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. Links 28/6/2016: Red Hat Summit 2016, Hadoop Events

    Links for the day



  2. Today's Media Coverage Says Microsoft Loves Linux, But Today Microsoft Extorted Linux Using Software Patents Again

    Luna Mobile has just been extorted by Microsoft (using dubious software patents, as usual) for using Android/Linux, but Microsoft-influenced media carries on spreading the lie that "Microsoft loves Linux"



  3. New Efforts to Work Around Barriers to UPC in Light of 'Brexit'; Behind These Efforts Are Self-Serving Patent Profiteers

    look at who's trying to work around the latest barriers to the widely-unwanted (by the public) Unitary Patent regime and what is being planned behind the scenes, or behind closed doors (by and for those who stand to profit from the Unitary Patent regime)



  4. Injunction Against Battistelli's Investigative Unit (Known Internally as 'Gestapo') Amid Serious Injustices and Bogus 'Trials'

    SUEPO, the EPO's staff union, steps up its spiel in a case against the "European Patent Organization" as defendant and "SUEPO/VEOB" (Trade Union of the European Patent Office) as claimants



  5. [ES] Con la UPC Muerta por el Resto del Termino de Battistelli, No Hay Razón para que la EPO o el Consejo Administrativo Sigan Manteniéndolo Más

    Pensamientos acerca de lo que pasará al líderazgo de la EPO después de ‘Brexit’ (salida Británica de la EU), lo que sevéramente socava el proyecto más grande de Battistelli el que usaba habituálmente para justificar sus increíbles abusos



  6. [ES] El Caradura Benoît Battistelli Debería Renunciar a Luz de la Filtrada Nueva Decisión en Su Vendeta en Contra de un Juez que se Atrevió a Decir la Verdad (Actualizado)

    Benoît Battistelli continúa quebrando las propias reglas de la EPO, no sólo las leyes naciónales, como una nueva decisión ayuda a revelar



  7. [ES] Cada Vez Más Parece Que Battistelli está Escondiéndo ‘Evidencia’ Falsa y/o Ilegalmente Obtenda de la Unidad Investigativa de la EPO

    El porqué creemos que Benoît Battistelli está cada vez mas desesperado de esconder operaciónes ilícitas de reunir ´evidencia´ lo que eventuálment lo puso a él mismo — no al acusado — en una situación catastrófica situacion que lo puede forzar (esperamos) a us renuncia



  8. Links 28/6/2016: Vista 10 Updategate, OpenMandriva 3.0 Beta 2

    Links for the day



  9. Links 27/6/2016: Linux 4.7 RC 5, OpenMandriva Lx 3.0 Beta 2

    Links for the day



  10. From Alleged Organised Crime to Vice-President of the European Patent Office (EPO)

    Željko Topić's situation in Croatia illuminated by means of recent documents from the authorities



  11. Battistelli May Still be on the Way Out as Pressure Grows in Germany, UPC in Shambles

    Pressure on Battistelli is growing even from within circles that are traditionally protective of him and a long letter is sent to Dr. Christoph Ernst, who some believe will replace Battistelli



  12. Caricature: European Patent Office (EPO) Under Battistelli

    The latest caricature about the state of the European Patent Office (EPO)



  13. Techrights (Almost) at 10: From Software Patents to Novell and to Present Focus on EPO

    A short story about how and why we ended up writing so much about the European Patent Office (EPO) and the impact beyond Europe



  14. Patents Roundup: Bad Quality (USPTO), Bad Analysis (India), Bad Microsoft, Bad Actors (Trolls), Bad Scope (Software Patents), and the Ugly

    A mishmash of news about patents, mostly regarding the United States, and what can be deduced at the moment



  15. Links 26/6/2016: IceCat 38.8.0, Wine 1.9.13

    Links for the day



  16. With UPC Dead for Battistelli's Entire Remaining Term, No Reason for the EPO or the Administrative Council to Keep Battistelli Around

    Thoughts about what happens to the EPO's leadership after 'Brexit' (British exit from the EU), which severely undermines Battistelli's biggest project that he habitually used to justify his incredible abuses



  17. Links 24/6/2016: Xen Project 4.7, Cinnamon 3.0.6

    Links for the day



  18. Benoît Battistelli Should Resign in Light of New Leak of Decision in His Vendetta Against Truth-Telling Judge (Updated)

    Benoît Battistelli continues to break the EPO's own rules, not just national laws, as a new decision helps reveal



  19. Fake Patents on Software From Fake Australian 'Inventor' of Bitcoin and the Globally-Contagious Nature of EPO Patent Scope

    News from Australia regarding software patents that should not be granted and how patent lawyers from Australia rely on European patent law (EPO and UK-IPO) for guidance on patent scope



  20. Patent Lawyers Love (and Amplify) Halo and Enfish, Omit or Dismiss Cuozzo and Alice

    By misinterpreting the current situation with respect to software patents and misusing terms like "innovation" patent lawyers and others in the patent microcosm hope to convince the public (or potential clients) that nothing in effect has changed and software patents are all fine and dandy



  21. Looks Increasingly Plausible That Battistelli is Covering up Bogus and/or Illegally-Obtained 'Evidence' From the EPO's Investigative Unit

    Why we believe that Benoît Battistelli is growingly desperate to hide evidence of rogue evidence-collecting operations which eventually landed himself -- not the accused -- in a catastrophic situation that can force his resignation



  22. As Decision on the UK's EU Status Looms, EPO Deep in a Crisis of Patent Quality

    Chaotic situation at the EPO and potential changes in the UK cause a great deal of debate about the UPC, which threatens to put the whole or Europe at the mercy of patent trolls from abroad



  23. Another Demonstration by European Patent Office (EPO) Staff on Same Day as Administrative Council's Meeting

    SUEPO (staff union of the EPO) continues to organise staff actions against extraordinary injustice by Benoît Battistelli and his flunkies whom he gave top positions at the EPO



  24. Links 23/6/2016: Red Hat Results, Randa Stories

    Links for the day



  25. Interview With FOSSForce/All Things Free Tech

    New interview with Robin "Roblimo" Miller on behalf of FOSSForce



  26. Links 22/6/2016: PulseAudio 9.0, GNOME 3.21.3 Released

    Links for the day



  27. IP Europe's UPC Lobbying and the EPO Connection

    The loose but seemingly ever-growing connections between AstroTurfing groups like IP Europe (pretending to represent SMEs) and EPO staff which is lobbying-centric



  28. EPO “Recruitment of Brits is Down by 80%”

    Letter says that “recruitment of Brits is down by 80%” and "the EPO lost 7% of UK staff in one year"



  29. The Conspiracy of Patent Lawyers for UPC and Battistelli's Role in Preparing by Firing People

    The parasitic firms that lobby for the UPC and actually create it -- firms like those that pass money to Battistelli's EPO -- are doing exactly the opposite of what Europe needs



  30. Patent Lawyers, Having Lost Much of the Battle for Software Patents in the US, Resort to Harmful Measures and Spin

    A quick glance at how patent lawyers and their lobbyists/advocates have reacted to the latest decision from the US Supreme Court (Justice Breyer)


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