11.13.08

Patents Roundup: Microsoft, re Bilski and Reform

Posted in America, Asia, Bill Gates, Law, Microsoft, Patents at 9:03 am by Dr. Roy Schestowitz

Software Patents Turn Against Microsoft, United States

ONE week ago we showed two things: 1) Microsoft’s apparent disregard for prior art; and 2) the lawsuit that hit Windows Vista. It did not bode well for Microsoft, whose policy on patent is — quite frankly — becoming somewhat of a joke in the blogosphere and even some media circles. It makes patents as a whole look like a circus.

Microsoft Employee Admits That Patent Disclosure Is A Myth

Defenders of the patent system quite frequently point out that one of the main benefits (some claim the only benefit) of the patent system is “disclosure.” That is, because the patent system requires you to disclose your patent, the patent system is quite helpful in spreading ideas. This is a myth that’s easily debunked on a few points.

This Microsoft employee has ironically enough been the person to get the myth dismissed. It has always been said that disclosure seems better on paper than in practice and here we have a testimonial.

The patent lawsuit that came from China is now being covered by The Inquirer.

A CHINESE Internet company has sued Microsoft for patent infringement over its use of RSS* in Windows Vista.

What goes around comes around… and bites those who are greedy in the rear. Glyn Moody goes a step further and suggests that this intellectual monopolies regime might have an effect at an international level.

In the 19th century, America was a by-word for piracy of British ideas. In the 20th century, as its industry developed, it embraced intellectual monopolies, and became the most fervent advocate of maximalist legal regimes.

In the 20th century, China was a by-word for piracy of American ideas. In the 21st century, as its industry developed, it embraced intellectual monopolies, and became their stoutest defender. The news story above is but the trickle that presages the torrent.

Soon, America will be deluged with such suits, as China tries to leverage its huge industrial power. The consequence? America will become one of the most fervent advocates for *minimalist* intellectual property regimes. Yes, you read that correctly: just wait.

Microsoft’s (or Bill Gates’) participatory role and investment in a massive patent-trolling firm seems to be confirmed by one publication which suggests Microsoft is among the funding sources, not just Bill Gates (at a personal capacity). Here is an interesting observation from Matt Asay.

Of more concern was the TechFlash’s news that Bill Gates, Craig Mundie, and other top current and past Microsoft officials make a regular pilgrimage to the patent troll, Intellectual Ventures, to feed it ideas which it turns into patents. Regardless of what one thinks about patents, shouldn’t Microsoft be feeding itself with patents, not another company? In other words, shouldn’t it be the patent troll?

Microsoft is better off feeding shells, which cannot be counter-sued. The system is structured such that it permits trolls to exploit it endlessly (unless or until the system gets mended). An old myth spread by Bill Gates is that patents are alright because all the large companies can cross-license and live happily (never mind small businesses and the waste of time that patent applications are). Well, it doesn’t compute anymore, does it? Further, says Asay:

Patents are short-term monopolies (20 years) designed to give inventors sufficient time in which to recoup their R&D costs and turn a profit. Open source turns the 20-year patent term into two years, if that. As a relentless, ever-growing competitior, open source keeps the proprietary world in check and on its toes to a degree that the industry has never before seen.

Reform: The Sooner the, Better

BusinessWeek, a somewhat notorious ‘Wintel’ publication that forbids linking to it (!!), is now entertaining an article that accuses the Patent Office of stifling innovation rather than promoting it.

Patent Office Stifles Innovation

Information Age innovators need not apply. At least that’s the implied message being stretched like police tape across the door of the U.S. Patent & Trademark Office (USPTO). The agency seems fixated on eliminating the last, true, sustainable American advantage: our capacity to innovate.

Sign of unrest, no?

Regarding business methods patents, even Microsoft resisted them, but much like IBM, it wanted to keep software patents in tact. Groklaw tells the story.

The Microsoft brief was filed along with Dell and Symantec, and it’s an attempt to get the court to deny the Bilski claims while at the same time trying to keep the court from going all the way and deciding software should not be patentable. There are some logic bumps along the way, as you will see. The court diverged from Microsoft’s argument about three-quarters of the way through, and it didn’t directly address software patents, except in one footnote, mainly because Bilski wasn’t about software. So it left unaddressed Microsoft’s chief argument about why software should patentable, namely because of what it does to a computer.

The FSF has just put forth a press release celebrating what it calls “a victory”.

As opinions form about the extent to which the Court ruling impacts the patenting of software, one thing is clear. The State Street ruling that in 1998 opened the flood gates to the patenting of business methods and software has been gutted, if not technically overturned.

Could re Bilski help the permanent burial of software patents in India, where multi-national companies continue to rely on loopholes [1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12]?

Why, you may well ask, is the denial of patent to Bernie Bilski for a method of managing weather-related risk in commodities making the software open source community jump up in joy? A particularly happy lot is the lobby campaigning against software patents in India.

Analysis continues to arrive and it’s very important as it may be used extensively as a reference in future cases. From Digital Majority and Groklaw we have:

1. Patent decision: New Roadblock to Software/Tech Patents

On October 30th a leading U.S. federal court decided the major case of In re Bernard L. Bilski. This 100+ page court case could have a major impact on software and technology companies, especially those trying to obtain or enforce software patents in the U.S.

2. United States: Long-Awaited “Bilski” Decision Restricts Patentability Of Software, Business Methods

The Bilski decision is significant because it may affect a patentee’s ability to enforce existing patents, the prospects for pending patent applications and the decision whether to file new patent applications directed to so-called “business methods” and software-related innovations….

It has meanwhile come to our attention that Amazon is appealing the 1-click patent rejection. Is this not close to impossible given the re Bilski ruling?

For some background, see this old page

EPO rules for full revocation after a hearing in the opposition of the Foundation for a Free Information Infrastructure (FFII e.V.) against Amazon.com’s infamous patent on the online purchase of gifts. The patent EP927945 is a descendant of the controversial One-Click Patent, which was granted to Amazon in the USA but was partially revoked there due to lack of novelty in October 2007.

The patent seems to be somewhere in between software and business methods. The USPTO should reject the appeal, citing the Bernard Bilski case at the very least. Prior art is another strong argument and so is obviousness. █

In the Amazon, parroting is inventing

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