BTG, the privatised former British Technology Group, is suing online retailers Amazon.com and BarnesandNoble.com over their use of online marketing technology that the UK firm says it owns.
The way online booksellers track their internet advertising and work out which advertisements direct the most traffic to sites such as Amazon is breaching the terms of two patents owned by BTG, the company alleges.
BTG takes technology from universities and companies and tries to commercialise it. It obtained the patents for a system to monitor marketing from an American firm, Infonautics, in 2002.
"The technology allows Amazon to measure the effectiveness of its ad campaigns," said a BTG spokesman. "It's quite valuable to them in terms of their business processes."
BTG had tried to strike a deal with the firms to license the intellectual property but could not agree terms. The lawsuit was filed in a court in Delaware and names two other small firms, Netflix and Overstock.com.
BTG is seeking an injunction against the future use of the technology. It has not revealed the amount of the damages it is seeking, but a spokesman said the amount was large enough to be significant to the business. It says it hopes the issue will be resolved quickly and suggests it may be settled out of court.
This is the second time this year that the company - which is valued at £207m on the stock market - has sued large American multinationals. It launched a lawsuit against Microsoft and Apple over technology that controls the way firms launch pop-up ads to give information about software upgrades. BTG said this litigation is likely to take several years.
BTG was privatised in 1992 and floated in 1995. It is the product of the merged government agencies, the National Enterprise Board and the National Research and Development Council.
The latter has a history dating back more than 50 years. Since privatisation the company has only once made a profit and that was less than £1m.
BTG suffered a setback last year when its Varisolve treatment for varicose veins was held up by American regulators.
Amazon said it did not comment on pending litigation. Barnes & Noble did not return calls for comment.
BTG shares rose 3% to close at 140p yesterday.
