Suit Settled, eBay and Tumbleweed Target Online Security

Tumbleweed Communications Corp. hopes to move forward with eBay Inc. and its PayPal person-to-person transaction unit on solutions for online transaction and e-mail security issues now that the companies have settled patent-infringement lawsuits Tumbleweed initiated in May and September 2002. In the suits, filed originally against PayPal and then against eBay when the online auctioneer bought PayPal, Tumbleweed alleged that PayPal's use of personalized e-mail notifications to payees violated patents Tumbleweed holds on that technology. The technology allows e-mail recipients to use a link embedded in the e-mail to go to a secure, unique site to view or verify information, such as payment amounts. In the settlement announced yesterday, eBay and Tumbleweed agreed to dismiss the pending suit, including counterclaims by eBay, and to license patented technologies from each other. EBay also announced it would like to work with Tumbleweed on e-commerce security technology. Tumbleweed is an organizer of the recently formed Anti-phishing Working Group, an industry group whose members hope to combat the phishing phenomenon through the exchange of information and the setting of standards for solutions. “We're hoping eBay will join,” says Timothy Conley, chief financial officer for Tumbleweed. In phishing schemes, criminals send e-mails with the logos and other identifying information of legitimate financial-service firms, hoping to con recipients into giving up account-authentication data such as passwords. Such e-mail attacks increased markedly during the recent holiday shopping season. Publicly held Tumbleweed, based in Redwood City, Calif., offers among its products e-mail firewalls and file-transfer systems used by financial-service firms to secure the transmission of check images and automated clearinghouse transactions over the Internet.