This Is Really A Wonderful Australian Software Story! Pity About The Trolls

This appeared a few days ago:

Patent ‘trolls’ come for Canva as it prepares for share sales

Amelia McGuire Business reporter

Jun 22, 2025 – 8.00pm

Canva is being targeted by a Canadian serial litigant alleging the Australian design software giant has stolen its patents for an artificial intelligence voice generator that is now integrated into its platform.

Cedar Lane Technologies has made similar claims against hundreds of companies over the last five years including Amazon, Zoom and Huawei. Its lawyer, Isaac Rabicoff, has lodged separate patent claims against Canva in Texas on behalf of other companies over the last two months.

While Cedar Lane is regarded as a nuisance litigator – a California court found it had made “objectively frivolous and misleading arguments in defending their defective filings” in 2020 – it has had remarkable success in squeezing settlements and payments out of Silicon Valley giants.

The litigation comes as Canva rolls out a suite of AI tools, making a number of significant acquisitions in a bid to bolster its design software platform and attract more paying users. Last week, Canva said 25 million people or a 10th of its users were now paying, an increase of 5 million since September.

An increase in paying users is key for the company as it prepares for a long-awaited float. Canva confirmed on Sunday that it would facilitate a sale of employee and founder shares at the end of the year, as first revealed by The Australian Financial Review’s Street Talk column last week.

Secondary share sales are popular with mature private tech firms because they allow employees and investors to cash out instead of waiting for a public listing. Potential investors have been told the sale would amount to up to $US500 million ($773 million) worth of shares and would value Canva at $US37 billion, The Information reported at the weekend.

Canva’s peak valuation was $US40 billion at the height of the tech bubble in 2021, when interest rates were near zero and there was a lot of capital flowing into tech start-ups. Canva’s last share sale was in October when it said it had increased its valuation by $US6 billion to $US32 billon.

While Canva has not committed to a float, co-founder Cameron Adams said last week the company had been “IPO ready” for a long time. “It’ll happen when it makes sense but we’re not any closer to firming it up,” he said.

Canva’s platform is used for everything from marketing and sales presentations to educational audiobooks and YouTube clips, and the platform’s voice generator lets users add audio to projects using an AI-powered tool that draws from hundreds of voices.

In a five-page filing lodged with the District Court in Texas earlier this month, Cedar Lane claimed that Canva’s AI voice generator used the company’s “system, method and apparatus” for generating audio,

In response, Canva said the claims were baseless and “strongly opposed” them. “This kind of litigation misuses laws intended to support genuine creativity, instead using them to pressure companies into a quick settlement,” a Canva spokesman said. “Allowing actions like this to go unchallenged risks normalising a damaging trend across the broader industry, and we intend to vigorously defend ourselves.”

Patent litigation has been booming in the United States, often brought by companies with little public information disclosed.

Intel, for instance, was sued by VLSI Technologies in 2019, a semiconductor producer that has actually been defunct for decades. The new VLSI business, according to the Wall Street Journal, is backed by a New York-headquartered hedge fund, and tied up Intel in years of litigation.

Cedar Lane has been described in congressional hearings as a business whose main source of revenue is suing larger companies, a practice known as patent assertion. Such businesses are known by detractors as “patent trolls”.

Another of the firms suing Canva in the Texas courts, Hyperquery, has a similar business to Cedar Lane. In one week alone earlier this year, it launched litigation against another Australian-headquartered software giant, Atlassian, along with ByteDance and Sony. It is also suing Xero, the ASX-listed cloud-based accounting software business.

Here is the link:

https://www.afr.com/technology/patent-trolls-come-for-canva-as-it-prepares-for-share-sales-20250622-p5m9bg

I suppose these sort of commercial attempts at profiting on others hard work is just inevitable as in other areas of endeavour!

Sad that, but Canva is a great Australian story!

David.