
comprising a relational database management system allows the bidder to choose a lee-time, such as 9:30 am
(RDBMS) 104 for storing bids and data relating to the instead of the premium time of 9:00 am. If the system finds
sen-ice provided to the bidders. Bidders may further enter that the golfer has achieved the requested tee-time priority in
maximum and/or minimum bids into the bidder terminals the search engine with respect to the current golf reservation
177. The online bid management system 102 keeps track of 35 server 152 processed, the system may reduce the bid to a
the maximum and minimum bids for each user who enters minimum which allows the bidder to keep ihe desired
bids into (he bidder terminals 177 by storing the bids in tcc-timc, step 510. Otherwise, the system increases the bid
RDBMS 104. The online bid management system 102 without exceeding the maximum bid entered by ihe golfer,
increments the lower bids until they reach desired bidding step 512.
positions entered by the bidders as long as ihe bids do not tn Ihe system re-checks the position held by the golfer, step
exceed maximum values entered by the respective bidders. 514. If the desired position is not achieved, step 516. the
Thus, the online bid management system 102 causes the system checks to see if the golfer had set a notification flag
relative priority for providing service to each bidder to so that the golfer would be notified if the desired position
exceed the priority for providing service with respeel to had nut been achieved, slep 518. If the golfer bid desired to
other bidders as long as the maximum bid is not exceeded. 65 be notified, the golfer is notified, step 520. Notification may
or until a desired position is reached. The online bid man- be by a standard technique such as e-mail or voice lelecom-
agement system is further programmed lo check and nitre- numication.
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The system checks to see if the last golf club for the of priority for airline reservations on one or several airlines
current golfer has been checked, step 522. If the last golf having airline reservation servers 154. On their reservation
club has not been checked for the current golfer, then servers 154, airlines may rank premium seats based on what
processing moves back to step 504. Otherwise, Ihe system their frequent flyer club members are willing to pay. For
checks to see the last golfer's positions have been checked, example, a premium seat may be a scat in Ihe first class
step 526. If not, then processing moves back to step 502. section of a flight between Los Angeles and New York, a
Otherwise, the system checks the timing loop, in this case a highly traveled route. Bids may be accepted for the first class
quarter day, for whether it is time to process all of the scats, the highest bidder receiving Ihe first choice in the first
golfers' positions again, steps 528-530. Once the timer has class lounge of the flight, with other bidders bidding less
determined that it is time lo check the golfers' positions 10 than the highest bidder receiving subsequent choices for
again, processing moves back lo step 500. sealing for each particular bid, all the way down to the least
With reference to FIG. 6, a block diagram illustrating an desirable scat for the flight. Premium times on flight sched
exemplary system architecture for another embodiment of ules may be auctioned in similar manner. The online bid
the present invention for managing frequeni flyer reserva management system 102 receives maximum and minimum
tions on airlines is shown. As with the embodiments shown IS bids on a plurality of airlines for which seating is determined
in FIGS. 1 and 4, the system comprises a server 100 by bidding.
comprising an online bid management system 102 for auto One of the plurality of reservation servers 154a may be
matically managing an auction for determining relative directly, electrically, connected to the online bid manage
priority fora service in a system wherein priority is based on ment sever 100 to facilitate faster updating of ranking of
the relative value of related bids. 20 flight reservations on the reservation server 154a. Similarly,
As with the server 100 of FIGS. 1 and 4, the bid a bidder terminal 179a may be directly electrically con
management server 100 comprises a processor electrically nected to the online bid management server 100 so ihnl bids
connected to a network. As those skilled in the an would may be updated faster to the online bid management system
recognize, the online bid management server 100 may 102.
comprise a standard RISC or CISC processor running the 25 As an alternative to having a centralized bid management
NT operating system by the Microsoft Corp. of Redmond, system 102, the online bid management system 102 may be
Wash., or a suitable UNIX server such as an ENTERPRISE stored locally on one or more bidder terminals 1796. The
Server by Sun Microsystems of Palo Alto, Calif., or an bidder terminal 1796 comprises or is electrically connected
AS400 System by the IBM Corporation, USA. to a RDBMS 104 which keeps track of bids made on the
Bids are made from bidder terminals 179 (called frequent lo bidder terminal 1796 by one or several frequent flyers. The
flyer reservation terminals in FIG. 6) which may comprise system on the bidder terminal 1796 works in similar fashion
Internet terminals with keyboards as one skilled in the art lo that on ihe online bid management server 100.
would recognize. A frequent flyer member may enter a bid With reference to FIG. 7, a flow diagram illustrating a
into the online bid management system 102 through a bidder method performed by the online bid management systems
terminal 179, which transmits the bid lo the bid management 35 102 of FIG. 6 is shown. The method is for automatically
server 100. As it receives bids from bidder terminals 179, the managing Ihe auction for determining relative priority for a
online bid management system 102 priorili/£s the bids service in a system wherein priority is based on Ihe relative
periodically. The online bid management system 102 deter value of relaied bids. 'lite system is programmed inio a series
mines continuing priority for providing an ongoing service of nested loops. The outer loop, starting at step 700, com
to the frequent flyers. 40 prises a timing mechanism or procedure which limes the
Ilie relative priorities for providing the service for fre updating ofbids for a plurality frequent flyer servers 154. Al
quent flyers for their bids received from the bidder terminals step 702, the system loops through the bids for each frequeni
179 arc dependent on whether their bids exceed the value of flyer who made bids on the bid management system 102. Al
other bids. step 704, the system loops through each bid for each airline
Ilie bid management server 100 may further comprise a 45 for which bids arc submitted by the particular frequeni flyer.
database 104 comprising a relational database management The system checks for whether the frequent flyer's
system (RDBMS) 104 for storing bids and data relating to desired position is met for determining seating priority for a
the service provided to the frequent flyers. Frequent flyers particular airline, step 706. For example, the system checks
may further enlcr maximum and/or minimum bids inlo Ihe for whether the frequent flyer's bid exceeds all other bids in
bidder terminals 179. 'Ilie online bid management system 5n the auction for determining priority for preferred seating.
102 keeps track of the maximum and minimum bids for each Another example allows the bidder lo choose a desired seat,
frequent flyer who enters bids into the bidder terminals 179 such as first-class front row, and the system can determine
into RDBMS 104. 'ITie online bid management system 102 the cheapest position that can be taken for the frequent flyer
will increment Ihe lower bids until they reach desired to be given that seat selection relative to the other frequent
bidding positions entered by (he frequeni flyers as long as 55 flyers. If Ihe system finds that the frequent flyer lias achieved
the bids do not exceed maximum values entered by the the desired sealing priority with respect lo the current
respective frequent flyers. Thus, the online bid management frequent flyer reservation server 154 processed, the system
system 102 causes the relative priority for providing service may reduce the bid to a minimum which allows the frequeni
to each frequent flyer lo exceed the priority for providing flyer lo keep the desired seating priority, step 710. Other
service with respecl lo other frequeni flyers as long as the wise, the system increases ihe bid wilhoul exceeding ihe
maximum bid is mil exceeded, or until a desired position is maximum bid entered by the frequeni flyer, slep 712.
reached. The online bid management system is further The sysicm re-checks the position held by the frequent
programmed to check and incrcmenl ihe bids a plurality of flyer, step 714. If the desired position is not achieved, step
limes, pausing for a fixed period of time between each 716. Ihe system checks lo see if Iho frcquenl flyer luid sel ;i
checking and incrementing. notification flag so that the frequent flyer would be notified
For the embodiment of FIG. 6. Ihe service provided to ihe if the desired position had not been achieved, step 718. If the
users of bidder terminals 179 comprises providing ranking frequent flyer had desired to be noliiied. the frequent flyer is
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notified, step 720. Notification may be by a standard tech- dor's priority, or until a desired priority position for the first
nique such as e-mail or voice telecommunication. vendor is reached. The online bid management system is
The system checks to see if the last frequent flyer server further programmed to check and lower bids a plurality of
154 for the current frequent flyer has been checked, step 722. times, pausing for a fixed period of time between each
If the last frequent flyer server 154 has not been checked for 5 checking and lowering of bids.
the current frequent flyer, then processing moves back to For the embodiment of FIG. 8, the service provided to the
step 704. Otherwise, the system checks to see if the last users of bidder terminals 181 comprises providing ranking
frequent flyer's positions have been checked, step 726. If of priority for selling to several buyers having buyer servers
not, then processing moves back to step 702. Otherwise, the 156. On their buyer servers 154, buyers may rank the order
system checks the timing loop, in this case a quarter day, for 10 in which each buyer uses vendors who desire to sell goods
whether it is time to process all of the frequent flyers' or serves to the buyers. For example, a buyer may need to
positions again, steps 728-730. Once the timer has deter- purchase personal computers from vendors in the amount of
mined that it is time to check the frequent flyers' positions 100,000 units. Bids may be accepted for priority for buying
again, processing moves back to step 700. computers from selected vendors, the lowest biding vendor
With reference to FIG. 8, a block diagram illustrating an 15 having the opportunity to provide as many computers as that
exemplary system architecture for another embodiment of vendor can supply, with other vendors bidding more than the
the present invention for managing vendor-buyer sales is lowest bidder selling units until the full number of desired
shown. As with the embodiments shown in FIGS. 1. 4 and units have been purchased. The system may comprise a
6, the system comprises a server 100 comprising an online method for selling and purchasing in lots or groups of units
bid management system 102 for automatically managing an 20 instead of individual units for high volume sales. The online
auction. In the case with the embodiment of FIG. 8, the bid management system 102 receives minimum and maxi-
online bid management system 102 is for determining mum bids from a plurality of vendors who desire to sell
relative priority for a bids for supplying goods or services to goods or services.
vendors. One of the plurality of buyer servers 154a may be directly.
As with the server 100 of FIGS. 1, 4 and 6, the bid 25 electrically, connected to the online bid management sever
management server 100 comprises u processor electrically 100 to facilitate faster updating of ranking of bids for
connected to a network. As those skilled in the art would purchasing goods. Similarly, a vendor terminal 181a may be
recognize, the online bid management server 100 may directly electrically connected to the online bid management
comprise a standard RISC or CISC processor running the server 100 so that bids may be updated faster to the online
NT operating system by the Microsoft Corp. of Redmond, 30 bid management system 102.
Wash., or a suitable UNIX server such as an ENTERPRISE As an alternative lo having a centralized bid management
Server by Sun Microsystems of Palo Alto, Calif., or an system 102, the online bid management system 102 may be
AS400 System by the IBM Corporation, USA. stored locally on one or more vendor terminals 181/>. The
Bids are made from bidder terminals 181 (called vendor vendor terminal 1816 comprises, or is electrically connected
terminals in FIG. 8) which may comprise Internet terminals 35 to, a RDBMS 104 that keeps track of bids made on the
with keyboards as one skilled in the art would recognize. A vendor terminal 181/> by one or several vendors. The system
vendor may enter a bid into the online bid management on the vendor terminal 181A works in similar fashion to that
system 102 through a bidder terminal 181, which transmits on the online bid management server 100.
the bid to the bid management server 100. As it receives bids With reference to FIG. 9 a flow diagram illustrating a
from bidder terminals 181, the online bid management 40 method performed by the online bid management systems
system 102 prioritizes the bids periodically. The online bid 102 of FIG. 8 is shown. The method is for automatically
management system 102 determines continuing priority for managing the auction for determining relative priority for
the vendors' relative priority for selling goods and services vendors selling goods or services to buyers in a system
to buyers. wherein sales are based on the relative value of related bids.
'l"he relative priorities for the vendors pruviding goods or 45 'Hie system is programmed into a series of nested loops. The
services to the buyers are dependent on whether the vendors' outer loop, starting at step 900, comprises a timing mocha-
bids entered into the vendor terminals 181 are lower than nism which times the updating of bids for a plurality buyer
other vendors bids entered. servers 156. At step 902, the system loops through the
[lie bid management server 100 may further comprise a buyers for which bids for sales are made in the online bid
database 104 comprising a relational database management so management system 102. At step 904, the system loops
system (RDBMS) 104 for storing bids and data relating to through each bid for each vendor who submitted bids for
the goods or services to be provided lo the buyers. Vendors sales to the buyers.
may further enter minimum and/or maximum bids into the The system checks lor whether the vendor's desired
bidder terminals 181. The online bid management system position is met for determining sales priority for a particular
102 keeps track of the minimum and maximum bids for each 55 buyer, step 906. For example, the system checks for whether
of the vendors who enter bids into the bidder terminals 181 the vendor's bid is lower than all other bids in the auction for
into RDBMS 104. The online bid management system 102 determining priority for selling computers. Another example
will start with the maximum bid from each vendor and allows the vendor to choose a desired sales position, such as
increment the higher bids until they reach desired bidding third in line for sales priority, and the system can determine
positions entered by the vendors as long as the bids do not 60 the maximum that the vendor's hid can be to obtain the third
fall below the minimum values entered by the respective priority position. If the system finds that the vendor has
vendors. Thus, the online bid management system 102 achieved the desired selling position with respect lo the
causes the relative priority for a first vendor's selling of buyer server 156 being processed, the system may increase
goods or services tu a buyer lo change with respect to the the bid to ;i maximum which allous the bidder lo keep Ihe
priority for a second vendor's priority for selling of goods 65 desired sales priority, step 910. Otherwise, ihe system
and services to the buyer by lowering the first vendor's bid decreases the bid without lowering the bid below the inini-
unlil the priority for. fust vendor exceeds the second ven- mum bid entered by the vendor, step 912.
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The system re-checks the position held by the vendor, step is sophisticated version of the bid adjustment rules described
914. If the desired position is not achieved, step 916, the with respect to FIGS. 1-3. Rather than simply setting mini-
system checks to see if the vendor had set a notification flag mum and maximum bids, the bids, and possibly the mini-
so that the vendor would be notified if the desired position mum and maximum bids, arc dynamically adjusted accord-
had not been achieved, step 918. If the vendor had desired 5 ing to current inventory levels on each product,
to be notified, the vendor is notified, step 920. Notification With reference to FIG. 11, a block diagram illustrating an
may be by a standard technique such as e-mail. exemplary system architecture for the presently described
The system checks to sec if the last vendor the current embodiment for managing vendor-online store listing prior-
buyer server 156 has been checked, step 922. If the last ity is shown. As with the embodiments shown in FIGS. 1,4,
vendor has not been checked for the current buyer server to 6 and 8, the system comprises a server 100 comprising an
1S6, then processing moves back to step 904. Otherwise, Ihe online bid management system 102 for automatically man-
system checks to sec the last buyer server 156 has been aging an auction. In the case with the embodiment of FIG.
processed, step 924. If not. then processing moves back to 11, the online bid management system 102 is for detennin-
step 902. Otherwise, Ihe system checks the timing loop, in ing relative priority for bids for listing products in online
this case each day, for whether it is lime to process all of the i 5 stores for vendors.
vendors' positions again, steps 928-930. Once the timer has As with the server 100 of FIGS. 1, 4, 6 and 8, the bid
determined that it is lime to check the vendors' positions management server 100 comprises a processor electrically
again, processing moves back to step 900. connected to a network. As those skilled in the art would
With reference to FIG. 10, a flow diagram illustrating the recognize, the online bid management server 100 may
steps performed by a buyer server 156 is shown. The buyer 20 comprise a standard RISC or CISC processor running Ihe
first places an order, step 1002. Placing an order may NT operating system by the Microsoft Corp. of Redmond,
comprise sending a broadcast message onto the world-wide- Wash., or a suitable UNIX server such as an KNTKRPRISK
web 130 (FIGS. 1,4,6 and 8), or by sending mail to vendors. Server by Sun Microsystems of Palo Alto, Calif., or an
or e-mail to several vendors. If the order is performed by AS400 System by the IBM Corporation, USA.
e-mail, then the vendors may view the e-mail on their 25 Product inventories arc entered into vendor terminals 183
respective vendor terminals 181. which may comprise Internet terminals with keyboards as
The buyer receives the current bids placed by the vendors. one skilled in the art would recognize. A vendor enters
step 1004. Step 1004 may comprise retrieving the bids from product inventories for its products listed in online stores
the RDBMS 104, or retrieving bids received on a regular 158 into the online bid management system 102 through a
bases from one ur more online bid management systems 10 vendor terminal 183, which transmits Ihe product inventory
102. data to the bid management server 100. As it receives
The buyer server 156 accesses the vendor bid record product inventories from the vendor terminals 183, the
having the highest priority, step 1008. The buyer server 156 online bid management system 102 checks product inven-
executes a program loop 10 purchase all needed products or lories periodically. Based on the inventory data, the online
services, step 1010. The buyer server 156 attempts to order 35 bid management system 102 determines proper bids for
as many products as possible from the current vendor, step maintaining listing priority for the vendor's products in the
1012, which is the vendor with the highest priority on the online stores 158.
first run through the loop. The system checks to see if the The relative priority lor listing each of a vendor's prod-
buyer's order has been completely filled, step 1014. If the ucts in online stores is dependent on whether the inventory
whole order could not be filled with the current vendor, the 40 for each product is higher with respect the vendor's other
buyer server 156 accesses Ihe next vendor record having the products.
next highest priority, and processing moves back to step The bid management server 100 may further comprise a
1010. Otherwise, if the whole order was able to be filled with database 104 comprising a relational database management
the current vendor, then processing of the order ends, step system (RDRMS) 104 for staring bids for (he product
1016. 45 listings and corresponding data relating to i nventory data for
Another embodiment of the present invention is one the corresponding products. Vendors may further enter mini-
related to e-commerce or online stores. This embodiment mum and/or maximum bids into the bidder terminals 183.
allows vendors to bid for positions within a category of an The inventory data is stored and updated periodically, e.g.
online store. In previous systems, a user accesses an e-com- monthly, for each product each vendor is selling in each
mercc web site such as BUY.COM and searches for 50 online store. For each vendor, the online bid management
"modems." In typical e-commerce web sites, also called system 102 measures relative inventories for each of the
online stores, the results listings that the user views after vendor's products. For those products which have higher
submitting the search comprises hundreds of modems from relative inventories, the bid management system 102 incre-
dozens of different vendors. Typically, the list is arranged in ments the bids higher to reach higher listing positions as
cither alphabetical order or according to price. 55 long as the bids do not exceed the maximum values entered
With the system of the present invention, vendors can bid by the respective vendor. Thus, the online bid management
for their individual products to be listed at the top of the system 102 causes the relative priority tor listing the high
search results (on a product-by-product basis), in the same inventory products to increase until a higher sales cause the
way as bidders bid for positions in the embodiment of FIGS. inventory to drop with respect to the vendor's other prod-
1-3. The vendor's inventory system is connected to lite hid en ucls. As inventory lowers fora product, then lite bids for the
management system 102. As inventory levels rise for a product are steadily decreased to lower Ihe product's listing
particular product, the inventor)' system feeds that data into orders in the online stores. The online bid management
Ihe bid management system 102, which automatically system is further progr;immcd lo check inventories a plu-
increases bids for that product in an attempt to unload excess rality of limes, pausing fur :i fixed period of lime between
inventory. As inventory levels fall, the opposite process as each checking of inventories
occurs. Bids are reduced to avoid over-promoting a product One of the plurality ol online stores 158a may be directly,
thai has low inventory levels. Hssentially, this embodiment electrically, connected to the online bid management sever
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100 to facilitate faster updating of ranking of bids for listing What is claimed is:
products. Similarly, a vendor terminal 183a may be directly 1. A method for automatically managing an auction for
electrically connected to the online bid management server determining relative priority for a service in a system
100 so inventories may be updated faster to the online bid wherein priority is based on the relative value of related
management system 102. s bids, comprising:
As an alternative to having a centralized bid management receiving bid management data from a first bidder for
system 102, the online bid management system 102 may be managing bidding by the first bidder in the auction, the
stored locally on one or more vendor terminals 183A. 'lite auction having at least two or more positions of prior
vendor terminal 1836 comprises, or is electrically connected ity, the received bid management data including infor
to, a ROBMS 104 which keeps track of inventories for one >° mation for selecting one of the two or more positions of
or several vendors. The system on the vendor terminal 1836 priority that the first bidder wishes to maintain in the
works in similar fashion to that on the online bid manage auction;
ment server 100. checking for if a second bidder holds the selected position
With reference to FIG. 12 a flow diagram illustrating a of priority, and
method performed by the online bid management systems ' * checking for whether a first bid from the lirst bidder
102 of FIG. 11 is shown. The method is for automatically exceeds a second bid from the second bidder in the
managing an auction for determining relative priority for auction for determining continuing priority for provid
listing products in a system wherein listing order is based on ing an ongoing service for the first and second bidder,
the relative value of related bids. The system is programmed wherein Ihe relative position of priority for providing
into a series of nested loops. I "he outer loop, slurring at step 20 the service for the first bidder is dependent on whether
1200, comprises a timing mechanism which times the updat the value of Ihe first bid exceeds the value of the second
ing ofbids fora plurality online stores 158. At step 1202, the bid, and wherein the relative position of priority for
system loops through the vendors having products tracked in providing the service for the second bidder is depen
the online bid management system 102. At step 1204, the dent on whether the value of the second bid exceeds the
system loops through each product for the current vendor. :5 value of the first bid;
The system checks for whether the product has a high according to the bid management data received from the
inventory with respect to the other vendor's products, step first bidder, automatically incrementing the first bid to
1208. If the product is found to have a high inventory, then a value exceeding the second bid if the first bid does not
the processing moves to step 1208 where the system sets a exceed the second bid, to thereby maintain the selected
loop to adjust bids in each online store for the product. The Vl position ofpriority for providing ihe service forthe first
bid is increased to give the product a higher listing priority, bidder,
step 1210 without exceeding the maximum bid. Alterna checking for whether the first bid is higher than needed to
tively, the system may adjust the maximum bid for listing maintain the selected position of priority that the first
the product in the online store in step 1210. The bid bidder wishes lo maintain in the auction, and
management system 102 checks for whether the last online 35 if the first bid is higher than needed to maintain the
store has been processed for Ihe product, step 1212. If Ihe selected position of priority that the first bidder wishes
last online store has not been processed, then processing to maintain in the auction, automatically reducing the
moves back to step 1208. first bid lo a minimum which allows the bidder lo keep
If the product was found to not have a high inventory in 40 the selected position of priority.
step 1206 relative to other products, then the system sets a 2. The method of claim 1, further comprising executing
loop through each online store listing the product, step 1214. Ihe steps of checking and incrementing a plurality of times.
For each online store, the bid is lowered for the product in 3. The method of claim 2, further comprising pausing for
order to lower the priority of listing for the product, step a fixed period of time between each series of steps of
1216. The bid management system 102 checks for whether 4S checking and incrementing.
Ihe last online store has been processed for the product, step 4. The method of claim 3, wherein the service lo bidders
1218. If the last online store has not been processed, then comprises providing ranking of hypertext links lo web pages
processing moves back to step 1214. in search results in an on-line web page search engine.
The bid management system 102 checks for whether the 5. The method of claim 4. wherein the ranking of a firM
last product for the current vendor has been processed, step so hypertext link lo a first web page for the first bidder is higher
1220. If not, then processing moves back to step 1204. than the ranking of a second hypertext link lo a second web
Otherwise, the system checks for whether the last vendor has page for the second bidder if the first bid is higher than the
been processed, step 1222. If not, then processing moves second bid.
back to step 1202. Otherwise, the system checks the timing 6. The method of claim 5. comprising placing bids on a
loop, in (his case each month, for whether it is time to S5 plurality of search terms which may be typed into Ihe search
process all of the vendors' product inventors again, steps engine by search engine users wherein different ranking is
1224-1226. Once the timer has determined that it is time to determined for each search term.
check the vendors' inventories again, processing moves 7. The method of claim 6. wherein the ranking of the first
back to step 1200. hypertext link is higher than the second hypertext link if Ihe
It will thus be seen that the objects set forth above, among 6i> first bid is higher than the second bid for each of the plurality
those made apparent from the preceding description, are of search terms.
provided and, since changes may be made in carrying out the 8. 'Hie method of claim 7. wherein the step of checking
above system and method and in the construction set forth and incrementing is executed for a plurality of search
without departing from Ihe spirit and scope of the invention, engines for a plurality of search terms.
it is intended that any and all matter contained in the above 65 9. The method of claim 1 wherein Ihe service 10 bidders
description and shown in the accompanying drawings shall comprises providing ranking of priority for golf course
be interpreted as illustrative and not in a limiting sense. tee-oil limes on one or several golf courses.
Case 2:07-cv-00582-WDK-TEM Document 1 Filed 12/13/2007 Page 26 of 26

US 7,225,151 Bl
15 16
10. The method of claim 1 wherein the service to bidders 13. The system of claim 12. wherein the processor is
comprises providing ranking of priority for airline rcserva- further for pausing for a fixed period of time between each
tions an one or several airlines. checking and incrementing of the first bid.
11. A system for automatically managing an auction for 14. The system of claim 13, wherein the service to bidders
determining relative priority for a service in a system 5 comprises providing ranking of hypertext links to web pages
wherein priority is based on the relative value of related in search results in an on-line web page search engine stored
bids, comprising: on the server.
an input device for receiving bid management data from IS. The system of claim 14, wherein the server is further
a first bidder for managing bidding by the first bidder for ranking of a first hypertext link to a first web page for the
in the auction, the auction having at least two or more 10 first bidder higher than the ranking of a second hypertext
positions of priority, the received bid management data link to a second web page for the second bidder if the first
including selected one of the two or more positions of bid is higher than the second bid.
priority that the first bidder wishes to maintain in the 16. The system of claim 15. wherein the processor is
auction; further for placing bids on a plurality of search terms which
a processor electrically connected to a network for check- 1s may be typed into the search engine by search engine users
ing for if a second bidder holds the selected position of wherein different ranking is determined for each search
priority, and for checking for whether a first bid from term.
the first bidder exceeds a second bid from a second n. The system of claim 16. wherein the server is further
bidder in the auction for determining continuing prior- for senjng lne ranking of the first hypertext link higher than
ity on a server electrically connected to the network for 20 ,ne second hypertext link in a search result if the first bid is
providing an ongoing service for the first and second higher than the second bid for each of the plurality of search
bidder, wherein the relative position of priority for terms.
providing the service for the first bidder is dependent lgThe ^n ofclaim ,7< furthercomprisinga pluralil>.
on whether the value of the first bid exceeds the value of servcR electrically connected to the network,
of the second bid, and wherein the relative position of 25 ,9 ^ m ofclaim ,g ^^ K- a lurali
pnontyft.rpmvidmglhesemceforthesea.ndbulder of search engines on the plurality of servers,
is dependent on whether the value of the second bid ,A-n.. ri •.«■_• L
exceeds the value of the first bid, and for automatically . *»■ ™e s?sl™ of 'lalm 19< whercm. **.. P™?™T"
incrementing the first bid according to the bid manage- fijrther lor checkmg and increment.ng a plurality of bids lor
men. data received from die firsT bidder to a value m ^ fort bidder on theplurality of search enguies.
exceeding the second bid ifdie first bid does not exceed 21-The system of claim 11 wherein the service to^dders
the second bid, to thereby maintain the selected posi- "^prises providmg ranking of priority for golf course
tion of priority- for providing the service for the first lee-°ff lunes on one or several »olf courses-
bidder; and 22- "lc syslcm ofclaim 11 wherein the service to bidders
a database electrically connected to the processor for 35 comprises providing ranking of priority for airline reserva-
storing the first and second bids; lions on one »r sevcnl1 airlincs-
the processor farther for checking for whether the first bid 23. The method or claim 1. further comprising executing
is higher than needed to maintain the selected position » plurality of times the step of automatically reducing the
of priority that the first bidder wishes to maintain in the first bid Io a minimum which allows the bidder to keep the
auction, -to selected position of priority if the first bid exceeds a value
the processor further for automatically reducing the first needed to maintain the selected position of priority,
bid to a minimum which allows the bidder to keep the 24. The system of claim 11. wherein the processor is for
selected position of priority if the first bid is higher than furlher for automatically reducing the first bid a plurality of
needed to maintain the selected position of priority that <imcs to a minimum which allows the bidder to keep the
the first bidder wishes to maintain in the auction. 4< selected position of priority if the first bid exceeds a value
12. The system of claim 11. wherein the processor is needed to maintain tlie selected position of priority,
further for checking and incrementing the first bid a plurality
of times. « « • • »

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