Seoul Plaza, South Korea

Summary: An outline of recent stories about patents, where patent quality is key, reflecting upon the population’s interests rather than the interests of few very powerful corporations

THE NEW YEAR IS ABOUT to start and we are eager to see governments all across the world recognising that patents have gone too far if examiners are granting millions of them. Techrights was never an anti-patent site; rather, it was pro-patent quality. We need to limit patent scope so as to ensure that the practical (or economic) impact of patents benefits society at large. The former Chief Economist of the EPO spoke about it earlier this winter.

“We need to limit patent scope so as to ensure that the practical (or economic) impact of patents benefits society at large.”Florian Müller has this new article about a Korean antitrust ruling. We have been writing about rulings of this kind for nearly a decade (going back to the Korean ruling on monopolistic Intel) and 3 months ago we wrote about Microsoft's latest patents controversy in Korea. We remind readers that Korea’s official position is that software is not patentable (different from Japan’s and China’s policy).

“I wish to point out,” Müller wrote, “that ACT is generally very IPR owner-friendly, but when it comes to FRAND licensing of standard-essential patents, its positions are pretty consistent with mine. An organization that takes similar positions on FRAND (and of which Google is a member) is the Brussels-based Fair Standards Alliance. Presumably the reason the FSA hasn’t spoken out on the Korean ruling yet is simply that people in Brussels tend to be on vacation this week (to a far greater extent than in the U.S.).”

“For the record, Florian Müller assured me he had been in no way associated with (or paid by) Microsoft for several years now.”As we noted earlier this year, the Fair Standards Alliance is rather mysterious, but the same cannot be said about ACT. I politely told Müller it’s worth pointing out that Association for Competitive Technology (ACT) is a Microsoft front group with decades of history (going back to the nineties, under another name and acronym). We have exchanged some messages about that [1, 2, 3, 4]. For the record, Florian Müller assured me he had been in no way associated with (or paid by) Microsoft for several years now. A lot of what we wrote about Florian Müller is no longer relevant/applicable as he left behind his Microsoft work and has no intention to do that again. Some people will never forgive him for that, but I have. I believe that he’s not “up for sale” now that he leads a team of “app” developers, hence not dependent on contracts from companies like Oracle, either.

“Just updated post on antitrust ruling against Qualcomm with link to unofficial translation of KFTC press release,” he added, after he mostly focused on ACT’s message. Here is a report we found about the news earlier this week:

A South Korean regulator said it would fine Qualcomm Inc. about $853 million for alleged antitrust violations, the highest such penalty handed to an individual company here, as the U.S. chip maker faces global scrutiny over its patent-licensing business.

A lot of people later discussed the relevance of this to the situation in China, where Qualcomm’s shakedown efforts have only met very limited success.

The Reinhold Cohn Group, writing this new article (“China may become more liberal towards business method and software related patents”), reminds us that China has gone bonkers with patent scope. SIPO now copies/emulates the mistakes of the USPTO and it already becomes a patent trolls’ heaven. It’s beneficial to nobody. “On 27 October 2016,” as the law firm put it, “the State Intellectual Property Office of China (SIPO) published, for comments by the public, proposed draft revisions to its current Examination Guidelines for examining software-related inventions. In the draft revised Guidelines SIPO goes one step further, as, in addition to granting patents on software-related inventions that solve a technical problem, is willing to allow patents for data carriers, and, in some cases, even for business methods.”

“SIPO now copies/emulates the mistakes of the USPTO and it already becomes a patent trolls’ heaven.”So basically they want to be the garbage dump of failed patent applications, or the equivalent of scholarly journals that almost blindly accept every submitted paper (and are hence worthless and have no following). We are gratified to see the USPTO departing from this lunacy left (having been accentuated) by David Kappos. Incidentally, some LLC (usually trolls) turns out to have sued the USPTO for last year’s long outage; it has just lost the case^*.

Jasper L. Tran, writing in the Iowa Law Review, has just published “Abstracting About “Abstract Idea”” — a short paper in which he tackles the classification of some patents as “abstract”. Also today, an article titled “Software patent eligibility in Canada: IP year in review” was published but then deleted, maybe by accident. █
__________
^* To quote Pharma Patents Blog: “On December 2, 2016, Judge O’Grady of the U.S. District Court for the Eastern District of Virginia granted the USPTO’s motion to dismiss the complaint brought by Elm 3DS Innovations, LLC over the “holidays” declared December 22-24, 2015 when the USPTO experienced a power outage that impacted its electronic filing systems. The decision may leave other stakeholders wondering whether Elm was not the best party to challenge the USPTO’s action, or whether the action is simply unreviewable under the APA.”

Summary: The latest facts and figures about software patents, compared to the spinmeisters’ creed which they profit from (because they are in the litigation business)

“L

atest [Section] 101 Statistics Show Improved Validity Prospects at Dist. Cts, Not CAFC or PTAB,” said a patent attorney the other day, reinforcing our response to Mullin's article (titled “These three 2016 [CAFC] cases gave new life to software patents”). The reality in the US right now is undeniably bad for software patents, which are being chopped at PTAB’s block and CAFC’s block. Patent maximalists are trying to pretend otherwise and we repeatedly rebut their arguments, only to see these arguments resurfacing over and over again, courtesy of the usual suspects. If the lies are repeated often enough, then maybe prospective applicants (or clients in need of legal representation) will actually believe them.

“The reality in the US right now is undeniably bad for software patents, which are being chopped at PTAB’s block and CAFC’s block.”The other day we saw this new article titled “Assessing USPTO’s Memo On Software Claim Patent Eligibility”; we keep wondering if USPTO officials will become as rational and realistic as US courts. Right now they just strive to rubberstamp whatever they can and those who pay the price for it are both plaintiffs and defendants; only patent law firms profit from it.

“This method of presentation involves storing and processing applications or parts of applications at a user’s local personal computer rather than at a remote server.”
      –PatentDocsAs a side note — although an important note nonetheless — we can’t help but notice that IBM keeps trying to corrupt the system though its former Director, who had worked for IBM beforehand. IBM definitely used to be a (GNU/)Linux friend. Now it’s just an Apple promoter/pusher and a malicious patent aggressor. Yes, IBM has been rather busy going after small companies using software patents. Some of these companies, seeing what a menace IBM is becoming, belatedly turn to PTAB in an effort to invalidate these patents of IBM. Here is one report about IBM’s software patent that will quite likely be invalidated: “The ’967 patent relates to a method for presenting applications in an interactive service featuring steps for generating screen displays of the service applications at the reception systems of the respective users. This method of presentation involves storing and processing applications or parts of applications at a user’s local personal computer rather than at a remote server. This helps avoid possible server bandwidth issues that can be caused by the server being required to serve too much data to multiple users simultaneously. The ’967 patent lists many applications that can take advantage of this method of presentation, including games, news, weather, movie reviews, banking, investments, home shopping, messaging, and advertising.”

This is pretty trivial. It’s akin to caching.

Now watch what David Kappos is cited as saying again. “US is losing the innovation war,” he is quoted by IBM as saying, “to China” (where IBM finds buyers for its failing business units, notably Lenovo).

“Kappos is a paid lobbyist,” Benjamin Henrion noted, “working for patent trolls such as Microsoft or IBM.”

“IBM’s Schecter would know,” I replied, as “he’s IBM’s patent chief ^_^ so [he] has the ‘receipts’…”

What we have here is IBM citing as ‘proof’ a former IBM staff who is now an IBM-funded lobbyist for software patents. Look how dirty (as in dirty play) these people are…

And as if the greater the number of patents, the better… who would be foolish enough to actually believe this?!

“China pushing for software patents,” Henrion noted in relation to another Schecter tweet, “apparatus claims relating to software can contain both hardware and “program” components…” (links to “China Files A Million Patents In A Year, As Government Plans To Increase Patentability Of Software”)

“Kappos is a paid lobbyist working for patent trolls such as Microsoft or IBM…”
      –Benjamin HenrionChina is their new bogeyman. One of these people added: “But USA keeps working on UN-patentability of software. What’s wrong with this picture?”

Nothing is wrong with this picture. It’s a good decision. End software patents, end patent trolls.

“China is plain wrong on this,” Henrion wrote, separately noting (to Marietje Schaake regarding software patents in Europe) that it’s “like the unitary patent lie that it won’t affect software development.”

On a final note, worth seeing is this rant from Watchtroll and 'gang' about end of software patenting (or demise thereof). “Stepping Back from the Cliff: The Year Congress Didn’t Cave to the Anti-Patent Lobby” says the title. They’re currently taking stock of a terrible year for them [1, 2] — a year which saw the demise of patent trolls. Watchtroll continues to attack PTAB for doing its job and we can’t help wondering why IBM’s Schecter treats this like some kind of ambassador for his cause. Does IBM really want to be so closely associated with Watchtroll, who even resorts to attacking judges?

For a more balanced summary of recent events, see “Year in Review: The Top-Five Legal Developments of 2016″ (posted days ago). It has a section about software patents.

“…anti patent trolling would be better, even if trolling is considered pejorative.”
      –Benjamin HenrionThose who are against software patents, notably people who actually write software, are not “anti-patent” as Watchtroll tries to put it. In fact, as Henrion put it, “anti-patent is a gross and blunt exaggeration here. […] anti patent trolling would be better, even if trolling is considered pejorative.”

Patent trolls, in the majority of cases, rely on software patents. Take the latter away to get rid of the former. █

Summary: The US Supreme Court (SCOTUS) is planning to weigh in on a case which will quite likely drive patent trolls out of the Eastern District of Texas, where all the courts that are notoriously friendly towards them reside

MANY patents granted by the USPTO have become the basis for ruinous lawsuits filed by patent trolls, which may soon be dealt an unprecedented and much-needed blow.

Patent trolls are not just a minor nuisance or some small random parasitic companies without products; some of them are gigantic and many are covers (or fronts) for large corporation seeking to shield themselves from counterclaims. Consider this new story about “Cayman Global”, yet another ‘IP’ proxy, this time for Faraday Future. “The Verge reports that Faraday Future does not own its intellectual property, and that it is instead owned by a separate entity called FF Cayman Global,” Business Insider wrote the other day. Microsoft too has created its own patent assertion entity — the one it uses to taunt Linux and Android all the time.

Florian Müller and LWN have both highlighted this good article published on December 27^th by Daniel Nazer of the EFF. To quote: “Patent trolls were down but certainly not out in 2016. After a massive burst of litigation at the end of last year, we saw a noticeable drop in patent troll lawsuits at the start of this one. But trolls began returning to court as the year continued and 2016 will likely end with a relatively small overall decline. Consistent with recent trends, troll cases clustered in the Eastern District of Texas. Approximately one in three patent suits were filed in that remote, troll-friendly district, and these suits were almost all filed by companies with no business other than suing for patent infringement.”

“Microsoft too has created its own patent assertion entity — the one it uses to taunt Linux and Android all the time.”A lot of patent trolls lose their battles as software patents reach the wastebasket or never get used at all (due to low certainty of settlement/prosecution).

In 2017 we expect the case that will likely destroy trolls to be decided on by SCOTUS. This new article by Sasha Moss, Technology Policy Fellow at the R Street Institute, says that the “U.S. Supreme Court announced earlier this month it will hear the appeal of a patent infringement case brought by Kraft Foods Group Brands LLC against zero-calorie sweetener manufacturer TC Heartland LCC.”

Even lawyers’ sites wrote about this, e.g. “Will forum shopping days, like holiday shopping days, soon come to an end?”

“Only the more ‘extremist’ sites of (and for) patent lawyers, as we noted here before, prefer to say that nothing will change.”Professor Michael Risch wrote about this case that Patently-O, where he wrote/published his piece, predicts is going to kill patent trolls’ business model. To quote Risch, “I should note that the outset that I favor TC Heartland’s position from a policy point of view. I’ve long said in a variety of venues (including comment threads on this very blog) that there are significant problems with any system in which so much rides on where the case is filed. And I think that’s true whether you think they are doing a great or terrible job in the Eastern District of Texas.”

Only the more ‘extremist’ sites of (and for) patent lawyers, as we noted here before, prefer to say that nothing will change. We shall see next year, but the one newly-introduced factor will be the Republican government and perhaps several new appointments of Justices. █

Summary: The scope of patents in the United States is rapidly tightening (meaning, fewer patents are deemed acceptable by the courts) and Fitbit’s patent case is the latest case to bite the dust

EARLIER this year we learned that the USPTO might have to reassess design patents, having already reassessed software patents. SCOTUS was poised to look into an Apple v Samsung case (one of several high-profile cases), which later turned out alright for Samsung.

Days ago we found a new article titled “US Supreme Court Sets The Bar Higher For Obtaining Damages For Design Patent Infringement” in the media of patent lawyers. At the same time patent law firms said that we all need more patents that fall inside/within a broader scope (i.e. more money paid for their ‘services’) , this time too in relation to design patents. Another patent law firm spoke in favour of design patents because it makes money out of patent maximalism. Shouldn’t we just ignore them all, knowing that they object to SCOTUS not because SCOTUS is wrong but because of greed? They want design patents, like those which are often applicable to gadgets, but such patents are being phased out, or defanged in the damages sense. The incentive too pursue such patents has just decreased and confidence in existing ones eroded.

Certainty surrounding software and design patents is declining and in fact just two days ago, regarding the Fitbit case that we covered here before, there was a major new development. The seminal lawsuit got dropped:

Fitbit drops patent infringement case against rival wearable tech company Jawbone

Fitbit Inc. has dropped one of its patent infringement cases against rival wearable tech maker AliphCom Inc.’s Jawbone, pointing to its belief that the company is already failing financially, reported The Wall Street Journal.

The two San Francisco-based companies both manufacture and market wearable fitness trackers and have been tied up in litigation with each other, alleging patent infringement and the stealing of trade secrets. Patents in the litigation dropped by Fitbit were related to heart-rate and physical activity monitor technology.

Fitbit’s case would have blocked Jawbone’s ability to bring their competing product into the U.S., however it seems as if financial issues have already hampered the company’s ability to do business. Jawbone no longer lists its products for sale on its website.

Fitbit’s implicit message here is that it was going to win but was merciful enough because of the defendant’s position, but that’s quite likely just spin. The legal battle soon became a two-edged sword because Jawbone fought back and now it looks increasingly expensive for Fitbit to fight on, especially relying on patents that high courts tend to invalidate at the end.

What we are seeing here is part of the trend of litigation declines (as noted by several sources so far this year). Bad news for patent lawyers, but excellent news to everybody else. █

Summary: Selective emphasis on very few cases and neglect of various other dimensions help create a parallel reality (or so-called ‘fake news’) where software patents are on the rebound

“In 2014,” Joe Mullin recalls in a new article (published earlier today), “the US Supreme Court dealt a major blow to software patents. In their 9-0 ruling in Alice Corp v. CLS Bank, the justices made it clear that just adding fancy-sounding computer language to otherwise ordinary aspects of business and technology isn’t enough to deserve a patent.”

“Since then,” he continues, “district court judges have invalidated hundreds of patents under Section 101 of the US patent laws, finding they’re nothing more than abstract ideas that didn’t deserve a patent in the first place. The great majority of software patents were unable to pass the basic test outlined by the Supreme Court. At the beginning of 2016, the nation’s top patent court had heard dozens of appeals on computer-related patents that were challenged under the Alice precedent. DDR Holdings v. Hotels.com was the only case in which a Federal Circuit panel ruled in favor of a software patent-holder. The Alice ruling certainly didn’t mean all software patents were dead on arrival—but it was unclear what a software patent would need to survive. Even DDR Holdings left a teeny-tiny target for patent owners to shoot at.”

“The patent law firms want us to believe that software patents are rebounding or something, even though CAFC invalidates them as quickly as ever, SCOTUS repeatedly rejects attempts to override Alice, and the number of lawsuits involving software patents sank considerably this past year, based on numerous comprehensive/exhaustive surveys.”Ignoring some of the biggest cases of 2016, Mullin then argues that “[j]udges on the US Court of Appeals for the Federal Circuit found three more cases in which they believe that software patents were wrongly invalidated. What once looked like a small exception to the rule now looks like three big ones.” What about that one single CAFC case involving not one but three invalidations, courtesy of the judge some hold responsible for software patents in the US? Here is a new article about it (bumped earlier today):

Intellectual Ventures recently filed for a rehearing en banc in Intellectual Ventures LLC v. Symantec Corp. and Trend Micro Inc. for a decision made in the U.S. Court of Appeals for the Federal Circuit that invalidated three of its software patents. The variety of patents at issue, colloquially dubbed the “Do-It-On-A-Computer” patent, have been increasingly invalidated after the U.S. Supreme Court’s decision in Alice Corp. v. CLS Bank International.

The Intellectual Ventures loss (covered here many times at the time) isn’t the only such loss this year (for software patents at CAFC). We actually covered quite a few other such cases, but the patent microcosm prefers to obsess over just 3 or 4 cases, i.e. less than it takes one hand’s fingers to count. In our humble assessment, Mullin, who is an excellent journalist, fell prey/victim to the endless propaganda from the patent microcosm. The patent law firms want us to believe that software patents are rebounding or something, even though CAFC invalidates them as quickly as ever, SCOTUS repeatedly rejects attempts to override Alice, and the number of lawsuits involving software patents sank considerably this past year, based on numerous comprehensive/exhaustive surveys. █

Reference: Trump escalates attack on ‘Mexican’ judge (this ‘Mexican’ judge was born in Indiana actually)

Summary: In light of Trump’s awkward history with judges (e.g. attacking them) one can hope that upcoming patent cases at the highest court won’t be affected by his pro-big corporations agenda

THE PATENT landscape in the US has changed a lot in recent years, especially after AIA (half a decade ago). Software patents, for instance, are a dying breed. This does not mean that things will continue to improve; they can get a lot worse as soon as a new President is inaugurated, to the chagrin and regret of many Americans. Lobbying of Trump has already begun, for instance by the Internet Association (large corporations, not what it sounds) and by IPO. They want the old order of things and they represent a threat to software developers.

AIPLA, another such entity which acts like a think tank (like oil companies in favour of offshore drilling), is telling the USPTO that they want more secrecy. It makes sense for them. As Patently-O put it the other day, “I would say even after/if the USPTO adopts a rule, be very careful if you have patent agents communicating directly with clients, without supervision of a lawyer, because there’s also the possibility that a court won’t follow the Queen’s University case and hold there is no privilege, anyway. That’s already happened in Texas.”

Well, as new articles continue to stress (the latest being, e.g. [1, 2, 3, 4, 5]), Texas may soon end its status as trolls’ capital, but only if SCOTUS rules rationally. This is yet another blow to the ‘old guard’; it represents patent progress and improvements that favour ordinary people, not oligarchs like Trump and a lot of his prospective cabinet members.

We urge people to support groups like the EFF, which growingly mention software patents and openly oppose these. Latest from the EFF’s Daniel Nazer [1, 2] is this article about this month’s “Stupid Patent”, which he explains as follows:

As you head home for the holidays, perhaps passing through a checkpoint or two, take some time to think about U.S. Patent No. 6,888,460, “Advertising trays for security screening.” The owner of this patent, SecurityPoint Holdings, Inc., has sued the United States government for infringement. SecurityPoint recently won a trial on validity [PDF] and the case will now proceed to a damages phase. So, unless the validity decision gets overturned on appeal, we’ll soon be paying tax dollars for the idea of moving trays on carts.

[...]

In a trial before the Court of Federal Claims, the government argued that this claim was obvious because moving trays using carts was well-known in many contexts. The court disagreed. The court suggested that even if using carts to move trays was well-known, the government needed prior art specifically for security checkpoints (arguably the government had such evidence, but the court disagreed on that point too).

In fairness to SecurityPoint, evidence at trial suggested that it had developed a good system for managing trays and carts within the confined space of an airport security checkpoint. But the patent’s claims are far broader than any specific solution. This is something we often see in patent law: someone develops a (fairly narrow) innovation, but then broadly claims it, capturing things that are well-known or banal. This sort of claiming hurts follow-on inventors who develop their own ideas that wouldn’t infringe any narrower claim, and weren’t invented by the patent holder. But because the broader claim is allowed, their own inventions become infringing. Here, claim 1 is not limited to any particular kind of cart, tray, or scanner. The claim really reads on using a couple of carts to move trays and, in our view, should have been found obvious.

Nazer’s colleague at the EFF has meanwhile advised institutions like universities not to give their patents to trolls. They actually mean “patents”, not “inventions” (as the headline puts it). These are not the same thing. “Research funded by the United States government should benefit everyone,” the EFF explains. “That’s why EFF so strongly supports the idea of writing an open access requirement for federally funded research into the law as soon as possible. It’s also one reason why we recently launched Reclaim Invention, a campaign asking U.S. universities to rethink their patenting policies. It’s crucial that federally funded research be made available to the public so that anyone can read and use it, not just people with institutional connections. But even if the public can read government-funded research, patents on inventions that arise from it can still fall into the wrong hands and undermine the public interest.”

Some universities, desperate for cash (especially in periods of privatisation — the Trump way!), are hoping to make a ‘quick buck’ out of patents that the public actually paid for. This is going to become a bigger issue if schools and universities operate more and more like businesses in the coming years, enjoying no status like they did decades or centuries ago. It means that some universities, with staff that receives public grants, will become litigation mills, directly or indirectly (via trolls).

Speaking of desperate appeals for cash, this new article about Chapter 11 Bankruptcy (a process Trump has gone through plenty of times to secure his billions) says that last “week’s corporate news roundup includes the holding by a U.S. federal appeals court that secured indenture noteholders were entitled to a make-whole premium notwithstanding the issuer’s chapter 11 bankruptcy case, the addition by companies in their securities filings with the SEC of risk factors relating to the outcome of the U.S. Presidential election, and the termination by the PTAB of IPR proceedings as to patent claims between Microsoft Corporation and Enfish LLC, resulting in a non-appealable win for Enfish.”

This goes under “TERMINATION OF ENFISH-MICROSOFT INTER PARTES REVIEW PROCEEDINGS IMPLIED AS UNAPPEALABLE AFTER FEDERAL CIRCUIT DECISION AGAINST MICROSOFT” (a case we covered here before).

In our last article we reminded readers that after Enfish the Court of Appeals for the Federal Circuit (CAFC) ruled repeatedly against software patents, including in very high-profile cases. Unless the Supreme Court with some Trump-appointed Justices chooses to reverse Alice (won’t happen any time soon based on the dockets), it is safe to say that political impact on patent law is still just a distant threat. █

“I can’t imagine what this place would be — I can’t imagine what the country would be — with Donald Trump as our president. For the country, it could be four years. For the court, it could be — I don’t even want to contemplate that.” –Justice Ginsburg

Summary: Looking at some of the latest promotions of software patents in the US and where this is all coming from (and why)

THE stature of software patents proponents isn’t quite what it used to be (they speak from a position of weakness now) and potency of software patents is at an all-time low. As one legal site put it the other day, a lot of these people now hope that Trump will magically change something (to their advantage). The article states that “Brendan S. Lillis, an associate at Phillips Lytle LLP, concentrates his practice in all areas of intellectual property law, with particular emphasis on patent preparation and prosecution and opinion work in the software, mobile applications and electronic arts.”

“We are generally quite open and frank about the parasitic nature of most patent law firms out there.”The problem is, Lillis works for an industry that profits from litigation and applications that precede litigation. They view things from an entirely different perspective, in the same way that an arms industry views peace negatively (or apprehensively, if they’re publicly polite about it). A legal firm, Banner & Witcoff Ltd, has just given small businesses some really bad advice (to pay legal firms), but what is the point if a small business can barely even afford going to court?

We are generally quite open and frank about the parasitic nature of most patent law firms out there. They pretend to care about “small businesses”, the “small inventor” etc. but all they care about is themselves and huge corporations that bring them the most income (for protectionism). Don’t fall for their marketing pitch!

“Federal Circuit judges spar over software patents,” said the headline from lawyers media the other day. “Will they ever agree?” (behind paywall)

“Notice how, at the same time, pro-software patents sites such as IAM want us to believe that CAFC suddenly loves software patents and things are somehow changing.”Well, in the majority of cases the Court of Appeals for the Federal Circuit (CAFC) rules against software patents, which is all one needs to know. Fenwick & West’s Sachs kept track of pretty much all these cases and generated charts based on these. These charts were very helpful. But what Sachs means by “gift” is software patents. These people are making no (successful) endeavor to hide their agenda/subjective interpretation. Instead of showing some objectivity they are just promoting their own business (profit). They are producing and showing lots of charts and along/between the lines they also interject opinions about whether the outcome is desirable or not — quite unprofessional if this was scholarly work. What they are trying to accomplish at the blog (if it can be called that, as it’s growingly looking like marketing) is squashing of Bilski and Alice. Wolves in sheep’s clothing is what they are and they are exploiting the name Bilski (of the famous patent case) to do this. To quote from their latest post, “Alice Brings a Mix of Gifts For 2016 Holidays”:

As I previously reported, the monthly data showed a drop in the number of invalidity decisions as well as an overall downward trend in the invalidity rate for district court decisions. In December thus far there’s been an uptick in such invalidity decisions (seven thus far) and a few more may issue in the before the year is out. The dotted line above shows the invalidity over three month periods, to smooth out the monthly fluctuations; overall the trend has been downward.

Nonetheless, in October, I cautioned that “I would prefer to see these numbers hold for several months,” because the Federal Circuit “continues to affirm more invalidity decisions than it reverses.” This fact still holds true: there have been nine decisions by the Federal Circuit since October, and they have affirmed ineligible subject matter in seven of them (77%).

Notice how, at the same time, pro-software patents sites such as IAM want us to believe that CAFC suddenly loves software patents and things are somehow changing. They aren’t. That’s usually just agenda disguised as news — something which IAM does a lot of. Therein lies the business model of IAM. █

“I find a considerable anxiety throughout the community of practicing computer scientists that decisions by the patent courts and the Patent and Trademark Office are making life much more difficult for programmers. ”

–Donald Knuth

Summary: Free/Open Source software (FOSS), which encourages sharing, is increasingly becoming infested or subjected to software patents barbwire, courtesy of those who want to monopolise rather than share

THE OTHER day we wrote about Blockchain and related technologies coming under attack because of giants that hoard software patents and threaten small players/contenders. A news site dedicated to Bitcoin explains this as follows:

Increasing Blockchain Patents May Soon Hamper Innovation

[...]

Companies count their patents among prized possessions. Having a patent for something important can be worth a fortune, guaranteeing the company a constant stream of revenue until it expires. At the same time, it may also hamper innovation by preventing other from using the technology for free.

Bitcoin and its underlying blockchain are open source technologies and it has gained prominence in the banking and fintech industry lately. The potential of blockchain to change the future of banking has forced many institutions to invest heavily in the development and implementation of cryptocurrency technology based applications.

However, the increased involvement of mainstream institutions has created another problem in the cryptocurrency industry. The banks and financial institutions are increasingly filing patents for various blockchain based solutions that are commonly used by many open source crypto-communities. If these institutions were to gain the patents, then they will soon be dictating terms to Bitcoin and other crypto-platforms, hampering innovation and ease of access to millions of people.

We are beginning to hear more and more stories like this and it matters even more to us because of the direct connection to FOSS and to the Linux Foundation. The other day WIPR showed that Hadoop too, in spite of being FOSS, became subjected to patent wars:

Founded in 2012, Pepperdata provides customers with products that improve the performance of Hadoop-based computing clusters. A computer cluster consists of a set of connected computers that work together.

According to the suit, Yahoo uses Hadoop clusters within the US. It made a software patch identified as YARN-5202, titled “dynamic overcommit of node resources”, which it has used on the clusters.

So anyone who uses this Free/Open Source software can now become the defendant in a patent lawsuit? How does that work? And why don’t more FOSS developers becoming actively involved in ending software patents? This should be our top priority. █

David Ruschke’s ‘official’ photo

Summary: The Patent Trial and Appeal Board (PTAB), led by David Ruschke, continues to function as another ‘layer’ that ensures patent quality by weeding out bad patents and here are some of the latest cases

THE patents and litigation climate is rapidly changing in the US. It’s not just about software patents, but it has a lot to do with them as a lot of litigation emanates from such patents, notably troll litigation.

Just before the days of the holiday (whichever one) we learned about the Patent Trial and Appeal Board (PTAB), which is responsible for invalidating many software patents, being in the midst of this battle:

The Patent Trial and Appeal Board announced on Dec. 2 that it would uphold a patent filed by Securus Technologies, and that the challenge filed by rival company Global Tel*Link (GTL) was invalid. GTL maintains, however, that Securus only won a partial victory.

The patent (U. S. Patent No. 7,494,061 B2) that Securus maintains held up to the challenge from GTL, relates to biometric identity verification monitoring devices used in correctional facilities. According to a summary of the patent, “The term “biometrics” refers to technologies that measure and analyze human characteristics for authentication.”

This patent is a software patent by the sound of it. These are actually the sorts of patents which improperly use terms like “biometrics” to sound as though they’re anything but image analysis, which is my field of research (post-doctoral). It has nothing to do with biology and it’s all typically reducible to mathematics (matrices). Does the appeal board (PTAB) realise this? If not, maybe it’s time to reassess.

Another report, last Updated 6 days ago, is an article about appeals in Korea, published by Jay (Young-June) Yang, Duck Soon CHANG and Seung-Chan EOM from Kim & Chang (patent microcosm). Remember that Korea still blocks software patents (as it should) and we commend this decision, which guards software giants (also hardware giants, not to mention military equipment players) like Samsung and LG — both of which became Microsoft prey for using Linux nearly 9 years ago. We last reported on this 3 months ago (Microsoft wants more 'Linux patent tax' in Korea).

Going back to PTAB, there is a CAFC/PTAB case (CAFC having the authority to object) that MIP explained as follows: “The original Federal Circuit panel decision in the case – written by Judge Reyna and joined by Chief Judge Prost and Judge Stark – was issued on May 25. The court affirmed the Board’s denial of Aqua’s motion to substitute claims 22–24 of a patent concerning automated swimming pool cleaners.”

There is a 9-page PDF in there. As mentioned here some days ago, they are complaining because their patent was granted in error and now they want to change it. Imagine if granted patents were something dynamic you could just amend, edit, expand etc. as you go alone. What a ludicrous thing. Invalidate the patent and if they insist it’s not fair, then they should apply for the patent again (with amended claims).

MIP also explains how to use PTAB to squash bad patents (like software patents) even when it’s not so trivial. “Jim Brogan, Brian Eutermoser and Janna Fischer discuss the ways that the unsuccessful IPR petitioner at the Patent Trial and Appeal Board still can challenge validity in subsequent district court litigation,” MIP wrote.

MIP, to its credit, keeps abreast of PTAB cases (mostly because of Mr. Michael Loney), although it sometimes misinterprets the numbers it puts forth.

In better news about PTAB, here is PTAB having a go at software patents and getting a chance to kill them again. As PatentDocs put it:

Petitioner, iVenture Card Traveler Ltd, filed a Petition seeking to institute a covered business method patent review of all claims of U.S. Patent No. 7,765,128, owned by Smart Destinations, Inc. The Board, applying the standard that requires demonstration that more likely than not Petitioner would prevail with respect to at least one challenged claim, the Board granted Petitioner’s request to institute the CBM review.

We hope that PTAB will continue to do its job improving patent certainty by knocking out a lot of rubbish patents, leaving in tact only those that merit court cases (if any). █

THE USPTO insists that it makes the US more competitive, but in many cases it actually helps large companies undermine small ones, not foreign ones.

Case of point: see the new article “When a patent-happy industry meets open-source technology” [1, 2]. To quote from the article:

When the financial services industry started paying attention to blockchain technology, many companies, seemingly as a reflex, sought patent protection for their ideas.

It was ironic, since the original bitcoin blockchain was a breakthrough of open-source development, in which software code is made freely available for anyone to use or modify. As the industry has gained a clearer understanding of how distributed-ledger technology could change its business, it’s begun to see the merits of such openness in supporting collaborative innovation, and the limitations of the traditional, you-can’t-touch-this approach.

Some are even using a hybrid strategy, pursuing patents to secure a competitive advantage – or at least protect themselves from legal challenges – while publishing code and inviting others to improve it by submitting fixes or patching bugs. The situation underscores the cultural differences between the banking and technology fields as the former looks to the latter for help meeting the demands of an increasingly digital world.

IBM’s Manny Schecter was interested in this and Benjamin Henrion told him that these conglomerates pursuing patents on Blockchain technologies is “like oil companies patenting everything solar.”

This isn’t entirely new a revelation. It’s an old trick in many industries (absorbing or denying competition that suggests alternative paradigms). Big Banks are essentially attacking Bitcoin, Blockchain etc. using software patents and today we found two more articles about it, “Blockchain patent filings by Goldman, others tip future cost risk” and “Corporate Patents on Blockchain Could Create Legal Problems for Startups”. Well, that’s the intention.

“Thankfully, a lot of software patents pertaining to payments and finance are being invalidated these days (thrown our by court), more so than in any other field.”“Over the past few months,” one of these articles says, “some of the world’s largest financial companies including Goldman Sachs, Bank of America and Mastercard – have been patenting promising Blockchain methodologies. Despite a common perception that Blockchain is Open Source and developers can freely use Sotoshi Nakamoto’s ideas from bitcoin to build new systems, it still could mean costly legal problems for fledgling startups, lawyers and others are saying.”

We wrote about this not too long ago in relation to MasterCard. A lot of the above culminated in the publication of “Big Banks Are Stocking Up on Blockchain Patents” (early yesterday in Wall Street media). To quote:

In the headlong rush to revolutionize modern finance, blockchain enthusiasts are overlooking one potentially costly problem: their applications, built on open-source code, may actually belong to someone else.

Recently, some of the biggest names in business, from Goldman Sachs to Bank of America and Mastercard, have quietly patented some of the most promising blockchain technologies for themselves. Through mid-November, the number of patents that companies have obtained or said they’ve applied for has roughly doubled since the start of the year, according to law firm Reed Smith.

Our readers are smart enough to know what’s wrong with this picture. Gullible people may try to frame this as a sign of “adoption” and “success”, but the large financial firms just want to guard their monopoly/oligopoly, they don’t want disruption.

Thankfully, a lot of software patents pertaining to payments and finance are being invalidated these days (thrown out by courts), more so than in any other field (about 90% of the time). That’s similar to business methods, too.

Are patent examiners in the US paying any attention at all to what courts have been arguing over and over again? █

Summary: The growing embrace of “China” as the convenient bogeyman for those who oppose patent reform and wish to see a resurgence of patent chaos, from which they personally profit at victims’ expense

THE USPTO may be in self-perpetuating denial about it, but software patents are a dying breed in the US as courts don’t tolerate them. The EPO, in the mean time, moves in the opposite direction, but we’ll leave the EPO out of this post’s scope.

Unhappy With Insufficient Number of Lawsuits and Collateral Damage

Paul Morinville, a prominent opposer of patent reform in the US (and part of Watchtroll’s ilk), whines that “PTAB procedures are now invalidating nearly 90% of all patents they evaluate.” Yes, so what? Alice and other cases are pretty clear about it and PTAB, unlike patent examiners, is not being pressured to just bless every patent in the name of “production” or “success” (again, a growing problem at today’s EPO).

Morinville picks on Google (large company as his latest scapegoat) and some of his online friends already heckle me for pointing that out. To quote his article: “Over the next decade, the Supreme Court would eliminate injunctive relief and then for all intents and purposes, invalidate their patents first under Bilski and then under Alice. The courts also changed the way claims were written, thus invalidating thousands of patents retroactively. The America Invents Act’s PTAB procedures are now invalidating nearly 90% of all patents they evaluate. The courts also radically reduced damages for patent infringement.”

That’s good. But wait until Morinville brings up the bogeyman again — the same bogeyman that David Kappos has been summoning recently.

Let’s Envy China

“With China strengthening its patent system,” Morinville says, in probably the most ludicrous part of the whole article. China is actually weakening patents by granting almost everything that comes through SIPO’s doors, causing a patent hyper-inflation and an epidemic of trolling. How is that desirable to anyone but the patent microcosm? These anti-AIA think tanks and lobbyists (like Morinville), who want more lawsuits and more litigation, continue to infest the Web and a lot of them congregate around Watchtroll these days. This pattern of China-blaming or China-shaming mirrors what the Democratic Party in the US has been doing with Russia as of late.

Watchtroll wants the USPTO and the courts to start another race to the bottom and give/approve patents on everything, just like SIPO in China. One might call it “the litigation lobby” — for all it want is more and more lawsuits (which the lobby profits from). Watch another new Watchtroll article, this time by Steve Brachmann, the henchman of Quinn. So people who don’t even develop anything insist that “China” is the threat and that “Chinese patent guidelines” are a threat to the US rather than to China itself.

What kind of post-truth nonsense have we sunk to here?

Watchtroll, in another new article, says “Keep it Cordial” while Quinn attacks everyone who does not agree with him, even judges (see the image at the top).

What a nasty Web site this is. For IBM’s patent chief to occasionally link to it probably takes some guts because it says a lot about IBM, which has gone rogue (even IBM employees now protest/object to the management over that infamous Trump fawning).

China’s Growing Trolls Epidemic

China’s situation with regards to patents is not good. As we have been pointing out since the summer, SIPO grants far too many patents, including software patents. “This is especially true for software patents where the scope of patent protection is rather vague,” says this new article from China, which also mentions Xiaomi, a company that got trolled through India, as we noted before. To quote the relevant part:

As Chinese smartphone brands work to carve out a spot in the major-league global smartphone industry, they are increasingly being dragged into an international patent war with foreign tech firms.

The latest case saw San Francisco-based audio tech firm Dolby Laboratories lodge a lawsuit against Chinese smartphone companies Oppo and Vivo in India, accusing them of infringing on its patented technology. Back in 2014, Chinese tech firm Xiaomi was barred from selling phones in India after Sweden-based Ericsson filed a complaint with an India court alleging patent infringement.

The Ericsson-Microsoft patent trolls strategy (using trolls as proxies) was mentioned here twice this month [1, 2] and Xiaomi is again being mentioned by the Microsoft Windows-powered IAM (with other Microsoft connections). It is again embellishing Microsoft's patent extortion against Linux as follows:

The May agreement between Microsoft and Xiaomi was undoubtedly the IP deal of the year and it was also an excellent example of how patents can play a role in broader commercial agreements. Under the terms of the deal, Xiaomi undertook to pre-load Microsoft products on to more of its mobile devices, the two sides agreed to a cross-licence and the US software giant transferred 1,500 patent assets to the Chinese company. The transaction provides an excellent foundation for Xiaomi as it looks to grow its business in the US and for Microsoft as it continues its penetration of the Chinese market.

This is misleading. All we have here is patent extortion by Microsoft against Linux, even in China where the government of China took a strong stance against it (even leaking a list of Microsoft patents that are secretly being sued to blackmail Chinese companies like ZTE). We believe that Huawei, the world’s leading Android OEM these days, is still able to resist Microsoft’s Mafia-like tactics. Microsoft repeatedly failed to sign a patent deal.

The bottom line is, China has become a dangerous place patents-wise. Is that desirable to anyone but the patent microcosm? Of course not. █

Summary: Signs that the patent system is on the one hand improving, thanks to the Supreme Court of the United States (SCOTUS), but on the other hand it continues to deny choices in the market by altogether blocking products

THE Justices of SCOTUS may soon be ending patent trolls' business model, irrespective of patent scope restrictions (like Alice at SCOTUS), which USPTO barely cares to respect anyway (it’s left for courts to do the job that USPTO examiners fail to do). As one new article puts it: “In a move that may shake-up U.S. patent law, the Supreme Court this week decided to hear a case about where patent owners can file lawsuits—a case that will likely put an end to a special Texas cottage industry that has been a thorn in the side of big business.”

Not just “big business”. In fact, that mischaracterises the entire problem because big businesses can usually afford going to court where they challenge the trolls. Small businesses cannot afford to do this and they suffer the most, usually quietly (under gag orders/instructions upon settlement).

Who does the current patent law work for best if not big businesses? Merck recently got awarded 2.5 billion dollars in supposed 'damages' in one single case. Who lost this patent case? Poor people who will die as a result of lowered/no access to drugs. As a medical news site put it the other day: “A federal jury awarded $2.54 billion in royalties to Merck, which owns the patents that Gilead allegedly infringed upon to create its two blockbuster hep C drugs, Sovaldi and Harvoni.”

So Merck not only gets a lot of money but also maintains a monopoly that will enable Merck to further jack up prices. Who benefits from this?

Another item of news deals with the ITC‘s decision to block Arista products — a subject on which we wrote in the past [1, 2]. MIP says the following about the latest twist:

The ITC’s ruling, administered by Judge Mary Joan McNamara, found that Arista had imported into the US two components for routers and networking systems that infringe upon Cisco’s patents, in violation of Section 337 of the Tariff Act. Arista plans to request a full review by the Commission, according to its press release.

As we pointed out before, when denying sales of Arista products those who suffer the most are ordinary people, not just Arista employees (the smaller company). Getting the patent system in tune with or in alignment with public interests is crucial. Otherwise people will simply cease to respect patent law — in the same way (and for similar reasons) a lot of people already regard copyright law to be tilted in favour of conglomerates and non-producers. █

LITIGATION with USPTO patents is down. It is down pretty sharply and this gives ample room for hope. But it does not, however, mean we should take our eyes off the ball.

Patently-O, writing in another recent post, said that “Medgraph’s claims are directed to a set of methods “for improving and facilitating diagnosis and treatment of patients.” See U.S. Patent 5,974,124 and U.S. Patent 6,122,351. The problem is that the claims require actions by both the computer system and also a patient/doctor. This claim structure directly runs headlong into traditional requirement for direct infringement of a patent – that all steps of the claim be performed-by or attributable-to a single entity.”

What’s noteworthy here is the presence of a computer system. We previously wrote about a similar case at the EPO appeal boards (computer conjoined with “medical” and “device” so as to make it look/sound non-abstract and novel). Right now in Europe it’s said to be easier to get (and defend) software patents than it is in the post-Alice US. The judge in the above case, P. Corcoran, thankfully rejected the application. No wonder Battistelli hates the appeal boards so much and strives to destroy them (while still maintaining the appearance or perception he complies with the EPC).

In other news from around the Web, there are formal/procedural changes emanating from CAFC decisions. “A recent decision from the Federal Circuit recognises a privilege between non-attorneys patent-agents and their clients under certain conditions,” says MIP. “Philippe Signore reviews the limits of this patent agent privilege, as well as those of the attorney-client privilege, within the context of the discovery phase of a US litigation,” continues the summary, but the article is behind a paywall.

“Federal Rule of Civil Procedure 6 has,” according to this from Patently-O, “since it first allowed for service by electronic means [legal papers served by E-mail, as the EPO attempted to do to me], treated it like other means of service, adding 3 days to the deadline to respond (under some circumstances). It’s now been deleted from the types of service that give the extra there days.”

Writing about a CAFC case, Patently-O also mentioned that “Patent Nos. 6,107,851 and 6,249,876 were not anticipated and were directly and indirectly infringed by Fairchild and that Fairchild’s Patent No. 7,259,972 was not obvious and was infringed by Power Integrations under the doctrine of equivalents (but was not literally infringed or indirectly infringed by Power Integrations). The jury also found Power Integrations’ Patent No. 7,834,605 neither anticipated nor obvious. Following trial, the district court granted judgment as a matter of law that Fairchild directly infringed this patent. The district court granted a permanent injunction against Fairchild and declined to grant an inunction against Power Integrations.”

The term injunction is just a nicer word for embargo and when companies start banning/blocking each other’s products it’s clear who’s not winning: the public. █

Summary: In spite of repeated rejections of software patents by high courts in the United States, those who profit from such patents carry on as if nothing happened and even pay the former Director of the USPTO (David Kappos, pictured above) for lobbying

NOW THAT it’s publicly being stated that the EPO is more software patents-friendly than the USPTO (in spite of the ban; not that Battistelli minds any laws whatsoever) we thought it would be a good time to bring up this new press release that says “Samesurf [...] announces the issuance by the USPTO of five patents relating to co-browsing and synchronized browsing of online content: (1) US Patent No. 8,527,591; (2) US Patent No. 9,171,087; (3) US Patent No. 9,185,145; (4) US Patent No. 9,483,448; and (5) US Patent No. 9,489,353.”

These are of course software patents, so one has to wonder if the USPTO dealt with old applications as though the new rules (Section 101 and whatnot) don’t apply. Of course not, but something is rotten here and it’s very improbable that a high court would accept these patents upon closer examination. After Alice it barely matters if the USPTO puts some stamp on this stuff; courts and appeal boards would likely undo the stamp (it asked/petitioned to do so). So what is Samesurf bragging about really?

Suffice to say, the USPTO still wants to just grant a whole lot of nonsense. It makes the USPTO look “productive” and they probably just label it all “innovation”. Recall the latest echo chamber of the USPTO (not the first of its kind) that promotes software patents and excludes actual software developers. The patent microcosm, which opposes Alice (obviously!), publishes this new article, soon thereafter to be predictably promoted by proponents of software patents including IBM’s patent chief. To quote the key parts:

Section 101 patentability challenges of the 1970’s, in Benson and Flook, culminated in the Diamond v. Diehr decision of 1981, and the roughly contemporaneous Chakrabarty decision of 1980, set out an admirably broad ambit for patentability on the advent of the digital and biotechnological revolutions that have transformed our world these last 35 years. Coming as they did at the foundation of the Federal Circuit, these decisions reinforced a view that the US patent system was capable of broadly encompassing “anything under the sun that is made by man,” the Chakrabarty Court quoting the Senate Committee report on the 1952 Patent Act.

[...]

To address this situation through legislation, I suggest something along the lines of adding a straightforward sentence at the end of Section 101:

101. Inventions patentable. Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title. For purposes of this section, it is irrelevant whether the invention or any of its claimed elements, is otherwise unpatentable under sections 102, 103 or 112.

I believe something this simple, or its equivalent, accompanied by clear legislative history, could help undo so much of the new troubling jurisprudence that imports these other conditions of patentability at the outset, and restore 101 to the minimal, simple threshold for inventions of the useful arts to which it was always intended.

The patent microcosm is trying to change the law and even the former Director of the USPTO was recruited for this task. They just want more and more patents on everything and lower quality control, obviously.

Don’t lose sight of these people. Their malicious agenda is a detriment to software development. They don’t even develop any software. █

Summary: The United States sees a decline in litigious activity as Alice sets in and devalues software patents (which many frivolous patent lawsuits have been about)

THE chart above, produced and published without comment by Patently-O earlier today, helps confirm that litigation was (still is) down sharply this year. Good news for everyone but the patent microcosm and patent trolls, right? It does not yet make Crouch’s job irrelevant.

We previously remarked on this trend, based on similar data that demonstrated sharp decline in litigation. Many people attribute this to Alice and Mayo. █

“Small enterprises generally adopt a rather negative position towards the current increasing granting of patents for software and algorithms because they fear that these will hamper or eventually even impede their work (more than 85%).” —German Federal Ministry of Education and Research (BMBF), Study of the Innovation Performance of German Software Companies, 2006, p. 86

Summary: The US patent system helps discrimination against small businesses or family-owned businesses — a problem which is likely to exacerbate/deepen under the next administration

THE USPTO has long been run by people from big industry and big companies. Watch what David Kappos has turned into. It remains to be seen where Lee will go after her time at the Office (Trump will pursue her removal, with high level of certainty).

Timothy B. Lee, a critic of software patents for about a decade now, has this new article about Trump in which he says “Google [is] also advocating reforms to rein in low-quality software patents” (we wrote about this the other day). Here is the key part:

In recent years, Google and Microsoft have both been actively lobbying for patent reforms to rein in litigious patent trolls, with Google also advocating reforms to rein in low-quality software patents. Trump will not only choose a new director for the patent office, he will also have influence over patent reform legislation over the next four years.

What about the views of small companies? As many people have already pointed out, Trump seems to be giving his ears only to billionaires and companies that rake in billions. It’s oligarchy on steroids. And watch this truly terrible advice from a truly terrible news site that famously glorifies billionaires. Big corporations’ media is now misleading small businesses on software patents by saying:

Why Patents Should Be Part Of Every Startup’s Risk Mitigation Strategy

[...]

The debate over whether software should be patented goes back to the beginning of software, but a good example is looking back to when Microsoft was a young company with almost no patents. Now they are one of the most prolific patent filers.

Actually, to quote Microsoft’s chief at the time, “[i]f people had understood how patents would be granted when most of today’s ideas were invented, and had taken out patents, the industry would be at a complete standstill today.”

Gates, who actually said that, complained that patents were harmful to small companies (like his at the time). Why pretend that, as Forbes put it, “Perhaps somewhat surprisingly, companies in industries that are seeing some of the most rapid innovation — like software and tech companies, particularly those focused on content delivery — often ignore the problem and don’t focus on future risk mitigation until they have a problem, and the result can be costly” (they actually cite Watchtroll!!!).

What they mean by “risk mitigation” is pursing patents of their own. What a terrible advice.

See this new article titled “The biggest threats to the free web” whose first section is “Software Patents”. To quote:

No one can own the web, but many companies are attempting to slice it up and own the very concepts that form the web. Software patents, unlike standard patents for inventions, do not actually involve the creation of tangible objects. Instead the U.S. patent office has handed out patents for ideas like the double-click or the use of a single button to make a purchase.

While the European Union has taken a more aggressive stance against software patents, the U.S. is now entangled in them with major companies like Google and Apple battling it out through proxy lawsuits. One firm, Eolas Technologies, claims to own the patent for the “interactive web” and threatens to undermine the very freedom of the web itself.

As history shows, and basically throughout the whole history of patents, the system was used as a mechanism of protectionism. Large companies used it to keep small companies from being able (or allowed) to compete. Why pretend that any of this has changed? And moreover, why on Earth cite propaganda from Watchtroll in an effort to urge small companies to hop on the patent bandwagon? It is widely known that for small companies to read patents only makes them more vulnerable (willfulness of infringement), patent applications make them poorer and enforcement of patents against trolls is impossible; enforcing patents against giants like IBM is worse than stupid because IBM can then retaliate with far more patents, so it’s not hard to see who this system really serves (by design, by persistent lobbying). █

Summary: A glimpse at the latest news about patent trolls (bad news for them), especially as viewed through the lens of IAM, a network funded in part by patent trolls

THE US patent system, the USPTO, keeps tightening patent scope. It does so begrudgingly as it has no choice following a series of important (high-level) rulings on patents. Here is IAM, the voice of patent maximalists and trolls, moaning that “patent litigation in the US is on the way down, fuelled in part by the suffering in the NPE [read: troll] sector.” That would typically be a cause for celebration, but among IAM’s funding sources is what it euphemistically calls the “NPE sector”.

Curiously enough, for a change, IAM actually used the word “troll” in this article at the end of the week. That’s a big improvement. To quote: “The concept at the centre of the LOT Agreement is a fairly simple one; the network seeks to reduce patent risk by requiring its members to grant all other members a licence to any patents they transfer to “a patent troll, or a patent assertion entity (PAE)”. The LOT Agreement defines an entity as a patent troll or PAE if: “The entity (including its parent and any subsidiaries) generates more than half its total revenue from patent assertion in a 12-month period, or if the entity has a plan approved by senior management to do so.””

One noteworthy new article, published a few days ago, was titled “Why Tech Giants Should Be Wary of Patent Trolls” and here is the core part:

Patent troll companies research on new technologies, license them, then sell them to tech giants to use in their products for a royalty fee. Ceding the rights to use a given technology to develop various products can be tricky especially when it comes to interpreting the details of the agreement. The slightest deviation from agreed upon details of the contract can result in major patent infringements thereby leading to lawsuits.

As per this intellectual property lawyer, one of the main reasons why many tech giants end up infringing patents is down to misinterpretation of the contents of a patent. Just like the law, patents are subject to different interpretations (in terms of application and concept), and this is what often leads to lawsuits.

This is what patent trolls prey on. With lawsuits, they often receive more than what is worth the patent that has been infringed. In intellectual property, every piece of technology can have its own patent, which makes the situation even tougher for giant tech companies. This is because a single product could be composed of several technologies thereby requiring the permission to use an array of patents.

[...]

Tech giants should be wary of patent trolls because some of these companies are formed for one purpose – to extort money from companies that use their technologies as much as possible through different channels. A lawsuit is one of the most common after royalties.

Thankfully, as we noted here the other day, patent trolls are losing it all (new SCOTUS case imminent), so IAM, the trolls’ mouthpiece which they pay, spins it like this: “SCOTUS agrees to hear key venue case, but it may not lead to the result most expect” (IAM as contrarian for the trolls).

Compare to that Mike Masnick’s “Supreme Court Will Hear A Case That Could Finally Shut Down East Texas As The Patent Troll Mecca” and several more articles like that. IAM is the only site which at the moment takes the side of the trolls. █

Summary: Front groups or media companies associated with (and funded by) the patent microcosm drive the agenda which would ruin local companies for the sake of parasitic elements

B

attistelli is (unfortunately) European and he uses the laughing stock which the EPO has become to promote software patents in India (see our Indian angle on that, published earlier tonight). IAM, the EPO’s mouthpiece of choice, has just advertised IPBC India 2017, yet another IAM event (like those that are supported by the EPO and even funded by the EPO’s PR firm). One can bet they’ll push software patents in India pretty soon, having done so already from their site which is based in the UK. Battistelli, according to some very large British law firm, has made the EPO more friendly towards software patents than the USPTO is. In spite of the European ban on software patents! That’s how bad things have become! Mischief would be an understatement; “Corruption” might give us more legal threats from Team Battistelli.

“Battistelli, according to some very large British law firm, has made the EPO more friendly towards software patents than the USPTO is.”Meanwhile, over in the US, the President of IPO sent a letter (from December 9^th) that urged Trump to bring back software patents to the US. Under “Policy and Advocacy Experience” it says about Lee's successor at the USPTO, “The Director must be capable of effectively taking the international stage in WIPO, EPO, JPO, and in other international agencies, and advocating for U.S. positions on international IP matters.”

EPO and WIPO? Seriously? Both are human rights abusers that drive workers to suicide. As a software patents proponent put it, “Kevin Rhodes Sends Trump Transition Team Letter Describing Qualifications USPTO Dir.” Above is a screenshot of the two pages of the letter, in case Rhodes et al decide to remove it later (as often turns out to be the case, based on one’s latest agenda as epi serves to show).

If that Director “belongs to the family,” as Benjamin Henrion put it, then IPO will be happy. He didn’t mean family literally; hiring from one’s actual family is Battistelli’s French specialty [1, 2, 3, 4]. █

Summary: Rebuttal to some recent articles from sites of (and for) the patent microcosm, or the meta-industry which wants more and more patents (hence more and more litigation)

PATENTS are a two-edged sword and for patent lawyers it means double-dipping. They profit both from the plaintiff and the defendant, or the aggressor and the victim. When people speak of the benefits of patents they often neglect to mention the harms; only one group benefits irrespective of the outcome.

“When people speak of the benefits of patents they often neglect to mention the harms; only one group benefits irrespective of the outcome.”The US, at a national level, wanted so badly to use patents against China and now China is schooling them using their own weapon. As the trolls’ voice (IAM) puts it, “[f]or US patent owners, a key element of their China strategies could be about to get much harder” (I have also heard this personally from an old friend who pursued or at least explored the option as recently as months ago).

The patent strategy of the US is clearly not working. The US is killing its very own businesses — especially small (or local) businesses — and only a growing meta-industry benefits. Watchtroll, part of this meta-industry, is now attacking another politician who does not agree with him and his grubby, money-grabbing hands. We don’t want to entertain IAM or Watchtroll too much (they are the opposition’s voice), but we are hardly surprised by these posts of theirs that border on personal attacks, lobbying disguised as news, and shameless self promotion.

“As one can expect, patent law firms ignore all the decisions they don’t like, then amplify rare exceptions.”Speaking of shameless self promotion, in these times when it’s widely agreed that software patents have become a waste of time and money (after Alice in particular) law firms like Knobbe Martens Olson & Bear LLP don’t want us to know the facts and instead cherry-pick cases to construct a flawed narrative. Hunter Freeman and Seann Patrick Lahey from McNair Law Firm give tips for overcoming a de facto BAN on software patents. Imagine if they gave such tips in areas of criminal law, immigration, etc. (like ways to avoid prosecution for rape/murder). It’s surreal, yet it has become so banal. This banality is now so prevalent that we must not simply ignore it. Here is Morgan Lewis & Bockius LLP cherry-picking PTAB/CAFC cases. As one can expect, patent law firms ignore all the decisions they don’t like, then amplify rare exceptions. Why? To mislead prospective/existing clients. They fight an information war.

“Having been awarded a software patent in 2016 is no small achievement,” says this new press release as if software patents are likely to survive courts like the Court of Appeals for the Federal Circuit (CAFC).

In the “PTAB Litigation Blog”, a blog run by a self-serving firm rather than unbiased observers, more of the expected bias can be found this past week. “The PTAB Currently Places The Burden Of Proof For Claim Amendments On The Patent Owner,” it says (as should be, rightly so). Is there a problem with that?

“It’s typically a sign of one firm’s financial failure if not bankruptcy, resulting in re-employment elsewhere.”Baker Donelson, another person from the meta-industry, is downplaying PTAB IPRs that are being used to invalidate many thousands (by extrapolation) of software patents in the US. Curiously, based on Donelson’s link in his article (IAM-hosted), the author’s employer is being absorbed. “Baker Donelson will combine with the well-respected national law firm Ober|Kaler as of January 1, 2017,” it says. Yet another example of one legal firm collapsing onto another in the post-Alice era? We’re losing count. It’s typically a sign of one firm’s financial failure if not bankruptcy, resulting in re-employment elsewhere. Sustainability of such firms is declining, spurring a panic and frantic attacks on Obama’s patent policy.

Let it be understood that software patents are not potent and CAFC has done virtually nothing to stop PTAB from invalidating software patents even outside the courts. Let it also be clear that the meta-industry (or patent microcosm as it’s sometimes called) created a misleading picture and constructed a parallel reality in order to further its agenda and embellish its bottom line.

“The era of software patents is over and the only opportunity for a rebound might be Justices and USPTO Director appointments by Trump…”See this new report about Verint Systems Inc. v Red Box Recorders that says “Plaintiff Verint asserted six patents against Red Box (U.S. Patent Nos. 7,774,854, 5,790,798, 6,510,220, RE43,324, RE43,386, and 8,189,763) in the District Court for the Southern District of New York. Red Box rebutted, asserting that all claims were invalid under 35 U.S.C. § 101 due to being directed to patent-ineligible abstract ideas.”

That’s Alice and if it’s pursued all the way up to CAFC or SCOTUS expect all these patents to be thrown away. The era of software patents is over and the only opportunity for a rebound might be Justices and USPTO Director appointments by Trump, which is why the meta-industry already lobbies him so unbelievably hard (more on that in the next few posts). █

End of the road for the notorious patent mess that only law firms consistently profited from?

Summary: The US Supreme Court’s Justices may soon put an end to the business model or the modus operandi of patent trolls

AS WE NOTED earlier this week, the US is no longer a good environment in which to be a patent parasite. Watch what happened to Apple after the Supreme Court had intervened (yes, it’s still in the news!), not just to small parasites that are commonly known as patent trolls. It’s rather revealing and the numbers from a new paper of Lemley et al reaffirm the trend.

All those recent SCOTUS decisions with yet more decisions to come (e.g. Lexmark, which is also still in the news, courtesy of John C. Bacoch and William R. Boudreaux from Brinks Gilson & Lione and MIP’s Natalie Rahhal) serve to show that SCOTUS, in its current composition (Justices), is rather intolerant towards patent bullies.

The reforms in the US (regarding patents) seem to be working out and weeding out “Patent Trolls Central”, the Eastern District of Texas (EDTX). Here is how Patently-O has just put it: “Goodbye E.D.Texas as a Major Patent Venue”

The headline may be sensationalist and premature, but here is how Patently-O justifies it:

In a case with the potential to truly shake-up the current state of patent litigation, the Supreme Court has granted certiorari in the patent venue case TC Heartland v. Kraft Food (SCT Docket No. 16-341). An 8-0 reversal of the Federal Circuit is quite likely, although my headline is likely premature.

Michael Loney, writing from New York, has also just covered the subject:

Supreme CourtThe US Supreme Court has granted cert to TC Heartland v Kraft Food Brands Group. The court will review the Federal Circuit law that allows a high concentration of patent cases in one district.

We wrote about this case before and so has the EFF (many times). For the uninitiated, EDTX boasts courts that are intentionally tolerant of plaintiffs, software patents and trolls. That’s how they used to attract ‘business’ or ‘clients’ (parties being sued or suing) and that’s why many patent law firms are based (or relocated to) there. █