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Blockchain Patents Are a Catastrophe in the Making as Trolls and Aggressors Accumulate Them

Posted in IBM, Patents at 4:12 pm by Dr. Roy Schestowitz

Related: Blockstream Has No Patents, But Pledges Not to Sue Using Patents

Marathon Patent Group: Massively Overvalued
Reference: Marathon Patent Group: Massively Overvalued

Summary: As patents pertaining to blockchains continue to be granted — even in defiance of Alice/Section 101 — it seems likely that patent wars will sooner or later erupt, involving some large banks, IBM, and patent trolls associated with the notorious Erich Spangenberg

THE emergence of digital currencies (also known as cryptocurrencies) brought rise to blockchains — a concept whose explanation ought to quickly reveal to anyone that it boils down to software and is thus not eligible for patents (except maybe in China).

There is a growing threat now; that threat isn’t FUD or “hacks” or “collapse” or whatever; patent parasites are like hawks waiting to attack digital currencies. See “Patent Strategies for Cryptocurrencies and Blockchain Technology” [PDF] and all sorts of articles from media of patent maximalists. They’re waiting to initiate something similar to and barely distinguishable from patent wars in mobile phones. Jon Calvert of ClearViewIP, for example, is quoted alongside a bunch of patent law firms. They all defend the ‘screwing’ of blockchains with a vast thicket of software patents. To quote:

The bigger tech companies, the IBMs of this world, are trying to create blockchain infrastructure that can be used by corporate enterprises or financial institutions. They want to charge for software as a service. By having patent protected technology, they can argue that theirs is the best, the most valuable, or the most valid, which makes them more credible. These are also the people who are more likely to use their patents aggressively later, when they’ve got a strong portfolio. If you look at Microsoft, they were probably filing blockchain patents almost a decade ago.

IBM’s role was noted here many times before; don’t be misled by the reformed IBM of Samuel J. Palmisano. The company has become not only a patent bully (again) but also the leading lobbyist for software patents worldwide. The other day the corporate media published an article (puff piece) titled “IBM Fueling 2018 Cloud Growth With 1900 Cloud Patents Plus Blazingly Fast AI-Optimized Chip” (emphasis on patents, which are basically software patents disguised as “cloud”). Such patents PR (and dumb new headline from Forbes) helps reveal what IBM has in its field of vision. IBM isn’t eager to transition the whole world to Bitcoin or anything remotely like that. Blockchain patents are a looming storm which trolls too wish to participate in. It was mentioned the other day by IBM and even the Linux Foundation speaks about it:

IBM and A.P. Moeller-Maersk on Tuesday announced a joint venture to create a platform based on Hyperledger Fabric 1.0, with the goal of creating huge efficiencies in the global supply chain. IBM and Maersk have teamed up to provide a more efficient method of standardizing shipping logistics using blockchain technology. “Adoption of Hyperledger Fabric by Maersk and … IBM has the potential to remake the shipping sector landscape and its use of information technology,” said Brian Behlendorf, executive director of The Linux Foundation.

In Bloomberg, on Tuesday, a less Linux-centric article was published and iophk, our reader, said that “this guarantees that blockchain advancements will occur outside the US” (that’s the effect of overpatenting). To quote Bloomberg:

Bank of America Corp. may not be willing to help customers invest in Bitcoin, but that doesn’t mean it isn’t plowing into the technology underlying the cryptocurrency.

The Charlotte, North Carolina-based lender has applied for or received at least 43 patents for blockchain, the ledger technology used for verifying and recording transactions that’s at the heart of virtual currencies. It is the largest number among major banks and technology companies, according to a study by EnvisionIP, a New York-based law firm that specializes in analyses of intellectual property.

It’s all about patents; The Linux Foundation plays along because its initiative, Hyperledger, is IBM-led. It always was, right from the start. The Linux Foundation merely acts as a sort of incubator pulling together contributions and helping the openwash.

As it turns out, based on another announcement, another patent aggressor (connected to Erich Spangenberg) positions itself to attack blockchains with patents. To quote:

Marathon Patent Group, Inc. (MARA), today announced that it has entered into a purchase agreement to acquire four patents related to the transmission and exchange of cryptocurrencies between buyers and sellers.

This might be another front for the likes of Spangenberg, whose latest venture was advertised a couple of times in corporate media (CNBC).

The details above may seem vague; that is because those who apply for or harvest blockchain patents (stockpiling) intentionally thrive in mystique/ambiguities. Patents like these don’t exist for ‘defensive’ purposes; someone is planning to at least try to make a lot of money using these patents alone (without an actual implementation of anything).


Top Rank at USPTO Goes to the Biggest Patent Bully, IBM

Posted in America, IBM, Patents at 10:18 am by Dr. Roy Schestowitz

Does the US want a patent bully as a flag bearer of its patent system?

Ginni Rometty

Photo source (modified slightly): The 10 Most Powerful Women in Technology Today

Summary: With 2017 figures coming to light (and to the mainstream/corporate media), we scrutinise what has received the most attention and why it’s detrimental to the reputation of the US patent system

THE USPTO, formerly run by a former IBM employee (and current IBM lobbyist for software patents), does no favour to its reputation. David Kappos still working as a lobbyist contributes to the perception of “revolving doors” or brokering.

The latest figures from the USPTO reaffirm such perceptions; there were two angles in corporate media this past week, one being China/India (nationality) and another IBM (by firm). The firm behind the figures wrote that “Chinese companies increased their US #patent count by 28% in 2017 from 2016.”

Here is the original page and the press release that said “IFI CLAIMS Announces 2017 Top U.S. Patent Recipients”.

Michael Loney, apparently visiting Hong Kong this month, wrote: “A record number of patents were granted by the USPTO last year, according to the 2017 IFI Claims US Top 50.”

“China is among top 5 U.S. patent recipients for first time,” said this headline from official/state media in China (the English-speaking site).

“China Becomes One of the Top 5 U.S. Patent Recipients for the First Time,” said Wall Street media, which also focused on nationality of applicants.

Chinese inventors received 11,241 U.S. patents last year, a 28 percent increase over the same period in 2016, according to a report released Tuesday by IFI Claims Patent Services, a unit of Fairview Research LLC. That propels the nation into the top five recipients for the first time, behind the U.S., Japan, Korea and Germany, but ahead of Taiwan.

A lot of it was a PR exercise from IFI and IAM played along with blog posts like this one (“Patents no barrier to Chinese smartphones in the US market”). “For licensors,” it said, “it means that aside from Apple and Samsung, a big swathe of the world’s biggest mobile device sellers simply won’t see the US as a critically important market. That means any effort to enforce patents against them will be most effective somewhere else.”

Most of the press coverage, however, was not about nations but about firms. We did a comprehensive media survey and found that dominant headlines stated things like “IBM Breaks Patent Record in 25th Straight Year as Number One” and “IBM led on patents in 2017, Facebook broke into top 50 for the first time” (Samsung 2nd, Canon 3rd). As IBM has outsourced or sent overseas many jobs, there were also headlines such as “India 2nd largest contributor to IBM’s over 9,000 patents in 2017″ and “IBM tops US patent list in 2017, Indian arm among major contributors”.

9,043 US patents for IBM just this past year. While the company is suing a lot of companies or compelling them to pay 'protection' money to avoid litigation. The USPTO is debased due to this tendency to just sue aplenty, but thankfully the courts have become tougher. Watchtroll wrote this:

IBM inventors received a record number of U.S. patents in 2017, again blowing past their own previous record to sail past 9,000 issued patents. The 9,043 U.S. patents issued to IBM in 2017 represents an average of nearly 25 patents a day. These 9,043 U.s. patents were granted to a diverse group of more than 8,500 IBM researchers, engineers, scientists and designers in 47 different U.S. states and 47 countries.

Imagine that; “25 patents a day” (recall what journalist Dan Gillmor recently said about that; he said that IBM “basically invented patent trolling and employs platoons of patent lawyers”).

So IBM has not much to show now but patents and patent deals/settlements. As if IBM becoming a kind of troll is somehow good for its reputation…

Our next post will revisit Finjan, a very notorious patent troll that IBM fed patents into as recently as last year.

“IBM has no choice,” IAM said. “Imagine the headlines if it ever fell off top place. It could well make a material difference. That may not be a great position to be in.”

Well, IBM used to be known if not renowned/famous for its very many patents. Nowadays it’s known for a lot of patent aggression, so the more patents it gets granted, the worse off society/industry will be.


When All That’s Left is a Bunch of Patents: Stories of IBM, Finjan, Ericsson, and Citrix

Posted in America, IBM, Patents at 9:45 am by Dr. Roy Schestowitz

Ericsson troll

Summary: Companies on the decline, where the number of products already verges (or is) zero, decide to just sue the entire industry, thereby reinforcing the cautionary tale about patents as ‘insurance policy’ taking its toll on real (operating) companies

THE USPTO has long granted all sorts of bizarre software patents. Those were granted on ideas that had already been implemented elsewhere (without the coder/developer/programmer pursuing a patent). There was extensive prior art, but code at the time was rarely shared on the Web (definitely not in the nineties and back in the eighties there was no World Wide Web just yet).

“There was extensive prior art, but code at the time was rarely shared on the Web (definitely not in the nineties and back in the eighties there was no World Wide Web just yet).”One such company which pursued many software patents was IBM. It applied for (and received) a humongous number of software patents. That was back in the nineties and the decade that followed. It spent many years in the top spot for prolific patenters (classified by firm). Many of these patents are still valid as in not expired; but they’re not necessarily valid based on triviality and prior art assessments (if done properly). IBM is now trying to ‘monetise’ these patents and as we noted some days ago, IBM now goes after Web firms (there’s a pattern here). A few days ago GeekWire wrote that “IBM is suing Expedia, alleging that the popular travel site has for years been infringing on several of its patents, some of which date back to the early days of the internet.” Because those patents are about to expire and IBM is about to die (the company’s core business is slipping away and layoffs are routine).

Will IBM change its ways? We doubt it. For a number of years we’ve complained about IBM’s ferocious lobbying for software patents in the US, putting aside its many threats and lawsuits against Web firms (such as Twitter). IBM is now a taxman and it is eager to maintain this revenue steam; it has become similar to Microsoft over the past 15 years (Microsoft hadn’t been aggressive with patents until its monopoly was slipping away just before Windows Vista and the ongoing rise of Google/Apple).

“For a number of years we’ve complained about IBM’s ferocious lobbying for software patents in the US, putting aside its many threats and lawsuits against Web firms (such as Twitter).”A few days ago we wrote about the patent troll Finjan because it blackmailed FireEye. It is supported by Microsoft and it received some patents from IBM to bolster its trolling efforts.

“FireEye and Finjan settle,” said this headline just before the weekend. Understatement of the year? So far in 2018? To call trolling and blackmail a “settlement” is to grossly misrepresent what happened. Finjan does nothing but this. It’s a predator. From the article:

Cybersecurity firm FireEye has agreed to pay $12.5 million to patent licensing company Finjan as part of an agreement settling their patent dispute.

The settlement includes a patent licence agreement, granting cross-licences between the two companies for the disputed patents.

Or, in simpler terms, “protection money”. Finjan will now use that as ‘ammunition’ with which to threaten more companies (the few it has not already sued and/or extracted “protection money” from). It’s appalling. IBM and Microsoft actively helped this troll.

“Finjan will now use that as ‘ammunition’ with which to threaten more companies (the few it has not already sued and/or extracted “protection money” from).”Elsewhere in the news we find mentions of Ericsson's trolling practices in Europe. This case was concluded around Christmas (we wrote about it) and IAM rushes to defend the trolling with tweets like this: “Ericsson IP chief highlights “methodological and mathematical errors” in landmark TCL decision as Swedish mobile giant plots appeal…”

Notice how they only tell or emphasise one side of this story. So did the writer of the story, who tweeted this: “Goes without saying that this decision is not good for licensors but taken with UP v Huawei and other big SEP decisions we now have some much clearer guidelines such as use of top down methodology and variable regional rates. That can only be good thing for #patent licensing…” (trolling)

IAM’s coverage, as expected, means amplifying — right from the headline — only the side/assertion/creed of patent trolls:

Key ruling in high-profile US FRAND case “highly biased in favour of infringers”, says Ericsson’s chief IP officer


Speaking to the IAM blog Ericsson chief IP officer Gustav Brismark has made his first public comments on the judgment handed down by a California court just before Christmas in the Swedish telco’s high-profile FRAND licensing dispute with Chinese mobile manufacturer TCL. The decision, which was filed on 21st December, is the latest case involving standard essential patents (SEPs) to hit the courts and is largely seen to have gone against Ericsson.

This is the kind of coverage we have come to expect from IAM because the site (like the magazine and events) is little more than a megaphone of trolls and patent aggressors. It’s like ‘Watchtroll Lite’.

“This is the kind of coverage we have come to expect from IAM because the site (like the magazine and events) is little more than a megaphone of trolls and patent aggressors.”Watchtroll has just written about a case which we mentioned here before — a case wherein a firm is pushing aside smaller rivals. This is the kind of thing IBM has been doing for decades, relying on its vastly bigger patent portfolio and vastly deeper pockets. And speaking of which, watch this new report about Citrix using its patents against a smaller rival as a form of retaliation for “improper conduct”, “deceptive statements” and so on. Patents are just being used for leverage here; it’s not about patents but about the defendant hiring “a number of its former employees and executives in the last few years.” To quote:

Citrix added that the aim of the suit was to prevent Avi Networks’ “improper conduct” and to recover damages over its wrongful use of its patented technology in its Vantage Platform. Citrix also wants to stop Avi Networks from making “further deceptive statements” and selling its infringing product without the correct licenses.

Citrix appears to have a beef with Avi Networks over its recruitment practices as well, as the smaller firm has hired a number of its former employees and executives in the last few years. This includes Avi Network’s current Chief Executive Officer Amit Pandey, who served as vice president and general manager of Mobile Solutions at Citrix from January 2013 to March 2014.

“Several other Citrix employees have left to join that company, bringing with them their knowledge of Citrix’s products and intellectual property,” Citrix complained in its filing.

What it means to say is that these employees simply know something and by virtue of knowing these things they become a liability. Citrix has been having business deflation issues and it now digs deep for patents with which to ‘punish’ rivals. How typical of software patents and those who possess them…


IBM Has Become Almost Indistinguishable From the Patent Trolls It Passes Patents to (Finjan for Example)

Posted in IBM, Microsoft, Patents at 3:57 pm by Dr. Roy Schestowitz

IBM has become another Microsoft

Ginni Rometty

Summary: IBM and Microsoft have adopted a similar patent strategy which involves threatening a lot of companies for ‘protection’ money and passing patents to patent trolls that threaten these same companies some more

THE life cycle or the lifespan of patents at the USPTO is typically 20 years. This means that many patents preceding the dot com bust are about to expire.

IBM is a dying company. It’s just trying to make money from a dying empire of mainframes which, in the age of hosting VMs/VPSs (so-called ‘cloud’), is worth zilch. IBM has already fired many of its ‘expensive’ employees and it now operates like a classic patent troll. As WIPR has just put it (in the headline), “IBM settles patent suit, sues Expedia over same patents” (like every patent troll).

Technology multinational IBM settled a patent dispute with a company that manages travel websites, one day before suing US travel company Expedia over the same four patents.

In 2015, WIPR reported that IBM had taken action against The Priceline Group, which manages travel websites such as priceline.com, and had alleged infringement of four patents.

The patents asserted include two that were issued in the late 1990s: US numbers 5,796,967 and 5,961,601. The ‘967 patent tracks previous conversations online between a web user and a merchant, and the ‘601 patent covers technology related to web performance.

Both sound like software patents which are about to expire. Trolling much, IBM? This desperate?

Let’s not forget that IBM also sold patents to this troll called Finjan last year. We wrote about its latest attack in the morning and it turns out that we were right. The press release (still being circulated) was hogwash as earlier this evening financial media made it clearer that was not licensing but blackmail. “Finjan (FNJN) Settles With FireEye for a Net $12.5 Million,” it says, so that’s nothing like “cross licensing” (as the press release suggested). To quote:

Finjan (NASDAQ:FNJN) announced today that it settled with FireEye for a net $12.5 in cash that was paid in Q4 2017. With this payment, Finjan will redeem about 31% of the Series A-1 preferred shares or $4.7 million of the $15.3 million Series A-1 Preferred Stock financing. From December 16, 2017 to March 16, 2018 Finjan is able to redeem this stock at 1.3 times the original purchase price. FireEye agreed to pay Finjan $17.5 million in license fees comprised of $12.5 million in cash which was paid on December 29, 2017, and $5.0 million which will be offset by $5 million in license fees from Finjan to FireEye under the FireEye cross license agreement.

What we have here is a publicly-traded troll. We named another one this morning. This troll is connected to both Microsoft and IBM, both of which have a track record of passing patents to aggressive trolls. What does that make Microsoft and IBM?


IBM’s Manny Schecter is Wrong Again and He is Attempting to Justify Patent Trolling

Posted in America, IBM, Patents at 6:42 pm by Dr. Roy Schestowitz

Published last week: Famed Journalist Dan Gillmor Calls IBM the Inventor of Patent Trolling

Trump alternative facts

Summary: In yet another dodgy effort to undermine the US Supreme Court and bring back software patents, IBM’s “chief patent counsel” (his current job title) expresses views that are bunk or “alternative facts”

TECHRIGHTS used to be very supportive of IBM. In fact, IBM used to be helpful to Free software, open standards, and GNU/Linux (especially at the back end and high-performance computing). But that was IBM a decade ago, managed by other people and adhering to different principles/strategies.

Do not be misled by what IBM used to be.

“In several areas/domains of technology IBM does nothing but patent predation.”IBM is attempting to attack/discredit Alice. It’s doing it like no other company does. IBM’s Manny Schecter, who is in charge of patents, says Alice is bad “because if the company fails, the investor must leverage its patent assets to return the investment.”

“Because if the company fails, it has to be turned into a troll” is how the FFII’s President translated/interpreted that. Yes, a troll. Like IBM right now… even some veteran technology journalists now call IBM a “troll”. In several areas/domains of technology IBM does nothing but patent predation.

Manny Schecter is an exceptionally harmful public face. It’s no good for IBM. Even if his tweets and talks he is attempting to distance from his employer, his expression of his own views is a projection of IBM policies. He’s not a low-level engineer; he’s management. Top-level management.

“How low is IBM willing to sink in an effort to shore up software patents?”IBM rapidly became a liar of a company. It’s so eager to blackmail new/small companies and its Patent Chief (or whatever they call him these days, putting aside fancy job titles) just makes them look vile. We used to support IBM, but now we just hope that IBM goes bust soon. The sooner, the better. Its activities on the patent front are ruinous and they concern a growing number of developers.

Regarding IBM’s (or Schecter’s) position, well… first of all, for a massive company to pretend to care for and speak for small companies is laughable or at least dubious. IBM attacks several such companies. Secondly, Alice made many such companies safer from trolls, hence a safer investment. Thankfully, WIPR decided to assess Schecter’s claims. Unfortunately, the article is quoting/citing extremists.

Here are portions from that article:

The number of venture capital (VC) investment rounds in technology companies has nearly halved, according to merchant bank Magister Advisors, sparking debate about the causes behind the decline.

Some commentators have discussed whether Alice v CLS Bank has played any role in this.

Citing data and research firm PitchBook, Magister Advisors noted that since 2014, the number of VC rounds in technology companies worldwide has fallen from 19,000 to 10,000.

For Manny Schecter, chief patent counsel at IBM, this decrease may correlate with the US Supreme Court’s 2014 decision in Alice. The decision led to an increase the number of patents being invalidated under section 101.

In early December this year, WIPR noticed a tweet from Schecter, who linked to a TechCrunch article written by Magister Advisors’ Victor Basta, and decided to investigate.


Chris Behrenbruch, CEO of radiopharmaceutical company Telix Pharmaceuticals, who replied to Schecter’s tweet, offered a different view.

“I don’t think it’s nefarious—it’s just fund-raising cycles. A lot of VC was raised back in 2006-2008 and then the impact of the financial crisis significantly reduced capital raised during 2009-13,” he said.

It’s rather sad that a company which prides itself on science cannot get something so fundamental right. In fact, even on the surface alone these claims that it’s Alice which harmed investment smell funny.

How low is IBM willing to sink in an effort to shore up software patents?


Famed Journalist Dan Gillmor Calls IBM the Inventor of Patent Trolling

Posted in Free/Libre Software, IBM, Patents at 5:08 am by Dr. Roy Schestowitz

Often attributed to Ray Niro though

Dan GillmorSummary: IBM’s growing focus on patent litigation — often with software patents — has not escaped the attention of people who are sympathetic towards Free/Libre Open Source software and IBM’s roots/inclinations when it comes to patent aggression (famously a subject of concern to Microsoft several decades ago) aren’t forgotten in light of recent activity, made visible owing to the Patent Trial and Appeal Board (PTAB) IPRs and few recent lawsuits

IBM has this highly bloated “Diversity & Inclusion” page to which it linked some days ago, stating: “Kimberly has filed 60 patents in the last four years. What’s her secret? Watch her story.”

That’s just a lot of patent propaganda. IBM likes to work behind closed doors in order to extract money out of companies (without it spilling over to courts, albeit PTAB often gets petitioned to invalidate IBM’s patents, whereupon these extortion/’patent assertion’ activities of IBM are made more visible).

“We hope that IBM is at least aware of its declining reputation among people who support Free software. They can see that IBM is a predator whose interests in several areas directly conflict with and harm Free software.”About a decade ago we were quite supportive of IBM, but nowadays the company attacks GNU/Linux-using firms and aggressively lobbies for software patents (we wrote about 20 articles about it). IBM is not what it used to be.

In response to the above, Dan Gillmor wrote: “She works for a company that basically invented patent trolling and employs platoons of patent lawyers?”

“IBM is the biggest patent troll,” the FFII’s Benjamin Henrion responded, “trying to rewrite the law in order to reinstall software patents in the US.”

We hope that IBM is at least aware of its declining reputation among people who support Free software. They can see that IBM is a predator whose interests in several areas directly conflict with and harm Free software.


The Lobbyists Are Trying to Subvert US Law in Favour of Patent Predators

Posted in America, Asia, Europe, IBM, Microsoft, Patents at 4:01 pm by Dr. Roy Schestowitz

David Kappos
Source: David Kappos 2013 interview

Kappos PAI
Kappos-led lobbying group

Summary: Mingorance, Kappos, Underweiser and other lobbyists for the software patents agenda (paid by firms like Microsoft and IBM) keep trying to undo progress, notably the bans on software patents

The patent trolls’ (or sharks’) lobby is at it again. Thankfully, owing to reports from their fan media and sometimes their own Web sites, we are able to see what they are up to.

Francisco Mingorance, a rather evil and deceitful person from Microsoft front groups like the BSA and now IP Europe, is trying to force software patents upon Europe using buzzwords like 5G and IoT. We wrote about it last month. Found via their tweet was this press release which quotes Mingorance as saying: “We wholeheartedly welcome this signal from the DOJ that they will prioritise the safeguarding of longstanding FRAND principles against recent coordinated action of some implementers. In Europe, a decision to abandon this Communication – or to bring it back into line with its initially stated goals – can protect innovation, R&D investment, high-tech jobs and European leadership in 5G and IoT open standards.”

Nonsense. Exactly the opposite is true, as actual practitioners in this area would gladly tell (if the media bothered asking them; it prefers to print lobbyists’ words). These patent thickets actively suppress innovation and breed monopoly. Why isn’t the mainstream media talking about it? The downside of patent lobbying and propaganda sites (like the above) is that they push agenda; the upside is, they inadvertently reveal who’s behind it.

Days ago we found out that David Kappos too is at it again. A bunch of patent bullies, including this IBM-paid lobbyist and former IBM employee, were lying to an audience. To quote the event’s organisers: “Last #IPDF17 panel of day on patent quality Kappos, Judge Michel, John Mulgrew @Uber, Marian Underweiser @IBM & A. Fahrenkrog @RobinsKaplan” (stacked panel).

“At the #patent quality panel at #IPDF17,” said another tweet, “Marian Underweiser @IBM points out that “the subject matter [ #Alice] discussion undercuts the purpose of the patent system.””

Remember Marian Underweiser? IBM appointed her to crush Alice. We wrote about her several times earlier this year and her agenda remains very clear; patent bully IBM has paid Underweiser for lobbying. Just like it pays Kappos for his connections and clout at the USPTO. IBM is very evil when it comes to software patents. Surprisingly even, especially considering the work it did for GNU/Linux.

Relaying messages from another event, IAM quoted or paraphrased: “Shore – we’re living in a banana republic. Silicon Valley owns Congress and the executive branch. The only difference between us and Honduras in early C20th is that instead of bananas it’s smartphones and software #IPDF17″

The law ‘industry’ wants to dominate everything, so when Silicon Valley warps the law in favour of technology Shore and others get upset. When technology sets law it bothers the parasites. They’re accustomed to making money by doing (or making) nothing.

A few days ago IAM again quoted Kappos. The patent trolls’ lobby wants lots of lawsuits and it now mistakes pro-aggression for “pro-innovator”. Here is what IAM wrote:

Delrahim’s comments have already made an impact with senior members of the IP community. Former USPTO Director David Kappos, who was in the audience, described it as “the most important DOJ antitrust speech on IP during my decades practising law”. He added that: “It marks a major pro-IP and pro-innovator shift in DOJ antitrust policy.”

For the USPTO to improve its reputation it ought to ensure former officials don’t become lobbyists (as they do). It’s just embarrassing and it reinforces the perception that laws are up for sale.

Kappos is one among the alarmists who keep bringing up “China!” in order to scare legislators, urging them to act or else “China is coming” (similar to the “Russia!” hysteria in politics). China has become litigation central (not innovation central), which invites patent trolls rather than practising companies. What does the US want or need? More jobs or more lawsuits?

Days ago we saw Managing IP hailing China (litigation) and IAM spreading the myth that the success of Huawei is owing to patents rather than in spite of them. To quote IAM: “China is a crucial market for SEP owners – with a large amount of standards implementation and a litigation system that is becoming more favourable to patent holders – and that is borne out in the level of filing there. About 18% of global 4G-LTE patents are Chinese rights – putting the country second only to the United States and just ahead of the EPO.”

See what we said above about Mingorance. These patents are counter-productive and harmful to actual innovation. Moreover, China has developed some of its proprietary/national standards in several areas (technical domains). What causes a large surge in Chinese patents (at SIPO more so than overseas) is the lowered bar, which now officially permits software patents too. It makes China one of the few countries (if not only country) in the world to move in such a direction.

Thailand, according to this new overview from Ananda’s Benjapol Kongsombut, does not allow software patents (similar to Korea and maybe even Japan to a lesser degree). “Computer programs or software cannot be patented under Sections 9,” Kongsombut explains. Here is the entire relevant part:

To what extent can inventions covering software be patented?

Computer programs or software cannot be patented under Sections 9 and 65decies of the Patent Act. However, inventions relating to devices or machines controlled by software, or processes or algorithms for controlling devices or computers, may be patentable. Software-related inventions involving only computer source code cannot be patented but may be protected as a copyrighted literary work or a trade secret.

To what extent can inventions covering business methods be patented?

A business method cannot be patented as it is not considered to be an invention as defined in Section 3 of the Patent Act. However, a business method carried out by a computer can be considered as a software-related invention that may be patentable.

To what extent can inventions relating to stem cells be patented?

Stem cells are considered to be an animal extract, which is a non-patentable subject matter under Section 9 of the Patent Act. However, processes for the production or use of stem cells may be patentable.

What the likes of Mingorance, Kappos, and Underweiser are paid to promote is software patents in the US. We already know why: Alice and the Patent Trial and Appeal Board (PTAB), which we’ll deal with in our next post.


Large US Companies Continue to Stockpile Patents, But US Courts Have Learned to Repel Patent Maximalism

Posted in America, Apple, IBM, Patents at 7:49 pm by Dr. Roy Schestowitz

Patents on software are just about as inane and worthless as patents on musical notes

Papers with musical notes

Summary: In spite of misguided campaigns to accumulate/hoard tens of thousands of patents and then cross-license these, courts do not see the legitimacy of most of these patents

SEVERAL days ago someone pointed out this case of a lawyer who had been fired for being ethical. It’s not too shocking; lawyers aren’t expected to be honest, only to maximise profit. To quote:

The Third Circuit reversed the grant of the dismissal of a lawsuit by in-house counsel who sued because, he alleged, he was forced to choose between complying with an application filing quota or complying with his ethical obligations to the USPTO. The case, Trzaska v. L’Oreal USA, INc., (3rd Cir. July 25, 2017), is here.

“The complaint alleged that complying with the quota meant filing “frivolous” patent applications,” Generare Oy Ltd. told me about this. The situation may seem familiar to some.

What’s with all the stockpiling? Why has this become so normal? Yesterday we saw blind acceptance of patents and endless admiration of Apple/Steve Jobs, leading to this kind of terrible Web site which equates/conflates patents with innovation and celebrates accumulation of patents based on quantity alone (because large companies just cross-license a massive number of patents without even assessing these individually).

“What’s with all the stockpiling? Why has this become so normal?”The above is about Apple, but IBM too plays that game and IBM is far too proud of software patents that are likely invalid (it still uses these to bully rivals). See this press release [1, 2, 3] which said “IBM leadership in storage systems and software is based upon more than 380 system patents, including IBM FlashCore technology and more than 700 patents for IBM Spectrum Storage software.”

Around the same time (as this press release) we saw IBM’s patents chief gloating that “Snap-On gets hammered” by patents, having just been judged by a jury that probably does not understand what patents are. The report in question says this:

The Journal Sentinel reports Snap-on’s Rick Secor says the company strongly disagrees with the jury’s verdict and will “vigorously appeal.”

In the lawsuit, the Brookfield-based Milwaukee Tool says the lithium-ion battery packs it invented revolutionized the industry after the technology was introduced in 2005. It replaced packs that used nickel-cadmium batteries.

This particular case is not about software patents, but it’s interesting that IBM is keen to promote it. The patents chief has also just linked to a patent troll’s site (Dominion Harbor) in support of software patents. “The sad, confused state of US #patent eligible subject matter described here,” he said in relation to a patent troll known as Secured Mail Solutions (SMS) — a troll we just mentioned here the other day. To quote:

Because I believe that everyone, as a means of self-improvement, should occasionally test their patience and evaluate their ability to manage pain, I was reading the Federal Circuit’s recent decision in Secured Mail Solutions, LLC v. Universal Wilde Inc., upholding the district court’s ruling on the pleadings that Secured Mail’s seven asserted patents were all ineligible under 35 USC § 101. These patents all address tracking mail through an encoded marking, e.g., a barcode, QR code or URL, on the outside of a mailer which is intended to provide information to the recipient about the contents and the sender. Setting aside that when you see a panel of Prost, Clevenger and Reyna you know the patent’s dead, it’s just a matter of how they will craft the language to that desired effect, let’s just look at how the famed Alice test was handled in this case in general.

It’s safe to say that almost every such case now yields invalidity. Courts understand, in light of Alice, that it’s a matter of great certainty. Software patents are out.

“Software patents are out.”If the rumours are true, the USPTO‘s patent examiners too will soon follow suit. Maybe the EPO‘s also?

The EPO mentioned PCT applications a few days ago and so did Patently-O (compare China to Korea in this graph). PCT is the Patent Cooperation Treaty and if one nation abandons software patents, we can expect others to follow the lead.

Moreover, as Patently-O pointed out a few days ago, better examiners will result in fewer incorrect patent grants. The research explores the “[r]elationship between examiner specialization and examination outcomes.”

“So it shows empirically that “specialization is associated with a more stringent examination process,” as one might expect. Lack of knowledge (or ignorance) in the problem domain leads to more patents.”The summary says, “we find a significant degree of technological specialization among patent examiners working in the same art-unit. This specialization is less pronounced in some of the computer-related technology centers. We found no evidence that examiners specialize in handling important or controversial applications. And it seems that specialization is associated with a more stringent examination process, perhaps because it allows examiners to more easily identify relevant prior art.”

So it shows empirically that “specialization is associated with a more stringent examination process,” as one might expect. Lack of knowledge (or ignorance) in the problem domain leads to more patents. Here we see the importance of the recruitment process, or the ability to attract top talent. It’s hard to mislead examiners who assess patents in their own field of expertise. Consider for instance this new example that says: “The court found the defendant’s argument “not unreasonable,” but nonetheless rejected it. The “great weight of the case law” made clear that the duty to “disclose all material information to the patent examiner” did not extend to ensuring that “the patent examiner understands that information.””

Sadly, if the examiners don’t understand, they often just grant patents. It should be the exact opposite. If the applicant cannot properly explain to the examiners what is being claimed, then the examiner should assume it’s likely intentional. “If you can’t explain it simply, you don’t understand it well enough,” Albert Einstein famously said. He too was a patent clerk (before becoming famous).

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