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09.17.17

Patent Trolls Update: Eolas, Conversant (MOSAID), Leigh Rothschild, and Electronic Communication Technologies

Posted in America, EFF, Patents at 4:57 pm by Dr. Roy Schestowitz

Boris Teksler keeps hopping from one troll to another

Boris Teksler
Credit: Japanese media

Summary: Patent trolls are still being watched — as they ought to be — even though some of them shy away, hide from the media, engage in dirty tricks, and file more lawsuits

THIS coming week we intend to start publishing a long series about the EPO. We therefore lack time to thoroughly write about each and every single patent thing in the US. This post is a quick outline of patent trolls of interest, all of which are based in the US.

We start this with McKool Smith, a law firm that’s notorious for helping patent trolls. We have mentioned it a lot over the years and this new post says that it got caught in a violation, this time when it represented Eolas (also covered here many times before). To quote:

This one is fun for me, since I teach civil procedure, patents, and ethics, and have written about prosecution bars way too much.

Prosecution bars are used when a court concludes that, although the usual rule is that lawyers will abide by provisions in a protective order that say “don’t use information disclosed in this suit for any other purpose,” there’s a risk that a lawyer will, perhaps even inadvertently, misuse the opposing party’s information disclosed in discovery because of work the lawyer does for his client. Here, in a case Eolas (represented by McKool) filed for its client against Amazon (and others), it seems that as part of the protective order, McKool agreed that its lawyers were in such a position — they were prosecuting patents for Eolas in similar technologies, presumably, to what was involved in the suit — and so the protective order provided that no McKool lawyer who received certain categories of confidential information from Amazon would prosecute patents for Eolas in those fields, for a time.

And there is the issue: how long? The protective order stated (in part — I’d want to see the entire thing to really understand this), that the bar expired “one (1) year following the entry of a final non-appealable judgment…”

Eolas lost at trial, and the Federal Circuit affirmed and entered judgment on July 22, 2013.

If the one year date runs from there — which I so far think it does — then it expired on July 22, 2014. And it was only after that date that McKool lawyers allegedly violated the prosecution bar.

In other news, this time about Conversant (used to be known as MOSAID, weaponised and emboldened by Microsoft), this is what IAM wrote a few days ago:

Patent pools in the wireless space have not enjoyed much success but the recent news that Lenovo, Verizon and Conversant have signed up as licensors in Via’s LTE pool suggests that, at the very least, this licensing collective for fourth generation mobile technology needs to be taken seriously. The three new members join a list of patent owners that already includes AT&T, China Mobile Communications Corporation, Google and NTT DOCOMO.

[...]

Teksler, who left his position as CEO of Unwired Planet in 2016 after it was acquired by Optis UP and was an adviser to Via prior to joining Conversant, identified increased transparency and predictability in the licensing process as one motivation for joining the LTE pool. He also claimed that, “historically, pools worked well with various audio and video standards and it is time that they were made to work again”.

Boris Teksler’s move was mentioned here before. What this article fails to say is that Conversant is a patent troll — one of the worst of its kind.

Next up we have Leigh Rothschild. On September 11th, a rather special day in the US, Leigh Rothschild, who is a patent troll we wrote about before, sued yet another real (producing) company called GoSpotCheck. It’s a small company from Denver. To quote the report from 3 days ago:

GoSpotCheck this week got a nod usually bestowed on tech giants like Oracle and Apple.

The distinction? All three have been sued by Leigh Rothschild.

In a federal court case filed this week, Rothschild, via his company Rothschild Digital Confirmation, claims that GoSpotCheck, which makes software used by field reps, violated a 2008 patent for attaching a timestamp and location data to an image.

GoSpotCheck “has directly infringed” Rothschild’s patent, the lawsuit alleges, and “will continue to do so unless enjoined by this court.” Rothschild says the company “has suffered monetary damages and is entitled to a monetary judgment” as a result.

GoSpotCheck CEO Matt Talbot said he had no knowledge of Rothschild’s patent, and called the complaint baseless.

Last but not least, the EFF is taking on/challenging more patent trolls, having recently defeated others. Here the introduction to the latest target:

Since 1992, Fairytale Brownies has sold delicious brownies based on a secret family recipe. It’s a small business founded by two childhood friends who were quick to see the potential of the Internet and registered the domain www.brownies.com in 1995. Fairytale Brownies became an e-commerce website before the first dot-com boom and has remained in business ever since.

But earlier this year, Fairytale Brownies received a surprising letter. The letter said its e-commerce website infringes U.S. Patent No. 9,373,261 (“the ’261 patent”). The ’261 patent is owned by Electronic Communication Technologies, LLC (“ECT”), a company that was previously known as Eclipse IP. We have written about it many times before.

What is the technology claimed by the patent?

Generally, ECT states that it patented “unique solutions to minimize hacker’s impacts when mimicking order confirmations and shipment notification emails.” From what we can tell, it claims to have invented sending an automated email in response to an online order, that contains personally identifiable information (“PII”). ECT claims that including PII allows customers to know that the email is not a “phishing” email or “part of an email fraud system,” and as a consequence customers will know to trust the links in the email.

Alice will probably squash this one easily. All it takes is money (which the EFF has). Will it put an end to this racket?

Microsoft is Promoting Software Patents in India in Another Effort to Undermine Free/Open Source Software, Microsoft-Connected Trolls Are Still Suing

Posted in GNU/Linux, Microsoft, Patents at 3:54 pm by Dr. Roy Schestowitz

Watch the men behind the curtain

Microsoft and trolls

Summary: The ongoing patent threat to Free/libre Open Source software (FLOSS) and the role played by Microsoft in at least much of this threat

THE company which claims that it “loves Linux”, Microsoft, unsurprisingly (given its track record on this) attacks GNU/Linux. It is still promoting software patents in India even though the rules are clearly preventing this. It is not allowed.

“…Microsoft, unsurprisingly (given its track record on this) attacks GNU/Linux.”How do we know?

See this report from a few days ago: “GNLU Centre for IPR in collaboration with GNLU-Microsoft chair on IPR and policy research, is organising a panel discussion on ‘Protecting software’s through Patents: Current Challenges and Future Solutions’ on 7th October, 2017 at Gujarat National Law University, Gandhinagar, Gujarat.”

Why would Microsoft organise a discussion on “Protecting software’s [sic] through Patents” in country that does not permit such patents?

“Why would Microsoft organise a discussion on “Protecting software’s [sic] through Patents” in country that does not permit such patents?”The matter of fact is, Microsoft is still an enemy of GNU/Linux, yet certain people choose not to see it.

Where is Microsoft when it comes to OIN? Non-aggression is not something Microsoft can commit to. As Simon Phipps keeps stating, he would not believe Microsoft unless or until it decides to join OIN. But that too would not be sufficient because we already know that Microsoft operates through trolls, too.

OIN made the headlines (again) a few days ago. But it required some digging to find (none of the major Linux news sites picked this).

According to the press release, JD.com Joins the Open Invention Network (OIN) ‘Community’, but OIN is not against software patents and it certainly cannot stop patent trolls, even by its very own admission, making itself susceptible to loopholes. To quote from the press release:

“The retail space is undergoing a significant sea change — perhaps the largest in its history — as consumers worldwide continue to accelerate their purchasing via online retailers. To meet this growing demand, sophisticated e-commerce platforms today are built on Linux and adjacent open source technologies,” said Keith Bergelt, CEO of Open Invention Network. “We greatly appreciate JD.com’s leadership in joining OIN and supporting patent non-aggression.”

OIN is still IBM-led (to some degree) and as we noted in our previous post, IBM lobbies for software patents. To patent aggressors, patent law firms and patent trolls that’s just extra business. Lawyers profit from both sides (plaintiff and defendant). To real companies that champion development/production these lawsuits are nothing but a money drain (lawyers’ gain). To OIN? Well, the greater the fear and uncertainty over patent lawsuits, the more money it will harvest. It just cares about its own relevance, i.e. it benefits from threat.

“Where is Microsoft when it comes to OIN?”Earlier this year we published many articles about Microsoft siccing trolls on its competition while offering ‘protection’ (or indemnification) from these trolls [1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13]. A few days ago we also saw Finjan, a Microsoft-connected patent troll, suing some more companies while attempting to dodge PTAB, which we wrote a lot about earlier today (two articles about PTAB, published earlier today, explain the relation to software patents). Finjan even issued this press release about it to say (about its software patents):

Finjan Holdings, Inc. (NASDAQ: FNJN), a cybersecurity company, and its subsidiary Finjan, Inc. today provide an update on four separate, but related matters including a summary judgment, IPR proceedings, Germany trial and an oral argument against Blue Coat Systems, Inc. (Blue Coat).

[...]

Second, in post-grant proceedings before the United States Patent & Trademark Office’s (USPTO) Patent Trial and Appeal Board (PTAB), the PTAB denied two additional Blue Coat petitions for Inter Partes Review (IPR), namely, IPR2017- 00996, which challenged the validity of U.S. Patent No. 9,141,786 (the “’786 Patent”) and IPR2017-00997, which challenged the validity of Finjan’s U.S. Patent No. 9,219,755 (the “’755 Patent”), and instituted trial on IPR2017-00995, which challenges the validity of U.S. Patent No. 9,189,621 (the “’621 Patent”). Notwithstanding institution, Finjan remains confident that the ’621 Patent will survive IPR. To-date only 20% of IPRs have been instituted against Finjan’s patents and, more impressively, after institution, 99% of Finjan’s claims remain intact.

Incidentally, a former adviser of Finjan is unhappy to see them turning to what he called “patent blackmail”. He wrote this a few days ago, right after reading our articles about it.

“Earlier this year we published many article’s about Microsoft siccing trolls on its competition while offering ‘protection’ (or indemnification) from these trolls.”Obviously, Microsoft wants to be seen as a friend of Linux, but all of Microsoft’s competitors seem to be sued by Finjan these days. Almost everybody except Microsoft (which used to lend a hand to this troll). Classy.

Incidentally, the USPTO is nowadays distributing its data in Microsoft OOXML format (which Microsoft famously corrupted ISO for). As Patently-O put it some days ago:

Beginning this week, the USPTO has transitioned its Private Pair system to include text versions of its office action rejections as well as notices of allowances (actual XML and DOCX versions). It is a straightforward step to move these documents into a searchable database available for public consumption.

I’ll note here that the XML/DOCX files are quite nice and, although not well tagged, will make it easy for patent attorneys to cut & paste from the OA in their responses or client emails. The system also includes a new mechanism for submitting documents to the PTO.

The bottom line is, Microsoft has long leveraged software patents to undermine the competition. None of that has changed, it just takes a little more effort to track or trace back to the source.

“The bottom line is, Microsoft has long leveraged software patents to undermine the competition.”We began this post by highlighting what Microsoft had just gone in India and Watchtroll too, only four days ago, did something similar, ascribing the term “IP integrity” to “software patents”. To quote:

Open source software can provide significant benefits to an organization—it can decrease product development time, distribute development across a community, and attract developers to your organization—but some organizations shy away due to perceived risks and disadvantages around intellectual property (IP). Too many people fear that once they’ve incorporated open source into their products or open sourced their own code they’ve surrendered control over their most valuable assets, or even worse, left themselves vulnerable to litigation with no defensive weapons to counter the threat.

It doesn’t have to be that way. Utilizing open source doesn’t have to be an either-or decision. It’s possible to simultaneously support an open source program while maintaining an active IP program. A smart organization can avail themselves of the ease of use and constant updating of code that open source provides, they can identify aspects of their software to open source which are of interest to a broader development community or that encourage adoption of their platform, and they can protect those aspects of their software which are unique to their business or provide a competitive advantage through various IP protections.

“As long as Microsoft so stubbornly pursues software patents, as it has done for well over a decade, it cannot be friends with GNU/Linux.”In reality, the Free software community/ies would rightly shun companies/people for bringing software patents. Just watch what is happening to Facebook and React these days (the latest development is, WordPress dumped React over it, as noted in our daily links).

Free software and software patents cannot co-exist. As long as Microsoft so stubbornly pursues software patents, as it has done for well over a decade, it cannot be friends with GNU/Linux.

Patent Trial and Appeal Board (PTAB) Under Attack by IBM and Other Patent Parasites Who Undermine Patent Quality

Posted in America, IBM, Patents at 3:05 pm by Dr. Roy Schestowitz

Ginni Rometty

Summary: The PTAB, which has thus far invalidated thousands of abstract/software patents, is under a coordinated attack not by those who produce things but those who produce a lot of lawsuit

HAVING just covered the PTAB-dodging "scam" which the Mohawk tribe participates in, we now turn our attention to PTAB bashing or to shameless lobbying by the patent ‘industry’. The EPO has already marginalised its equivalent of PTAB, known as the appeal boards, in order to reduce patent quality, so why not the USPTO too?

“Manny Schecter, IBM’s patent chief who is friends with Watchtroll, is already lobbying the likely new Director of the USPTO.”Watchtroll is attacking PTAB again. It does this almost every other day. It has done this many dozens of times if not over a hundred times. Who or what is Watchtroll? This is basically a bunch of lawyers trying to destroy technology companies. Just look at who writes for them and who the founder is. His sidekick Paul Morinville is one of the radicals who burned stuff in unauthorised protests on USPTO premises and two days ago he too joined his ‘master’ in attacking PTAB. His headline speaks of a “failed PTAB experiment,” but actually, it has been exceptionally successful when it comes to squashing bad patents which should never have been granted in the first place. Technology companies certainly support and appreciate PTAB! We wrote a lot about that. There are very few exceptions to this, notably IBM. “IBM continues to push for legislation to abolish Alice and restore swpats [software patents] in the US,” Benjamin Henrion (FFII) wrote a few days ago. This does not surprise us because IBM is nowadays a lobbyist for software patents and it habitually attacks small(er) companies with large-scale patent lawsuits. Manny Schecter, IBM’s patent chief who is friends with Watchtroll, is already lobbying the likely new Director of the USPTO. In what platform? None other than Watchtroll (soon to be promoted by Patently-O, increasingly conjoined with Watchtroll).

Here are some portions from what Schecter wrote, citing the villainous Chamber of Commerce (it would not be surprising if it’s a front group to IBM too):

At long last, the next Director of the U.S. Patent and Trademark Office (USPTO) has been revealed. My congratulations to Andrei Iancu of Irell & Manella on his nomination to lead the USPTO. I recently wrote about the direction the next leader of the USPTO will need to provide[1] and the U.S. patent system remains at an important crossroads. Assuming Director-designee Iancu’s nomination is eventually confirmed, he will have the opportunity, through a variety of channels, to meaningfully influence the path of the U.S. patent system going forward.

In the 2017 U.S. Chamber report on Global IP[2] the U.S. patent system fell from the best in the world to tenth, equal with the patent system in Hungary. The Chamber report explains that the post-patent grant challenge proceedings created under the America Invents Act adds substantial costs and uncertainty, and the Court’s narrow interpretation of patentability of biotech and computer-related inventions puts the U.S. in a disadvantageous position as compared to international standards. Clearly there is work to be done to restore the competitiveness of the U.S. patent system. Unfortunately, there is currently a lack of consensus in the U.S. on how to proceed. Patent subject matter eligibility is prime among the substantive issues for which legislation has been proposed, but to date no legislation has been formally introduced. Many of the major IP associations have published resolutions urging legislation to amend 35 U.S.C. 101, but work to build consensus continues .[3]

So he is bashing AIA, which brought PTAB into existence. This isn’t new or unexpected from him. The truth of the matter is, as IBM sues all sorts of companies the Patent Trial and Appeal Board (PTAB) often comes to the victims’ rescue. We habitually name new examples, which this guy continues to keep abreast of [1, 2]. The latest:

  • Startup Perigen can’t get patent on fetal monitoring machines thx 2 PTAB random (mis)application of Alice precedent: https://e-foia.uspto.gov/Foia/RetrievePdf?system=BPAI&flNm=fd2016002806-08-30-2017-1 …
  • PTAB finds 2-page long, kitchen sink patent claim by IBM as just an”abstract idea” https://e-foia.uspto.gov/Foia/RetrievePdf?system=BPAI&flNm=fd2016003153-08-24-2017-1 … guess War&Peace also abstract?

IBM is a big patent bully, so PTAB invalidating its software patents and stopping its aggression is a good thing. But not in the eyes of the above patent maximalist, who is right now attacking the EFF in a patent trolls’ site (Dominion Harbor), only to be promoted by other patent maximalists, including patent trolls.

Spotted the pattern yet? Notice who’s attacking PTAB.

Again come out the PTAB bashers, who simply want software patents and a patent trolls resurgence, piggybacking SCOTUS by lobbying to abolish PTAB. There was a long article about this in Blooberg a few days ago. This long article by Tony Dutra did a reasonably OK job explaining that it’s the patent microcosm against those who actually make stuff. To quote some portions from the article:

Stakeholders have filed 31 friend-of-the-court briefs reviewing petitioner Oil States Energy Services LLC’s (OSES) argument that a patent is a private property right that can only be revoked by a federal court, not by the PTO ( Oil States Energy Servs., LLC v. Greene’s Energy Grp., LLC , U.S., No. 16-712, briefs filed 8/31/17 ). Companies and individual inventors with patents contend that patent rights include the Seventh Amendment right to a jury trial, which is not provided for in a PTAB proceeding before administrative patent judges.

On the other side are the Silicon Valley heavyweights and generic drug manufacturers that have used IPR proceedings as a way to avoid the higher hurdle for showing patent invalidity in court. A federal judge and jury must presume the patent is valid and require clear and convincing evidence to the contrary. The AIA set up the IPR proceeding without the presumption of validity, with the challenger’s burden of proving invalidity by an easier standard, the preponderance of the evidence.

Counterarguments by Greene’s Energy Group LLC, the successful challenger to OSES’s U.S. Patent No. 6,179,053, which relates to protecting wellheads during fracking, and the U.S. Office of the Solicitor General, are due by the end of October. Several more amicus briefs supporting the AIA’s constitutionality are expected then as well.

The court has not yet set a date for oral arguments, but it should be before the end of this year, with a decision before June 2018.

Dutra then mentions the disgraced/corrupt judge, Randall Rader:

Critics often call the PTAB a “death squad” because of the high rate of patent claims that it kills, but the phrase was originally used to describe the constitutional questions about the board’s role.

Former Federal Circuit Chief Judge Randall R. Rader coined the term in 2013, before any IPR was decided. He meant it in a way that underlies the constitutional argument, that it is wrong to have the PTO with “7,000 people giving birth to property rights”—referring to the patent examiner corps—while PTAB judges are “acting as death squads, killing property rights.”

And finally:

IPLAC lays out the question in terms of the PTO’s rights as to follow-on action after a patent issues. Prior to the AIA, the Patent Act gave the PTO no such rights, according to the association’s brief. But the AIA changed the nature of the PTO’s ongoing involvement. From the implementation date, the PTO’s grant is better characterized as only an “issue-from-examination … while-subject-to-further-processes-of securement,” IPLAC said.

Not a bad article overall. Compare that to the usual PTAB/IPR bashing from Dennis Crouch. Days ago he wrote: “As a placeholder – I’ll note here that the pending en banc case of In re Aqua Products regarding amendments during IPR Proceedings is still pending before the Federal Circuit.”

“Companies that make stuff like PTAB.”Crouch spent a great deal of effort earlier this year trying to compel the Federal Circuit to step on PTAB's toes. Follow the money and the interests and it’s abundantly clear what the motivations are…

Companies that make stuff like PTAB. This isn’t a subjective observation.

Companies (or firms) that just make lawsuits hate PTAB. The evidence is out there for all to see (e.g. in the form of amicus curiae briefs, pretending to be the highest court‘s “amici”).

Some law firms have grown so afraid/wary of PTAB that they apparently have such a thing as “PTAB chair”. See this new article from a patent maximalists’ news site:

Scott McKeown (right) has joined Ropes & Gray as partner in Washington, DC, and as chair of the firm’s Patent Trial and Appeal Board (PTAB) practice.

Maybe they should focus more efforts on applying for better patents (quality rather than quantity); then, PTAB would not be a concern to them and their clients.

To close this on a more positive note, have a look at the CCIA’s Josh Landau with his analysis of Oil States, claiming that the PTAB’s IPRs have saved over $2,000,000,000 in just 5 years. Here’s a portion from Landau’s good article:

This Saturday, September 15, 2017, marks the five-year anniversary of the first filing of an inter partes review. We’ve seen nearly 7,000 post-grant reviews filed since then, a Supreme Court case dealing with IPRs, and there are a pair of IPR Supreme Court cases up this term. [Oil States] [SAS]

Over the next few weeks, I’ll tell you about particular stories where inter partes and covered business method patent reviews have curtailed abusive litigation and allowed smaller companies to defend themselves even if they might not have been able to fight a full-fledged patent lawsuit.

But today I just want to step back and look at the effects of the inter partes review system as a whole. One of the reasons IPR was created was to “provid[e] a more efficient system for challenging patents that should not have issued; and reduc[e] unwarranted litigation costs and inconsistent damage awards.” (Page 39-40 of the House Report on the AIA.)

All in all, the IPR system has been incredibly effective at achieving these goals—I estimate that the implementation of inter partes review has helped plaintiffs and defendants avoid at least $2.31 billion in deadweight losses by providing an efficient system for challenging patents.

This benefit is purely based on avoiding deadweight loss from legal fees; it does not account for the benefit of preventing transfers from defendants to plaintiffs based on patents that should have been invalidated. The financial data used in this analysis is based on publicly available data, as well as some data derived from the 2017 AIPLA Economic Survey. Unfortunately, this survey is not publicly available; where possible, I have linked to open summaries of the data contained in the survey.

We certainly hope that Justices can tell apart parasites from producers. At the moment, with very rare exceptions, all those who oppose PTAB basically oppose science and technology. All they want is more and more litigation, blackmail, and threats (which merely drain money out of the productive economy).

Why the Mohawk Tribe Should Fire Its Lawyers and Dump the Patents Which Now Tarnish Its Name

Posted in America, Patents at 2:07 pm by Dr. Roy Schestowitz

The quick buck isn’t worth the damage done to the Mohawks’ reputation

Mohawk

Summary: In order to dodge the Patent Trial and Appeal Board (PTAB) with its Inter Partes Reviews (IPRs), the Mohawk tribe is being exploited — very much in direct detriment to its reputation and status

LAST week we wrote about the Mohawk people being used by vicious corporations that only need the Mohawk people because of corporate greed. We were actually very surprised that the Mohawk people had fallen for it (or rather their lawyers had plotted this). We last wrote about that six days ago.

Since then, much has been said about the subject. We certainly hope that the Mohawks will rethink the whole thing. Published by Mike Masnick on Wednesday was this article calling the whole thing a “scam” (in the headline). The Mohawk tribe ought to take this as a sign and fire the dumb (if not corruptible) lawyer/s. The tribe should then toss out these patents, thereby signaling to anyone else who thinks about such a scam that it will end up badly. To quote Masnick:

We’ve written a bunch over the past few years about the so-called Inter Partes Review (IPR) process at the US Patent Office. In short, this is a process that was implemented in the patent reform bill back in 2010 allowing people and companies to ask a special “review board” — the Patent Trial and Appeal Board (PTAB) — at the Patent Office to review a patent to determine if it was valid. This was necessary because so many absolutely terrible patents were being granted, and then being used to shake down tons of companies and hold entire industries hostage. So, rather than fix the patent review process, Congress created an interesting work-around: at least make it easier for the Patent Office to go back and check to see if it got it right the first time.

Last year, part of this process was challenged at the Supreme Court and upheld as valid. However, the whole IPR is still very much under attack. There’s another big Supreme Court case on the docket right now which argues that IPR is unconstitutional (the short argument is that you can already challenge patents in court, and by taking them to an administrative board, it creates an unconstitutional taking of property without a jury). There are also some attempts at killing the IPR in Congress.

Joe Mullin, a trolls expert, hasn’t missed this news either. Several days ago he said that a “[d]rug company hands patents off to Native American tribe to avoid challenge” (PTAB). We reckon that the Mohawk tribe isn’t at fault here. It just doesn’t know it has a lawyer who exploits them and shames them in the process. Some people have rightly pointed out that this scam might have been enabled unintentionally (without the Mohawks intending to do harm). To quote Mullin:

A drug company has found a novel way to avoid challenges to some of its most prized patents: handing them off to a Native American tribe for safe-keeping.

On Friday, Allergan disclosed that it gave six patents covering its top-selling dry eye drug Restasis to the St. Regis Mohawk Tribe in Northern New York. The deal will provide the tribe with $13.75 million immediately and an annual royalty of $15 million as long as the patents are valid. The new deal was soon reported in both The New York Times and The Wall Street Journal.

Allergan made the unprecedented move because it will prevent any meaningful challenge to the company’s patents at the Patent Trial and Appeal Board, or PTAB. Challenging patents at the PTAB in a process called “inter partes review” (IPR) was authorized by the America Invents Act of 2011, and the IPR process has significantly changed the patent landscape since then. While invalidating a patent in district court typically costs millions of dollars, invalidating a patent via IPR can happen for the relative bargain of a few hundred thousand dollars.

A very detailed analysis from CCIA‘s Josh Landau was published to explain why the US legal system is disgraced when patents can enjoy immunity by having dodgy entities exploit Natives. To quote some key bits:

What do Seymour Cray’s high-performance computing research company SRC Labs and drug manufacturer Allergan have in common? Both SRC Labs and Allergan sold patents to the Saint Regis Mohawk Tribe, then licensed them back from the tribe, in order to use tribal sovereign immunity to prevent challenges to their patents as invalid.

[...]

Sovereign immunity is not a topic that appears on many Patent Law syllabi. But in the past year, it’s become a more pressing issue when it comes to patents. First, state universities used it to avoid challenges to their own patents. And now, sovereign immunity is being sold to completely unrelated companies.

The University of Florida Research Foundation (UFRF) is a non-profit foundation established by the University in order to “to promote, encourage and provide assistance to the research activities of the University faculty, staff and students.” As part of this, they patent inventions by UF faculty and staff, and license those inventions.

Covidien (a medical device manufacturer) had a patent license agreement with UFRF. UFRF sued Covidien, and in response Covidien defended themselves by filing inter partes reviews (IPRs) against the UFRF patents. Back in January, UFRF claimed that, as a state entity, they were immune from IPR under Eleventh Amendment sovereign immunity. The Patent Trial and Appeal Board agreed and dismissed the IPR on Eleventh Amendment grounds.

Later in the year, a similar situation occurred, this time featuring the University of Maryland and NeoChord, another medical company. Maryland had given an exclusive license to several of their patents to Harpoon Medical, which sued NeoChord. NeoChord filed an IPR on the patents, and again, the PTAB dismissed the IPR on Eleventh Amendment grounds.

There are a few other instances of Eleventh Amendment immunity claims that may come up, including one by the University of Minnesota against Ericsson.

[...]

The tribe’s FAQ on this program is interesting. I don’t know if they got the wrong impression from their lawyers, just misunderstood, or what, but they claim that by doing this, they can help “protect[] from patent trolls.”

Bluntly put, preventing patents from being IPRed does not protect anyone from patent trolls—it protects patent trolls from IPRs.

The tribe also claims that IPR is “very unfair” and allows patent trolls to void valid patents. (Patent trolls do not generally try to invalidate patents, because they usually don’t have any products to be sued on.) The tribe also claims that they’ll file to have their patents reviewed in federal court, which, again, does not happen.

If IPR is unfair, why does the Federal Circuit affirm three quarters of appealed PTAB decisions? The PTAB is getting decisions right, there’s just a lot of invalid patents out there to be challenged.

On the other side of the fence, as usual, there are PTAB-bashing blogs like Patently-O/Crouch, who uses any opportunity to undermine PTAB. Silly US immunity from PTAB (e.g. for universities) means that dodgy companies now hide behind Natives. We have already explained why universities should enjoy no such immunity. Here is what Crouch wrote about it some days ago: (the typical PTAB bashing when he’s not carrying out automated assessment of words in patents)

US Law generally holds that Indian Tribes are “Sovereign Powers” that “possess immunity from suit,” although only “to the extent that Congress has not abrogated that immunity and the tribe has not clearly waived its immunity.” Breakthrough Management Group, Inc. v. Chukchansi Gold Casino and Resort 629 F.3d 1173 (10th Cir. 2010), cert denied. As the Supreme Court wrote, “without congressional authorization,” the “Indian Nations are exempt from suit.” United States v. United States Fidelity & Guaranty Co., 309 U.S., at 512 (1940).

The Mohawk tribe’s lawyer is a either fooled or a fooling actor. Whatever it is, the Mohawk need to get out of this PR debacle. They are only supported by sites that favour patent trolls. The Mohawk tribe’s lawyer was apparently told that this stops patent trolls, but the very opposite will be true. It actually does the very opposite, especially if other patent holders follow the example/tactics of Allergan/the Mohawks. Here is how IAM put it:

The recent news that pharma giant Allergan and tech company SRC have licensed patents to a Native American tribe in an attempt to protect the patents from inter partes review (IPR) has once again catapulted the controversial post-issuance review process into the wider business press. With the Supreme Court due to hear Oil States, a case concerning the constitutionality of IPRs, in its next term, the Patent Trial and Appeal Board (PTAB) is in the spotlight like never before.

Since the move by the pharma giant was announced early last week there has been an avalanche of press and blog coverage (you can read what this blog had to say here and another piece on Indian tribes and sovereign immunity, which is particularly worth reading, here). The Saint Regis Mohawk Tribe was clearly unimpressed by some of the ensuing coverage and so yesterday put out a statement in what it described as a clarification. Clearly keen to play to the patent gallery the statement ended with: “A strong patent system is in everyone’s best interest, which is why patent protection is one of our original constitutional rights.”

IAM says that the “Patent Trial and Appeal Board (PTAB) is in the spotlight like never before” while it actively participates in PTAB bashing, as we shall show in our next post.

Sadly, corporate media too plays a role in misinformation. Consider this coverage from the New York Times 9 days ago. The headline in its own right is wrong. That’s not “how to protect a drug” but how to shield bogus patents from quality control (PTAB).

Here is what the Times said:

The drugmaker Allergan announced Friday that it had transferred its patents on a best-selling eye drug to the Saint Regis Mohawk Tribe in upstate New York — an unusual gambit to protect the drug from a patent dispute.

Under the deal, which involves the dry-eye drug Restasis, Allergan will pay the tribe $13.75 million. In exchange, the tribe will claim sovereign immunity as grounds to dismiss a patent challenge through a unit of the United States Patent and Trademark Office. The tribe will lease the patents back to Allergan, and will receive $15 million in annual royalties as long as the patents remain valid.

What kind of a scam is this and who seduced the Mohawks into this PR disaster? Whoever or whatever it is, they need to get out of it in order to (maybe, if it’s not too late) undo the damage. Media generally regards this as evidence of Mohawks being unintelligent, or even worse: mischievous and greedy.

Amazon and Google Have Both Become Part of the Software Patents Problem

Posted in America, Patents at 12:42 pm by Dr. Roy Schestowitz

Giants benefit from a so-called ‘thicket’ (patent barrier to entrants) that protects their monopoly/ies

Page Rank
Some truly fundamental software concepts — however trivial (simple reference count) — are already patented by Google (or Stanford)

Summary: The transition from so-called ‘defensive’ patents to offensive patents (ones that are used to suppress competition) as seen in Amazon and in Google, which is already suing rivals and is pursuing additional patents by acquisition

AS noted in our previous post, it’s still possible to get software patents granted, albeit they’re very difficult to successfully enforce in court.

Amazon is said to be one of the most litigated companies out there (if not the most, depending on what’s measured). There were articles about it last year. Amazon, as far as we’re aware, is not a patent bully, at least not yet (growing companies rarely need to resort to aggression). Google, by contrast, started patent aggression earlier this year.

“They are loathed partly because software patents are an abomination in general.”Generally speaking, software patents — especially after Alice/Section 101 — are lame ducks, but not if the accused (or defendant, mainly if this reaches the court) cannot afford a legal battle.

“Amazon, eBay, Google lead surge in AI patents” was the headline of this article from last week. As we noted in the last post, “AI” is one of those buzzwords that are frequently used to justify software patent grants. “The whitepaper,” it says, “titled “Artificial Intelligence in Retail: Patent Analysis,” suggests that the publication of patent filings may have peaked in 2015, with 329 publications that year, before drifting down to 296 in 2016. Prior to 2015, there were 128 AI-related patent filings published in 2012, 191 in 2013 and 224 in 2014. There have been only 54 published this year, though Netscribes stressed that there is often an 18-month lag between when patents are filed and when they are published.”

These are software patents.

As an article recently put it, Mr. Bezos suggested reducing the lifetime of “business method and software patents from 17 years to three to five.”

Well, he never did that or never really accomplished any of this. In the meantime, as stated above, Amazon continues to stockpile lots of horrible patents, as does Google. Amazon-friendly media like GeekWire has just published this podcast about the recently-expired one-click checkout patent of Amazon. From the show’s outline: “The patent was for the technology that made one-click checkout possible, and on this episode of the Week In Geek, we dig into why it was so unpopular and why patents themselves occupy a controversial place in the tech world.”

Well, this Amazon patent was one of many that are similarly outrageous. They are loathed partly because software patents are an abomination in general. Over the years we covered several other examples of Amazon patents that should never have been granted at all. Certainly, as it’s likely inevitable, one day Amazon too will resort to patent aggression. Or an aggressor might buy/receive these patents.

As for Google, well… an older article of ours reached Hacker News’ front page and Reddit last week. No idea why people suddenly cared half a year late, but we can only speculate that it had something to do with reports like this one (a subject we covered a week ago). Here’s another report about it:

Entropy coding technology known as ANS devised by a Polish academic is now sought to be patented by Google – even though he released it into the public domain precisely so no company could swoop on it and lock it up.

So Google is increasingly being portrayed as a raider of ideas and a patent opportunist that seeks a monopoly even on the public domain. Not good…

Now that Google uses patents pro-actively it cannot be cheered and can no longer be trusted with any patents. According to this blog post from IAM, Google might soon take HTC’s patents too:

Three weeks ago, Bloomberg reported that Taiwan smartphone maker HTC has held takeover talks with Google, as the struggling business explores ‘strategic options’. More recently, several outlets have reported that a deal – either for the whole company or just its smartphone unit – is in late stages. Other options on the table include an investment by the US company. Whatever happens, there is a good chance that HTC’s days as a stand-alone smartphone maker are numbered. If Google does pull the trigger, this latest hardware deal won’t have patent implications as big as its previous Motorola turnaround, but it will mark the unification of two long-term patent partners.

Remember that after Google had taken patents of Waymo it sued a competitor. It’s now a CAFC case, Waymo v Uber, reminding us of the real danger of any patents landing on Google’s lap. As Patently-O put it some days ago:

The Federal Circuit has released a pair of decisions (2017-2235; 2017-2130) in this patent / trade secret case. Waymo (Google) sued Uber (Ottomotto) for patent infringement and trade secret misappropriations. “Specifically, Waymo alleges that its former employee, Mr. [Anthony] Levandowski, improperly downloaded thousands of documents related to Waymo’s driverless vehicle technology and then left Waymo to found Ottomotto, which Uber subsequently acquired.”

Google uses patents against rivals. Expect it to do more of that (the temptation is greater once it has been done already). As for Amazon? Give it time and see Bezos too (as the world’s richest man, like Bill Gates before him) turning to patents as a last resort to save an empire.

‘“Other than Bill Gates, I don’t know of any high tech CEO that sits down to review the company’s IP portfolio” —Marshall Phelps (formerly of IBM, which also resorts to patent aggression because its empire crumbles)

Unless Physical, Inventions Are No Longer Patent-Eligible in US Courts, But USPTO Ignores Precedence

Posted in America, Patents at 11:47 am by Dr. Roy Schestowitz

Unless you can actually see the supposed invention, it’s likely just code and thus invalid under Section 101/Alice

Coding

Summary: Even though the ability to enforce software patents against a rival (or many targets, especially in the case of patent trolls) is vastly diminished, the US patent office continues to grant these

THE US Supreme Court (SCOTUS) ruled against software patents in the summer of 2013. Things have changed profoundly since then. Each year it seems like the system — mostly but not limited to the legal system — is becoming more hostile towards software patents. They’re just not worth the time and money anymore.

“We’re talking about trolls and serial litigators here. They suffer badly and some have gone out of business (good riddance!).”Software patents are not officially dead. Moreover, there’s a threat of them coming back, for circles that are hostile towards software development try to prop them up again. Every single week we write about several of their concurrent attempts, ranging from legislative/lobbying to subversion/entryism. For them, it’s likely a fight for their very survival. We’re talking about trolls and serial litigators here. They suffer badly and some have gone out of business (good riddance!).

The reality of the matter is, companies like Apple patent all sorts of malicious software that’s being celebrated in their fan sites. They don’t want the public to think of it as software, but since this particular domain is my professional domain it’s clear to me that it’s pure softwar which they patent and the USPTO tolerates this. Here is another new example, this time from Virtual StrongBox, which was mentioned here before (last month). They patent pure software. It’s mathematics. They just phrase things in a way that’s intended to dodge or work around Section 101. Here we see another case of nonsensical, meaningless buzzwords like “technical effect”. A translation says “when software solves a technical problem you are definitely in the area where a patent is possible” (page in Spanish). The EPO is equally culpable here. How about this new example? The USPTO is once again granting software patents — something in the realm business methods/mathematics (abstract).

To quote this article:

Pittsburgh entrepreneur Mike Wagner is best known for his high-growth company which specializes in optimizing carrier pricing in real-time. Now, Wagner’s Target Freight Management has introduced a new technology to an industry with the announcement of their patent for Freight Innovation Density Analytics – or FIDA.

That’s mathematics. The USPTO facilitates a race to the bottom if it permits this kind of grant. Here is another new example, where software gets patented under the guise of the buzzword “deep learning”. There’s a gold rush for software patents under the guise o buzzwords like “AI”, “machine learning” and so on (I know how these things technically work and implemented them in the past; it’s purely mathematics/statistics).

In the next post we shall take a closer look at technology giants that amass software patents and misuse these against competitors (we say “misuse” because these patents are likely patent-ineligible, but it’s expensive to prove so).

Citing the European Patent Convention, Spanish Court Tosses Lawsuit With EPO-Granted European Patent

Posted in Europe, Patents at 7:01 am by Dr. Roy Schestowitz

Spain flag on palace

Summary: The quality of European Patents (EPs) — a subject of growing levels of scrutiny — as demonstrated in Barcelona this summer

THE EPO has long been granting software patents in defiance of the European Patent Convention — something that would further accelerate if the UPC power-grab ever gained any traction/got a foothold (it’s very unlikely, hence our choice of tense in “would”).

Techrights is not an enemy of the EPO. Techrights wants what’s good for the EPO. Techrights is viewed as an enemy by top-level EPO management (Team Battistelli), hence it has been blocked by Battistelli. We are pretty certain that EPO examiners already know — and can check our history on this subject — that we care about quality of patents; it’s not about patents per se (in general). Our main complaint — all through these years — was granting of low-quality patents in defiance of the rules.

“Spain rejects the UPC for more than one reason (such as language). They specified several other reasons for shunning the terrible, awful UPC.”Every now and then we highlight a public display of the problem (symptom), such as the Administrative Council tossing a whole class of patents (biological processes), the appeal boards voiding patents, and sometimes actual courts (where fees are enormous, for both defendant/s and plaintiff) rejecting EPs upon closer scrutiny.

That makes perfect sense. If patents are improperly granted, sooner or later these patents will expire or be voided (one of the two).

Make no mistake about it. Not everyone wants patent quality, which typically translates into a decreased number of lawsuits. Consider for instance IAM Media. A short while ago IAM, a longtime advocate of the UPC (because it advocates for Battistelli and patent trolls), wrote that “Spain will not join UPC because Spanish is not one of the official languages. Go figure!”

That’s after IAM spread fake news about the UPC in Spain (about half a year ago when some Spanish media did the same thing).

Spain rejects the UPC for more than one reason (such as language). They specified several other reasons for shunning the terrible, awful UPC. We wrote many articles about it, going back to around 2010.

Does Spain need the UPC? No. The Spanish patent office does a better job (examination and searches) than the EPO under Battistelli, as we last noted a month ago, citing people who have worked with both.

Moreover, Ana-Laura Morales from Grau & Angulo has just published this self-promotional piece about a judgment from earlier this summer (we have not seen any press coverage of it in English). Here are the key facts:

In its judgment of June 30 2017, the Barcelona Court of Appeal confirmed the Barcelona Commercial Court Number 4 first-instance decision, which had dismissed the patent infringement action filed by Novartis against several generics for alleged infringement of European Patent 2’292’219 (EP’219)

[...]

In its first-instance decision, the Barcelona Commercial Court Number 4 upheld the defendants’ interpretation of the claim based on Article 69 of the European Patent Convention and thus dismissed Novartis’s infringement action. This judgment was in line with the court’s previous decisions and those of the Barcelona Court of Appeal in preliminary injunction proceedings.

With its June 30 2017 judgment, the Barcelona Court of Appeal confirmed the first-instance decision, thus interpreting the claim and establishing its scope in line with the defendants. In particular, the court reiterated the importance of interpreting a claim in light of the description of the patent, which in this case clearly supported the defendants’ understanding of its scope.

Got that? European Patents smacked down by the Catalans. And some people still wonder why we have a hard time with what’s going on at the EPO…

Looking up more information about the patent in question, it was used elsewhere this summer (e.g. Court of Appeal of The Hague) and it was granted on the 12th of June 2013, i.e. under Battistelli.

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