EditorsAbout the SiteComes vs. MicrosoftUsing This Web SiteSite ArchivesCredibility IndexOOXMLOpenDocumentPatentsNovellNews DigestSite NewsRSS

11.21.12

Regulators Target Patent Trolls But Lose Sight of Patent Cartels

Posted in Law, Patents at 3:30 pm by Dr. Roy Schestowitz

Hammer

Summary: Action is finally being taken against patent abuse, even though it does not go far enough

TECHRIGHTS has gathered a lot of information on Intellectual Ventures and so did a paper from early in the year, which states accurately: [via Stefano Zacchiroli, the Debian Project Leader]

The new mass aggregator, however, is an entirely different beast. To begin with, funding sources for mass aggregators include some very successful and respectable organizations, including manufacturing companies such as Apple, eBay, Google, Intel, Microsoft, Nokia, and Sony, as well as academic institutions such as the University of Pennsylvania and Notre Dame, and other entities such as the World Bank and the William and Flora Hewlett Foundation. Nations such as China, France, South Korea, and Taiwan even have their own mass aggregators to varying degrees.

Moreover, the acquisition appetites and patent supply sources are quite interesting. Mass aggregators may have portfolios that range across vastly different areas of innovation from computers to telecommunications to biomedicine to nanotechnology. In some of the acquisition activity, mass aggregators purchase large chunks, and even the majority, of an operating company’s patents and patent applications. They typically pay cash up front, as well as a share of any future profits generated from asserting the patents against anyone other than the selling manufacturer. Mass aggregators have engaged in other unusual acquisition approaches as well, including purportedly purchasing the rights to all future inventions by researchers at universities in developing countries. Other acquisition approaches purportedly include targeted purchases of patents that are of particular interest to the mass aggregators’ investors.

The types of returns promised to investors and the types of benefits offered to participants are also quite different from garden-variety non-practicing entities, as are some of the tactics used in organizing the entities and in asserting the patents. Finally, the scale itself is simply mind-boggling. Mass aggregators operate on a scale and at a level of sophistication and complexity that would have been unimaginable a decade ago. They have taken the prototype strategies pioneered by a prior generation of non-practicing entities and changed them into some of the cleverest strategies yet seen in the intellectual property rights field.

The goal of this article is to shed some light on mass aggregators. We hope to provide some understanding of the nature of the change, to analyze its economics and implications, and to offer some normative considerations. In the descriptive section, we focus on the oldest and largest of the mass aggregators, Intellectual Ventures, which has gone to great lengths to maintain secrecy. Working from public sources and investing thousands of hours of research, we offer a detailed picture of the entity, tracing through approximately 1300 shell companies and thousands of patents. The section also describes in brief form several other mass aggregators, including ones that are public companies.

These are cartels and they should be made illegal. They inflate prices and deflate innovation. We dealt with the subject before.

There is an article in the BBC titled “Phone patents: An absurd battle“. iophk says it proposes patent trolls as a solution and adds: “I am surprised that Intellectual Ventures was not promoted. That’s one of the biggest if not the biggest” (it is).

I cannot read this article in the UK. Neither can Glyn Moody, who wrote: “wow, this is fun: the #BBC won’t let me access the bbc.com site ‘cos I’m in UK – http://bit.ly/Q5SK2Q ironic much?”

Good ol’ BBC is still serving plutocrats, not taxpayers who fund it obligatorily.

Here is what Groklaw quotes from this article: “One reason boils down to the nature of mobile devices like smartphones and tablets, according to Daniel O’Connor, a self-styled anti-trust and internet policy wonk as well as senior director of public policy at the Computer and Communications Industry Association. He says that software is a particularly active area for patents, especially anything to do with telecommunications, semiconductors and 4G data networks. Software patents are also particularly broad and vague, and that makes infringement difficult to avoid. “That creates the conditions for a kind of patent perfect storm,” O’Connor says….

“[M]ost of these patents don’t just make a single claim to a particular intellectual property right – on average each patent makes more like 20 such claims. That means that this collection of 250,000 patents actually describes about five million restrictions on what mobile device makers can do while they design a new model. Realistically an individual may be able to keep five, 10 or maybe 20 restrictions in mind when designing a new feature for a mobile device, but probably not 50 or 500. And five million? Not a chance.”

The solution should be to rethink patents, not create cartels with them. Innovative Automation (IA), a company named in a comical way like IV, shows that even cartel members are not safe. Apple got sued while still assembling a new part of the patent cartel:

Back on September tenth we posted a report revealing the fact that Apple had acquired 434 LTE centric patents. One of the original sources of our report stated that Rockstar Bidco, a company that Apple holds the majority stake in, acquired 116 LTE patents from Nortel, giving them a total of 434 LTE patents. It’s now been revealed that Apple had been acquiring even more patents over the summer and the list is extensive.

In a report filed yesterday, Business Insider listed a link to the US Patent Office which linked to a series of patent assignments between Nortel, Rockstar Bidco and Apple. The list totaled up to 1375 patents originating from Nortel, with the vast majority of them being assigned to Apple. Some of the listed patents have yet to be assigned to Apple as shown here and here.

Google’s talking points from the patents team focus on trolls rather than the cartel as their problem. They are focusing on trolls instead of the system as a whole because the want Google to become part of the cartel, hence part of the problem. That’s how patent lawyers think. Regulators are said to be taking a look at this problem:

U.S. antitrust authorities are examining whether specialized patent-holding firms—or “trolls” to their detractors—are disrupting competition in high-tech markets, opening a new front in a long-standing Silicon Valley battle.

“There’s a possibility of competitive harm here,” said Joseph Wayland, who served as the Justice Department’s acting antitrust chief until last week, when he stepped down to return to private practice. Mr. Wayland said officials are devoting “huge energy, particularly at a senior level” to this and other antitrust issues surrounding patents.

Other reports like this one from Reuters say that the US-leaning ITC is also taking a look:

The US International Trade Commission will review a judge’s decision which found that Apple did not violate patents owned by Samsung in making the iPod touch, iPhone and iPad.

An administrative law judge at the ITC had said in a preliminary ruling in September that Apple was innocent of violating the patents. The ITC, which could have opted to simply uphold the judge’s decision, said that it would take up the matter. A final decision is expected in January.

The FTC focuses on patent trolls and not cartels:

US antitrust enforcers are getting mighty interested in patent trolls. The Federal Trade Commission has even taken to calling these lawsuit-happy companies “patent assertion entities,” or PAEs.

“There’s a possibility of competitive harm here,” said Joseph Wayland, who was the head of antitrust enforcement at the Justice Department until last week. Wayland just left the government for private practice, and he told the Wall Street Journal there is “huge energy, particularly at a senior level” being spent on scrutinizing the intersection of patents and antitrust.

The FTC and the Department of Justice announced today they will host a public forum on December 10 to study the issue more closely. The speakers include IP lawyers, law professors specializing in these so-called PAEs, and even officers of high-profile patent trolls like Intellectual Ventures and Round Rock Research LLC. Executives from companies that have been critical of patent-holding companies, such as Cisco and Rackspace, will also be featured.

Here is more:

The US Department of Justice (DoJ) and US Federal Trade Commission (FTC) are opening informal hearings next month which will look into the question of whether specialised patent-holding firms, also known as “patent trolls” to many, are disrupting competition in technology markets. Concerns that non-practising entities (NPEs) – companies that hold patents but do not make use of them – cause problems in the market have existed for some time. The traditional “troll”, a small company holding a handful of patents, has in recent years been joined by the huge patent-holding corporations who buy up hundreds of patents. The aim of the NPEs is to get licence revenue from companies who they claim are infringing the patents they hold.

They ought to look at the cartels, not just trolls. We’ll make this point again at the end of the night (addressing the USPTO as a whole, not just the ITC). The patent system is as inherently corrupt as the political system, which corporations control at people’s expense and to people’s detriment.

Share this post: These icons link to social bookmarking sites where readers can share and discover new web pages.
  • Reddit
  • email
  • Google Bookmarks

If you liked this post, consider subscribing to the RSS feed or join us now at the IRC channels.

Pages that cross-reference this one

What Else is New


  1. The Internet Archive Doesn't Forget, Whereas the Internet and the Web Forget Very Fast

    World Wide Web history is grossly undervalued and preservation of such history (e.g. by the Wayback Machine) is taken for granted by far too many people; the robber barons of today benefit the most from erosion of collective memory as they get to rewrite the past to suit their present and future interests



  2. Environmentalism and Free Software Can be Viewed as Closely Connected and Help One Another

    Modest lifestyles are an overlapping pattern in the Free software community and green activists; there's room for alliances and collaboration, bettering society by reducing consumption and discouraging voyeurism



  3. Free (as in Freedom) Software + Social Control Media ≠ Free Speech

    Speaking through middlemen and private platforms is bad enough (that gives others unjust power over speech); to claim that because the underlying platform is free/libre software it therefore becomes a non-issue is also dishonest



  4. António Campinos: President or Quasi-Autocratic Corporate Puppet?

    The culture of oppression — and censorship of evidence of oppression — is what today’s EPO is all about; the EPO learned how to better avoid (or block) negative publicity without actually changing its ways; and due to unprecedented speech restrictions you won’t hear that from SUEPO



  5. The Media Continues to Ignore Corruption of António Campinos

    António Campinos has Croatian scandals on his lap; the obedient media, however, refuses to even talk about it (or uses COVID as an excuse to write nothing on the subject, as some journalists have told us)



  6. A Call for Patent Sanity

    The public's call for reform is motivated by improved understanding of today's debased patent system and how out-of-order (detached from its original mission statement) it has gotten; patent maximalism, if it does not completely unravel this whole system, severely discredits it



  7. Declassified US Army Field Manuals Explain Microsoft's Public Relations Strategy (Similar to Selling Imperialism to the Occupied)

    The misuse of public broadcast to brainwash the public is well understood and thoroughly exploited by both Microsoft and the Gates Foundation (which sells this ridiculous lie that the world’s richest people speak for and fight for the poorest, i.e. those impoverished by endless greed)



  8. IRC Proceedings: Friday, July 10, 2020

    IRC logs for Friday, July 10, 2020



  9. Links 11/7/2020: Slackel 7.3 Openbox, Kiwi TCMS 8.5, Librem 5 Dogwood Update 3

    Links for the day



  10. Education Without Free Software is Training or Indoctrination

    Kids need to decide for themselves what they want to do and what they wish to use when they grow up; schools need to provide general tools and the mental capacity to make good decisions (rather than make these decisions for the kids, sometimes at the behest of foreign monopolists)



  11. Links 10/7/2020: Wayland-Info, diffoscope 151 and Tor 0.4.4.2-alpha

    Links for the day



  12. European FRAND (Related to SEP) Proponent and Famed Programmer Comes to Realise That It's Actually a “Scam”

    Even people who have long promoted the practice of mandatory "licensing" (in effect patent tax one is unable to work around) are apparently changing their minds and their tune



  13. Not Even a Single Corporate Journalist Has Written Anything About These Very Important Bits of News

    Constant propaganda from patent maximalists has long infested the media, which is sometimes controlled and even bribed to set the tone and the agenda; important developments are being tucked away and require very deep digging for ordinary citizens to find



  14. IRC Proceedings: Thursday, July 09, 2020

    IRC logs for Thursday, July 09, 2020



  15. Racism in Technology (and Who Typically Lectures Us About the Subject)

    Racism is a real problem; some approaches to tackling racism, however, can also be problematic and those who take the lead 'on behalf' of victims tend to be opportunistic and privileged few (piggybacking others' grievances to further advance their financial agenda)



  16. Links 10/7/2020: Debian 8 Long Term Support EOL, Mobian Project, Mesa 20.1.3

    Links for the day



  17. [Humour] COVID-19 is Very, Very Afraid of Human Beings Making More Monopolies Instead of Fighting Together

    The European Patent Office (EPO) to the rescue! Fighting a dangerous pandemic one profitable monopoly at a time!



  18. The News is Never 'Slow', It's Just Journalism That's Slowing Down (and Investigative Journalism Coming Under Attack)

    A mix of censorship and subtle mind control contribute to misinformed societies that shape their perception or misunderstanding of the world based on false measures of authority (where money can determine what is true and what is untrue); many topics remain completely untouched, leading to apathy in a vacuum; it's very much applicable to international organisations, which are presumed benign by virtue of being multi-national or supranational



  19. Social Control Media is About Social Control and If It Doesn't Ban You It'll Shut Down Everyone's Account (One Day)

    It’s time to leave the ‘Internet rot’ which is social control media well behind us; blogging and RSS/XML may seem like a thing of the past, but they may as well become the future (again; if we make the correct and informed choices)



  20. Microsoft's Fingers in Every Pie: The Cult Mentality That Society Needs to Become Wary of

    Microsoft and its co-founder (pretending to do his for-profit 'charity' via the Gates Foundation) are trying to control the world; in the process they've moved to control even their most potent competitor, according to Gates himself, which is GNU/Linux



  21. Links 9/7/2020: Google’s Open Usage Commons, GNOME 3.36.4, Neptune 6.5

    Links for the day



  22. IRC Proceedings: Wednesday, July 08, 2020

    IRC logs for Wednesday, July 08, 2020



  23. Links 8/7/2020: SUSE to Acquire Rancher Labs, Btrfs as Default in Fedora, Qt Creator 4.12.4

    Links for the day



  24. Yes, Master

    When the Linux Foundation tells us to tone down our language we ought to remember what kind of hypocritical stance these people have (note: the above have nothing to do with slavery, either)



  25. Fraunhofer is Again Evergreening Software Patents to Maintain Its Codecs Cartel, Forcing Everyone to Pay to View/Stream Multimedia Files

    The roller-coaster of software patents on multimedia isn't stopping; we know the culprits who can be named for perpetuating this injustice



  26. [Humour/Meme] Focusing on the Bombings and Who's Included in the Bombings

    Supremacist agenda disguised as "tolerant and inclusive" is still objectionable supremacist agenda



  27. Manners Are a Good Thing. The Yardstick or the Standard of Manners Changes Over Time.

    Entirely legitimate grievances of African-Americans are being exploited by people who aren’t even African-American (and usually don’t speak for African-Americans) to warp the debate from one about software ethics and technical issues, not to mention war crimes of companies that employ many programmers, to something which is unlikely to really help African-Americans (also, they don't employ any African-Americans)



  28. IRC Proceedings: Tuesday, July 07, 2020

    IRC logs for Tuesday, July 07, 2020



  29. Links 8/7/2020: Huawei’s GNU/Linux PC, Sparky 5.12, and Endless OS 3.8.4 Released

    Links for the day



  30. [Humour] Television Channels That Don't Speak of Real Looting But Participate in Looting

    People may need to look beyond (or outside) the television screen to grasp what's going on


RSS 64x64RSS Feed: subscribe to the RSS feed for regular updates

Home iconSite Wiki: You can improve this site by helping the extension of the site's content

Home iconSite Home: Background about the site and some key features in the front page

Chat iconIRC Channel: Come and chat with us in real time

Recent Posts