11.13.16
IAM’s Interest in Patent Trolls Going Global, Capitalising on Declining Patent Quality
Summary: A roundup of news about patent trolls, in particular their growth in east Asia and growing interest from parasitic firms like IBM and Microsoft (which have not so much left but a pile of software patents amassed in past years)
CHINA’S SIPO, which the EPO‘s President got close to (and increasingly imitates both in terms of degrading labour standards and poor patent quality), is becoming the generator of the world’s biggest platform for patent trolls. We have been pointing this out for a number of months now. It’s a harrowing scene because it means that an epidemic that (thus far) was almost exclusive to the US has spread like a pandemic to the world’s largest population.
A new article from John Collins and Steve Lundberg (yes, that crude software patents booster from Schwegman Lundberg & Woessner) is titled “Barrier to Business Patents Softening in China” and it reveals that China — like today’s EPO — encourages more patents irrespective of their quality and it already attracts patent trolls that utilise software patents. Has China learned nothing from the mistakes of the United States — mistakes that even government departments now openly speak of?
According to IAM, a site exceptionally sympathetic towards patent trolls (some of them pay IAM), says that “Qihoo 360 was actually the first company to have a GUI design patent granted.” Now it’s a highly litigious company, IAM says. With software patents, as expected, come the patent trolls to Asia, where patent quality nearly got abandoned (same mistake which the US had made). Here is another new example from IAM, though it does not use the “T” word. These trolls operate not only in China and as we pointed out before, some of them now go abroad and sue Western companies in plaintiff-friendly courts like those in Texas. They will certainly come to Europe as well, in due course. At the EPO, as we have repeatedly demonstrated, patent examination is too lax/lenient — a recipe for disaster for existing EP holders, if not future ones too. According to this tweet from the EPO: “Luis Ignacio Vicente del Olmo of @Telefonica : “The number of patent applications is increasing” #EPOPIC pic.twitter.com/BcmVRxswtD”
Does that mean more innovation or aggressive patent thickets that lock the ‘small guy’ (or business) out of the market?
As another EPO tweet put it the other day: “Luis Ignacio Vicente del Olmo: ” A smartphone may include more than 5000 patent families” #EPOPIC”
Wonderful! “Luis Ignacio Vicente del Olmo speaks about new challenges for IP as a result of the new technological paradigm,” the EPO says, adding that: “Luis Ignacio Vicente del Olmo of @Telefonica talks about trends in #ICT sectors & transparency of patent data #EPOPIC pic.twitter.com/wApNe223C1″
Some of that data comes to and from Asia, as this tweet notes: “Luis Ignacio Vicente del Olmo: “The European market is very attractive to companies outside Europe like from Asia & the US” #EPOPIC”
So how long before Chinese patent trolls come to Europe, even without that UPC (which would greatly assist them if it ever became a reality)?
IBM, which is already suing small companies using software patents, seems to salivating and drooling over litigation in China. See this tweet from IBM’s Manny Schecter, boasting that “China’s patent-lawsuit profile grows. http://www.wsj.com/articles/chinas-patent-lawsuit-profile-grows-1478535586 … via @WSJ” (article here but with limited access to non-subscribers).
“When a Canadian patent-licensing firm wanted to sue Japanese electronics company Sony Corp., it chose an unlikely venue: China.” That’s what the report says. IBM already sold quite a few pieces of its business to China and we can envision IBM trying to impose patent licensing deals in China, if not lawsuits too (for those not sufficiently ‘obedient’).
According to this new article from Liu, Shen & Associates, the notion of obligatory patent tax has already spread to China. “Standard essential patents have long been a hot topic in China,” they argue. “Hou Guang and Jia Hongbo of Liu,Shen & Associates explain the history and analyse recent developments…”
Standard essential patents (SEPs) block the use of Free/Open Source software (FOSS) and much more. IBM used to lobby for this kind of mess in Europe and look where it led to; rather than stop SEPs/FRAND IBM told the European authorities that software patents promote FOSS innovation (which is of course a lie).
Design patents in Taiwan (arguably part of China, depending on who one asks) are discussed in another new article. Japan and China phased in this nonsense, as we noted the other day and sooner or later we expect China to overtake the United States in terms of patent trolling, including trolling in places/parts of the US where litigation is ubiquitous and low-quality patents are routinely tolerated (not just Texas, the trolls’ capital). See this article titled “As litigation increases, China follows Japan in exploring state-subsidised IP infringement insurance”. It says that “[p]atent authorities in both China and Japan have recently brought forth proposals for patent office-subsidised IP infringement insurance. SIPO says it will focus on offering protection to Chinese companies expanding outside the country, while the JPO anticipates local SMEs using its insurance product both offensively and defensively in China. As litigation increases in China, and more Chinese companies expand abroad, companies throughout the region need all the IP risk management tools they can get.”
What a total waste of resources and energy. They handicap their own economy.
Over in the United States, says this article from IAM, Rockstar (a patent troll connected to Microsoft) pursues more shakedown, even though the FTC deemed this damaging to the country. IAM, being the trolls’ apologist that it is (or denier of patent trolling), attacks the FTC’s study which bemoans patent trolls (for the second time in less than a month!) and says this:
One of the significant outcomes of the Federal Trade Commission’s recent report on patent assertion entities (PAE) is that it very clearly differentiated between two types of licensing business.
On the one hand there were the litigation PAEs, who use the threat of infringement litigation to drive a large volume of low-dollar settlements. They, it was strongly implied, largely engage in the kind of abusive practices that many in the patent community criticise and drive a high number of lawsuits.
We are increasingly convinced that IAM is very eager, with money from Microsoft-connected patent trolls on its table, to see patent trolls go global. IBM too seems to like the idea, as the company has little left other than a pile of patents (same as Microsoft). Some companies are simply transforming into megatrolls; see what Blackberry does in Texas because its products are failing to sell. █
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