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05.17.10

Backlash Against The European Patent Office (EPO), The Extended Board of Appeal (EBoA), and Trolls-Friendly Patent Systems

Posted in America, Europe, Law, Patents at 3:05 pm by Dr. Roy Schestowitz

Alison Brimelow

Summary: Why the EBoA does not resolve Europe’s problem with software patents; the patent systems continue to favour monopolies with imaginary arsenals, not inventors with concrete ideas

THE EBoA decision has thus far been covered by us in [1, 2, 3, 4]. Here is the conclusion of one long comment from Groklaw.

Indeed, I fail to see anything positive in this ruling.

Gary Barnett has assessed this and he writes: “Sheesh – EPO’s decision not to conduct review is apalling! Software is STILL patentable in Europe, rules are STILL inconsistent”

A Swedish member of the FFII (see FFII.se) argues that the “European Patent Office bites its tail in order [to] blur what’s patentable – again”:

This week, we finally learned that the questions The European Patent Office (EPO) sent two year ago to clarify what can be patented where inadmissible by its own patent high court, The Extended Board of Appeals (EBA). Its all the usual mess from EPO with slippery and indecisive wordings creating endless loops without clarifications.

[...]

To put an extra spin on this mess, the EPO PR interpret this non decision as a win for software patents. Hilarious and said, since this is just right – leaving questions unanswered and matters diffused is just was has created this situation from the start.

Florian comments about the Defensive Patent Licenses (DPL) which was brought up by a Microsoft writer just over a week ago [1, 2]. He still dislikes IBM’s stance on patents (rightly so) and writes: “How useful the DPL is going to be remains to be seen. Being better than IBM’s and similar pledges is a low hurdle and I’m quite confident the DPL will set a far higher standard in that regard. The toughest test, however, will be inhowfar such a initiative can affect not only the decisions of benevolent parties but also those of malicious aggressors. Only getting the “good guys” to contribute to a defense initiative isn’t enough to make a really noteworthy difference if there isn’t going to be a major impact on the “bad guys”. That will be a key criterion for gauging the potential effectiveness of the DPL.”

He also wrote to us to say:

It will still take weeks if not months before the Defensive Patent Licenses (DPL) is published. This is a first look into the issue, to the extent that it’s possible to comment prior to having seen the proposal. So far, no compelling reason for anyone to contribute patents is visible, but maybe the final thing will offer one if its authors figure out a way to achieve an increase in retaliatory potential for those who join. Even if it might end up being unable to make any noteworthy difference, it’s at least a sincere attempt to solve a problem in part, unlike the “pledges” made by IBM, Sun and others.

Concerning the state of the anti-swpat movement, I had explained to you in a recent email how hopeless the situation is with those SMBs. The post on the DPL doesn’t elaborate on it in such detail but explains that absent a forceful push for abolition, defensive approaches should at least be looked into constructively…

That part about SMBs is noteworthy. Florian used to consult for them and they know the headache of software patents.

Meanwhile, the president of the FFII says that “Patent Trolls seems to be a sector specific issue” and asks, “high correlation with software patents?” Here is the data (“Ranking of Operating Companies by Number of NPE Lawsuits”) and here is what Patently-O wrote some days ago about “Patenting by Small-Entities”:

The number of small-shop innovators continues to dwindle. In a sample of recently issued patents,* only 20% claim “small entity” status. Of those, 30% (6% of the total) are held by the original inventors.** According to the PTO Rules, large universities and non-profits still qualify as for the small entity price-break so long as the patents-in-question have not be assigned or licensed to a non-qualifying entity. At least 12% of the small entity patents are assigned to universities or non-profits. These small entities include multi-billion-dollar operations including Battelle Energy Alliance, California Institute of Technology, Princeton University, and the Korean government funded ETRI. The remaining small entity patents are largely held by companies and partnerships such as Audible Magic, PixArt Imaging, and Alverix.

In other words, this confirms our long-standing allegation that the patent system serves large companies and harms the smaller ones. The system has lost sight of its original goals. Moreover, as we pointed out some days ago, this system is exceedingly tolerant of patent trolls and TechDirt provides yet more proof of that:

Court Won’t Move Patent Lawsuit Out Of East Texas, Despite Plaintiff’s ‘Ephemeral’ Connection To Texas

[...]

As has been discussed plenty of times, a disproportionate number of patent lawsuits are filed in East Texas, under the belief that the venue is the most friendly to patent holders (there is some debate lately about how accurate this is, but either way it remains, by far, the most popular place for patent lawsuits). This happened even in cases where there was clearly no reason for the case to be heard in Texas. My favorite is the story of two San Jose, California companies, whose offices were blocks away from each other… who ended up in an East Texas court to fight a patent battle. Two years ago, the Federal Circuit suggested courts should be more willing to transfer cases that don’t really belong in their district — a clear warning shot at East Texas.

This system favours lawyers/trolls and monopolies, not innovation. Unless evidence contradictory to this claim is presented (we have seen none), it seems pretty safe to establish it as truth.

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