From search engine with a ‘cute’ face to patent aggressor with a mean face, in less than two decades
Summary: Google has just turned a little more evil, by essentially using patents as a weapon against the competition (by no means a defensive move)
ABOUT 7 years ago I wrote to Google managers whom I knew that they should refrain from hiring patent lawyers, collecting lots of patents, and basically turning the company into a big patent bubble. But this had little effect on the company’s decision; it has since then been taken over by ‘foreign’ (newly-hired) influence.
“We can no longer say what we used to say — that Google was officially using patents only for defensive purposes or in response to a preemptive attack from other companies.”Google, over time, went from being a patent sceptic to gradually becoming a patent collector. Now, as we feared, Google becomes patent aggressor. Google is gradually becoming a patent bully now, even if it calls itself “Alphabet”, and it’s bad even if the defendant is a company that’s pure evil (as in this case). Even IAM took note of it already; it recalled the BT case which we covered here many times before as follows: “The first and really only high-profile patent infringement lawsuit Google has pursued was against BT – and even that was after BT had transferred patents to a third party which had then used them to sue the search giant. Google quickly filed a counter suit against the British telco and the conflict ultimately fizzled out. So, for a Google business to be asserting now is a very big deal indeed.”
There is already a huge trove of news articles about it, e.g. [1, 2, 3, 4]. It’s everywhere. The effect on the competitor was described yesterday as follows:
When Anthony Levandowski loped onto the stage to accept the Hot New Startup award at an industry awards show this month, the trucker hat perched on his head served as a cringeworthy nod to the millions of drivers his self-driving truck company is poised to leave jobless.
Three weeks later, it is the pioneering engineer of self-driving car technology whose job could be in jeopardy, and the lawsuit he is named in could pose an existential threat to an increasingly vulnerable Uber.
We can no longer say what we used to say — that Google was officially using patents only for defensive purposes or in response to a preemptive attack from other companies. Google is turning ever more evil, even when it comes to patents. It’s a very big deal because Google is probably the world’s largest distributor of GNU/Linux (e.g. Android and Chromebooks).
There will, from now on, be less of a track record to guard and thus less of a deterrent against further such actions from Google. Suffice to say, Google has many sofwtare patents now. █
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If it looks like a patent troll, IAM will certainty love it and agonise over the bad reputation of trolls
Summary: Selective coverage and deliberate misinterpretation of Microsoft’s tactics (patent settlement under threat, disguised as “pre-installation of some of the US company’s software products”) as seen in IAM almost every week these days
THERE IS A WAR against GNU/Linux. It’s a very big war. But a lot of it happens in the back room and it is being led by Microsoft, a notoriously corrupt company that still relies on bribes and blackmail for a lot of its deals (we have given many examples in the past).
Yesterday we saw a Microsoft-friendly site writing about the latest attack on Free software from Google. The site called it “Patently Ridiculous” (in the headline) that “Google [is] Ordered To Pay $20 Million Plus,” as we noted here the other day (it’s a notoriously trolls-friendly judge).
“Not all of this officially counts/qualifies as patent revenue (royalties) because Microsoft uses a clever trick now.”“Software patents are usually patents on the obvious wrapped up in as obscure, vague and technical a language as possible,” the site said. “In this case Google has been found guilty of infringing a “sandbox” patent in Chrome.”
That’s a software patent and it was found valid in one of those notorious courts in the Eastern District of Texas, so Google will hopefully appeal. But there is an even broader war going on, some of which involves Microsoft satellites that keep suing Android (or GNU/Linux) device makers. We provided plenty of examples in past years.
“This trick started about a year ago with Acer, not too long after it naturally followed from a lawsuit against Samsung that yielded a settlement 2 years ago (same effect, same consequences).”Microsoft itself is playing this aggressive game also directly, though it learned how to disguise it a little better. It is trying to make billions of dollars by shaking down Android OEMs and Chrome OS OEMs (often the same OEMs — more or less — as these two operating systems overlap one another more and more over time). Not all of this officially counts/qualifies as patent revenue (royalties) because Microsoft uses a clever trick now.
This trick started about a year ago with Acer, not too long after it naturally followed from a lawsuit against Samsung that yielded a settlement 2 years ago (same effect, same consequences). Then came Xiaomi (not only bundling of Microsoft malware but also payments to Microsoft, in the form of patent purchases). This was all along misportrayed by IAM, as we repeatedly showed. Either they are willfully ignorant or maliciously lying about it. Today IAM published another one of these puff pieces. It paints Microsoft as some kind of “good cop”, but what the author of this article conveniently neglects to say (or twists the facts of) is that Microsoft previously blackmailed HTC using software patents (around the same time Apple did so).
Here is how IAM put it:
The Microsoft petition – jointly filed with Taiwan’s HTC – argues that claims 14, 15 and 17 of the ‘695 patent should be invalidated on grounds of obviousness. The petition also notes that the ‘695 patent has been asserted by Philips along with several other patents in a series of infringement cases it filed in the District of Delaware back in December 2015. The seven of these lawsuits that remain active target Acer, Asus and HTC from Taiwan; Double Power Technology and Yifang from China; and US companies Visual Land and Southern Telecom. Microsoft has joined the Acer, Asus, Double Power, Visual Land and Yifang cases as a counter-defendant; it is also involved in the HTC case as an intervenor-plaintiff.
Of the defendants in the Philips lawsuits, we know that Microsoft signed HTC as a patent licensee back in 2010, and that it has revised and expanded existing IP licensing deals with Acer and Asus in recent years. With regards to both the latter, this involved the pre-installation of some of the US company’s software products on the Taiwanese manufacturers’ devices; this has also been a feature of headline patent deals signed with other major Asian companies, including Lenovo and Xiaomi. It may be the case that Microsoft has also offered some form of patent risk mitigation, similar to the aforementioned cloud customer programme, as part of these agreements – though that is just my speculation at this stage, and would be difficult to confirm since the details of such licensing arrangements are typically highly confidential.
Instead of ever acknowledging their mistakes/errors, Team IAM likes to pretend that I did not understand what they wrote. This Microsoft-powered site with many guests from Microsoft embedded in articles is fooling nobody. Microsoft is almost worshiped there and rarely is there even a single sentence critical of the company.
“Just using patents to coerce companies into doing what Microsoft tells them,” I told IAM. “It’s a form of blackmail.” But they keep repeating Microsoft’s talking points every month if not every week. That’s revisionism.
Watch how IAM framed a PTAB IPR petition (as if Microsoft cares for companies it blackmailed): “Microsoft IPR filed against Philips looks like another example of the company’s patent-plus value creation strategy.”
Blackmail with patent threats is not “Value creation”. It’s extortion, it’s blackmail. IAM needs to stop pretending that it’s a news site if trolls are painted as innocent victims and companies that terrify and bully the whole industry get treated like a banality to be ignored if not celebrated.
IAM, like the EPO which turned it into a propaganda mill, is a symptom of many of the things we stand against. The other day it celebrated European patent-based sanctions against Chinese companies (like the aforementioned OEMs from Taiwan or China) and only days ago it promoted patent tax through SEPs, which are inherently not compatible with Free/libre software. To quote:
Avanci was launched last September with Qualcomm, Ericsson, ZTE, KPN, InterDigital and Sony all agreeing to make their standard essential patents that read on 2G, 3G and 4G technology available for license across a range of IoT industry verticals. The first three sectors that Avanci has targeted are the auto industry, connected homes and smart meters. There’s no doubt that Avanci brings together some of the leading plays in wireless technology, but it also has some notable gaps such as Nokia and Huawei. Five months after it launched it is yet to conclude any licensing agreements, although Alfalahi insisted that feedback from the industry and from regulators has been positive and that his team continues to talk to a wide range of licensees and possible members. “We’re not saying that cross-licensing or one-on-one licensing doesn’t work, we just believe there’s a better way and over the last year it has become clear there is a need in the market,” he said.
By making up buzzwords like “IoT” or “4G” companies try to bundle together a bunch of patents that deny entry into the market (via standards) unless entrants pay a very large toll (sometimes more expensive than all the hardware combined). In reality, many of these patents are software patents, i.e. something which isn’t even patent-eligible in the vast majority of countries.
We read IAM not for information but mostly as an exercise in understanding the idealogical opposition; IAM stands for greed, protectionism, and litigation, in lieu with its funding sources (revenue sources are not limited to subscriptions). █
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“Linux infestations are being uncovered in many of our large accounts as part of the escalation engagements.”
Summary: In an effort to combat any large deployment of non-Microsoft software, the company goes personal and attempts to overthrow even management that is not receptive to Microsoft’s agenda
IN LIGHT of the news (also the Microsoft-leaning fake news) from Munich, and also in light of Microsoft’s attempts to cause me trouble with my employer (that is their modus operandi apparently), now is a good time to share this story, which we learned about some months ago. Over the years we have covered examples of Microsoft retribution against individuals and organisations that were viewed as “enemies” of Microsoft. To Microsoft, competition is “enemy”, standards are an “enemy”, and even fair competition is an “enemy”. Less than a decade ago a government delegate compared Microsoft's methods to those of “Scientology cult”. That comparison was apt.
“I’ve been looking for Tim Bray’s blog post about how Microsoft went after his job; when they couldn’t get him fired, crushed his wife’s business.”
–AnonymousThe latest example of it happened in the UK and is still happening (we might have some updates on this at a later time). We have shared this information with some Techrights members and studied the patterns before publishing anything.
“I’ve been looking for Tim Bray’s blog post about how Microsoft went after his job,” one member wrote, “when they couldn’t get him fired, crushed his wife’s business.”
“Also,” this member noted, “Microsoft has been after you before, do you have a blog entry about it? If not, it might be a good idea.”
I learned some more about it a few months ago in my employer’s Christmas dinner, but that might be an interesting subject which would be better left aside for another day.
Today we would like to focus on a bigger story which has been long coming. We waited before writing about this, as Microsoft is evidently back to these dirty tricks that many assumed had already ended. It is pretty serious and lawyers along with police are involved (in the UK). In the mean time, in order to not compromise any ongoing processes, we shall refrain from naming people and companies.
“Life for my friend and I has been pretty horrific. Still dealing with the aftermath…”
–AnonymousA person we spoke to said something “isn’t quite right at the moment” in some local authorities in the UK. These local authorities are in England. It has gotten so severe that relocations were needed. “A friend/former colleague,” we were told, “is in similar situation, but is skeptical of larger issues…”
Several key groups in the UK, those professing to promote Free/Open Source software, are now “in the hands of someone influenced by some very Microsoft-friendly people,” we got told. It’s too early/premature to name the culprits, but we might do so one day. “Microsoft’s “open source” staff contacted my boss,” I told the person, and they “tried to get me fired or something…”
The matter of fact is, this isn’t so uncommon. “Nothing surprises me,” this person told me. “Just remember Microsoft acts like a cult,” I explained, and it “always did,” based on people who knew Microsoft as officials. Look what happened in Munich recently, including the politics preceding it all the officials involved. “Life for my friend and I has been pretty horrific,” the person explained to me. “Still dealing with the aftermath…”
We are afraid we cannot say much more at the moment. “Still just dealing with complaints,” the person told me, who will “will make little progress until solicitors return from leave…”
Whether we can proceed to naming and shaming some of the parties involved only time will tell. What we know for sure, however, is that Microsoft still plays dirty and people who are in denial about it do so at their own peril.
“I figure that even if Microsoft goes bankrupt, there will be a very long tail due to its cult-like nature and the spread of its minions throughout industry and, now, even academia.”
–Anonymous“I know someone non-technical who considers Microsoft mostly dead,” a member told us. “From my perspective, I don’t count them gone until the office furniture is auctioned off and the officers past and present brought to justice before the courts of law.
“I figure that even if Microsoft goes bankrupt, there will be a very long tail due to its cult-like nature and the spread of its minions throughout industry and, now, even academia. The big breakthrough needed there will be a court decision rendering anti-disparagement clauses invalid so that those that have had a change of heart can speak out.”
This isn’t so rare and unusual an incident. “About Microsoft,” one member told us, “my dad now came to the conclusion on his own that Microsoft put pressure on the administration in my old job to force me out, first removing my boss, then me, then harassing the hell out of my former students. I have no opinion on his conclusion in that area due to lack of data aside from the harassment, the removal of my boss with no warning or reason given, and the discontinuation of my contract with the excuse of the lie of no more teaching. I had not suggested Microsoft as a cause at all to him because I have no data other than that the new managers gave the appearance of being both incompetent and assholish. There was something going on though with or without Microsoft involvement. Anyway, it looks like that whole institution may close soon.”
This is similar to something that happened to a potential client of ours in the UK. They get rid of people’s entire role, in order to get rid of the people who occupy these roles. It’s quite obvious that Microsoft and its resellers do this intentionally and consciously.
“I was going to meet someone who had widely deployed GNU/Linux and was using it for nearly 100% of their machines. While I was physically en route to their site, they got a panicked call from the top regional Microsoft sales representative who kept them on the phone a long while, trying all kinds of methods to get them to purchase Microsoft, even trying to wheedle a meeting agreement when a sale could not be reached.”
–Anonymous“Another time,” told us a member, “I was going to meet someone who had widely deployed GNU/Linux and was using it for nearly 100% of their machines. While I was physically en route to their site, they got a panicked call from the top regional Microsoft sales representative who kept them on the phone a long while, trying all kinds of methods to get them to purchase Microsoft, even trying to wheedle a meeting agreement when a sale could not be reached. They thought it was coincidence, I did not. Fortunately he had a good working relationship with his boss and his boss’ boss so when Microsoft went over his head, he survived unscathed. However, that site really wishes to remain very low profile some years more to further build up their position.”
I have come to witness this sort of “low profile” policy myself; Microsoft likes to keep a sort of “naughty list” of institutions or companies (to convert to Microsoft). There’s nothing they won’t do to derail the competition, even just for the sake of driving it out of business.
If you too have a similar story to share, even if pertinent details like names must be omitted, please get in touch with us. The world needs to understand what Microsoft is still up to. █
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Google uses IPRs to eliminate everything that’s left of this parasite
Summary: A new example of software patents against Free software, or trolls against companies that are distributing freedom-respecting software from a country where these patents are not even potent (they don’t exist there)
InfoGation Corp. [sic] (corporations typically make things) is not a real company. Maybe it used to actually do something in the distant past, but now it’s just a pile of patents. Their Web site is a one-page stop, the classic troll-themed Web site, referring to “technology” (for so-called ‘licensing’) rather than actual products. Search the Web for the term “InfoGation Corp.” and just about every single result will be about some lawsuit, which is rather telling.
“Search the Web for the term “InfoGation Corp.” and just about every single result will be about some lawsuit, which is rather telling.”Under the “Patent Trolling Archives” section, the Patent Investor described InfoGation Corp. as an “assertion entity” (fancy name for troll), noting that after it had gone after Taiwan’s HTC (the first time we wrote about InfoGation Corp.) it also attacked other Google partners, mostly in China, e.g. ZTE and Huawei. Google stepped in to defend these partners.
Watchtroll is bashing PTAB, essentially by calling the patent holder, InfoGation Corp., “small software developer” (yes, software patents) and saying that those challenging the patents merely “gang up”. This is quite a lot of Watchtroll FUD in quick succession, e.g. after it had published a piece we debunked this morning. We don’t want to start a line-by-line rebuttal; instead we’ll just say that Watchtroll has been grooming this troll for quite some time (it wrote quite a lot about it in the past). It also exploits it for PTAB bashing — an old tradition at Watchtroll. Is PTAB going to trash some more software patents, thus taking InfoGation out of business once and for all? We sure hope so. This would help deter trolls and discourage further litigation such as this. █
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If you don’t pay Microsoft the ‘protection’ fee, then watch out!
Summary: The story of Huawei gets more complicated, even though software patents are losing their teeth and notorious patent trolls are altogether losing their patents
Microsoft has successfully blackmailed all the big Android (and Chrome OS) OEMs except Huawei (whose headcount is almost twice that of Microsoft). Microsoft now attempts to paint patent settlements as "bundling" (the latest trick among more for taxing GNU/Linux and Free software). This does not, however, suggest that Huawei is safe because Microsoft has an army of “punishers” (or trolls), ranging from classic trolls like Intellectual Ventures to companies like Nokia and trolls that Microsoft passes Nokia’s patents to, e.g. MOSAID/Conversant.
Will Huawei bear the brunt of trolls for ‘daring’ to repeatedly refuse to sign a patent settlement with Microsoft (like Xiaomi did)? Ericsson, according to this new blog post from IAM, uses its already-notorious patent trolls (like Microsoft does) to taunt Huawei in the Eastern District of Texas. What we were not aware of, however, is that Nokia too — having become Microsoft’s patent bully after Elop’s infiltration/entryism — goes after Huawei. To quote: “Already embroiled in a standards licensing dispute with competitors Ericsson and Nokia, Huawei now faces battle on a new front after NPE PanOptis sued the Chinese company for alleged infringement of its standard-essential patents (SEPs).”
What we are seeing here is the sort of sordid mess that makes so-called 'smart' phones grossly overpriced and helps Microsoft compete on pricing terms while also extorting the competition (extracting so-called ‘royalties’ from projects and products it contributed absolutely nothing to).
We hope to see Microsoft’s trolling coming to a halt, but with the Linux Foundation being so paralysed by Microsoft cash we doubt a reprieve will ever come from there.
One way out of this mess is the weakening of software patents and perhaps their complete phase-out in the US. MPHJ, one of the world’s most notorious patent trolls, turns out to have just lost its software patents. As Patently-O has just put it:
Scan-to-Email Patent Finally Done; Claim Scope Broadened by Narrow Provisional Application
MPHJ’s patent enforcement campaign helped revive calls for further reform of the patent litigation system. The patentee apparently mailed out thousands of demand letters to both small and large businesses who it suspected of infringing its scan-to-email patents. The primary patent at issue is U.S. Patent No. 8,488,173.
Ricoh, Xerox, and Lexmark successfully petitioned for inter partes review (IPR), and the PTAB concluded that the challenged claims (1–8) are invalid as both anticipated and obvious. On appeal, the Federal Circuit has affirmed.
Nice to see PTAB saving the day again! That’s why we wholeheartedly support PTAB, whose role is still growing this year. █
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Companies that are using GNU/Linux in their datacentres have become the target of software patent lawsuits from a fake ‘friend’ of GNU/Linux
Summary: IBM’s poisonous policy on patents, which has long been incompatible with Free/Libre software, has gotten even worse and the company now takes the lead in lobbying for patenting of software
The “Open Invention Network,” Florian Müller told me a few hours ago in Twitter, “has co-founded a *pro-patent* advocacy thing,” called “The Center for Intellectual Property Understanding”. The press release reveals the involvement of the man who turned both IBM and Microsoft into massive patent bullies (Marshall Phelps, who is also quoted at the bottom):
“The IP knowledge gap is growing,” said Marshall Phelps, former head of IP at Microsoft and IBM and CIPU’s Vice Chairman. “Many people, including the general public and many in government, haven’t a clue what patents and other IP rights achieve. The incentive for taking IP seriously is at an all-time low. The Center for Intellectual Property Understanding will engage groups like schools, parents and the media about the benefits of respecting new ideas and the impact of failing to.”
It is worth noting that the Open Invention Network (OIN) was founded in part by IBM and was first headed by an IBM employee. The above serves to reinforce our growingly sceptical view of both OIN and IBM, which now engages in a lobbying campaign for software patents in the United States. Adding insult to injury, IBM is once again aligning itself with Watchtroll, which has been attacking people like Michelle Lee (USPTO Director) in an effort to engineer her dismissal [1, 2, 3, 4, 5, 6] and make way for a crooked person like Rader. Manny Schecter, IBM’s patent chief, actually contributed to Watchtroll — didn’t just link to it — and the headline was “Congress Needs to Act So Alice Doesn’t Live Here (in the Patent System) Anymore”.
“IBM’s willingness to do it so openly is a slap on the face of anyone who ever supported or praised IBM as some sort of guardian of GNU/Linux.”It doesn’t get any clearer than this. IBM is an enemy of software developers everywhere, and not just Free/Libre software developers. This was published yesterday, February 13th. Once upon a time IBM tried phoning me to control the narrative of my stories (I told them off immediately). They love shaping the media behind closed doors, but Schecter continues to make it abundantly clear that IBM is now just a business ally of Apple, not “Linux” (or GNU/Linux). IBM is actually rapidly becoming an enemy of GNU/Linux and everything that has helped IBM grow over the past 2 decades.
Others are also promoting software patents this week, for example Finnegan, Henderson, Farabow, Garrett & Dunner, LLP (as expected from patent profiteers). IBM’s willingness to do it so openly is a slap on the face of anyone who ever supported or praised IBM as some sort of guardian of GNU/Linux. IBM is now suing massively all sorts of companies with massive GNU/Linux deployment, using software patents. █
“[The EPO] can’t distinguish between hardware and software so the patents get issued anyway.”
–Marshall Phelps, IBM and then Microsoft
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Whereas in Munich, Microsoft’s allies from Accenture continue to game the media with claims (years in the making now, always in vain) that GNU/Linux is a “failure”
“I’ve heard from Novell sales representatives that Microsoft sales executives have started calling the Suse Linux Enterprise Server coupons “royalty payments”…”
–Matt Asay, formerly Novell
Summary: Microsoft’s so-called ‘love’ of GNU/Linux is conditional; Microsoft is willing to just tolerate GNU/Linux and not sue its users/distributors to death (or hefty settlement) as long as they pay Microsoft some royalties
AFTER a bunch of days without a single article (two of my laptops broke down, the connection went bust and other serious issues came up in the course of just 48 hours!) I can finally catch up with a lot of news which I was eager to write about. One might joke that for the past few days I’ve experienced the stress levels of EPO employees.
“The marketing/slogan was similar 10 years ago and we are beginning to see what Microsoft was plotting with this whole Azure “Microsoft loves [GNU/]Linux” façade.”Last week’s most popular article was this one about Microsoft's latest PR twist — a claim that balkanisation of Free/Libre Open Source software (“safe” and “unsafe”) is somehow benign and even desirable. A lot of the corporate press played along [1, 2] (Googlebombing “microsoft troll” as we noted here before). The latter, for example, is a highly misleading headline (“10,000 Microsoft patents free of charge”) because they pay Microsoft, otherwise Microsoft’s trolls can go after them. Notice the name of the programme, “IP Advantage”. If it sounds familiar, it should; these are same words that were used back in the Novell days. There was even a domain named along those likes. The marketing/slogan was similar 10 years ago and we are beginning to see what Microsoft was plotting with this whole Azure “Microsoft loves [GNU/]Linux” façade. It’s not too hard to see what really happens here and it’s probably not a coincidence or a side-effect but something that Microsoft’s strategists came up with. This is how they try to leverage software patents to ‘milk’ Free software.
“No other company pushes the envelope on IP value creation quite like Microsoft,” said Microsoft’s friends at IAM. “Yesterday the software giant was at it again with the announcement of a new level of patent protection for its cloud business through the launch of the Microsoft Azure IP Advantage programme.”
“So Microsoft is now looking for new ways to tax, using patents, the technology which is taking over (and isn’t Microsoft’s).”Watch how these mesmorised writers from IAM spin Microsoft’s passive-aggressive patent tactics. These tactics show that Microsoft has not changed. Only the marketing got tweaked a little. To quote more: “Microsoft’s recent value creation drive comes at a time when one of its traditionally strong IP areas — licensing fees — are on the decline; thanks, in large part, to a slumping smartphone market.”
So Microsoft is now looking for new ways to tax, using patents, the technology which is taking over (and isn’t Microsoft’s). Michael Loney too missed/lost sight of the Microsoft plot. He acts like a courier of Microsoft. “In an interview,” he wrote, “Erich Andersen explains Microsoft’s new programme to protect customers against IP litigation related to cloud computing, including making 10,000 patents available and pledging to Azure customers that if it transfers patents to non-practising entities they cannot be asserted against them” (like those entities that are operated by or are connected to Microsoft).
Brad Smith, President and Chief Legal Officer after his promotion (showing increased focus on patents, not products, a couple of years ago), is promoting “Microsoft Azure IP Advantage programme,” but let it be clear that this is just the latest Microsoft assault on GNU/Linux and Free software. Anyone who believes otherwise is just refusing to see the obvious; or maybe we just failed to explain this clearly enough last week. We expect to say more about it in the near and distant future. Wait for trolls like Intellectual Ventures to go after hosts (or their customers) that are not Microsoft-’protected’. █
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Qualcomm still one of the worst companies and most lethal patent aggressors out there…
Summary: OEMs that actually manufacture/sell phones rather than slap a patent fine on them need to (re)group around Apple and help ensure that the patent thicket is removed (or made a lot thinner)
“No One Should Listen to Qualcomm About Patents,” Matt Levy wrote yesterday, having pushed for patent reform for a number of years, striving to improve patent quality at the USPTO and put an end to patent trolling (which would be an outcome of the former, as there’s a direct correlation). To quote Levy:
Why No One Should Listen to Qualcomm About Patents
Qualcomm is a major opponent, perhaps the strongest opponent, of patent litigation reform. It’s becoming pretty obvious why. A few weeks ago, the Korean Fair Trade Commission went after Qualcomm for its anti-competitive licensing practices. This time, it’s the U.S. Federal Trade Commission going after Qualcomm for its licensing practices.
With the FTC complaint, we find a little bit more about Qualcomm’s practices. For example, we learn why requiring companies to take a separate patent license in order to purchase chips is abusive. Normally, the purchase of the chips would be enough without a license, because, under the first sale and patent exhaustion doctrines, a seller automatically gives a license to the purchaser for any of the seller’s relevant patents.
Qualcomm, however, forces its customers to take a separate patent license that entitles Qualcomm to a percentage of the price of the entire device that uses its chips. That is, a smartphone manufacturer has to pay Qualcomm a percentage of the price of the entire phone for each phone sold, in addition to paying for the chips. That’s essentially extortion.
On the other side of the debate we have trolls- and aggressors-friendly sites like IAM, which is actually funded by them. Watch this:
Barnett’s work is particularly timely given the spate of lawsuits that have recently been brought against Qualcomm by, among others, the Federal Trade Commission (FTC) and Apple, over the chipmaker’s FRAND licensing. Those cases frame the argument around a dominant patent owner and technology supplier abusing its position to block out competitors and extract licences from manufacturers.
Qualcomm will no doubt counter with a robust defence; but, as Barnett’s research shows, like many licensors the company is on the wrong side of a set of theories that continue to shape much of the licensing narrative in the US.
So even those whom we expect to be very sympathetic to Qualcomm appear to have lost hope. Florian Müller has meanwhile told me that “one day that U.S. Apple v. Qualcomm case will go to the appeals court and Android OEMs will file pro-Apple amicus briefs” (it’s one rare situation where Apple and Android have a common cause and we believe that, inadvertently, Apple helps Android OEMs too in this case).
“So it sounds as though Apple takes its fight against Qualcomm even further.”Going back to IAM (which seems to believe readers care patent applicants at SIPO, in spite of the appalling patent quality), here is a recent translation/interpretation of reports that are typically published in Mandarin alone. “According to media reports,” IAM says, “Apple lodged two separate complaints against Qualcomm with the Beijing IP Court. One alleges violations of China’s Antimonopoly Law, to the tune of 1 billion yuan ($145 million). The other is a challenge to the chipmaker’s licensing practices, which are described as “unfair and unreasonable”. The new move comes on the heels of a similar suit in the United States by Apple, that itself followed the FTC complaint covered in this blog last week. Qualcomm has dismissed Apple’s actions as a meritless effort to pay less for the technology it uses.”
So it sounds as though Apple takes its fight against Qualcomm even further. This would, once again, be beneficial to Android OEMs, and not just Chinese ones. Remember that some of these Qualcomm patents are software patents.
“Nokia, in spite of returning to Linux and Android, represents a threat to Android OEMs in the patent sense.”At the same time Apple continues fighting back against Nokia, which became very aggressive just before Christmas. See these new reports [1, 2, 3, 4] about the ITC investigating Nokia’s patent claims against Apple. The ITC is not unbiased (typically favours US companies, as one might expect), so we suspect it will favour Apple (US) over Nokia (Finland). Nokia, in spite of returning to Linux and Android, represents a threat to Android OEMs in the patent sense. The same is true for BlackBerry.
In other news about Apple, the “Federal Circuit Invalidates Ameranth’s Menu Software Patents as Unpatentable Abstract Ideas,” so there is growing hope that Qualcomm’s and Nokia’s software patents too will be thrown aside, leaving only patents on physical things. To quote the latest report:
The Federal Circuit’s recent decision in Apple, Inc. v. Ameranth, Inc. highlights the potential impact of characterization of recited features as conventional, routine, generic, or known in the field without further discussion of an innovation that goes beyond these features. Employing the two-step analytical framework of Mayo/Alice to evaluate subject matter eligibility under 35 U.S.C. § 101, the Federal Circuit affirmed in part and reversed in part Patent Trial and Appeal Board (“Board”) determinations in Covered Business Method (“CBM”) reviews regarding the patentability of U.S. Patent Nos. 6,384,850 (“’850 patent”), 6,871,325 (“’325 patent”), and 6,982,733 (“’733 patent”).
Remember that software patents die 70-80% of the time at the Federal Circuit (CAFC) and PTAB is widely supported/honoured by CAFC.
CAFC, however, will be the subject of our next post. █
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