OIN has in many ways contributed to the problem rather than or instead of working to tackle it
Summary: An update on patent trolls and the role played by supposed allies of Free/libre software, who in practice do everything to exacerbate the problem rather than resolve it
Trolls are a symptom of a big problem, typically the granting of far too many patents and too lenient a treatment (favouring the claimant) at the courts. This is why the US was so popular among patent trolls and China is now attracting if not giving birth to those same sorts of trolls.
Things are about to change for the better in the US. “Broad patent venue rules allowing corporations to be sued for patent infringement almost anywhere,” as this new article puts it, is a regime which will likely end soon (it’s reminiscent of what UPC proponents envision in Europe — a recipe for patent trolls in the EU and beyond).
“This is why the US was so popular among patent trolls and China is now attracting if not giving birth to those same sorts of trolls.”This new article refers to TC Heartland — a decision we eagerly await — and says this: “Broad patent venue rules allowing corporations to be sued for patent infringement almost anywhere are under siege both in Congress and in the courts. Yet, a non-patent case that was recently granted certiorari by the Supreme Court, although not widely noted in intellectual property law circles, may provide another potential front in this ongoing battle. [...] Based on the cert grant, the U.S. Supreme Court now appears set to decide when a claim sufficiently “arises out of or relates to” a defendant’s contacts with the forum state. Although Bristol-Myers is not a patent case, it involves the same specific jurisdiction criteria that the Federal Circuit has found satisfied in patent cases by product shipments into a forum. Therefore, it is possible that a Supreme Court decision that tightens the nexus between the claims and the defendant’s acts that is required to establish specific personal jurisdiction may curb patent owners’ abilities to bring suit in as wide array of fora as is possible under current Federal Circuit precedent.”
“OIN has become pretty useless and it’s likely that it was always this useless.”Some time later this year, assuming that new Justices grasp the damage caused by patent trolls, the whole business model of trolls is likely to collapse, having already suffered a great deal when Alice made their patents a lot weaker. We cannot rest on the laurels, however, as patent maximalists constantly try to sabotage all this progress and Make Trolls Great Again, as we last noted yesterday. Here, in this new article from Embry-Riddle, a person who makes a living by promoting patents (or patent maximalism) unsurprisingly promotes more and more patents. We see articles like these every day. This other new article, one from Beta News, is very wrong and misguided; it oddly enough calls or paints OIN as anti-trolls, even though OIN openly admits that it’s not (OIN is absolutely incapable of stopping trolls). Here is the key part:
More and more, we’re seeing businesses band together to find creative, efficient solutions to the patent troll problem.
Take OIN (Open Innovation Network) [sic, it's Invention] as an example. This organization operates in the open source community, cross-licensing patents to protect companies against litigation using Linux-related patents. Another example is the LOT Network, the non-profit community that I lead. More than 80 percent of patents litigated by patent trolls are acquired from operating companies through events like bankruptcies, M&A, or when a company is looking for an extra revenue stream. LOT members agree that if one of their patents falls into the hands of a troll, the other members get a free license. This acts as immunization for member companies — rendering a troll lawsuit involving that patent moot. At the same time, LOT Network does not affect the traditional uses of patents — like buying, selling, or even suing other companies.
One could argue that OIN helps weaken trolls by attempting to grab (buy) particular patents which would otherwise be given to trolls, but having seen how it works from the inside (long conversations more than half a decade ago), that just barely ever happens. It happened maybe once before (that we know of). OIN has become pretty useless and it’s likely that it was always this useless. Its stated goals are not its real goals. Recently, OIN pretty much endorsed a lobby for software patents, misleadingly named Center for Intellectual Property Understanding (CIPU). OIN often seems to have remained somewhat of an IBM front group, often aligned with IBM’s own agenda and even led by former IBM staff. Speaking of IBM, which is becoming an ally of Apple and a foe of GNU/Linux, its patent chief said the other day: “Patents should promote innovation regardless of inventor size (large co, small co, independent) and regardless of technology” (easy for him to say, coming from the largest patent assignee). Benjamin Henrion’s response to him can be see here; it’s all just mumbo-jumbo from IBM, equating patents with “innovation” — however one defines that thing. IBM uses its patents to bully competitors and extract ‘protection’ money from them. That’s hardly innovation.
“Recently, OIN pretty much endorsed a lobby for software patents, misleadingly named Center for Intellectual Property Understanding (CIPU).”Where was OIN when Acacia, a patent troll with connections to Microsoft, attacked GNU/Linux vendors such as Novell and Red Hat? As expected, patent trolls such as Acacia pivot/expand in China after SIPO and the courts had done damage to the country (diluting the patent system with low-quality patents). According to the trolls’ news site the “Texas-based NPE [which the headline calls "Acacia alumni NPE"] Longhorn IP announced this week that it has acquired a patent portfolio, including several China-only patent families, from a major Chinese telecoms company.”
Guess what will happen next… █
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Backed by IBM, Microsoft, and all the usual suspects…
Summary: An introduction to what the Center for Intellectual Property Understanding [sic] really is, what it is for, and who is behind it
YESTERDAY we wrote about OIN's role in the Center for Intellectual Property Understanding (CIPU), which is the opposite of what its name says (common practice among front groups). Watch the composition: this is a software patents lobby with David Kappos, a clear IBM role, and Microsoft role also.
IAM, the mouthpiece of patent maximalists, says this right now (shielded behind a paywall, so it’s easier for them to evade scrutiny):
As well as being headed by Berman, CIPU includes former IBM and Microsoft IP supremo Marshall Phelps as vice-chairman. A number of other high profile IP figures have helped with getting the Center off the ground. These include Philips CIPO Brian Hinman, former Chief Judge of the Court of Appeals for the Federal Circuit Paul Michel and former USPTO Director David Kappos. Microsoft, Philips and Duke University are among those providing support.
It is too easy to see whose interests are served by this front group. Now watch the sole comment on this blog post, published by Peter Harter of The Farrington Group (friend of IAM): “Glad to see that the FAKE NEWS of the infringer lobby can be countered. Perhaps all ethics reviews for IP professionals, journalists and bloggers should include a literacy evaluation built on the CIPU rubric?”
“They try to strike down Alice, bring back software patents, and extort a lot of companies for many billions of dollars.”We are probably going to hear a lot from this front group in the coming weeks/months. It will also lobby politicians behind closed doors, we are pretty sure about that…
It’s clear what they want as they repeatedly write about it. They try to strike down Alice, bring back software patents, and extort a lot of companies for many billions of dollars.
Christopher Hall, writing for the National Law Review right now, seems to be on that same bandwagon. He seems to have not gotten the memo about death of software patents, or maybe he just conveniently pretends that Alice does not exist. People like him, along with the CIPU backers, have been constructing a bunch of tricks for loopholes that often work in the EPO; they try to pass off algorithms as a “machine” (to quote, “could be a computing machine of some sort, for computer-based algorithms”).
These are technically meaningless terms (Deepak Chopra-style mumbo-jumbo) that may in fact suggest that Hall does not know how computer programs work (Watchtroll evidently has the same problem). Here is the full paragraph, which does cite §101:
Claims written with the above template capture initial values, iterative values and results in the context of an iterative algorithm tied to a machine (which could be a computing machine of some sort, for computer-based algorithms). Variations on this can be written for tangible media and for system claims. This approach should pass muster for arguments and subject matter patent eligibility under 35 USC §101, because the algorithm and presumably tangible result are inextricably tied to the machine that is executing the algorithm, so that a computer is not a mere field of use limitation.
We need to keep track of all these firms and front groups that are trying to spin things and even lie in major newspapers, basically telling people that the potency of software patents is just fine (when clearly that is not the case).
Apple, for example, based on its patent promotion sites (not affiliated with Apple but always pushing Apple agenda on patents), is still gambling its future on Steve Jobs’ “thermonuclear” patent wars against rivals. The same goes for IBM and Microsoft, both of which are attacking companies that use GNU/Linux. If software patents are taken away from them, then they are pretty hopeless. That’s why they lobby so hard against Alice (Apple, IBM and Microsoft pay Kappos through his front group for lobbying on this). █
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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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Summary: Another roundup of patent news from around the Web with special focus on software patenting
THE USPTO is problematic for quite a few reasons, chiefly or primarily the low patent quality (especially in recent years). When there’s no quality control, as was increasingly the case under Kappos, patents cease to be respected and people resort to filing lawsuits and fighting in courts, which is an expensive process (small companies would just settle out of court, even if they know they can win the case).
“As Suntory and Asahi settle their patent dispute over non-alcoholic beer,” wrote MIP the other say, “John A Tessensohn surveys the state of litigation in Japan, and compares it with the United States” (where litigation is extremely high in frequency).
It is worth taking stock of who’s suing with patents in the US. “Of the 19 patent lawsuits filed today,” United for Patent Reform wrote some days ago, “16 were filed by patent trolls — 84%. It’s time for Congress to take action to #fixpatents!”
It has been estimated recently that nearly 90% of all technology patent lawsuits are now filed by patent trolls. Most of them use software patents. In other words, in the absence of software patents, there would be far fewer trolls and lawsuits.
Speaking of trolls, the EFF’s Elliot Harmon tackles an old problem which is universities selling their patents by the tons/bucketloads to patent trolls (Microsoft’s patent troll Intellectual Ventures, quite notably compared to other entities, buys them and then shakes companies down with these patents, which were originally earned thanks to taxpayers’ money/investment). Here is what Harmon wrote:
When universities invent, those inventions should benefit everyone. Unfortunately, they sometimes end up in the hands of patent trolls—companies that serve no purpose but to amass patents and demand money from others. When a university sells patents to trolls, it undermines the university’s purpose as a driver of innovation. Those patents become landmines that make innovation more difficult.
A few weeks ago, we wrote about the problem of universities selling or licensing patents to trolls. We said that the only way that universities will change their patenting and technology transfer policies is if students, professors, and other members of the university community start demanding it.
It’s time to start making those demands.
Well, many demands should be made, even here in Europe. The system is unregulated, so it has been evolving along the lines large corporations and their patent lawyers demand, not the public good. Watch this new article about the “Patent Box Regime”, which is a tax evasion scam/scheme (Microsoft does a lot of that), using patents as loophole. “It relates to income that arises from patents, copyrighted software, and, in the case of smaller companies, other intellectual property that is similar to an invention that could be patented,” according to this article from Tax News.
“The system is unregulated, so it has been evolving along the lines large corporations and their patent lawyers demand, not the public good.”That’s probably too much for small companies to apply for, as is often the case when it comes to Ireland as a notorious tax haven. To quote: “The regime is only available to the companies that carried out the research and development, within the meaning of section 766 of the Taxes Consolidation Act 1997. The guidance provides definitions of a qualifying company, a qualifying asset, and profits arising from exploiting the qualifying asset. It also explains the extensive documentation requirements that must be complied with to claim relief under the KDB.”
We wrote about this subject many times before. There’s no indication that European authorities are doing anything at all to stop this abuse.
Speaking of Microsoft, a Microsoft promotion site says that PTAB, abolisher of many software patents, has just come to Microsoft’s rescue. “Personalized Home Page patent troll threatening Microsoft, Google and others squashed by appeal court,” says the headline. To quote:
Bloomberg Legal reports that the Patent Trial and Appeal Board has invalidated a patent held by B.E. Technology LLC for a Personalized Internet User Interface or home page which dates back to 1998 and which the company was using against Google, Microsoft and 6 other companies.
B.E. Technology filed 11 lawsuits accused smartphones and tablets of infringing their patent, but also included a wide variety of other devices, including Microsoft Xbox 360 consoles.
Google , Microsoft, Samsung and Sony all challenged the patent, submitting 5 petitions with the Patent Trial and Appeal Board, and was eventually able to show that a 1996 patent covered all of B.E. Technology’s claims, rendering it invalid.
Speaking of PTAB, Michael Loney wrote a couple of articles (from New York) about the latest figures. He is presenting some graph about big growth in post-grant reviews in 2016, but also demonstrates a decline in the first half of year for filings. The “Patent Trial and Appeal Board filing so far this year is down on 2015,” he notes (as he did before). However, another graph is presented in this article. It says that “Post-grant review petition filing this year is already higher than the whole of 2015, with biopharma companies leading the way.” The part about the decline says this: “The 826 petitions filed in the first six months of the year was the lowest half-year figure since the 730 filed in the first half of 2014 while the PTAB’s appeal was taking hold.”
It’s not entirely clear (yet) if PTAB will grow fast enough to ever overwhelm all software patents, or most patents which Alice effectively invalidates. The patent microcosm just keeps attacking PTAB’s legitimacy, with shameless smears too.
A theme we found in the news today [1-3] was patents of pharmaceutical giants (often referred to, collectively, as Big Pharma). It is common knowledge that Big Pharma are to a large degree subsidised by the US government (i.e. taxpayers), consistently to the tune of tens of billions of dollars per year (this number too is common knowledge), yet all money and patents go to private hands. Talk about injustice! Here is a new comment regarding one of these new articles:
It seems the new patentability landscape post-Alice, Myriad and Mayo is taking shape
- Alice really meant that computer implemented inventions were only patentable in as far as they related to the working of a computer somehow, and so business methods and mental acts are unpatentable inventions
- Myriad and Mayo could could not have meant all inventions relating to natural products and laws were not patentable, and products in particular which are different from nature and have practical uses remain patentable
- Mayo remains a bit of mystery until the Federal Circuit approves an invention based on a natural correlation. Sequenom shows it is difficult to get broad claims where any sort of natural correlation is involved and so diagnostic inventions remain in limbo.
In an age when patents are foolishly treated like money  and the patent microcosm spreads tired old myths about patents (marketing)  it’s only to be expected that reduction in patents would be portrayed as a loss to “innovation” or something along those lines. Shelston IP, the self-serving propagandists (for their own pocket) who lobby for software patents down under [1, 2] can again be found in the media . They still try to change New Zealand’s patent law so as to allow software patenting. They don’t care about programmers, they just want to tax programmers.
In the US, software patents are somewhat of a passing fad. It doesn’t mean that nobody applies for them and even gets granted some. According to this new article about an acquisition, “Denning noted that AppFirst also has a number of patents around the architecture of its agents.” Additionally, this other new article says that “several patents related to the technology behind their picking system.”
This sounds like software patents, but software patents are rather useless when it comes to litigation as courts typically reject those nowadays. This new article states about CAFC (where software patents very rarely survive scrutiny) that “[i]t is also a reminder that, for the Federal Circuit, the underlying patent and prior art documents represent the most important evidence available in a patent validity dispute.” Well, that’s just common sense and any courts ought to consider that aside from Alice (in the circumstances of allegedly abstract patents).
Another new article says that “Bose holds several patents on this technology…Bose also improved the sound silencing software.” Regarding BlackBerry, which is becoming somewhat of a patent troll nowadays, this article says that “Blackberry [is] slowly fading into obscurity when it comes to the handset market, it makes sense the company would turn to its software, patents, and enterprise expertise as a way to keep the company afloat.”
Nowadays, as we correctly predicted, BlackBerry is a troll (PAE). It is even filing lawsuits down in Texas, as we noted earlier this month. Some of these patents are on software, some on hardware, and some on networking. And speaking of which, there is this new article (behind paywall) about Internet Protocol (IP) patents. The summary says: “Fluent in both types of IP: Scott Bradner has been an architect of intellectual property (IP) policy for internet protocol (IP) standards. He played a core role in the development of internet protocol, leading to the very digital revolution we know today, as well as the next generation IPv6, all the while designing intellectual property policy to go along with it. Here is an interview with Bradner.”
The Internet is supposed to be open to all. Just like the World Wide Web, it should be free from patents (less true today than it was at its genesis, for reasons we covered in past years), so the notion of so-called ‘IP’ on IP (Internet Protocol) is troubling. So is the notion of a ‘FOSS’ group which is open to software patents. OIN, for instance, was created by companies that are not against software patents but wish to minimise risk of being sued. Deb Nicholson, who moved to OIN from the Free Software Foundation, defends OIN as follows. From an interview published earlier today:
The Open Invention Network — OIN, as its friends call it — “is a defensive patent pool and community of patent non-aggression which enables freedom of action in Linux.” That’s what it says (among other things) on the front page of the organization’s website. Basically, if you join OIN (which costs $0) you agree not to sue other members over Linux and Android-related patents, and in return they promise not to sue you. Google, IBM, and NEC are the top three members shown on OIN’s “community” page, which lists over 2,000 members/licensees ranging from Ford to one-person Android app developers.
Today’s interviewee, Deb Nicholson, is the group’s community outreach director. One description of her says she “blurs the line between professional and punk rock,” which is a very cool line to blur. She travels a lot and speaks at a lot of conferences.
She used to work for the Free Software Foundation. You may have heard of them. It is less likely, however, that you know about OIN. But you should, because it does hugely valuable work in keeping the slimy jaws of patent trolls away from innocent FOSS developers and users. If you’re an OIN member and a nasty software patent beast comes after you, they risk the wrath of… well, not “The Wrath of Khan,” but of running afoul of one of the many thousands, possibly hundreds of thousands, of patents held by OIN’s many members.
That’s hardly the solution at all. Just hoarding software patents and putting them in a very large pool — no matter how large — does not rid us from the actual menace. It’s like stockpiling weapons to make one secure from other groups with a large arsenal. Mutual disarmament of all groups, or invalidation of software patents, is the solution. Nicholson’s previous employer, the Free Software Foundation, ‘gets’ that. █
Related/contextual items from the news:
Two recent developments in U.S. patent law mean mixed news for the bio-pharmaceutical industry. First, the bad news — the U.S. Supreme Court declined to accept for review the closely-watched Ariosa Diagnostics v. Sequenom case concerning the patentability of a diagnostic method. Second, the good news — a panel of the U.S. Court of Appeals for the Federal Circuit issued the Rapid Litigation Management v. Cellz Direct decision further clarifying application of the two-step Alice/Mayo test (1. claim directed to a patent ineligible category and 2. lack of inventive concept) concerning laws of nature.
Earlier this summer, the Patent and Trademark Office created an expedited review process for certain patent applications covering “immunotherapies” — new cancer treatments that re-engineer the body’s immune system to attack tumors. Within days, the National Institutes of Health rejected a petition that urged the agency to use “march-in” rights to effectively take back the patent on a prostate cancer drug: It would’ve had a chilling effect on the development of new drugs if such blatant government overreach was implemented.
It’s time to restore the U.S. patent system to its original purpose – to protect and incentivize invention, not innovation. There’s a difference. Innovation is the investment in the commercialization of inventions. Just because a company invests money to commercialize a drug does not mean it has invented a new drug. This is where today’s patent system is broken. If we continue to muddle innovation with the patent system’s original purpose of invention, we will continue to hand out 20 years or more of monopoly power to companies for the same science over and over again and keep paying higher drug prices. Instead of incentivizing a race to the top, we are pursuing a policy of a race to the bottom. Only with genuine inventions can true medical innovations flourish and support both society’s health and a strong drug development pipeline.
Thailand has enforced a new law to promote using intellectual property as loan collateral, an effort likely to make intellectual property a more valuable asset for its holders. But experts caution that the country still lacks the infrastructure of a viable IP market.
A New Zealand “innovation patent”? Unlikely, but watch this space nonetheless. The popularity of Australia’s innovation patents regime has been well documented. Although it is not without its faults, has been prone to certain unintended outcomes and has recently gained some high-profile critics, the Australian innovation patents regime has arguably been relatively successful in stimulating R&D activity (innovation) amongst Australian small-to-medium enterprises (SMEs).
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A better initiative would strive and work towards ending software patents, not faith-based ‘protection’
“Where knowledge ends, religion begins.”
Summary: The Open Invention Network (OIN) reports growth, but in practical terms it does little or nothing to help developers of Free/Open Source software
THE function of OIN seems benign if not benevolent on the surface; the problem is, it helps distract from better efforts that would more effectively defend Free/Open Source software (FOSS). Another not-so-useful initiative was Peer-to-Patent, but it seems to be gone by now.
OIN is growing (see the OIN ‘Community’) and MRV has just joined OIN (see the press release [1, 2], mostly or completely overlooked by reporters). This is a sign of growth, but it is growth which won't help FOSS all that much because it was never truly designed with FOSS in mind. The “Open Source Innovation” mentioned in the title of the press release wrongly assumes this will be beneficial to FOSS, but unless every company in the world joined and vowed not to sue any of the other members (like Oracle suing Google), what would it achieve? And what about lawsuits by proxy? Even if Microsoft was ever to join, its patent trolls (two of which we wrote about last night) would still be capable of suing Linux developers/companies.
Speaking of which, even Android players are a patent menace at times (e.g. Sony). A new and relatively long article by Professor Jason Rantanen speaks about Ericsson’s patent troll, Unwired Planet, and its case against Apple. “This post will focus on the issue of fault in the context of Unwired Planet,” he wrote upfront, “although its observations about fault are relevant to issues of culpability in the context of enhanced damages determinations.”
Even if Ericsson was ever to join OIN, this would not prevent it from suing Android OEMs, directly or via proxies like Unwired Planet (which even operates in Europe now). █
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Hostile environment in which trolls thrive owing to software patents and cashless startups that must settle
Summary: With unconvincing excuses such as OIN, large corporations including IBM continue to promote software patents in the United States, even when public officials and USPTO officials (like Bahr on the left) work towards ending those
SOFTWARE patents remain a very major barrier not just to FOSS developers but to all software development. Such patents, unsurprisingly, are being promoted by monopolists and their facilitators, to whom they’re a major source of revenue. Those monopolists continually rig the whole system in their favour as they can definitely afford it; in fact, it might be considered part of the obligation to shareholders (protectionism through legislation).
The mainstream media or corporate media no longer talks about software patents. Instead it speaks about “patent trolls” and by patent trolls it means the small ones, not the media owners. Apple, for instance, is directly connected to some major media conglomerates, so bias in patent coverage is to be expected in some cases (we wrote about this in past years). Let’s be easily deluded and just ignore Apple demanding billions (not millions) from Android OEMs (patent aggression and sometimes trolling includes big vendors) and also forget Apple’s unique role in Intellectual Ventures (explained here several years ago), the world’s largest patent troll which goes after Android vendors. The article “Apple will pay $25M to patent troll to avoid East Texas trial” is eye-catching and so is “Newegg’s Three-Step Solution to Fighting Patent Trolls” by Gary Shapiro, President and CEO of Consumer Technology Association (CTA). This group likes to focus on patent trolls rather than patent scope. Here is some of the latest from Gary Shapiro:
Lee Cheng is a troll trapper. As chief legal officer for Newegg.com, the second-largest online only retailer in the United States, Cheng has successfully battled the almost three dozen trolls that have attacked his company in the last ten years. And not just fight them, but win.
Patent trolls — sometimes called “non-practicing entities,” or NPEs — don’t actually create any products or services. Instead, they scoop up patents for the express purpose of using them to extort money from real companies large and small that can’t or don’t want to pay high legal defense costs. NPEs focus on settlements and generally have no desire to test their generally poor-quality patents in trial and through appeal. Even bad patents can generate millions in settlement dollars.
A newly-updated Harvard Business School study finds patent trolls sue cash-rich firms “seemingly irrespective of actual patent-infringement” — because that’s where the money is. The Harvard researchers noted trolls are taking a toll on innovation at the firms they target: “After settling with NPEs (or losing to them in court), companies on average reduce their research-and-development (R&D) investment by more than 25 percent.” So instead of funding development of the Next Big Thing in consumer technology, these American small businesses are handing over legalized extortion payments to trolls.
Research estimates that patent trolls drain a prodigious $1.5 billion a week from the economy. I sat down with Lee Cheng to get a from-the-trenches account of the patent troll problem, and to let him share his lessons for taking down the trolls.
“They also rely a great deal on software patenting, as a look at their patent portfolio easily and instantly reveals.”What Gary Shapiro misses here is that patent trolls are often part of a broader shell game played by large corporations such as Microsoft. They also rely a great deal on software patenting, as a look at their patent portfolio easily and instantly reveals. All the focus is now being shifted towards trolls, both in the media and US Congress. Just see this new tweet (“VIDEO: Sen. Jeff Flake Targets Patent Trolls”).
Proskauer Rose LLP, which likes to cherry-pick cases in promotion of software patents, recently released this so-called ‘analysis’. They try to maintain a grip on software patents no matter what. Some large corporations are doing the same thing and it’s not limited to Microsoft. Consider IBM.
IBM’s commitment to Free software, especially now that it pays lobbyists like David Kappos for software patentability, should be seriously doubted. It just likes “Linux”. Manny Schecter, a patent chief at IBM, is an ardent proponent of software patents and he has just linked to “Latest very brief USPTO update to patent examiners on subject matter eligibility in view of recent cases…”
This is a PDF of a new Robert Bahr (Deputy Commissioner for Patent Examination Policy) letter regarding the Rapid Litigation case and Sequenom case (both covered here earlier this month). Herein he is alluding to Mayo and Alice as he might try to gently challenge these or begrudgingly adopt what the ‘pesky’ Supreme Court said. Here is a quote from the PDF: “In summary, the USPTO’s current subject matter eligibility guidance and training examples are consistent with the Federal Circuit’s panel decisions in Rapid Litigation Management and Sequenom. Life sciences method claims should continue to be treated in accordance with the USPTO’s subject matter eligibility guidance (most recently updated in May of 2016). Questions should be referred to Technology Center subject matter experts or your SPE.”
Where does IBM stand on the subject? It’s hardly even a mystery. IBM does not like Alice because IBM loves software patents and actively works to expand these to more countries/continents. At the same time IBM brags about OIN as though it magically makes IBM’s patent policies absolutely fine and compatible with FOSS. “I don’t think there is an alternative choice when you are small entity,” told me someone today. “When has OIN actually helped a small company? Even as a deterrent,” I replied. “When your entity is relatively small,” he said, “OIN represents a potential shield to provide you even a minimum of security.”
“Life sciences method claims should continue to be treated in accordance with the USPTO’s subject matter eligibility guidance (most recently updated in May of 2016).”
–Robert BahrBut how in practice can OIN protect one against a troll for example? It cannot. OIN is totally useless against patent trolls. Don’t ever forget that. I saw that firsthand when I was part of E-mail thread I had initiated. Small companies sometimes try taking rivals to court with their patents. If the rival is big enough, then countersuit is massive (IBM has a massive portfolio which virtually every software patents infringes on), defeating the very point of bothering with a lawsuit in the first place. Large companies may use trolls as satellites/proxies, so the lawsuits/countersuits can come from all sorts of mysterious directions.
“Intel and McAfee Sued for Patent Infringement,” writes Patent Buddy this week. Security Profiling LLC (LLCs are usually patent trolls) is suing in the Eastern District of Texas. What can Intel do about it? Nothing. Intel is now trying to sell/offload McAfee, based on last week’s news reports (see our daily links for half a dozen such reports). Has it become too much of a burden perhaps? The point about patent trolls and OIN sticks, no matter what. Steven J. Vaughan-Nichols has just fallen for the OIN public relations machine, joining the chorus which began with an 'exclusive' puff piece. OIN is not a “Linux” thing as some want it to be widely viewed; it’s mostly an IBM, Sony etc. thing. It helps legitimise software patents rather than acknowledge that they are not compatible with FOSS or Linux and thus need to be ended. █
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Choice of a ‘lesser evil’ still leaves us with evil
Summary: Another reminder of where IBM stands on patent policy and what this means to those who rely on IBM for sheltering of Free/Open Source software (FOSS) or small businesses (SMEs) in a post-Alice era
Large corporations take it all when it comes to patents. Patent trolls are somewhat of a distraction and an obsession, as they help obscure the underlying problem with patent scope, including the existence of software patents. Consider IBM. IBM is itself a patent bully (with history). It uses software patents to attack far smaller companies and lobbies for such patents as well. IBM is opposing patent reform and it is also relying on its lobbyist (and former employee and former USPTO Director) David Kappos to maintain the status quo and abolish Alice as a factor, i.e. to prop up software patents at a time they’re increasingly dying.
“IBM is opposing patent reform and it is also relying on its lobbyist (and former employee and former USPTO Director) David Kappos to maintain the status quo and abolish Alice as a factor, i.e. to prop up software patents at a time they’re increasingly dying.”According to another new article from Fortune, which seems to have found an interest in patents lately, “innovation and entrepreneurship has been on a steady decline for the last 40 years, and the U.S. has ultimately become less competitive as large companies take a greater share of profits in their respective industries, and roughly as many small companies go out of business as start up annually. One particularly telling statistic: Nearly 60% of U.S. employees now work for firms founded before 1980, Kauffman says.” The article is titled “How Licenses and Patent Trolls Are Choking Entrepreneurship in America”. The current policy is basically an SME killer (they’re increasingly being eliminated by patents), whereas large companies don’t seem to mind this. They form conglomerates like OIN which provide them with a collective shield in many cases. Where does antitrust law come into this?
“Don’t be misled,” IBM’s Manny Schecter wrote regarding the above article, “this is about occupational licenses, not patent licenses even tho it is also about patent trolls”
Benjamin Henrion responded to Schecter by saying “patent trolls such as IBM. I had a look at your Prodigy patents complain[t], really insane.”
And right now, based on yet another corporate media puff piece (Bloomberg in this case), it sure looks like the OIN people are greasing up major journalists for puff pieces this week. iophk told us regarding this article: “When will Microsoft put their money where their mouth is and join?”
“Some may be friends of FOSS on the technical side, but when it comes to policy — especially patent policy — they are certainly part of the problem.”Well, when will IBM actually do something to stop the menace of software patents rather than promote these? Red Hat, which itself pursues software patents of its own (we wrote about this before), gets all excited about OIN even if it doesn’t achieve much. Today it wrote about it that “Fortune reports that Toyota has joined the Open Invention Network as a full member, joining IBM, Red Hat, Google and others.”
Unless or until OIN makes its goal also the abolition of software patents, why would the FOSS community have a good reason to embrace it? Look at the main parties behind OIN. Some may be friends of FOSS on the technical side, but when it comes to policy — especially patent policy — they are certainly part of the problem. Toyota itself is very close to Microsoft. █
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Summary: Free/Open Source software (FOSS) continues to be used as a cover for large corporations (like Google, IBM, NEC, Philips and Sony) to maintain a grip on patent pools and act as gatekeepers with software patents that they openwash (not even cross-license, as Oracle v Google serves to illustrate)
WE were never huge fans of OIN, which is why OIN’s CEO and PR people tried hard to convince us otherwise. I saw first-hand accounts where patent trolls were repelled by OIN, which didn’t quite seem to care (maybe because OIN cannot do anything at all about patent trolls, other than attempt to buy/harvest patents before they’re bought to be used offensively). OIN is basically the world’s biggest legitimiser of software patents. IBM, the main company behind OIN (recall its first head of operations, Jerry Rosenthal from IBM), is a patent bully and a notorious software patents proponent, so how can one honestly expect OIN to be part of a true solution? IBM is demonstrably part of many problems.
“IBM is demonstrably part of many problems.”According to this new article from Fortune, joining OIN makes one “a Patron of Open-Source Software” (what a ludicrous headline). To quote from the article: “It’s called the Open Invention Network, and its other members are Google, IBM, Red Hat rht , NEC nec-electronics , Philips phg , Sony sne , and SUSE (a unit of Britain’s Micro Focus). Fortune is the first to report Toyota’s startling move.
“Formed in 2005, OIN’s mission is to protect and encourage the collaborative development and use of open-source software, like the Linux operating system, which can be freely copied, altered, and distributed, and which no one person or company owns. OIN pursues a variety of strategies aimed at protecting the users and developers of such software against the threat of patent suits by proprietary software manufacturers, like Microsoft and Apple. Such suits, if successful, could deny users the freedoms that make open-source software desirable.
“That Toyota would now join the group reflects the growing importance that software is playing in cars, and the growing number of automakers who believe that open-source software is the best approach to providing many of the needed solutions for its vehicles. Open-source champions say such software is cheaper, more flexible, and of higher quality, because it benefits from the pooled resources of collaborative input.”
Toyota, a very close Microsoft partner (probably more so than any other vehicles maker), claims to have joined OIN, but what good will that do for FOSS? Nothing. Toyota is not even a software company. It’s about as relevant to FOSS as that openwashing campaign from Tesla (and later Panasonic). Total nonsense. It’s about as helpful to FOSS as RAND is and speaking of RAND (or FRAND), this new article from IP Watch speaks about FRAND in relation to Europe, where the term FRAND is typically a Trojan horse (or surrogate) for software patents in Europe.
“Toyota, a very close Microsoft partner (probably more so than any other vehicles maker), claims to have joined OIN, but what good will that do for FOSS?”Going back to OIN, it has done virtually nothing so far to protect FOSS. It’s like bogus insurance plan which does not actually work or cover anything (no matter the circumstances). Where is OIN every time Microsoft blackmails Linux/Android OEMs? Speaking of which, Professor Crouch has this new article about insurance based on patents (or copyright, trademark, and trade secret). He says that “Hammond’s insurance company USLI had refused to indemnify Hammond based in-part upon the intellectual property exclusion found in the policy that specifically excluded coverage for any “loss, cost, or expense . . . [a]rising out of any infringement of copyright, patent, trademark, trade secret or other intellectual property rights.” Agreeing, the court particularly found that the basis for TCA’s attorney fee requests stemmed from the Pennsylvania Uniform Trade Secrets Act as well as the Copyright Act – even though no intellectual property infringement claim had been asserted in the underlying case.”
Look what we have come to. With misnomers like “intellectual property”, which compare ideas to “property” and ascribe physical attributes to them (like insurance traditionally did, covering for damage caused to physical things), no wonder the media says joining OIN is becoming “a Patron of Open-Source Software” (FOSS inherently rejects the notion of patron or owner, except in the copyright assignment sense).
“Fortune is the first to report Toyota’s startling move,” its author wrote, but in reality Fortune is the media partner to peddle Toyota’s marketing/propaganda, along with OIN’s agenda. █
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