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06.07.13

The Good News: White House Knows the Patent System is Broken. The Bad News: It Does Not Understand Why.

Posted in Microsoft, Patents at 3:24 am by Dr. Roy Schestowitz

The Red Room is still dominated by corporate guests like Gates and Ballmer

Red Room

Summary: A summary of thoughts and analysis amid White House statements regarding the patent system

There is good news but also bad news, as we noted earlier this week. For quite some time now, US politicians have been pushing for reform involving trolls but not software patents, or scale rather than scope [1, 2, 3, 4, 5, 6, 7].

“…fighting patents one by one will never eliminate the danger of software patents, any more than swatting mosquitoes will eliminate malaria.”
      –Richard Stallman
A high-tier court decision regarding software patents sure had the potential to change the consensus about patentability of software in the US. It didn’t happen though. The patent lawyers are littering 'legal' sites (designed for patent lawyers’ interests, suiting the target sudience) with yet more promotion of software patents, characterising the latest CAFC ruling as providing “limited guidance”. The problem is, the news feeds on the subject of software patents are filled to the rim with software patents promotion like this. By this point, those who claimed that many software patents had died in the US have been mostly washed away by the stampede of overzealous patent lawyers. It was the same after the Bilski case. Life goes on, the status quo is hardly challenged.

The EFF has lost its sting because it recently started focusing on patent trolls again (like this one), instead of software patents. Here is the alleged troll:

The “inventor,” Jim Logan, started a completely failed business around delivering audio news on cassettes. And now he claims to have invented podcasting and wants a cut. Once again, it’s an example of everything that’s wrong with the patent system.

Dr. Richard Stallman, whom I habitually chat with, famously said that “fighting patents one by one will never eliminate the danger of software patents, any more than swatting mosquitoes will eliminate malaria.”

Likewise, going after one particular segment is hardly the solution to the problem.

A lot of reports about Obama’s attention to patent trolls can be found out there, including weird intervention by a SCOTUS judge. As one reporter put it:

Given the timeliness of the issue, it’s no shock to see an op-ed about the issue in today’s New York Times, suggesting a solution to “[t]he onslaught of litigation brought by ‘patent trolls.’” But the missive comes from a surprising and influential source—Randall Rader, the Chief Judge for the US Court of Appeals for the Federal Circuit, which hears all patent appeals.

Here is the original. Just like Judge Posner [1, 2, 3, 4, 5, 6], Rader turns into some kind of columnist, which is inappropriate and unprofessional. Rader responds to the White House’s move, showing himself to be another politician in a robe. Here is the original fact sheet accompanying this blog post, request for feedback, and social media posts. Well, we’ll spare unneeded repetition of the news and concentrate on EFF posts from Julie Samuels, who targets not software patents but patent trolls (loss of focus at the EFF). Gérald Sédrati-Dinet (of April) tells Samuels “go go go for a clear exclusion and/or exception for #SoftwarePatents” while Andy Updegrove, a “good lawyer”, has this analysis which says:

Yesterday, the Obama administration announced a new effort to curb baseless patent lawsuits, which it believes are stifling innovation and economic activity. The new initiative would take five actions under the President’s Executive authority, and also makes seven legislative recommendations intended, “to protect innovators from frivolous litigation and ensure the highest-quality patents in our system.”

Steph Kennedy, the person behind That Patent Tool and a funny blog about patent trolls, wrote about this also. Matthew Rimmer ‏thinks aloud: “Given Obama’s US initiatives, why doesn’t the Trans-Pacific Partnership have proper safeguards against “patent trolls”?” Good question and probably a rhetorical one, too.

Press coverage [1, 2] and blog coverage [1, 2], including coverage from the Gates-funded ‘Guardian’, has not been great. It was shallow and it didn’t add much, unlike Masnick’s great site which noted:

We’d already discussed President Obama’s proposals for patent reform, but now that the announcement is official, it’s worth also looking at the report about the broken patent system that was released at the same time from the White House, put together by the President’s Council of Economic Advisers, the National Economic Council, and the Office of Science & Technology Policy. It’s a quick read, but does cover many of the high points of just how broken the system remains.

Will Obama put an end to Intellectual Ventures (IV), by far the world’s biggest patent troll which was was recently exposed as having around 2,000 proxies? It’s a pyramid scheme that should be pursued with criminal charges, not a mere reform in the patent system. Watch the “Cult of Gates” as iophk calls it. The pro-Microsoft site which does damage control like this as the CIO of Microsoft quits, is still trying to portray IV as anything but a troll. Bishop, a longtime friend of Microsoft who has whitewashed the Gates Foundation with its patent troll partner (IV) and continues to do so, is at it again, responding to the facts about IV by saying “Microsoft chief technology officer, who still works regularly with Bill Gates on a variety of businesses and projects.”

“Google knows how to fight, and if you look at their record, they tend to win in the end. As for Microsoft, is their motto, Always do Evil?”
      –Pamela Jones
Yes, Gates is well connected to this troll and he too should come under Obama’s hammer, but will he?

Here is the original piece (transcript) and a timely reminder that trolls are not the sole issue. Obama should also go after companies like Monsanto and Microsoft,

Simon Phipps, OSI President, says about the damage control from the pyramid scheme that “Intellectual Ventures recognises we all think their business stinks and promises to do a better job hiding it” (IV is quite secretive indeed, and the thousands of proxies help obfuscate its modus operadi).

Pamela Jones helps remind us of how Microsoft uses trolls as proxies in its battles. Regarding Vringo Jones wrote: “A couple of things about this Vringo affair. First, Mark Cuban bought a 7% interest. Blech. Speaking of stupid patents, Google has asked for reexamination of the patents, and some of the claims were already preliminarily rejected. And with Google’s record in patent cases, these greedy folks may just end up put out of the Vringo lawsuit business. Hence Microsoft transferring to them some patents? You think? You can find directions to find the USPTO office action on the two patents in suit — 6,314,420 and 6,775,664 — here if you’d like to track it, and if you know of any prior art, sing out. Vringo investors stated that their goal was multiple billions in both damages and royalties from Google, and that dream has died, and they also predicted that they’d send Google’s stock to zero. What kind of malevolent dream is that? They imagined Google would settle. Good luck with that, bullies. Google knows how to fight, and if you look at their record, they tend to win in the end. As for Microsoft, is their motto, Always do Evil?”

On a separate occasion she wrote regarding MOSAID, another troll which Microsoft uses as a proxy. Correctly, in light of this article she wrote: “Good! People are noticing what I’m noticing. Have I not been telling you this for a long time? And may I please point out a smarmy irony? Microsoft is complaining with tears and loud outcries to courts about Motorola asking its usual price for FRAND patents, and meanwhile, it joins with Nokia to transfer FRAND patents to a troll, with the explicit hope of being able to avoid the FRAND commitment, as the article points out: “Nokia could not assert these 2,000 patents without breaking patent peace and risking counter-suits for patent infringement. MOSAID can use these patents without fear because MOSAID does not practice in the industry and immune to countersuits. The transfer also allows Nokia to evade a FRAND commitment not to charge more than 2% total royalty for all the wireless SEPs in Nokia’s portfolio.” Priceless. 2% is very close to what Motorola was asking. How amazing Microsoft’s gall is. Nokia… what can I say? It’s pitiful. Doesn’t Microsoft know how to compete without antitrust issues coming to stage front, center? They should put some of this wonderful energy into making better phones and tablets, methinks, instead. And if they can’t, they should step back and leave others alone instead working for destruction of others whose products people actually do want to buy. Patent litigation is what dying companies resort to. The article doesn’t seem to have a link to the article it says we should all read, so I looked around, and I think this is probably the one [PDF], an article titled “Patent Assertion Entities and Antitrust: Operating Company Patent Transfers” from April, available on the Antitrust Source website.”

“MOSAID can use these patents without fear because MOSAID does not practice in the industry and immune to countersuits.”
      –Pamela Jones
And what about IV? This is Microsoft’s largest troll proxy. It feeds companies that act as second-tier proxies, e.g, Lodsys, to attack Android and Apple’s iOS developers, essentially extorting them.

Jones had this to say about Apple: “Here’s what I think folks are missing. They keep writing that Samsung hasn’t done well in the US against Apple, as if Apple keeps winning. It won once, damages, but it failed to win an injunction. As for the Motorola case, Motorola won an injunction against Microsoft in Germany, but Microsoft then got a home-team judge in Seattle to block it. Samsung also won several rulings against Apple in the UK and in Europe. It prevailed in a Dutch ruling just this week, which found that it had not infringed Apple’s design patents. The UK not only ruled the same; if force Apple to publicly apologize for claiming that Samsung was a copycat.

“What is significant about this win for Samsung is this: It is the first time either Samsung or Apple has won an injunction against the other. The second huge win is because Samsung won at the ITC with FRAND patents, which both Apple and Microsoft have been claiming should never be allowed to even ask for an injunction. If we analyze the whole picture, then, I’d have to say Samsung is now doing better than Apple. I hate software patents, personally, and I don’t believe they are valid, and watching this all play out makes me hate them more, but if you are analyzing events, there is no question Apple’s thermonuclear war against Android is fizzling out, and after the President’s trim-the-trolls announcement, I think extremist patent strategies will be less and less successful, precisely because we are all sick of it and the President is now sick of it too, evidently. He may be focusing specifically on trolls, but all the fighting is exhausting and unappealing to watch play out. Nobody, other than the parties,
wants either company’s products banned. There. I said it. We hate patent law for even making all this possible.”

“…after the President’s trim-the-trolls announcement, I think extremist patent strategies will be less and less successful, precisely because we are all sick of it and the President is now sick of it too, evidently.”
      –Pamela Jones
Android is not under attacks only by trolls but also Apple, Microsoft and Oracle (CPTN), which faces growing opposition as documented by Groklaw over the past week or so. Tackling the trolls won’t be enough. Jones too said this several times before, so why cheer so much over Obama’s latest move?

Microsoft’s chief patent terrorist, Horacio Gutierrez, says “Devil’s in the details: Proposal to expand business method rules to software patents could harm innovation and jobs” (link to Microsoft’s lobbying blog where extortion legalisation is constantly advocated by Gutierrez). At least we see reaffirmation of Microsoft’s strong anti-Linux and anti-FOSS position. How convenient software patents must be for them now that they have a monopoly and a pocket deep enough to engage in SLAPP-based (strategic lawsuit against public participation) racketeering.

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A Single Comment

  1. Needs Sunlight said,

    June 7, 2013 at 4:00 am

    Gravatar

    That’s a clever trick there. Sign a patent ‘truce’ over certain groups of patents and then quietly sell them off to a troll who can then do the dirty work. The previous owner can then disclaim responsibility for what happens next.

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