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07.25.11

Rage Against the Masochist

Posted in America, Patents at 5:32 pm by Dr. Roy Schestowitz

Nathan Myhrvold

Summary: Public opinion is quickly shifting against patents after a National Public Radio (NPR) piece and also some highly excessive activities from a shell troll of Nathan Myhrvold (shown above)

WE have just written a summary following the NPR coverage that led to some very strongly-worded comments about Microsoft’s patent troll who is the world’s biggest patent troll. A lot of people were not quite aware of the seriousness of this issue.

Professor Webbink has this theory about what Lodsys is doing with Myhrvold’s acquired patent (that he passes around for other non-practising entities to sue and absorb the bad press):

To really understand why Lodsys is doing what it’s doing, we thought it would be worthwhile to ask a patent lawyer to explain it, so we contacted Patrick Igoe, the lawyer who writes the Apple Patent blog and who has pointed out some real weaknesses in the Lodsys patents.

Why, we wondered, was Lodsys first going after the little people, so to speak, first and now hitting up Rovio and Electronic Arts? Is it like SCO, lots of headline seeking, hoping people will be so scared they’ll just pay them to stop? Is it all just so much “legal” theater, in other words, with analysts popping up and advising the little people to settle with Lodsys? I gather that didn’t work. If Lodsys was following a traditional playbook and hoped to use any licensees as a foundation to next go after the big fish, are they now acknowledging that failure and heading for the deeper pockets, in hopes that will work better?

And why only claim 27 of the ’545 patent, which is what Lodsys is alleging is infringed? What is claim 27, anyhow? How could a game violate it?

The head of the FFII meanwhile discovers that ‘Amazon [is] sued for patent infringement over transactions using “a receipt having payment remittance information.”‘ He also links to this item of news about Lodsys attacking Angry Birds — a subject that even the BBC covers right now:

But here is what I would want to have asked him. Is a system that appears to reward those who acquire patents and hire lawyers and punish those who simply try to make things really going to encourage innovation?

My contact is certainly not doing much innovating right now – he’s too busy worrying about the threat of an expensive lawsuit.

That comes from Rory, who in the past did a lot of Microsoft promotion. Maybe he softened with age. Either way, the news might not be so bad for Brits. After all, it is US-based users who are likely to be prevented access to software and Britain might also see developers leaving the US and come to a haven from patent trolls, a haven such as the UK (provided they don’t sell in the US).

As a direct result of NPR coverage, “Intellectual Ventures: Another American Mafia story” was published by Stefano Maffulli. “Intellectual Ventures is the company behind Lodsys,” he explains, “the company suing independent iPhone app developers for a silly patent violation. Lodsys has no employees, it’s not making any product, it’s not producing any innovation. It sues people that create jobs and deliver products.

“Did you think that patents were introduced to foster innovation? To give an incentive for inventors to bring new products to the society and solve problems? Think again. Companies like Intellectual Ventures are just a problem for startups and innovators. Venture investor Chris Sacca even said to NPR reporters that these trolls remind him of “a mafia-style shakedown, where someone comes in the front door of your building and says, ‘It would be a shame if this place burnt down. I know the neighborhood really well and I can make sure that doesn’t happen.’”. The FSFE raised this issue in Europe many years ago. The US patent system needs to be reformed, now.”

Well, in several recent stories about patent FUD we highlighted the fact that almost nobody in today’s society should want patents. It’s the luxury of very few and it is beneficial to even fewer, maybe less than 1% of the population. In a new post titled “Android & Linux FUD”, someone asks about Oracle’s attack:

Do you think that patent issues and all this money changing hands has nothing to do with Linux? Just follow the money. While most of the legal attention focuses on Dalvik, the Android implementation of the Java virtual machine, the public perception of Linux is also tarnished to anyone who understands that Android is a Linux distribution. I can only imagine what cyanogenmod.com people think about what is going on.

Well, Oracle’s attack is already weakening and the Oracle case might yield nothing at all or only a fraction of what Oracle expected. To quote this new summary:

What If Oracle Loses The Android-Java Court Battle?

[...]

Contrary to the blog-based reports, Oracle has been at the losing end from the very beginning. The major setback was when the court ordered it to cut the number of claims from 132 to 50. Another major setback for Oracle was when USPTO rejected a majority of Oracle’s patent claims.

Oracle again faced a defeat when the judge earlier questioned the damage estimates of Ian Cockburn and asked both parties to name more experts to assess damages. An now the court has rejected Oracle’s 6.1 billion damage estimation. The court has asked Oracle to come up with a figure starting from $100 million.

Maybe the case will end in dismissal or some settlement at a low (and likely undisclosed) price. Who knows, maybe it will even go on for years like the SCO case, depending on Oracle’s stubbornness (or SCOracle’s vindictiveness). Either way, I’m away until August, so no more paten rants for a while.

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3 Comments

  1. twitter said,

    July 25, 2011 at 7:39 pm

    Gravatar

    The NPR story did more than include Chris Sacca’s opinion, they researched it and agreed it was correct. After quoting Sacca’s extortion scheme accusation,

    it’s this very delicate balancing act that is
    quite reminiscent of scenes you see in movies when the mafia comes to visit your butcher shop and they say to you, “Hey, it would be a real shame if somebody else came and sued you. Tell you what, pay us an exorbitant membership fee into our collective and we’ll keep you protected that way.” A protection scheme isn’t that credible unless some butcher shops burn down now and then

    They ask IV what they thought of it and then dismissed the answer by saying,

    it seems like a lot of butcher shops have been burning. As we were reporting this story, more and more Intellectual Ventures patents started showing up in the hands of companies like Oasis, companies without employees or operations, who were formed for the purpose of filing lawsuits.

    They also chased down one of the shell companies, Oasis, which shares the same physical address as Lodsys in East Texas.

    Sadly, the show concludes by predicting success in driving all but the largest companies out of the market. That kind of defeatism should not be advocated by a news agency, especially when there are so many encouraging signs of software patents being rejected by US courts. Anyone discovering a crime like this should advocate the end of the crime.

    If no one has the nerve to prosecute Myvold, Gates and others for racketeering, society should at least have the sense to eliminate software patents. Real harm is done to everyone when small businesses are destroyed by judicial extortion, but it’s especially hard on the company investors and employees. Eliminating software patents would punish the greedy people who have invested in extortion and it would also allow decrepit software houses like Microsoft to finally fall over.

  2. Needs Sunlight said,

    July 27, 2011 at 6:45 am

    Gravatar

    From the NPR transcript:

    “Laura: How many shell companies do you personally believe that Intellectual
    Ventures has, based on your research?

    Ewing: Very close to 1,300.”

    Very interesting.

    Guest Editorial Team Reply:

    Wow.

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