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07.25.18

Trump-Appointed Lobbyist (Delrahim) Comes Under Scrutiny and Criticism for His Stance on Patents and Antitrust

Posted in America, Antitrust, Patents at 10:51 pm by Dr. Roy Schestowitz

Jorge L. Contreras‘s newest paper:

Jorge L. Contreras

Summary: Antitrust person (AAG) Makan Delrahim, who now forms the basis of key US policies, is becoming the target of much scrutiny, especially from academics rather than from patent maximalists

THE USPTO has long granted low-quality patents — a bad legacy which needs tackling. The SCOTUS, the Federal Circuit and Patent Trial and Appeal Board (PTAB) inter partes reviews (IPRs) gradually tackle this legacy. But that’s not enough.

“The USPTO has long granted low-quality patents — a bad legacy which needs tackling.”Donald Trump has put a lobbyist, Delrahim, in charge of antitrust. A lot of people don’t agree with his policies or at least with the speeches he has given. Mark Patterson (Fordham, a pusher of patent maximlism, typically funded by Microsoft) said earlier this week that:

To put my cards on the table, I am largely in agreement with AAG Delrahim’s critics, though I did not sign either of their letters. I agree with Delrahim that it is reasonable to devote scrutiny to the patent “hold-out” problem that is his focus, but doing so does not require dismissing a well-established consensus on the validity and harm of patent “hold-up.” The most compelling evidence for hold-up, it seems to me, is the 100-to-1 ratio of royalty demands to royalty awards that have been seen in some cases. Perhaps that differential is the product of confused courts, but despite the calls of AAG Delrahim and his supporters for evidence or more evidence for hold-up, they themselves provide nothing to show that the courts are confused. Nor do they provide empirical evidence to demonstrate the claimed greater importance of hold-out.

[...]

I make no claim to the objective correctness of my annotations, which are only my immediate responses to various points made in the documents. But I have pointed out what I think are weak points in the responses by critics of Delrahim (despite my general agreement with those critics) as well as in his speeches. Also, some of my points in some documents are raised also in others, but I have tried to avoid duplication. Finally, the annotation approach might seem more argumentative than necessary, but I think it is warranted by the importance of the issues, the dramatic differences in the views expressed, and the unfamiliarity of some with these issues. This controversy deserves even more attention than it has already received.

There is also this new paper from Jorge L. Contreras (published on July 23rd and just promoted by him in Twitter) whose abstract states: “In November 2017, U.S. Assistant Attorney General Makan Delrahim, chief of the Department of Justice (DOJ) Antitrust Division, gave a speech at University of Southern California provocatively entitled “Take it to the Limit: Respecting Innovation Incentives in the Application of Antitrust Law”. In this speech, Mr. Delrahim announced a new DOJ policy approach to the antitrust analysis of collaborative standard setting and standards-development organizations (SDOs) — the trade associations and other groups in which industry participants cooperate to develop interoperability standards such as Wi-Fi, Bluetooth, 4G and 5G, USB and the like. He explained that the DOJ had “strayed too far” in its focus on single firm conduct concerning standards, particularly the assertion of patents essential to the implementation of standards in technology products (“standards-essential patents” or “SEPs”), and that antitrust authorities should be more concerned with potential collusion by competitors within SDOs (i.e., an apparent shift in doctrinal focus from unilateral conduct under Section 2 of the Sherman Act to concerted action under Section 1 of the Sherman Act). One commentator described the DOJ policy shift announced by Mr. Delrahim as “a 180 degree turn” on SEP issues. The new policy also seems to put the enforcement priorities of the Antitrust Division at odds with those of the other principal U.S. antitrust enforcement agency, the Federal Trade Commission (FTC). This article analyzes the contours of the emerging divide among U.S. antitrust agencies, as well as reactions to the “Take it to the Limit Speech” by industry, academics and Mr. Delrahim’s subsequent public statements.”

“We’re repeatedly cited people who called that a “scam” and have received legal threats for it.”What we’ve seen so far, especially from the scholarly community (not people who make money from lawsuits), isn’t positive. They see Makan Delrahim, a former lobbyist, for what he truly is. Contrast that with lawyers-dominated coverage which promotes patent maximalism (example from yesterday) and lawyers’ sites which still insist that Mohawk folks should be "above the law", including patent law, in order to protect a massive corporation like Allergan. They repeatedly lose every case. We’ve already explained why it’s unlikely that this will ever go any further or the decision overturned (by SCOTUS). They’ve named “St. Regis Mohawk Tribe v. Mylan Pharmaceuticals Inc., Appeal No. 2018-1638, -1639, -1640, -1641, -1642, -1643 (Fed. Cir. July 20, 2018),” a clear case of monopoly abuse using patents and misuse of immunity from the Mohawk Tribe. We’re repeatedly cited people who called that a “scam” and have received legal threats for it.

The US AAG now actively defends this kind of behaviour.

07.21.18

Cisco v Arista Networks is a Stain on the Reputation of the US International Trade Commission (ITC) and It’s Beginning to Recognise This

Posted in Antitrust, Courtroom, Patents at 10:34 am by Dr. Roy Schestowitz

Administrative Law Judge Photos
Reference: Administrative Law Judge Photos

Summary: Cisco is leveraging software patents which PTAB deemed to be invalid against a much smaller firm (revenue ~30 times smaller [1, 2]), demanding an embargo and bypassing the ordinary routes of justice by turning to the ITC

Sometimes companies want to bypass the ordinary courts (District Courts, Federal Circuit, SCOTUS) to just quickly issue an injunction, i.e. embargo, raids, prevention of import/sales and so on. It’s the kind of thing that the EPO is pursuing with its shameless UPC lobbying. The assumption that any patent granted by the USPTO is OK or should be presumed valid is a dangerous one and proper justice (due process, plus appeal/s, innocence until proof of guilt) isn’t assured anymore. It’s a leap towards extreme action. It’s not really patent justice but patent prejudice and maximalism. It’s like copyright takedowns (as per DMCA) where the accused gets censored without even a right/access to defense. Ripe for abuse? By design?

“It’s not really patent justice but patent prejudice and maximalism. It’s like copyright takedowns (as per DMCA) where the accused gets censored without even a right/access to defense.”Arista Networks uses inter partes reviews (IPRs) for the Patent Trial and Appeal Board (PTAB) to scrutinise the patents at hand; Arista Networks won the case/appeal, but the ITC then shockingly enough snubbed the ruling, having never previously ignored such rulings! There was a lot of commotion about this at the time (especially last year) and now we learn, courtesy of World Intellectual Property Review (WIPR), that the ITC will review the administrative law judge’s (ALJ) decision. To quote:

The US International Trade Commission (ITC) said yesterday it will review an administrative law judge’s (ALJ) determination regarding a patent infringement claim Cisco Systems brought against computer networking company Arista Networks.

The ITC said it will review the final remand enforcement initial determination (REID) that the ALJ issued in June, when it found that Arista did not violate a cease and desist order regarding one of the patents.

In January 2015, the ITC launched an investigation into Arista based on a complaint from Cisco.

Cisco alleged that Arista had violated section 337 of the Tariff Act of 1930 by importing certain network devices, related software and components that infringed six patents relating to software.

[...]

The ALJ’s investigation determined again that Arista did not violate the cease and desist order. Both parties filed petitions for review of the REID and filed responses to the other side’s petitions.

ITC staff must understand that the reputation of its judgments is on the line. It’s not only us who bring up these issues; sadly, however, the media is dominated by law firms (at least for this particular topic), so the voice of technologists is rarely heard. Many are unaware of the dispute or cannot follow the news, owing partly to legalese.

“Whose interest would be served by embargoes? Not the public’s, that’s for sure… Arista’s engineers have already been compelled to make their products intentionally worse.”Judges must take into account not the interests of law firms that profit from litigation/feuds but technologists who profit from actual innovation. Whose interest would be served by embargoes? Not the public’s, that’s for sure… Arista’s engineers have already been compelled to make their products intentionally worse. This is never a positive thing; in fact, Cisco’s legal actions have already put many companies like Arista at existential risk.

06.27.18

US Supreme Court Will Hear Helsinn v Teva, But What’s Needed Right Now is a Challenge to Patents Inside Standards (a.k.a. ‘FRAND’ or ‘SEP’)

Posted in America, Antitrust, Europe, Microsoft, Patents, RAND, Standard at 11:40 am by Dr. Roy Schestowitz

Standards you can’t use (unless you’re rich)

Trapped

Summary: Antitrust/monopoly aspects of patents one cannot work around (to merely conform/comply with industry standards) are worth debating at the highest of levels rather than in forums full of lobbyists (sometimes hosted inside Microsoft’s very own premises!)

EARLIER this week we noted that SCOTUS would not reassess patent scope (e.g. Section 101). It was mentioned by Patently-O earlier this week and is now being mentioned by many other patent-centric blogs. Managing IP wrote:

The court in Helsinn v Teva appears likely to craft a bright-ruling on the issue of whether the confidential sale or license of a not-yet-patented technology or process qualifies as prior art under the America Invents Act

Gregory Sephton and Anna Schoenfelder said: “As a follow-up to our previous post “The Federal Circuit Has Its Final Say On the “On-Sale” Bar Under the AIA,” the Supreme Court has granted certiorari in the Helsinn v. Teva case, which concerns whether the America Invents Act (“AIA”) changed the longstanding “on-sale bar” rule. This means that at least four of the nine Supreme Court justices agreed to address this case.”

Watchtroll (Gene Quinn) also had to say something only hours after promoting an “ethical” troll, claiming that “iPEL has also defined a set of business practices that a Non-Practicing Entity can follow in order to call itself an Ethical NPETM.”

Ethical? That’s funny!

It’s like Patent Factory Europe (PFE). WIPR has since then done a puff piece for this troll’s PR campaign and it’s comical that those taxing everything with patents, harming small businesses the most, are trying to hide that fact by associating themselves with “Startups and Small Businesses” and “SMEs”. It is, at best, a googlebombing strategy. They wish to drown out the truth with press releases and lies.

The subject of FRAND has meanwhile resurfaced. The same people who push this PFE nonsense are best known for lobbying on FRAND in Europe. They front for large corporations, notably Microsoft. “I am reminded that FRAND worked its way into the ITU’s false definition,” a reader told us, linking to ITU’s definition of “Open Standards” after Microsoft lobbying/entryism (we covered this before).

Florian Müller, a FRAND proponent, has meanwhile ranted about Delrahim (lobbyist-turned-official), whose take on FRAND — related to standard-essential patents (SEPs) — he does not agree with. To quote:

This is a follow-up to last month’s post on an open letter that 77 former government officials and professors (of law, economics, and business) sent Assistant Attorney General Makan Delrahim in order to remind him of long-standing and consistent U.S. policies on standard-essential patents (SEP) under both Republican and Democratic administrations. I’ve meanwhile become aware of the AAG’s reply, which does not provide any indication that he’s on the side of innovation and fair competition.

To his response, Mr. Delrahim attached a letter dated February 13, 2018 from about a dozen academics and former government officials that support the statements he makes, which he describes as “the United States’ policies” (we’ll talk about that further below). With the greatest respect for those individuals, they do not collectively counterbalance the 77 signatories of the letter that criticized Mr. Delrahim’s statements. That’s not just a matter of numbers: for an example, there is no former FTC chairman among them.

Also, before the academics’ February letter, there was a very impressive industry letter to AAG Delrahim in January, signed by industry bodies such as CCIA, the Fair Standards Alliance, the Software & Information Industry Association (SIAA), and ACT | The App Association, but also by major tech companies such as Apple, Intel, Microsoft, Samsung, HP, Dell, and Cisco. It’s very hard to understand why neither of those letters appears to have given AAG Delrahim pause. Does he seriously think he can make his contribution to #MAGA by acting against the likes of Apple, Intel, HP, and Microsoft–and trade organizations that have such companies as Google among their membership?

This whole “MAGA” delusion aside (Müller is an avid Trump proponent), it’s not hard to see that several of the above groups are Microsoft front groups (at least 3 of them). But what ought to matter a lot more is the benefit to society at large, including small businesses. Maybe the Justices at SCOTUS will some time soon find an opportunity to look into the matter (instead of relying on corporations and front groups that set policies by lobbying Trump-appointed ‘officials’, or former lobbyists). We certainly hope so because we have written a great deal about this subject since our inception in 2006.

06.11.18

Saint Regis Mohawk Tribe Blind to Its Participation in a Scam Around Patents on Nature

Posted in America, Antitrust, Europe, Patents at 3:36 am by Dr. Roy Schestowitz

Recent: Allergan/Mohawk ‘Sovereign Immunity’ Patent Scam (Dodging PTAB) Backfires Spectacularly

Tired man
Without even shedding a tear over what they’ve done (a betrayal to Native American values)

Summary: For over $20,000,000 (so far) the Saint Regis Mohawk Tribe has agreed to pretend that it has something to do with controversial patents of Allergan, in effect grossly abusing the concept of tribal immunity while at the same time enabling privatisation of nature

THIS SITE typically focuses on software patents and Alice. But a few other high-level decisions, notably Mayo, impact patent scope as well. There are many bogus USPTO patents which are well overdue for a review by the Patent Trial and Appeal Board (PTAB) and maybe the Federal Circuit as well. That includes patents of Allergan, which is visibly afraid of PTAB, knowing perhaps that its patents are questionable and would likely be voided upon closer scrutiny.

Allergan hired some dodgy law firm that bullies bloggers like myself; they are maximalists of patent law who are resorting to outright "scams" now (many people call it a “scam”).

“Allergan hired some dodgy law firm that bullies bloggers like myself…”Patently-O‘s Dennis Crouch has in fact just given the platform to these patent “scammers” who misuse tribal immunity to cushion/shield monopoly of Allergan (based on bogus patents). Michael Gulliford, an advisor to the Saint Regis Mohawk Tribe and the Founder of Soryn IP Group, uses terms like “controversial” and “death squad” to refer to PTAB. He compares judges and courts to assassins basically. What a lunatic.

He admits upfront that the tribe takes “$13.75 million upfront, with continuing royalty payments of $3.75 million per quarter” to participate in a “scam” of Allergan. This is pure greed and mischief. The tribe’s reputation is dead. They know it. In his own words:

Native Americans and patents don’t make headlines. That changed when the Saint Regis Mohawk Tribe, located in upstate New York, conceived a lucrative transaction that saw Allergan transfer patents covering the dry eye drug Restasis® to the Tribe. In return, the Tribe agreed to use its sovereign status to protect the patents from a controversial administrative proceeding coined the patent “death squad”, and to license the patents to Allergan. Allergan paid the Tribe $13.75 million upfront, with continuing royalty payments of $3.75 million per quarter.

The tribe now has very serious trouble in its hands; it has become widely associated with apatent “scammers” (especially in news headlines). These tribes are usually renowned with preservation and opposition to private ownership; this tribe is now known for the very opposite. It’s a greedy opportunist that helps a bunch of billionaires have a monopoly on nature.

“The tribe now has very serious trouble in its hands; it has become widely associated with a patent “scammers” (especially in news headlines).”Whose idea was it? The lawyers’, no doubt, both Allergan’s and the tribe’s. “AstraZeneca sign[ed] [an] $1.5B antibody deal with Allergan” a couple of years ago, so it’s clear that they increasingly just rely on notorious patents on life.

As we noted here before, Patent Docs habitually promotes patents on life (stuff like CRISPR and beyond) and a few hours ago it republished a page (“Antibodies in the European Patent Office“) from a patent law firm, noting upfront that “[t]he following article was reprinted with permission from J A Kemp.” (who habitually write about the EPO, e.g. [1, 2, 3]

It starts with a discussion about Supplementary Protection Certificates (SPCs), which Team UPC keeps promoting, and then there’s this:

This Advanced Guide is drawn primarily from our experience prosecuting large numbers of antibody cases before the EPO and our discussions with EPO examiners. This may raise the question: Why is there so little supporting case law?

The main reason is that antibody case law at the EPO has been relatively slow to develop in recent years. In our opinion this is because the most common pending antibody applications during this period have focused narrowly on a lead molecule or molecules of the applicant.

It really comes to show just how much uncertainty surrounds these patents. They’re almost shrouded in mystery. Well, the examiners at the EPO are resisting these, but patent maximalists such as Team UPC push back hard, sometimes together with IAM. Lately we’ve been receiving pointers to sites which oppose patents on life; EPO insiders, perhaps witnessing public protests to that effect, understand the injustice/irrationality of such a concept. What will the Boards of Appeal, whose member has allegedly been bullied into severe depression by Battistelli's abuses, do on that matter?

06.02.18

US Antitrust Official Makan Delrahim Encourages Parasitic Patent Behaviour — Not Just Embargoes — in the Phones Domain and Beyond

Posted in America, Antitrust, Apple, Asia, Patents, RAND, Samsung at 8:47 am by Dr. Roy Schestowitz

The lawyers might like it, but it’s bad for the customers (fewer choices, more expensive overall)

ZTE

Summary: US antitrust authorities and the European Commission have been speaking a lot lately about FRAND/SEP and SPCs; will they institute policies which benefit the monopolies or the market at large?

WE HAVE ALWAYS PREFERRED not to deal with politics but with purely technical matters, but when it comes to patent law it seems like politics are inevitable. The EPO, for example, is run by a crooked politician and the USPTO is connected directly to the government. See Makan Delrahim's history just before Trump put him in his current position; Trump put yet another rogue lobbyist (“swamp” is what he calls it) in charge and it hurts actual science and technology. Before Iancu was nominated and appointed by Trump his firm had worked for Trump too. That’s politics.

Makan Delrahim’s policies were mentioned by Richard Lloyd just before the weekend. It was about standard essential patents (SEPs). There was a discussion about it in Europe (FRAND/SEP and SPCs) because of the European Commission’s latest announcement (relegated to our daily links) and here’s what Lloyd wrote about a new letter:

A group of advocacy groups with close ties to the high-tech, automotive and retail industries have released a new paper calling into question several of the policy positions staked out by US antitrust chief Makan Delrahim regarding the application of antitrust law to the licensing of standard essential patents (SEPs). The paper follows a letter, signed by 77 former government officials and academics sent to Delrahim last week which also questioned several of the comments that the head of the Department of Justice’s antitrust division has made since he was appointed last September.

We already wrote several posts bemoaning Delrahim’s policies, which seem to be influenced not by national interests but few private interests.

Speaking of politics, ZTE has been everywhere in the news lately; it isn’t all about patents, but the patents angle/aspect does get brought up on occasions, sometimes in relation to these lawsuits in Texas, which is becoming widely known for little but patent trolls and patent lawsuits. From a new report about it:

Despite the fact that its devices were recently banned in America, Chinese smartphone maker ZTE is now facing a patent infringement lawsuit in the US.

A Northern Texas US District Court judge recently denied the company’s motion to dismiss a patent infringement case filed by a Texas-based mobile software developer.

Seven Networks has alleged that ZTE’s firmware uses seven of its own patents regarding battery management, data transfers and notifications. The software developer’s complaint alleges that the ZTE Blade smartphone as well as its other devices, use parts of all seven patents to manage their battery life and handle notifications and data transfers.

[...]

ZTE has decided to halt production until the ban is lifted and its lawsuit with Seven Networks will likely complicate matters further.

As The Register put it (adding some politics), “ZTE can’t buy chips from America – but can still get sued for patent infringement in the US” (this is the headline).

Chinese phone maker ZTE will have to face a patent infringement lawsuit in the US, despite its handsets being effectively barred from sale in America.

On Wednesday a Northern Texas US District Court judge tossed the Chinese company’s motion to dismiss a patent infringement case filed by a Texas-based mobile software developer.

Seven Networks has alleged that ZTE’s firmware borrows from seven patents it holds regarding data transfers, battery management, and notifications.

Why would ZTE even wish to participate in the US market? ZTE and other Chinese companies have been the subject of a political smear campaign lately*. The same has been happening in Europe, especially in the UK.

Going back to the patent maximalist/lobbyist Richard Lloyd, he caught up with something we had covered regarding Panasonic. It’s feeding patent trolls in spite of all the openwashing. It’s likely that the trolls will soon go after companies like ZTE, suing perhaps through Texas (this has become common among Canadian patent trolls). Quoting Lloyd:

WiLAN has acquired a portfolio of patents from Panasonic in the latest in a long line of patent transfers between the Japanese tech giant and the Canadian NPE. The portfolio contains 34 patent families comprising 96 grants worldwide. It relates to security camera surveillance technologies, including camera systems used in retail, other commercial buildings and smart home applications. The transfer follows another transaction between the two in January which related to semiconductor memory technologies used in Dynamic Random Access Memory (DRAM) and NAND Flash Memory.

Nobody benefits from it; they artificially elevate the price of phones, which basically come with a ‘trolls tax’ attached.

As Samsung and Apple recently came to accept, this is mostly beneficial to patent lawyers. IAM named Samsung as the winner in Apple v Samsung, but the truth is that neither company won. Only their legal departments gained, as usual.

Well, having uploaded the relevant PDF, which can be found in Scribd [PDF], Florian Müller wrote that “Apple, Samsung trying to put patent dispute behind them through mediation” and to quote:

After last week’s Apple v. Samsung damages verdict (largely over design patents) in the Northern District of California, counsel for both parties told Judge Koh that they were both willing to put an end to their long-running dispute, which started with a complaint filed by Apple in April 2011 and quickly escalated into a global dispute with filings in ten countries.

[...]

What’s furthermore unclear (and no one may know at this stage) is whether the parties will try to resolve both California cases (the one that went to re-retrial in May, and a second one that turned into a roller coaster) or just the first one.

High-profile smartphone disputes between handset and platform makers (unlike litigation brought by non-practicing entities or increasingly-”trollified” former phone makers such as Nokia and Ericsson) haven’t recently resulted in license agreements. Instead, parties just dropped pending cases but reserved all options for bringing new complaints anytime, with some license agreements–or covenants not to sue–of extremely limited scope possibly having been part of some of those confidential deals. I would expect the same if Apple and Samsung finally called a truce. Apple obviously isn’t going to extend a design patent license to Samsung; the result might involve a license (or a convenant not to sue with the practical effect of a license) to a few software patents, though some have expired and others have been worked around. But by and large the question is just whether Apple will withdraw any pending claims. And, even if this works out now at long last, no one knows when hostilities might flare up again.

Müller speaks of “non-practicing entities or increasingly-”trollified” former phone makers such as Nokia and Ericsson,” but he might as well add Blackberry with Apple at its heels.

All these lawsuits sure fascinate patent lawyers because these make them richer. But at whose expense? We would be better off without all these legal battles. Can Delrahim, a lawyer himself, ever understand that?
____
* In addition to this, Microsoft blackmails ZTE and others. It’s suing or threatening to sue using patents just because they use Linux and Free/libre Open Source software.

03.18.18

China Has Become Very Aggressive With Patents

Posted in Antitrust, Asia, Patents, Samsung at 11:27 pm by Dr. Roy Schestowitz

The Communist Party of China (CPC) has a protectionist plan and a shared agenda (not just tactics) with Battistelli, who significantly lowered patent quality for the sake of raw quantity

Pooh the Bear and EPOSummary: China now targets other Asian countries/firms — more so than Western firms — with patent lawsuits; we expect this to get worse in years to come

KOREAN giant Samsung, which employs an extraordinary number of people, has traditionally been one of the top patenters (if not the top patenter, e.g. in 2012) at the EPO and USPTO, not just KIPO. Sure, it fell behind LG (the ‘other’ South Korean giant) this past year at the EPO, for whatever reason (we don’t want to speculate).

“China’s patent aggression is a growing problem and it’s like nothing we ever saw in Japan and Korea (traditionally of the patent ideology of live and let live).”Samsung, at least traditionally, is not patent-aggressive. In other words, it rarely sues anyone except if sued first. The same is said about Korean culture in general. Some time ago China began assaulting LG with patents — to the point where LG withdrew/pulled a lot of its business out of China. Samsung too came under many attacks in China and then it retaliated, even in the US. The latest in this retaliation? Florian Müller reports on the injunction against Huawei (highly CPC-connected firm):

A few days ago, Law360.com reported that United States District Judge William H. Orrick (Northern District of California) expressed an inclination at a Wednesday hearing to grant Samsung’s motion seeking to bar Huawei from enforcing a couple of Chinese patent injunctions before the U.S. court has determined whether it is, in light of its FRAND obligations, entitled to injunctive relief.

You won’t be surprised if you’ve been following the case here. Two weeks ago I published a post here with a headline that contained the following prognosis: “antisuit injunction looms large”

Even though I’m just a little blogger, it’s a bit daring to offer such a prediction based on the briefing record, especially since antisuit (here, actually just anti-enforcement) injunctions don’t come down every day. But for the reasons explained in my previous posts, above all Ninth Circuit case law, Huawei won’t be able to complain.

China’s patent aggression is a growing problem and it’s like nothing we ever saw in Japan and Korea (traditionally of the patent ideology of live and let live). A few days ago Managing IP wrote:

Big changes to the intellectual property office, including combining the enforcement functions of trade marks and patents, are expected to strengthen IP enforcement in China

Managing IP speaks of “administrative overlap” at SIPO. The main issue with SIPO, however, is not “administrative overlap” but really low patent quality which already causes patent trolls to soar there and few large Chinese firms (which can afford to fight trolls in court) to merely consolidate power.

“…expect Xi and CPC to try to leverage their ‘soft power’ abroad with patents.”China isn’t what patent maximalists claim it to be (we wrote many rebuttals to that effect recently) and the number of granted patents says little about innovation. Chinese patents at European and American patent offices are basically the ‘best of Mandarin’ (SIPO patents translated, sometimes with help from foreign workers). Those are the patents that are probably actually worth something.

Either way, expect Xi and CPC to try to leverage their ‘soft power’ abroad with patents. They know that trade sanctions are imminent (if not already in tact, e.g. tariffs), so it’s a form of deterrent or counterattack.

03.04.18

Microsoft Should be Subjected to Antitrust Action For an Extensive Network of Patent Blackmail, But With a Lobbyist in Charge (Trump Appointee) Don’t Hold Your Breath

Posted in Antitrust, GNU/Linux, Microsoft, Patents at 11:59 am by Dr. Roy Schestowitz

Elaborate plot to tax Linux/Android/ChromeOS will continue unabated

RacketSummary: While it seems unlikely that renewed antitrust action will be invoked against Microsoft, there’s ample evidence that Microsoft continues to feed patent trolls while offering ‘protection’ from them (e.g. in the form of “Azure IP Advantage,” which echoes the Microsoft/Novell strategy for collecting what they called “patent royalties” one decade ago)

THE CHANCES of regulation under Trump seem slim. There are many reasons for this, but we would rather focus on patents rather than pure politics.

Makan Delrahim is a lobbyist, yet he is in charge of antitrust now. It’s almost unthinkable, but with Trump in power anything is possible, e.g. people governing or regulating industries which they themselves came from and may go back to (revolving doors). Dennis Crouch’s thoughts on Delrahim were mentioned some days ago in a blog of patent maximalists. To quote a portion:

Makan Delrahim, the leader of the Antitrust Division of the U.S. Department of Justice of the Trump Administration, has made several interesting comments concerning patents and the antitrust interface. In a recent post on the Patently Obvious Blog, Professor Dennis Crouch discusses some debate concerning Mr. Delrahim’s positions as to when patent holders may create antitrust issues: “[Delrahim] explained that the DOJ’s historic approach has been a “one-sided focus on the hold-up issue” in ways that create a “serious threat to the innovative process.”” Professor Crouch includes links to documents concerning Delrahim’s positions as well as some responses.

Readers of ours have long called for government scrutiny over Microsoft’s patent aggression (and dirty games which often rely on intermediaries). We still see such calls occasionally (they contact the Justice Department).

Remember Intellectual Ventures? The troll Microsoft pretty much created and continues to fund? The troll that passed thousands of patents to another patent troll called Dominion Harbor. Apparently, based on this update from Unified Patents, Dominion Harbor now uses proxies to engage in blackmail. Many of these patents may be worthless, as Unified Patents explained some days ago: “On February 28, 2018, the Patent Trial and Appeal Board (PTAB) instituted trial in an IPR filed by Unified against U.S. Patent 8,082,213 owned and asserted by Smart Authentication IP, LLC. Smart Authentication, a Dominion Harbor subsidiary and a well-known NPE, declined to file a preliminary response in opposition to Unified’s petition. The ’213 patent, directed to a user authentication system, has been asserted against such companies as MongoDB, Slack Technologies, Evernote, Etsy, Discover and USAA.”

We have meanwhile learned from this tweet that Intellectual Ventures (IV) passed some patents to Google. “According to USPTO assignment records,” IAM wrote, “Google has picked up a couple of patents from IV. After recent RPX deal shows growing band of buyers looking at IV assets…”

This patent troll, Intellectual Ventures, attacks Federal Express in the “Rocket Docket” of trolls (EDTX, Judge Gilstrap), based on this new Docket Report about a lawyer falling ill. “The court deferred ruling on defendants’ motion to substitute one of its experts and appointed a special liaison to help determine whether the expert would be able to proceed at trial,” Docket Navigator wrote. What looks like another patent troll now sues Huawei in Texas (the “Rocket Docket”, EDTX again), based on this other new Docket Report:

The court granted defendant’s motion to strike portions of the report of plaintiff’s infringement expert regarding previously undisclosed secondary considerations of nonobviousness.

Another Microsoft-backed troll, Finjan, was mentioned the other day. “News of a big settlement between Finjan and Symantec including a $65m payout to the NPE and a possible additional payment of $45m,” IAM wrote.

Symantec is a Microsoft competitor, one of many that are being targeted by this troll. Does Microsoft expect nobody to notice Finjan's track record? While it’s selling 'protection' from such trolls?

Glyn Moody at Linux Journal has in fact reminded readers what Microsot did a decade ago in an effort to target every GNU/Linux distributor out there. To quote:

Its general strategy was to spread FUD (fear, uncertainty and doubt). At every turn, it sought to question the capability and viability of open source. It even tried to convince the world that we no longer needed to talk about free software and open source—anyone remember “mixed source”?

Alongside general mud-flinging, Microsoft’s weapon of choice to undermine and thwart open source was a claim of massive patent infringement across the entire ecosystem. The company asserted that the Linux kernel violated 42 of its patents; free software graphical interfaces another 65; the OpenOffice.org suite of programs, 45; and assorted other free software 83 more. The strategy was two-fold: first to squeeze licensing fees from companies that were using open source, and second, perhaps even more important, to paint open source as little more than a pale imitation of Microsoft’s original and brilliant ideas.

The patent battle rumbled on for years. And although it did generate considerable revenues for the company, it failed dismally in its aim to discredit free software.

Why was Microsoft never subjected to any antitrust scrutiny over it? Right now Microsoft does pretty much the same things, albeit indirectly. Recall the never-heard-of-before Provenance Asset Group (Microsoft may be in the shadows, as we explained before [1, 2]). It is now distributing/scattering patents from Nokia, whose patents Microsoft already instructed Nokia to pass to patent trolls in the past. “Provenance Asset Group has published details of several lots of Nokia/Alcatel-Lucent patents it’s selling,” wrote a former IAM writer (link to the relevant page). Belatedly, this strange little entity names Dan McCurdy, Timothy Lynch, Linda Biel, and Laura Quatela as staff. Some have background in Alcatel-Lucent. RPX is mentioned there also. Microsoft too was a member of RPX until recently.

02.25.18

As Japan Moves Towards Reducing Patent Lawsuits and Curbing SEP Abuse Will the United States Follow Suit?

Posted in America, Antitrust, Asia, IBM, OIN, Patents, RAND at 2:56 am by Dr. Roy Schestowitz

Ask Makan Delrahim

KDDI Corporation logo

Summary: Japan is getting tougher on standards-imposed patent traps (SEP), the US may be getting ready to do the same, and Japan’s KDDI Corporation joins OIN

WE recently wrote about Japan's growing comprehension of the SEP threat, unlike the US with Makan Delrahim (a lobbyist) in charge of antitrust matters. President Trump fills his swamp and it truly shows (just look at his USPTO Director pick, soon to speak at an IAM event). As IAM put it the other day: “Another speech from @TheJusticeDept’s Makan Delrahim suggesting US gov is looking very closely at use of antitrust enforcement in standard setting https://www.justice.gov/opa/speech/assistant-attorney-general-makan-delrahim-delivers-remarks-college-europe-brussels” (think about Qualcomm for instance).

Watchtroll, in the mean time, is frustrated that on patents “Trump DOJ is on the same page as the Obama DOJ, which is hard to fathom given all the promises made by President Trump during his campaign.”

“The patent maximalists sure hope that chaos will be restored as they profit from that chaos.”Watchtroll now helps the lobby for patent chaos, hoping that republishing a letter will help it have impact. The patent maximalists sure hope that chaos will be restored as they profit from that chaos.

As we recently noted, Japan (and JPO) recognises that patent litigation isn’t desirable (unless you’re a lawyer) and this new report says that “Japan will soon implement a process that will swiftly resolve disputes over patents that are crucial to adhering to certain technical standards…” (that’s SEP)

This is a good thing. Consider the fact that, as IAM put it last week, Hitachi fed patents to “NPE Microconnect in the past several months.”

“…Japan is moving in the same direction as the US. The EPO, by contrast, moves in the same direction as China (SIPO).”“NPE” is a euphemism for patent troll and it’s worrying to think that a Japanese giant will resort to this. This is good for IAM and its paymasters of course, but what about Japan in general? IAM has just published this sponsored ‘article’ for Shobayashi International Patent & Trademark Office (Japan), so it’s clear that IAM is in the pockets of the Japanese patent ‘industry’ (litigation), not actual industry.

A week ago it was announced that KDDI, a communications service provider in Japan, had entered the Linux-centric Open Invention Network (OIN). A press release got disseminated (e.g. [1, 2]) to say:

Open Invention Network (OIN), the largest patent non-aggression community in history, announced today that KDDI Corporation (KDDI) has joined OIN as a community member. As the first key communications service provider in Japan to enroll in the OIN community, KDDI is demonstrating its commitment to open source software and the associated development efforts that benefit the entire communications industry.

“The communications industry is continuing its rapid transformation. Linux-based platforms like ONAP, OPNFV, and OpenDaylight are beginning to enable carriers and enterprises to provision new levels of service functionality across cloud and software defined networks (SDN) at an unprecedented pace,” said Keith Bergelt, CEO of Open Invention Network. “We appreciate KDDI’s participation in joining OIN and demonstrating its commitment to innovation and patent non-aggression in open source.”

OIN is not against software patents. It’s more of an IBM ‘hack’ which, according to Bruce Perens, is about protecting software patents from Linux rather than protecting Linux from software patents (quite an accurate description we might add).

Japan is one of IP5 (JPO is in it), so watching what happens there is definitely worthwhile. Japan has become a lot stricter on software patents and the courts not so plaintiff-friendly. In that regard, Japan is moving in the same direction as the US. The EPO, by contrast, moves in the same direction as China (SIPO).

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