Bonum Certa Men Certa

The US Patent System: Where One Wastes Years in Court and Spends $8,000,000 in Lawyers' Fees Fighting a Bogus Patent

The US patent office has essentially externalised the costs to the public

Alice road



Summary: A roundup of news about software patents in the US and what they have led to, owing in part to the USPTO's declining patent quality (leaving others to clean up its mess)

THE ridiculously low standards of the USPTO come at a huge cost, albeit this cost is considered an externality by this greedy patent office. Unless this mess is sorted out soon, the US might have nothing left but large multinational corporations with tens of thousands of patents each, as opposed to agile startups with none.



Elliot Harmon says that this one particular software patent, which can possibly be demolished quite easily using Alice, has been used in the Eastern District of Texas and it's the "Stupid Patent of the Month" (as per the series of the EFF). To quote:

This month, a company called Voice2Text Innovations filed patent infringement lawsuits against two voice over Internet protocol (VoIP) services, Phone.com and Vitelity. Voice2Text has no website or any other information online; its sole asset appears to be US Patent No. 8,914,003—unsurprisingly, a patent on using voice recognition to convert a voicemail into a text message. Equally unsurprisingly, it’s filed those suits in the Eastern District of Texas, whose patent-troll-friendly practices we’ve thoroughly documented on this blog. The Voice2Text patent is so absurd that we had to honor it with our Stupid Patent of the Month award.


"Unless this mess is sorted out soon, the US might have nothing left but large multinational corporations with tens of thousands of patents each, as opposed to agile startups with none."In order to destroy such a patent one might need to spend quite a lot of money rather than settle. Consider this new story titled "Court Orders Plaintiff to Pay Defendants’ $8 Million in Attorney’s Fees in Patent Row". That's a lot of money; patent lawyers grossly overcharge and the system plays in their favour by inducing additional costs at many levels (e.g. appeals), thus favouring those with bigger budgets or deeper pockets, leaving small players vastly more vulnerable. To quote the concluding words: "This case illustrates that the courts will take strong action when faced with baseless claims, hidden or altered evidence, and misleading statements made to the court or opponents. It also serves as a strong reminder to consider your counsel carefully, and the advice that they provide, or a plaintiff may have to pay its own fees and those of the defendant, which in this case amounted to another $8 million."

This case may be the exception rather than the norm, but judging by NewEgg's decision to stand up to trolls, it often costs literally millions and there is no guarantee of the plaintiff -- upon loss -- bearing the cost of the defendant's (victim's) legal bills. NewEgg actually made history by managing to compel a patent troll to pay its victim's legal fees some months ago, owing to an unusual decision by the judge.

"NewEgg actually made history by managing to compel a patent troll to pay its victim's legal fees some months ago, owing to an unusual decision by the judge."Patently-O has just recommended Lynda J. Oswald's relatively new paper which criticises the term “strict liability” and whose abstract says: "In 1995, the Federal Circuit summarily attached the label of “strict liability” to direct patent infringement, even though that term does not appear in any U.S. Patent Act of the past two centuries. The catechism of “strict” direct patent infringement liability is now so well-engrained in patent doctrine that it is easy to lose sight of how recent the advent of this terminology is in the case law, and how troublesome application of this standard has proven, even to the Federal Circuit, which created it. The first patent act (1790) preceded the emergence of tort law as a distinct field of U.S. common law (mid-1800s) by a half-century or more, and the products liability explosion of the mid-twentieth century radically altered our understanding of strict liability. The implications of this forgotten timeline are profound. “Strict liability,” particularly in its modern formulation, is not a neutral, descriptive term. Rather, the term evokes social policy choices and balancing considerations that may be appropriate within the case law context of products liability or abnormally dangerous activities, but which are incongruous and inapposite in the statutory context of patent law. Deeming direct patent infringement to be a strict liability leads to two unanticipated and unwelcome effects. First, the adoption of the “strict liability” label for direct patent infringement liability improperly inflates the courts’ role in setting direct patent infringement liability standards and suggests — incorrectly — that patent liability is a case law construct, when in fact it is a statutory construct. Second, the “strict liability” label improperly shifts the focus of the patent infringement inquiry from the Patent Act’s protection of the plaintiff’s exclusive property interest in its patent right toward a value-laden examination of the social utility of the defendant’s conduct vis-à-vis the injury to the patent holder. Jettisoning the “strict liability” label for direct patent infringement would reframe the analysis and debate, moving direct patent infringement liability out of a policy framework and back toward its proper statutory setting."

"PTAB is increasingly being used to correct the USPTO's errors, but why not dig deep into the root of the problem and simply tackle the USPTO's unrestrained greed?"What's worth noting here is that a lot of the risk has been passed to defendants, not to plaintiffs, who often rely on poor quality examination by the USPTO (resulting in the grant of bogus patents). PTAB is increasingly being used to correct the USPTO's errors, but why not dig deep into the root of the problem and simply tackle the USPTO's unrestrained greed?

CAFC won't be coming to one's rescue after PTAB, according to one example just put forth by Patently-O. To quote Patently-O: "The Federal Circuit has denied en banc review of decisions in four inter partes review proceedings brought by Gnosis. Federal Circuit had previously affirmed the Patent Trial and Appeal Board’s IPR determination that the challenged Merck and SAMSF patent claims were invalid as obvious."

The relevance of this was ever more apparent when Bass gamed the value of companies by invalidating key patents -- a move which IAM now conflates with patent trolls by comparing Bass to trolls. Spangenberg is a patent troll, Bass invalidates patents. They have a very different modus operandi, but as IAM put it, the connection lies within a team-up: "Since teaming up with former IPNav CEO Erich Spangenberg to launch their first US inter partes review (IPR) in February last year – challenging a pharmaceutical dosage-related patent owned by Acorda Therapeutics – Kyle Bass has become one of the IP business world’s highest-profile players. Whether he should primarily be seen as antagonist, protagonist or the antihero somewhere in-between depends on your point of view. What is certain is that the validity actions being pursued by him and Spangenberg through their Coalition for Affordable Drugs – targeting patents belonging to pharmaceutical ‘originator’ companies – rocked the post-America Invents IP landscape."

"The USPTO's poor quality -- a trap which the EPO growingly falls into -- helps trolls, strategic predatory investors/hedge funds, and monopolists which do a disservice to innovation."What is worth noting here is that if the patents invalidated upon request by Bass were not granted by the USPTO in the first place, none of this would have happened. The USPTO's poor quality -- a trap which the EPO growingly falls into -- helps trolls, strategic predatory investors/hedge funds, and monopolists which do a disservice to innovation. Watch IBM's patent chief having the audacity this weekend to complain about the system which David Kappos from IBM made worse (in IBM's favour; IBM pays him now for lobbying), furthermore complaining about a system outside his own country (Australia) because it attempts to improve patent quality, as we noted yesterday.

Recent Techrights' Posts

Microsoft said “GitHub and its leadership team will continue its mission as part of Microsoft’s CoreAI organisation.” But it's just an empty shell created earlier this year.
In short, it's not too clear what Microsoft has just done except dumping GitHub - i.e. mostly a Web site that loses a ton of money (it always lost money) - into some mysterious new bucket
IBM Layoffs in MCC, or Marketing, Communications and Corporate Social Responsibility (CSR)
IBM and Microsoft inflate their share price by circular financing
The Register MS gets Lazy, Uses Slop
Unlike 3-D renderings or "Classic" CG, slop images aren't quite original and definitely not fair use
Overly Maximalist, Expensive, Localised Patent Law is Dooming Western Companies, Argue 3-D Printing Champions
We've long warned (over 7 years already!) that China's approach to patents will impress WIPO by gaming the totals but will doom the West
Microsoft's Windows in Gabon: Still Moving Down
What is this Unknown? Who knows...
 
Links 19/08/2025: "NASA Is Giving Up on Climate Change Science" and "Earth's Continents Are Drying Out at an Unprecedented Rate"
Links for the day
Phil Wyett evidence & Debian Zizian plagiarism, modern slavery tendencies
Reprinted with permission from Daniel Pocock
In Many Countries People Move Away From Vista 11
Vista 11 has been available for download for 4 years already, but adoption has been poor
Desktops/Laptops Fall to All-Time Lows in the UK, So Why Does British Media Quote a Famous Criminal on "End of the Smartphone Era"?
mobile usage (for Web access) has never been higher, based on an Irish surveyor, statCounter
The Groklaw Web Site Has Been Hijacked by Scammers
Groklaw.net isn't a safe site to access at this time
Over at Tux Machines...
GNU/Linux news for the past day
IRC Proceedings: Monday, August 18, 2025
IRC logs for Monday, August 18, 2025
Online Safety Act Does Not Tackle the Worst (and Biggest) Culprits
if our governments are serious about tackling online harms, then they need to look closely at GAFAM and social control media giants
Chat Control (1 and 2) in the European Union Sends the Wrong Message
This is an EU law
Slopwatch: Google News and Serial Sloppers (Fake Articles About "Linux")
Calling out the culprits
Gemini Links 19/08/2025: Digital Legacy and Chat Control
Links for the day
English Law Misused by Americans and Irishmen Against Brits is Unfair
There's always a way to improve existing laws
Links 18/08/2025: "Microsoft Store" Gets Increasingly Hostile, "Cracking Abandonware DRM"
Links for the day
Gemini Links 18/08/2025: Summer "Gone" and Web Reposts in Gemini
Links for the day
Links 18/08/2025: LLM Reputation Damaged, Australia Catches Google Foul Play
Links for the day
Geeks Like GNU/Linux
The technical community seems to be consolidating and rallying around GNU/Linux
GNU/Linux is 486 in Ireland
4.86% that is
End of Reliable Media
it makes the world a worse place, it renders the Web a misinformation machine
Over at Tux Machines...
GNU/Linux news for the past day
IRC Proceedings: Sunday, August 17, 2025
IRC logs for Sunday, August 17, 2025
GitHub Won't Last Much Longer
Many things at Microsoft are going to go the way of the Skype (or "dodo"). GitHub will be among those.
We've Never Used Large Language Model (LLM)
we just never used an LLM
"Secure Boot" is a Security Problem, Not a Solution
These people don't try to improve security but to undermine security
Gemini Links 18/08/2025: Retro and Endless Escape from the WWW
Links for the day
Working Whilst Away From Home
Decades ago being away meant all sorts of problems associated with workflows and connectivity
The Next Version of Windows Will Always be the Best (for Microsoft)
It's worse and slower over time
"End of the Smartphone Era" According to Jeffrey Epstein's Key Enabler
They call it "sour grapes"
Links 17/08/2025: Strike Downs Air Canada, Postmortems of Putin's Red Carpet Summit
Links for the day
Links 17/08/2025: Slow Tools and Enshittification of YouTube
Links for the day
Don't Talk to Bullies
This serious matter is still being examined by British authorities
Links 17/08/2025: "The Performance of Power" and "My Undesirable Friends"
Links for the day
Growing Our Reach
Our goal was never "hits"
The Russian Vision of Technology
Russia's surveillance is very extensive
Sooner or Later Almost Everyone Will Know "AI" is Just a Go-To, Misused, Misapplied, and Grossly Overused Term of Liars and Con Jobs Who Ride a Ponzi Scheme
At the expense of people gullible enough to "invest" in this or take salaries/bonuses in the form of "stock" (tied to a Ponzi scheme)
The Register MS Has Begun Using Slop Images
It's not clear when it started; but it's definitely getting worse [...] Worst of all are 'articles' about slop that are themselves slop
Reddit Funded by Microsoft
Reddit is merely a filter and we knows who controls that filter (using money)
When It Comes to Technology, Mozilla and Firefox Are Illiberal
Last month in Planet Debian we saw one more person explaining to everyone how to "turn off" DRM in Firefox and hide the pop-up/s
Over at Tux Machines...
GNU/Linux news for the past day
IRC Proceedings: Saturday, August 16, 2025
IRC logs for Saturday, August 16, 2025
The Open Source Initiative Has Many Scandals, We'll Try to Summarise Them All
Open Source Initiative (OSI) hates facts
Open Source Initiative (OSI), Wikipedia, Molly De Blanc, and Censorship/Reputation Laundering
OSI is like SPLC. The old name remains, the mission changed
Gemini Links 17/08/2025: Misunderstanding "Geminiverse" and Let's Encrypt
Links for the day
Links 17/08/2025: Breaches, Layoffs, and Scams
Links for the day