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07.20.09

Patents Roundup: Microsoft Stung, Microsoft’s Troll Speaks to Facebook, Alternatives Considered, and USPTO Head Calls Patents “Monopolies”

Posted in America, Free/Libre Software, Law, Microsoft, Patents at 5:23 pm by Dr. Roy Schestowitz

Summary: Patent news from the past week or so

THIS is another long roundup of patent news that may affect software patents and patent trolls.

Patent Ambush and Extortion

Rambus, a recent pioneer in gigantic patent ambush [1, 2, 3, 4], has suddenly seen the red light, which is rare. It will not be getting its way with Nvidia.

Patent Office rejects Rambus claims against Nvidia

[...]

The additional eight claims are based on two patents that Rambus has asserted against Nvidia in litigation. This follows the USPTO’s rejection last month of 41 other claims in seven patents that Rambus had asserted, Nvidia said.

This report from Eric Savitz talks about an extortion that has actually just worked.

Research In Motion (RIMM) this morning said it will pay $267.5 million as part of an agreement to settle all existing patent litigation with venture-backed Visto, which is now known as Good Technology.

FFII’s president writes in response to this: “RIM pays 267 Millions USD to get rid of another patent troll [...] We need more patent trolls.”

What he probably means to say is that by showing how utterly broken the patent system has become will there be greater pressure for change. Patent trolls are one symptom of an ill system

Some weeks ago we saw Microsoft's patent troll extorting Intuit, which is Microsoft’s rival.

Microsoft

Guess who is buddies with Facebook’s founder? It’s the aforementioned patent troll, ‘born’ and raised (and funded) by Microsoft.

After leaving Microsoft, Myhrvold went into the patent business. His Intellectual Ventures works like this: Buy up patents, then use them to bludgeon large tech companies into forking over fees or making investments in Intellectual Ventures.

In the course of his short career, Zuckerberg, as a tipster reminded us, has accumulated a nice array of patents. They’re related, as you might guess, to social networking and digital media. Could he use them against his rivals via Myhrvold, raising some money for Facebook in the process?

This is something to watch out for. Zuckerberg has been meeting and having fun with Microsoft executives for quite a few years.

Microsoft is not just a patent troll (by proxy). Here it is being hit from multiple directions, as the latest news ought to suggest:

i. Patent parasites sue Microsoft over Xbox Live (Microsoft too is a patent parasite)

Peter Hochstein and Jeffrey Tenenbaum (pricks) once patented a method of “communicating live while playing the same video game in separate locations” and have been milking their “idea” since 1994. In 2004, they went after both Sony and Microsoft, and in April of this year, scored a settlement with the former over the PS2′s online gaming network. Now they want more, and are focusing on Xbox Live.

ii. Apple, Microsoft, others sued over touchpad products

A case started in a US district court alleging that Microsoft, Apple and a host of other defendants have breached a patent relating to touchpad technology.

iii. Apple, Microsoft sued over iPod, Zune controls

Apple, LG, Microsoft, and 20 other companies are being sued for patent infringement by a Texas firm that claims to have invented the touchpad.

It was disappointing to find some more “innovation” propaganda published as an article in BusinessWeek (“innovation” is almost synonymous with patents in some contexts). And guess what? Only in page two does it say who the author is: “Bill Buxton is Principal Scientist at Microsoft Research and the author of Sketching User Experiences…”

Common practice for the business press. They let corporations do the ‘reporting’ or ‘independent’ ‘analysis’. The sad thing is that most readers would neither notice nor mind. Business press: from the corporations, for the corporations, passed on to ordinary people (“consumers”) to absorb.

Other Approaches

Slated has written two essays, one of which is a general critique of intellectual monopolies.

In fact, I have often drawn this comparison before, because I see very little distinction between the practise of physical slavery, and the equally reprehensible practise of intellectual slavery. Indeed, the latter may actually be more sinister, since it assumes ownership and control of that which touches all of us, not just an unfortunate few, and is a form of subjugation which travels silently and invisibly throughout all of society, tainting us and compromising our liberties, infecting us with the disease of intellectual monopoly, thus assuming ownership of our minds. More bluntly, Intellectual Property is a cancer.

The second essay is his proposition of an alternative to patents.

Then every company in the world would be funding all research (and any other relevant industrial development included in the budget), and every company in the world would be entitled to utilise the results of that research without any further legal obligation or financial liability. No company would be at an immediate disadvantage due to R&D costs, and the need for patent protection would be completely dispensed with.

Even better, those who benefit most from this research, profit the most, and subsequently pay the most tax. This is not only demonstrably self-sustaining, but is even fair. And of course, it keeps capitalism under control too, thus stabilising the economy, and benefiting consumers.

The result is: No patents, no profiteering, a massive and guaranteed supply of research funds, academic freedom for all, and better prospects for industrial development and mankind’s overall progress.

The only losers here, that I can see, are those who were unethically over-exploiting the current system anyway (patent trolls, and those engaged in the practise of so-called Hollywood Accounting).

There is also a new journal article about the peer-to-patent initiative. It takes an entirely different approach to tackling the real issues that are no longer just perceived ones.

The patenting of software has increased significantly. Regardless of any personal bias as to the existence of software patents, it is a trend that is unlikely to end anytime soon. As a result, the open source movement may be threatened by the proliferation of non-meritorious or overly broad patents. Peer-to-Patent provides a means for mitigating the limitations that may be placed upon the open source community by software patents, as the program allows the open source community to participate in the peer review of pending patent applications. Members of the open source community are knowledgeable, interested parties with a unique stake in the software patent debate and thus are capable of making a significant contribution to improving the current system.

USPTO Head: Patent Are Monopolies

The Mises blog asks, “Are Patents ‘Monopolies’?”

On occasion you get some defender of patents who is upset when we use the m-word to describe these artificial state-granted monopoly rights. For example here one Dale Halling, a patent attorney (surprise!) posts about “The Myth that Patents are a Monopoly” and writes, ” People who suggest a patent is a monopoly are not being intellectually honest and perpetuating a myth to advance a political agenda.”

[...]

Now it is, indeed, clear that a patent is a monopoly grant to someone that permits them to charge above-market prices; this is exactly the goal of the patent law: to provide this monopoly profit to inventors so as to incentivize them to innovate and file for patents. And it is why, for example, Blackberry paid over $600 million to NTP in a recent patent suit; and it is why consumers will have to pay more for Blackberry services than they otherwise would, etc. Did NTP have “monopoly power” as defined by the government’s antitrust scheme? I don’t know. Probably not. But did they extort RIM/Blackberry by use of the government-granted patent monopoly? Of course.

David Kappos, the new head of the US patent office (whom we mentioned previously in [1, 2, 3, 4, 5, 6, 7, 8]), can be seen as responding to the above with the following immortal quote:

Mr. Kappos announced his opposition to business method patents last year by stating that “[y]ou’re creating a new 20-year monopoly for no good reason.” Thus, it is unclear where Mr. Kappos will attempt to draw the line between software and business method inventions worthy of patent protection.

Yes, that’s right. Even the head of the USPTO openly admits that patents are a “20-year monopoly”. Some proponents of software patents still deny this. Kappos is considered a strong proponent of the peer-to-patent initiative mentioned above.

Pro-Software Patents Lobby (Gartner et al)

Brian Prentice from the Gartner Group is an advocate of software patents, as we noted before [1, 2]. Whether it’s part of the general policy at Gartner, well… it may hard to tell, but here he is again making it very explicit at Gartner.com: “Why We Need Software Patents”

I would much rather we embrace software patents and water down trade secret legislation than the other way around.

Microsoft’s connection to the Gartner Group is a financial one by the way [1, 2, 3]. Gartner helps Microsoft fight against Free (libre) software.

Another Web site whose habitat remains rather similar is IP Watchdog, with the usual lobby for software patents, this time from another writer: “Is Software Patentable?”

As mentioned above, new, useful software is not always patentable. But some software must be patentable, or the long history of patents for manufacturing process and electronic devices cannot be sustained as software becomes central to these inventions.

There are more similar pieces (similar convictions) from the same site, e.g.:

i. Examiner Interview Changes Favor In Person Meeting

It seems that early last week a memo went out from the powers that be to the examiners handling Bilski-related applications, and in the memo it was explained that merely putting “computer implemented method” in the preamble of the claim is not something that will any longer work to overcome a patentable subject matter rejection under 35 U.S.C. 101. It seems that now you need to have “computer implemented method” in the preamble and there must also be positive recitation of “a computer” in the body of the claim.

ii. On the Road: Bilski Examiner Interview and CNN

I spent the better part of last week in Washington, DC conducting Examiner interviews for some of my clients that have pending software patent applications. The great news is that I believe we now have a handle on the ever changing Bilski ruling. I know it sounds like a misstatement to say that the Bilski ruling is ever-changing, but apparently, the reality of the situation is that when the Federal Circuit provides a ruling, it comes with little or no guidance for the Examiners to properly examine applications based on the ruling. The guidance comes from internal memos to Examiners from the PTO indicating how applications should now be examined based on Bilski.

As a site of lawyers, it is inclined to support more and more patents. The broader the scope, the higher the revenue. Science doesn’t matter so much to them. Engineers are “pawns in the battle”, to borrow a phrase from Microsoft evangelists.

Car Insurance Patent Trolls

There are reports circulating about patents that threaten even the car insurance businesses. [via Digital Majority]

Under a major decision handed down last fall, the United States Court of Appeals for the Federal Circuit interpreted federal law to make it much more difficult to patent “business methods.”

The so-called “Bilski” decision essentially ended a decade of looser standards the same court introduced in 1998 with a decision known as State Street. That ruling opened the floodgates for business-method patents like Amazon’s one-click process to buy goods online.

See how much positive impact the decision In Re Bilski has had. Law.com has some more information about this Amazon patent in its new article, which starts by stating:

Ten years ago, Amazon.com riled the tech world when it sued Barnes & Noble with a patent on “1-click” buying. Critics cried that clicking once to order a book wasn’t really an invention — and certainly not worthy of a patent. And it became the poster child for a patent system gone overboard.

Here is another new report about the car insurance patent. FFII’s president remarks on it by saying: “Help Patent Trolls make their patents more resistant.”

A Stamford patent agent and a Massachusetts actuary have paired to seek a patent on an insurance product aimed at promoting safety among teen motorists.

Mark Nowotarski, president of Markets, Patents & Alliances LLC, said today the U.S. Patent Office could rule by late June on their patent application (No. 20090063201) filed last October for the SoberTeen Driving Insurance product.

It’s obviously a patent troll. On the “Ethics of Patent Trolling” (or lack thereof) The Prior Art blog has an article which states:

The nature of the claimed invention in these cases also raises serious questions about online rights. The Spangenberg companies, by suing hundreds of websites, have claimed a proprietary right over e-commerce itself. I’m not making that judgment based on an analysis of his patents—I’m making it based on the accusations in the lawsuits, filed against hundreds of companies that don’t have anything apparent in common other than the fact that they sell stuff online. And while Spangenberg targets only big corporations, many of his imitators have no such scruples.

Patent trolls and software patents both need to go. Patent trolls are a useful excuse for reform that eliminates the latter.

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A Single Comment

  1. zatoichi said,

    July 21, 2009 at 1:05 am

    Gravatar

    Research In Motion (RIMM) this morning said it will pay $267.5 million as part of an agreement to settle all existing patent litigation with venture-backed Visto, which is now known as Good Technology.

    I take strong exception to your characterization of Good Technologies as a “patent troll”. Good has been making synchronization solutions for use with Exchange servers (don’t start, people use them, there isn’t a law against it) for more years than Research in Motion has been making Blackberries. Good made the first Exchange sync solution for Palm Os (and I worked for Palm from 2001-2003, so I’m in a position to speak authoritatively here.)

    Whether you like or dislike patents, they exist, and if Good has one that RIM is infringing–and as I said, it seems quite likely that they might–and if RIM has refused to come to terms with them, then they have every right to settle it in court.

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