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02.09.17

Good News on the Patent Trolls Front as Collapse of Such Parasitic Firms Continues, US Government Signals Ongoing Reform

Posted in America, Law, Patents at 9:47 am by Dr. Roy Schestowitz

KEEP CALM AND CRUSH PATENT TROLLSSummary: Judging by some of the latest news and developments, the crackdown on patent trolls is likely to continue this year and the Supreme Court is likely to crush the courts of the Eastern District of Texas

THE STRANGE WORLD of patent trolling has grown only in unpopularity and public disdain. I know people and companies that were personally and legally impacted by these. Thankfully, however, the USPTO took some steps towards tackling this plague, helped by courts including SCOTUS, which is likely to rule against the majority of patent trolls some time later this year.

Sites that speak for trolls (and are funded by some) are not particularly happy. We recently wrote about the RPX debacle and it turns out to be even worse than we thought. RPX is now headless and the head’s “departure, which was confirmed in a press release early yesterday morning, apparently came after a proposal he made to take the business private. According to the release, RPX’s board of directors “conducted a review of the company’s prospects and opportunities and disagrees with Mr Amster’s views on the matter”. Given that, Amster clearly had to go. As we also revealed last Friday, he has been replaced by general counsel Marty Roberts on an interim basis.”

“Sites that speak for trolls (and are funded by some) are not particularly happy.”RPX is not defensive, it’s a parasite or even a troll. It’s also supported by Microsoft, a notorious patent aggressor.

It sure looks like many trolls are rotting or dying these days. The father of patent trolling died a few months ago and shortly thereafter his own troll went under. We recently gave some more example of dead (or dying) patent trolls. They’re not publicly-traded entities, so it’s not easy to keep track of such things. Even the world’s largest patent troll, which is connected to Microsoft and was connected to the father of patent trolling, seems to be suffering a collapse (layoffs and founder heading outwards). Microsoft’s own in-house troll was recently decapitated and there too there are layoffs on the way.

“It sure looks like many trolls are rotting or dying these days.”Looking at IAM for some more troll news (they favour the trolls), it turns out that the IP strategist of American Express is quitting and in “IP Zone [he] will continue to make use of its online Virtual Intellectual Property Exchange (VIPEX) tool which IP owners can use to help manage the deal process.”

Sounds like a trolling operation, or a tool for armament of patent trolls. Will it take off? Hopefully not.

In another new post from IAM, which loves the trolling it sees in China, it is being shown that east Asia is quickly becoming a patent trolls hub, as many observers already warned before. Xilinx is now being targeted; its products helped me learn how to develop software at chip design level (I constructed a calculator in just a few days using gate-level design when I was 19).

“Microsoft’s own in-house troll was recently decapitated and there too there are layoffs on the way.”Is there anything that trolls won’t ruin and outright destroy? To quote IAM, “Japanese sovereign patent fund (SPF) manager IP Bridge launched its latest patent assertion campaign at the end of last month, suing fabless chipmaker Xilinx in the Eastern District of Texas.” (EDTX)

Now they do this in Beijing, Tokyo and even Guam. Horrible. We need to be aware of the impact this will have on ordinary people.

Earlier this week Professor Dennis Crouch offered his thoughts on Neil Gorsuch, who is likely to join SCOTUS soon (and will thus rule on patent trolls later in the year; see the aforementioned case). Crouch wrote: “I don’t know if my end-of-April prediction will hold true, but I do expect Neil Gorsuch to become a Justice on the United States Supreme Court. As a 10th Circuit Judge, Gorsuch never decided a patent case, but does have a handful of interesting IP cases.”

“Gorsuch is extremely young for this kind of role (Justice at SCOTUS).”That’s what we too noticed. He’s mostly a mystery when it comes to copyrights, patents etc. One has to wonder how much of a grasp he has in this area. If he is not experienced or properly educated, then patent maximalists will prey on his mind and turn him into another Rader. Gorsuch is extremely young for this kind of role (Justice at SCOTUS).

Writing about where companies stand on killing patent trolls, or at least putting an end to their venue of choice (EDTX), Crouch wrote this quick but detailed post the other day. “Just about everybody is weighing in on #SCOTUS case over #patent venue shopping,” one firm wrote about this. “Here’s an easy breakdown, w/links…”

“Professor Mark Lemley is fantastic and he barely has a conflict of interest, so we hope that SCOTUS will weigh his views accordingly.”“Without the Government Brief,” Crouch noted, “Mark Lemley’s brief (on behalf of 61 professors) may be seen as the most influential. However, I would suggest that the brief loses some amount of its “law professor” credibility by being so one-sided in its statutory construction.”

Professor Mark Lemley is fantastic and he barely has a conflict of interest, so we hope that SCOTUS will weigh his views accordingly. Here is the EFF writing about its own submission:

Supreme Court Must End Texas’ Grip on Patent Cases, Restore Fairness in Court Selection

Washington, D.C.—The Electronic Frontier Foundation (EFF) urged the Supreme Court to overturn a court decision that tilted the scales in favor of patent trolls by making it easier for them to venue shop and file lawsuits in certain courts.

Venue shopping, also called forum shopping, is an insidious practice whereby parties to a lawsuit look for courts with procedures favorable to their cases. Unfortunately, some courts have engaged in an even more insidious practice known as forum selling by actively encouraging patent lawsuits in their districts. For example, a court might adopt plaintiff-friendly procedures and policies that undermine the rights of defendants.

One such court is the Eastern District of Texas, a rural area with almost no manufacturing, research, or technology facilities, where more than one-third of all patent cases in the country were filed last year. That proportion is no accident: patent litigants flock to Texas because the court has put in place a host of procedures that make it difficult for defendants to terminate meritless cases early, while also speeding up the time it takes for cases to go to trial.

Matt Levy has not yet had much to say about it (the submissions, not the subject as a whole), but he wrote this:

Patent Reform Is Back on Congress’ Agenda

Here’s some good news from the House of Representatives.

Levy cites this: “Goodlatte Announces Agenda for 115th Congress” (Judiciary of the White House).

To quote: “We’ll also work on reforms to discourage abusive patent litigation and keep U.S. patent laws up to date. Collectively, these reforms will help alleviate the wasteful burden of unnecessarily expensive litigation costs, thereby freeing small businesses to flourish, unleash innovation, and create new jobs for Americans.”

“We have always been courteous and polite towards Michelle Lee. She did a good job.”So even after the election of Trump there seems to be will to sort things out. That’s an encouraging sign.

Watchtroll, in the mean time, having attacked the Director of the USPTO, “is [still] trying to drum up controversy over the possibility that she might remain,” according to Mike Masnick. We are gratified to see that other people have noticed this too.

Watchtroll, which is currently attacking Director Lee (Watchtroll authors have attacked Lee a lot, at least 4 times in just a fortnight [1, 2, 3, 4]), has become an embarrassment to the patent microcosm. It is very much eager to show its true colours and by extension this serves to alienate the Judiciary, the Office, etc. We have always been courteous and polite towards Michelle Lee. She did a good job. Also see Matt Levy's good words to Lee. Now contrast this with what Masnick wrote:

I recognize that many (especially regular Techdirt readers) will assume from the title above that the question is a rhetorical one in response to the latest craziness around a stupid trademark or awful patent. But, no, we mean that literally. You see, right before the Trump inauguration, it was widely reported that Michelle Lee would stay on as the Director of the US Patent and Trademark Office. That was undeniably good news. For all the complaints we have about the USPTO, Lee has done a fairly amazing job running that office, and seems to be one of the first Patent Office directors who actually understands how patents can do serious harm to innovation. Keeping her on would be a really good sign. After seeing the stories claiming that she was staying, we’d mostly moved on. However, Politico reporter Nancy Scola sent me down something of a rabbit hole after tweeting that it’s basically impossible to know who’s in charge of the Patent Office right now.

[...]

As for the PTO’s own website, Quinn rightly points out that its leadership page still lists out a number of other individuals who have announced resignations and are no longer there, but whose profiles are still on the website. The Commerce Department seems to be refusing to comment to anyone who asks (I’ve sent in my own question) and it’s quite unclear if Michelle Lee really is the director.

If you look through the fairly long list of articles by Quinn on the subject, it’s quite clear that he (as someone who is not a fan of Lee) is hoping that she’s been pushed out, and is trying to drum up controversy over the possibility that she might remain. But the lack of any clarity from anyone… is bizarre. Quinn’s most recent post on the subject notes that while no one seems willing to say who’s running things, Lee “continues to be seen” in the building. That would certainly support the theory that she’s staying.

We suppose that sooner or later, maybe within a number of weeks, Lee’s position will be confirmed, the Web site will be updated, and Lee will continue to make the patent system “Great Again”, rather than make litigation and/or trolls “Great Again”.

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