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

12.11.12

USPTO Sued as the System Collapses Under the Weight of Trolls, Monopolists, and Lawyers/Politicians

Posted in Patents at 1:58 pm by Dr. Roy Schestowitz

The core of this problem requires striking at the root

USPTO building

Summary: The cartel office (USPTO) has become the target of some of its victims, who see their system abducted by bureaucrats and self-serving non-practising blood-sucking leeches

THE USPTO has become the shadow of corporations, cast upon by those in power to repress the creative population. The patent system in the US is rotting because too many lousy patents are granted, often to trolls that hide behind shells and destroy the economy.

The troll known as “Clouding IP LLC” strikes again, joining the likes of Lodsys, which is also suing some more:

There are all kinds of patent trolls making outrageous claims about the technology they “own,” but there’s no question that Lodsys is one of the most infamous. Last year, Lodsys explained how it was generously offering to let the iOS and Android app developers of the world continue to do business—if they pay a patent tax of 0.575 percent of their revenue.

Lodsys gets some patents from Intellectual Ventures, the biggest troll which uses many shells for litigation. This is the largest such cartel and it is backed by ruthless businessmen like Bill Gates. Here is an interesting new report about changes that would impede that racketeering operation:

Figuring out the specifics of Intellectual Ventures’ frighteningly enormous patent portfolio has always been next to impossible. Its roughly 8,000 U.S. patents and 3,000 applications are assigned to an assortment of 1,276 shell companies, few of which have Intellectual Ventures in their name, according to a study published in January in the Stanford Technology Law Review. Nor is the company alone in playing shell games with its portfolio: Devices to mask patent ownership are the exception rather than the rule for companies with a business model of asserting IP rights.

The USPTO, the principal facilitator of such extortion, considers changing its rules due to that. Another bit from the group of Bessen [1, 2] estimates the cost of trolls. To quote:

Today it is perfectly legal for companies to buy and sell the rights to unlimited numbers of ideas, a company is not required to have any interest in making these ideas a reality. It is perfectly legal for companies to sit on patents and wait for others to create before either suing the creator or charging licensing fees. The following pair of quotes is pulled directly from the promotional material on the website of just one prolific patent troll:

“$2 Billion+ cumulative licensing revenue”

“70,000 IP assets acquired and nearly 40,000 in active monetisation programmes”

In fact it is not just legal, patent trolling is an industry on a colossal scale. According to research recently published by Boston University School of Law, last year patent trolls won a cool $29 Billion. One of the most worrying findings of research in to patent trolls is that the mere threat of a suit is enough to put the frighteners on and make creators pay up:

Another parasite, Vringo, got Nokia patents after Microsoft had taken over and then attacked Google. Here is a financial report about it:

This article provides a unique discussion of broad economic conditions in software, energy, human labor, and patents. The discussion highlights upside and downside characteristics in the patent space, and argues software patents are overvalued relative to other industries. The article then provides an investment conclusion of selling Vringo (VRNG) shares and buying Lightbridge (LTBR) shares.

To bypass the macro discussion, scroll down to the bold heading containing the text “Dump Vringo”

Software is hot.

Investors are concerned about bubble-like conditions. Inside this bubble float software patents, gaseous substances which have been reified as solids in public perception. A crescendo of such reification is scored by the America Invents Act, which introduced “first to file” priority, overturning the “first to invent” principle which has been around forever. Instead of inventions, patents themselves are now the property; in a classic sense of reification, words have stolen the identities of the ideas they describe.

We are taking the word “property” far too literally, as if the government had announced a race for land, as if patents were a hard asset like real estate. Fiat currency is a far more appropriate analogy. Patents are inflated and deflated at the whims of politicians, and frequently counterfeited by artistic lawyers in a game of litigation shakedowns. A land run among investors in this now-crowded space occurs atop thin ice.

Paul Kedrosky shows that patent trolling pays well:

Doing useful stuff is apparently for chumps: A portfolio of patent trolls vs the S&P 500 in 2012 pic.twitter.com/ghv3uKEl

The USPTO made this legal and now its head leaves in shame (its heads come from the cartel it protects), having lost some public arguments:

The patent community has had plenty to talk about with two recent actions by David J. Kappos, the Director of the United States Patent & Trademark Office (USPTO).

On November 20, 2012, in an address to the Center for American Progress, Director Kappos gave a full-throated defense of software patents in response to recent public criticisms of software patents stemming from the so-called “smartphone patent wars.” As part of the defense, Kappos recounted several recent efforts to improve overall patent quality, including the quality of software patents. (Read a summary of those efforts here). Then on Monday, November 26, 2012, Kappos announced to USPTO staff that he would be stepping down as Director in early 2013. (See reports here and here.) According to news reports, USPTO deputy director Teresa Stanek Rea will assume the role of acting director upon Kappos’ departure in 2013. Kappos’ resignation seemed to catch a number of commentators by surprise and the USPTO has not yet provided further details or an official release.

USPTO is said to be preparing for lawsuits over its bad practices which pro-fascism politicians like Leahy try to take global:

Congress has passed a bill that would implement two patent law treaties to help American businesses expand into foreign markets, Senator Patrick Leahy (D-Vt.) announced today.

Stop giving the corruptible, corporate-serving USPTO more power abroad. This lets software patents expand. And not just software in fact. For instance, citing the article “Bill Gross Patents Way To Count”, Mike Masnick slams yet more USPTO-granted patents, saying:

I’m reminded of that, after seeing Dealbreaker’s headline about how world famous mutual fund investor, Bill Gross, of PIMCO, has patented the methodology for his bond fund — or, as Dealbreaker correctly points out, he “patented a way to count.” Indeed, the patent in question, US Patent 8,306,892 is somewhat hideous, describing not much more than the concept of an algorithm that weights regions based on GDP.

Here is more from Masnick:

The next big case to pay attention to concerning software patents appears to be the CLS Bank v. Alice Corp. case, which is being reheard “en banc” (by the full slate of judges) at the federal circuit court of appeals (CAFC). The short version of the case is that it involves a patent over the idea of software that conducts a “shadow transaction” to make sure that there are enough funds to complete a real transaction, before allowing the real transaction to go through, thus minimizing “settlement risk” (the risk of the deal not actually being completed). Should that be patentable? Well, that’s part of the argument. The district court tossed out the patent as being simply about an “abstract idea,” which is not patentable, as abstract ideas are excluded from section 101 of the patent act, which lists out patentable subject matter. On appeal, a divided three judge panel overturned the lower court, and said that when you looked at the invention as a whole, it was patentable subject matter under section 101. The full CAFC has agreed to rehear the case, and the amicus briefs are flowing in, as people realize that this case is the next key battleground over software patents.

Of course, as often happens in these kinds of cases, you get amicus briefs with wildly divergent claims. For example, here we’ll show and discuss the briefs from both the EFF and the Business Software Alliance (BSA). Somewhat surprisingly, both of those briefs agree on one thing: that the actual patent in question should be ruled invalid, as in the district court ruling. But that’s about the extent of the similarities between the two — who paint extremely different versions of the world of software patents today. The EFF brief explains how damaging software patents are to innovation and the wider economy while the BSA brief talks about how software patents are the greatest thing ever for innovation. One of these three-letter-acronymed organizations is wrong, and it’s not the EFF.

The EFF is also getting involved now:

The Electronic Frontier Foundation (EFF) urged the full Federal Circuit today to throw out the dangerous patents it previously held valid in CLS Bank v. Alice Corp, arguing that the court’s earlier decision goes against the law and helps foster the recent dramatic increase in patent litigation. In the amicus brief filed today, EFF proposes that the court require patent owners to claim what they actually invent and nothing more.

“The Patent Act doesn’t protect abstract ideas because it would lead to harmful monopolies on simple ideas, like ways of running a business or cooking a meal,” said Staff Attorney Julie Samuels. “Yet we’re still routinely seeing patents issued based on abstract ideas, and having those patents upheld in some courts. In an environment like this, it should be no surprise that company after company decides to buy a lottery ticket in the guise of a dubious software patent and see if it can hit the jackpot. The Federal Circuit has a chance to help curb this new rash of patent lawsuits.”

The system has been abducted by monopolies. It is time to sue it, abolish it, or whatever it takes, but it won’t be easy when everyone including politicians is bought (bribed). The USPTO is not an independent body; it is controlled by its major clients, i.e. companies like IBM, which also control the politicians. People who call for ending the Federal Reserve are perhaps missing another important institution that needs ending and that’s the USPTO, perhaps wirh the exception of trademarks.

Share this post: These icons link to social bookmarking sites where readers can share and discover new web pages.
  • Digg
  • del.icio.us
  • Reddit
  • co.mments
  • DZone
  • email
  • Google Bookmarks
  • LinkedIn
  • NewsVine
  • Print
  • Technorati
  • TwitThis
  • Facebook

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. Techrights Confirmed as a Target of EPO Surveillance, With Help From Control Risks Group (CRG)

    Unveiling the cloak of secrecy from long-term surveillance by the European Patent Office (EPO) and a London-based mercenary it hired, bypassing the law



  2. Google's Fight to Keep APIs Free is Lost, Let's Hope Google Continues Fighting

    SCOTUS refuses to rule that APIs cannot be considered copyright-'protected', despite common sense and despite Java (which the case is about) being Free/libre software



  3. Patent Trolls in the Post-Alice World

    A round-up of news about patent trolls in the United States, some of whom are are doing well and some of them not as well



  4. DDOS Attacks Against Techrights

    Information about some of the most recent DDOS attacks against this Web site and the steps to be taken next



  5. The Patent System Not What it Used to be, Large Corporations and Patent Lawyers the Principal Beneficiaries

    A look at some recent patent stories and what can be deduced from them, based on statistics and trends



  6. After Intervention by the Council of Europe Comes a Detailed Summary of the Situation in the European Patent Office (EPO)





  7. IRC Proceedings: May 31st - June 27th, 2015

    Many IRC logs



  8. Links 28/6/2015: Manjaro Linux Cinnamon 0.8.13, VectorLinux 7.1

    Links for the day



  9. Williamson v. Citrix Online (at CAFC) Reinforces Alice v. CLS Bank (at SCOTUS) in Crushing Software Patents

    More patent news from the United States, again serving to indicate that software patents over there are getting weak (harder to defend in court or acquire from the patent office)



  10. Proskauer Rose LLP is Cherry-Picking Cases to Make Software Patents Seem Eligible Despite Alice v. CLS Bank

    Naming and shaming those who are trying to reshape the consensus despite a rather consistent pattern of software patents being rejected



  11. IAM Biased: How IAM 'Magazine' Glorifies Patent Stockpiling

    A look at the bias of one of the most overzealous sites for and by patent lawyers



  12. PATENT Act No Longer in the News... and That's Just Fine

    Putting the PATENT Act aside for the time being, for it has little or no impact on the really problematic patents



  13. The Latest Lies From Microsoft's PR Apparatus/Public Face, Mr. Nadella

    Having spread the outrageous lie that “Microsoft loves Linux” (whilst obviously attacking it in many ways), Microsoft's CEO (essentially Bill Gates' right-hand man) says Microsoft is “one of the biggest contributors to Linux kernel” (because of proprietary software it tries to contaminate it with while violating the terms of the GPL)



  14. Microsoft Jack (Schofield) Promotes Microsoft's Proprietary Lock-in and Calls People Who Recommend Free/Libre Software 'Trolls'

    Jack Schofield, writing for a Bill Gates-funded paper despite claiming to have retired, promotes Microsoft Office and insults all those readers who do not agree with him



  15. The Council of Europe Slams the EPO as Political Pressure Grows for EPO Management to Obey the Law

    Battistelli et al. come under yet more fire as politicians -- many of whom from Battistelli's home country -- become better informed of the EPO's management fiasco, abuses, and scandals



  16. Operating Systems Usage Based on Technical Site Statistics

    ome numbers to show what goes on in sites that do not share information about their visitors (unlike Windows-centric sites which target non-technical audiences)



  17. Links 27/6/2015: Wine 1.7.46, SparkyLinux 4.0

    Links for the day



  18. Proprietary Software on Top of Proprietary Software (AV on Windows) Only an Illusion of Security

    Remarks on the recent revelations about code and communication interceptions targeting insecurity firms and Microsoft's claim that 'transparency' alone would be enough to assure security



  19. The EPO's Circus of Nepotism, Corporatism and Gross Abuse is Promoting the Unitary Patent

    The shameful management of the EPO, which Benoît Battistelli constructed based on his nefarious self-serving agenda, keeps pushing forth in a direction that greatly harms European citizens while mistreating the EPO's technical staff (scientists and examiners)



  20. Links 26/6/2015: Ardour 4.1, GNOME 3.17.3 Released

    Links for the day



  21. An Estimated 1,000 EPO Staff in Munich Demonstrated Against EPO Management Yesterday Afternoon

    Earliest coverage of yesterday's protest against EPO corruption and abuses



  22. Microsoft Windows So Insecure That Even Fonts Are Remotely Exploitable

    Windows userbase is once again under serious threat and high risk because something as simple as fonts (rendering of text/pixels on the screen) isn't done securely in Windows



  23. Microsoft is 'Buying' the Media Ahead of Vista 10 Launch

    Signs serve to indicate that Microsoft is already tightening its grip on technology news sites, ensuring that they give Microsoft disproportionate levels of coverage



  24. DockerCon 2015 Infiltrated by Microsoft

    DockerCon gives room to Microsoft propagandists who want to divert the audience's attention from secure GNU/Linux focus to proprietary Windows with back doors and surveillance



  25. Links 25/6/2015: Docker Focus, NVIDIA Opening Slightly

    Links for the day



  26. The Lie or the Fiction of Microsoft Tolerating GNU/Linux

    The 'Microsoft loves Linux' nonsense cannot be put to rest, as that tired old lie keeps resurfacing in the media



  27. Microsoft is Again Demonstrating That It is Not Interested in Making Windows Secure

    Microsoft decides to leave Windows with flaws in it, claiming that fixing the flaws would not be worth Microsoft's resources



  28. Not Only is Vista 10 Not Free, It is Getting More Expensive, According to the Taiwanese Press

    More proof that Microsoft charges quite a lot for Vista 10 (at OEM level), despite the perpetual deception about costs



  29. EPO Protest in Munich and Growing Unpopularity of EPO Management, Media Manipulation by the Management

    Poll shows that the European Patent Office (EPO) comes under fire for its media strategy which involves wasting taxpayers' money on fake/organic media coverage that glorifies the EPO



  30. Links 24/6/2015: Meizu MX4, Red Hat and Samsung Partner, Women in Open Source Awards

    Links for the day


CoPilotCo

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

CoPilotCo

Recent Posts