Amazon ordered to pay $525million to tiny Chicago-based software company Kove for infringing cloud storage patents in David vs Goliath court fight

Amazon has been ordered to pay a tiny Chicago-based tech company $525million in patent infringement damages in a David vs Goliath cloud storage court fight. 

Kove, which has around 20 employees vs Amazon Web Service's 136,000, claimed in 2018 court filings that the tech giant had used three of its patents as 'building blocks' for its hugely profitable cloud storage service. 

Yesterday, a jury agreed and awarded the smaller company over half a billion dollars in damages. 

Amazon has since vowed to appeal the ruling. 

Amazon founder Jeff Bezos, the world's second richest man, with fiancée Lauren Sanchez at the White House on April 10

Kove, the Chicago-based company, operates out of an office in this Chicago warehouse 

The jury determined that AWS infringed three Kove patents covering technology that Kove said had become 'essential' to the ability of Amazon's cloud-computing arm to 'store and retrieve massive amounts of data.'

Representatives for Amazon did not immediately respond to a request for comment on the verdict.

Kove CEO John Overton

Kove's lead attorney Courtland Reichman called the verdict 'a testament to the power of innovation and the importance of protecting IP rights for start-up companies against tech giants.'

Chicago-based Kove sued Amazon in the U.S. District Court for the Northern District of Illinois in 2018. 

The company said in the lawsuit that it pioneered technology enabling high-performance cloud storage 'years before the advent of the cloud.'

Kove alleged that AWS' Amazon S3 storage service, DynamoDB database service and other products infringed the cloud-storage patents. 

The jury agreed with Kove on Wednesday that AWS infringed all three Kove patents at issue, though it rejected Kove's contention that AWS violated its rights willfully.

AWS had denied the allegations and argued that the patents were invalid.

Amazon Web Services is one of the company's strongest sources of revenue, bringing in $88billion in 2023