Coupon Sites Continue Battling on Multiple Fronts

You most likely didn’t notice, but the coupon-finding browser extension Honey quietly changed its tagline recently, from “Honey will find every working promo code on the Internet” to “Honey automatically looks for every coupon code.” It’s a subtle change, but a notable one, that traces back to a dispute that’s been going on for more than two years – and shows no signs of ending any time soon.

Honey and the coupon code site RetailMeNot have been embroiled in a multi-front legal battle that began with a single lawsuit in 2018 and has since escalated to additional claims, counterclaims, new patents, challenged patents, and a complaint to an industry advertising group. The litigation and patent disputes involve complicated technical arguments about how coupon codes are physically applied online. The advertising dispute was much more straightforward – could Honey really claim to find every coupon code in existence, thereby implying that other coupon sites can’t?

If you’ve ever tried searching for a working coupon code online, you know that no coupon aggregator is perfect. Many sites list expired or otherwise non-working codes, and many don’t include codes that other sites might offer. So for one coupon aggregator to promise that it will find every single coupon in existence is a pretty bold claim.

That’s what prompted RetailMeNot to file a challenge last month with the National Advertising Division, the advertising industry’s self-regulation system. RetailMeNot argued that Honey’s claim implies that “without exception, Honey offers its users access to every single working promo code that is available on the internet – including codes offered on an exclusive basis by RetailMeNot.com or other online businesses.” In addition, RetailMeNot said the claim implies that “consumers need never look elsewhere to find separate, relevant codes.”

Before the NAD could dig into the dispute, though, Honey decided to change its tagline. In announcing the outcome of RetailMeNot’s challenge, the NAD said Honey “agreed to permanently discontinue the challenged claims,” without admitting any wrongdoing. And, in what may or may not have been a complete and unrelated coincidence, Honey said “it was in the process of discontinuing the challenged claims for business reasons” anyway.

So the NAD has closed the case. But that doesn’t mean these two coupon competitors are burying the hatchet, because the NAD complaint was only the newest front in this ongoing battle.

RetailMeNot’s 2018 lawsuit claimed that Honey was violating several RetailMeNot patents. The patents relate to a method in which a coupon code is automatically applied on a retailer’s site, after clicking on a deal on RetailMeNot’s website. It may seem like a straightforward process to the layman, but it’s actually a complicated technical process – hence the patents, RetailMeNot argued, and hence its efforts to defend those patented processes against anyone who might use them without authorization.

“These valuable patents protect RetailMeNot’s pioneering developments in computer-related technologies, and Honey’s unauthorized use of them enables key features of Honey’s website and browser extensions,” RetailMeNot explained at the time.

Honey responded to the lawsuit by challenging RetailMeNot’s patents as invalid. Then it filed its own patent applications, which RetailMeNot subsequently challenged. RetailMeNot then filed a second lawsuit, claiming that Honey was violating additional RetailMeNot patents, to which Honey responded with counterclaims of its own.

With the tentative trial date for the now-merged lawsuits not until March 2022, you can likely expect this heated dispute to continue playing out on multiple fronts, for some time to come. The judge noted earlier this year that the two parties have already “produced hundreds of thousands of pages of documents” in their efforts to make their case.

Further complicating matters, PayPal acquired Honey late last year, and soon afterward, filed its own lawsuit against RetailMeNot alleging violations of still more patents now owned by PayPal. By violating those patents, PayPal’s lawsuit argued, “RetailMeNot unfairly competes with the Honey platform and, therefore, with PayPal.”

PayPal paid a cool $4 billion for Honey. And a year before filing the initial shot in this dispute, RetailMeNot was acquired by Harland Clarke Holdings, the owner of RedPlum publisher Valassis, for a more modest but still impressive $630 million. So there’s big money at stake – in this long and complicated battle to determine who’s best at saving money for you.