ClickFunnels vs. GoHighLevel Lawsuit: A Lesson in US Patent Infringement and Ethics
Have you heard the news?
So, ClickFunnels is suing GoHighLevel over patent infringement!
Since the language in the original Complaint is quite legal and a little complicated for a common marketer to grasp, we’ve turned to different sources to investigate the issue further.
Let’s see what this lawsuit is all about.
In the Ring: ClickFunnels and GoHighLevel
In one corner, we have ClickFunnels, established in 2014, and a household name in digital marketing today. Their founding idea was to make funnel building as easy as possible, and the software enabling the creation of sales funnels remains their largest product to date. Over time, they’ve expanded their offer by adding website and landing page builders, integrated email marketing options, and other digital products. It’s a big company worth hundreds of millions of dollars.
In the other corner, we find GoHighLevel, a relative newcomer to the scene that has gained serious momentum over the past couple of years. Founded in 2018, HighLevel LLC (GHL’s legal name) is a cross-functional marketing software platform with a broad offer of digital products, including CRM, website and landing page builder, email marketing software, social media marketing management options, and, apparently, a sales funnel builder.
As you can see, the two platforms have a sizeable overlap in their offers, and in this case, the problematic one is the funnel builder. The Complaint concerns the funnel-building principle they allegedly both use, with ClickFunnels claiming the method is theirs alone.
You may be wondering how you can sue someone for building a sales funnel. Let’s look at the current lawsuit to find out.
ClickFunnels: The Funnel is Mine. See You in Court!
The official Complaint for Patent Infringement states that ClickFunnels is suing HighLevel LLC over the unlawful use of the U.S. Patent No. 10,846,357 (the “’357 Patent”) titled “Website Creation System for Creating Websites Having at Least One Series of Directional Webpages and Related Methods” the plaintiff legally owns. They claim ClickFunnels suffered damages and request GoHighLevel to pay them or, at a minimum, to pay for the royalties for using the patent in question.
Apparently, a chart is attached to the Complaint demonstrating HighLevel’s infringement, which we don’t have access to.
In short, ClickFunnels is saying that GoHighLevel is using their way of building sales funnels and wants them to stop and pay damages or at least royalties for what they’ve used.
Seemingly small, this complaint sparked a growing discussion in digital marketing, with two questions resonating the loudest:
- Owning a funnel? How is this possible?
- What does this mean for the future of digital marketing?
Let’s try and unpack them one by one.
Is It Possible to Own the Idea of a Sales Funnel?
The logic would tell you — it’s not.
However, ClickFunnels has registered the funnel-building principle under US law. So, it’s definitely legal.
To be fair, the patent itself does not mention the word “funnel.” It’s called a “Website creation system for creating websites having at least one series of directional webpages and related methods,” which is a rather broad and vague definition that can also include website or landing page builders.
It’s good to know that it’s also possible and legal to challenge a patent issued by the USPTO by filing a request for its reexamination.
If you observe the lawsuit alone, as a non-lawyer, it appears as if ClickFunnels protected the very concept of the funnel and is going after the competition.
This is allowed in the US legal system, but according to well-known industry lawyer Peter Hoppenfeld, “Chances are the whole patent idea is gonna be tightly examined [in the course of this lawsuit].”
As you can imagine, the lawsuit created a lot of buzz around the web and incited a lot of speculation.
We like to stick to the facts, but we cannot overlook the comments coming from different sides of the digital world or the potential consequences of the plaintiff’s bold claim.
What Could ClickFunnel’s Lawsuit Against GoHighLevel Mean for Digital Marketers?
Being still early in the process, we cannot say how the lawsuit will be resolved. In an informative YouTube video by Ryan Lee, expert lawyer Peter Hoppenfeld explained that it would not be unusual for the case to settle before arriving at court. He also pointed out the importance of royalties mentioned in the Complaint as a point where the case might settle, but he underscored that the proceedings are still in the early stages, and we cannot conclude much at this point.
This lawsuit is likely to open a broader discussion on what you can and cannot patent, especially in the digital world. It will also definitely raise awareness about patent and copyright infringement, as there are “many copycats” out there, to quote the law expert mentioned.
Should ClickFunnel’s Complaint succeed in court or receive an expected settlement, the most problematic outcomes could include the potential for the plaintiff to sue other competitors offering sales funnels as their product and the implication that any method or principle widely known and used in the digital marketing industry could be patented and protected by any company on a first-come, first-served basis.
While the financial benefits the claimant would receive are substantial, the latter potential outcome is a much bigger problem for everyone, primarily from an ethical standpoint.
Is it Ethical to Own the Concept of a Funnel?
Although it is legal, we question the morality behind ClickFunnels’ patent. To help put things into perspective, we’ve turned to comments from industry folk.
Relevant online sources, such as the Sell Your Service YouTube channel, say ClickFunnels have initially built a part of their platform with open-source software. Further, the company hosts the Funnel Hacking Live International event, offering funnel training where elements of successful funnels are integrated into their funnel-building process.
Apparently, they were also not the first to use a sales funnel — LeadPages was there before them, and companies such as ThriveCart, Zen Cart, Shopify, Wix, Squarespace, and many other e-commerce and online companies have website and funnel builders.
Does this mean ClickFunnels can go after each of them if they win?
Another fact is that ClickFunnels is coming hard at GoHighLevel, which may be read as a fear of competition but is equally problematic. They’re a big and well-funded company turning against a much smaller competitor right after GHL received a significant round of funding.
In all fairness, GoHighLevel did enable their users to replicate theClickFunnels-based funnels within their platform, thus dragging away a significant number of the plaintiff’s customers. As a competitor, they have the right to fight for customers, but whether they were just regarding the technical part — an investigation will discover.
Be as it may, people around the web are calling out ClickFunnels and its founder Russell Brunson for hypocrisy, waiting to see what will happen next. Check out a couple of comments below.
Where Does Campaign Refinery Stand
We think everyone should operate under the law.
Problems arise when there are loopholes.
We also know there are lawyers who base their business on class action lawsuits only to settle and make money.
So, at this time, we cannot have a clear say, but in terms of fairness in business — we firmly believe in fair competition and transparency.
That’s why we aren’t afraid to share our knowledge on email and deliverability — the more people follow best practices, the better!
You can download The Inbox Formula, a simple and clean guide to top deliverability.
We use these methods on our platform, and we know they work.
You can try them out too!
But we can help you can get the best results much, much faster.
In the meantime, we’ll keep our eyes peeled for more news on the ClickFunnels and GoHighLevel lawsuit.
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