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08.26.16

Erosion of Patent Quality Enables Patent Extortion With Large Portfolios of Low Validity Rate

Posted in America, Apple, Courtroom, Europe, Microsoft, Patents, Samsung at 7:55 am by Dr. Roy Schestowitz

Quality of patents causes markets to prosper or contrariwise perish

Many sacks
Giving aggressors like Microsoft sacks of patents to breed Mafia-like behaviour, not healthy competition

Summary: Revisiting the EPO’s vision of poor patent examination and the effect of discriminatory granting practices, favouring patent bullies such as Microsoft (which actively attacks Linux using low-quality and usually pure software patents)

“A skilled patent attorney working with a qualified searcher could cobble together a colorable obviousness argument against the vast majority of issued patent claims,” says a new article from Patently-O. Not to mention “abstract” criteria, prior art and so on. “Part of the difficulty for patentees,” continues the article, “stem from the the billions of prior art references available via increasingly effective search tools. Even when an invention results from a ‘flash of genius,’ patent law typically back-fills extensive knowledge for the obviousness analysis – even when that knowledge was not actually available at the time of the invention. The larger difficulty though is likely the large number of hard-to-pin-down facts such as the motivations, common sense, and level of creativity of a person having ordinary skill in the art.”

“In the case of large companies like Microsoft, mountains of patents (granted in bulk by the EPO]) can be used to compel companies to pay up without even a trial.”If the EPO replaces examiners with algorithms, things will exacerbate further and patents get granted incorrectly, leading to an ocean of frivolous lawsuits. In the case of large companies like Microsoft, mountains of patents (granted in bulk by the EPO) can be used to compel companies to pay up without even a trial. Recall the Microsoft v TomTom case. Picking on small companies is Microsoft’s thing; it doesn’t sue Google.

The above reminds us of the danger of poor patent quality as well as streamlining grants, which is what Battistelli’s EPO has in effect done for Microsoft (and evidence we showed for that led to legal threats from the EPO). They — like the USPTO — in effect facilitate patent racketeering by Microsoft.

“They — like the USPTO — in effect facilitate patent racketeering by Microsoft.”Watch this new article titled “Primetime: Microsoft’s Android Cross Patent Dealings”. That’s misleading because it's not cross-licensing, it's a patent settlement (in bundling form) and it’s essentially a patent shakedown without even a trial and without an opportunity to properly assess the quality (and thus in/validity) of patents. The article says that “to press on this advantage, Microsoft does need to sign into more cross licensing or similar patent deals with manufacturers. Given Microsoft’s patent portfolio and how useful this will be to those manufacturers wishing to break into the North American market, such as Xiaomi, we may be seeing more of these arrangements in the coming months. The alternative might be Microsoft suing any manufacturer that tries to sell devices into a patent-friendly market.”

But again, these are not cross-licensing deals, these are patent shakedowns. One might even call this extortion or racketeering, even though Microsoft is too well-connected to face court charges brought forth by the government.

It is worth noting that many of Microsoft’s patents — those which it uses to shake down Android players (OEMs) — are not even valid anymore (if properly scrutinised), but there are so many of them that it would cost a fortune to demonstrate it to the court. It’s a numbers game, quantity rather than quality. It’s cheaper to just settle and let Microsoft continue to wield software patents like a weapon, even post-Alice. PTAB cannot take a request to review hundreds of patents from just one single company because it’s already overburdened by a growing number of reviews (IPRs).

Speaking of patent aggressors, there is this new software patent from Facebook (the usual, see our Facebook wiki page). These are oftentimes surveillance patents, but this time is’s about languages, at a time of increased competition with Google. Facebook's growing stockpile of patents is a real problem (Facebook has a history of going aggressive with them) and The Next Web says that “the US patent office issued 6,789 patents. Each patent adds a little something new to the human knowledge base. As we cannot list all six thousand, the PatentYogi team has selected the five most interesting patents.” How many of these are software patents that oughtn’t have been granted? How many of these will be toothless some time in the near future?

Patently-O says “The number of pending Ex Parte appeals continue to drop. Great work PTO.” There are other statistics of interest, based on PDFs from the USPTO (like this one). Patently-O claims they suggest that: “Design patent applications expected to reach 40,000 for FY2016 – up from under 30,000 in FY2010. The PTO is working to improve design patent prosecution speed – current wait of more than a year for a first office action.”

Well, the Office may have granted 40,000 patents on designs, but once reassessed the Office may need to throw them all away, on a per-request basis (post-Apple v Samsung at SCOTUS). Granting again for the sake of granting? Until the next Alice happens?

Patent quality control is the principal pillar of true and potent patent offices, otherwise they would be just archives of untested claims (a registration/filing system).

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