Summary: New trouble for Željko Topić in Strasbourg, making it yet another EPO Vice-President who is on shaky grounds and paving the way to managerial collapse/avalanche at the EPO

PRESIDENTIAL loyalists like Willy Minnoye (Vice-President of the European Patent Office), Ciaran McGinley and Lucy Neville-Rolfe are leaving and the Croatian gravy train (the 'Balkan Express') is close to crashing. We have received the following information from Croatia today. It looks plausible that one EPO Vice-President won’t just retire early but might actually end up behind bars like Ivo Josipović (former President of the Republic of Croatia). In the words of our source:

STRASBOURG – TWO CORRUPTION INDICTMENTS BROUGHT AGAINST ŽELJKO TOPIĆ

On 19 December 2016 the EU Court in Strasbourg received two indictments against Željko Topić, former Director General of the State Intellectual Property Office (SIPO) of the Republic of Croatia in Zagreb and currently the right hand of Benoit Battistelli at the European Patent Office (EPO) in Munich. The indictments include a number of offences in support of corruption committed by Željko Topić as an accountable person during his DG office at the SIPO in Croatia. Namely, due to inefficiency of the Croatian justice and the political protection provided to Željko Topić in the Republic of Croatia, especially by the State Attorney’s Office of the Republic of Croatia (DORH in Croatian) and the Office for the Suppression of Corruption and Organised Crime (USKOK in Croatian), after more than 8 years of investigation, a party to the proceedings made a decision to seek legal protection within the international frameworks at the EU Court in Strasbourg. At any rate, Croatia has not been declared one of the most corrupt countries in the world for no reason according to the latest Corruption Perceptions Index of Transparency International. The most tragic fact in the entire lengthy investigative proceedings in Croatia is that Željko Topić has never been called in for questioning by the police or the State Attorney’s Office. All this time Željko Topić has been receiving his pay from the EPO nonstop in the amount of EUR 18,000.- a month, and the parking space in the EPO car park in Munich has been adorned by his black Mercedes-Benz illegally appropriated from the SIPO in Zagreb, i.e. from the Republic of Croatia. The former President of the Republic of Croatia, Ivo Josipović, is listed as one of the potential political protectors of Mr. Topić. Using a possible criminal offence of influence peddling the former Croatian President has protected Željko Topić from criminal prosecution in investigative structures of the Republic of Croatia for a number of years for one reason only, which reason concerns the operation of the Croatian parafiscal musical association under the name of the Music Authors Rights Protection Office (ZAMP in Croatian). That is to say, by obstructing investigation and protecting Željko Topić the former Croatian President Ivo Josipović in fact has been protecting himself since there is a clear trail of corruption offences leading directly to him over the ZAMP and the SIPO. Moreover, the staffing of the SIPO of the Republic of Croatia is largely comprised of the ZAMP employees having disputable qualifications. The fear that Željko Topić might “squeal on him” during the investigation and the legal proceedings in fashion of the member of the Calabrian mafia has resulted in dropping of criminal charges against him, which in this particular case ended up in Strasbourg. The final act in this judicial play protecting the person and the action of corrupt Željko Topić was performed at the County Court in Zagreb and the Constitutional Court of the Republic of Croatia where the investigations against Topić were declared inadmissible. Therefore, and especially due to the unbearable stench of the judicial marshland, nobody in Croatia was surprised by the most recent statement given to the media by the new Minister of Interior saying that all judges of the Constitutional Court should hand in their resignations on account of corruption since they pose a direct threat to national security of the Republic of Croatia. In addition to the legal proceedings in Strasbourg, the party to the proceedings has also announced criminal prosecution against the leading persons in Croatian justice, and the DORH and the USKOK implicated in protection of Željko Topić. Those charges will also be brought in France, most probably at the Ministry of Justice in Albertville or Grenoble. Specifically, after Croatia joined the EU as a full Member State, the Croatian citizens also have a possibility to take criminal offences to courts beyond the Croatian borders. In conclusion, as learned off the record, there are at least 6 more criminal investigations carried out against Željko Topić in Croatia.

Yes, we already heard about those additional 6 criminal investigations against Željko Topić in Croatia. The man seems to be corrupt enough to match the job requirements of Battistelli and Bergot. And since he is so legally vulnerable they can probably better control him (e.g. by blackmail), too.

We shall post more information about the Strasbourg case in the coming days if not weeks.

The situation at the EPO is getting worse by the day. Published a few days ago by media in Luxembourg (looks like a French and German mix) was an article about the climate at the EPO. The purely automated translation (not edited) says:

The dispute between the President and the Suepo trade union, which represents the bulk of the 7,000-strong workforce, has been raging for more than five years. Minister Etienne Schneider is now responding to a parliamentary question by the LSAP deputies, Claudia Dall’Agnol.

The leadership style of President Benoît Battistelli, who took over this office in 2010, leads from escalation to escalation. Only recently did employees move through the streets of Munich and consulates. According to the statements of the trade unionists, Battistelli has for a long time sprawled the bow so far that the working climate is at its zero point. In the course of this year, three trade unionists from the Suepo were already set before the door. According to our information, the President has indicated very spurious causes of these cancellations, which are not to be attributed to the hair.

Full and accurate translation of the entire article will be appreciated. █

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. █

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. █

Justice Breyer was pro-Alice or in favour of what’s now known as the Alice test that eliminates many software patents

Summary: In an important upcoming patent case, gross abuse of patent laws for the support of dubious business models can finally be tackled

As we noted here the other day, a big decision on patents is afoot. Great printer manufacturers heist (monopoly on toner/cartridges) can be stopped by the Supremes, but the implications go beyond just printing as global trade is at stake. The case of Lexmark affects every company that produces printers and also every company that tries to enforce its patents — so as to defend a notorious business model — abroad. A lot of articles have been written about this in recent days, e.g. [1, 2, 3, 4, 5], and in the words of the National Law Journal, “Justice Stephen Breyer seemed persuaded on Tuesday that supplying a single component of a product for overseas assembly isn’t enough to trigger extraterritorial application of U.S. patent laws.”

Breyer has already come under attacks from the patent microcosm for his views on other domains of patenting and we defended him. In this case too, Breyer seems capable of recognising that patents need to justify themselves at a broader sense than just someone’s business model. We hope that Lexmark will lose this case. When you purchase a printer or a cartridge, than both should basically be treated as your properly and anything you do with them oughtn’t be artificially limited by patent law. This relates to a recent controversy — one which the EFF too got involved in — where HP basically artificially limited people’s printers (remotely even) given updates that induced a sort of physical DRM (machines or software refusing to take orders from their operator/owner, in spite of having the capacity to do so). █

–Laurent Prunier, EPO staff representative

Summary: The EPO’s kangaroo courts and farcical notion of justice should serve as a warning sign to anyone seeking patent justice at the EPO, either as partners/employees or stakeholders/applicants

THE EPO is a horrible, horrible place to work at. The staff survey speaks for itself and people who work for the EPO constantly remind us of the nature of the workplace, comparing it to being in the trenches.

The kangaroo courts of the EPO are some of the most jaw-dropping aspects of the EPO. Anyone can be accused of anything and so-called ‘evidence’ even fabricated or ‘sexed up’ in order to do whatever the egoistic President wants, making up for his insecurities and cluelessness by merely bullying people. We covered several examples of that over the past year. It’s not about one person. There are many victims and only few of them are courageous enough to go public.

President Battistelli believes he can be the accuser, the jury and a judge above the law (both national and international). He also acts a lot like an executioner, judging by the number of dismissal letters he sends out to people who represent staff (we might elaborate on this in some future series). Would EPO managers get away with murdering little girls because of the immunity they proudly claim inside Eponia? Read this new comment (posted today in relation to the EPO):

To: “Et sinon je reprendrais bien des croquettes”

When a drunken diplomat kills a little girl, immunity is upheld, but the diplomat is declared “persona non grata” and sent back to his or her country. The diplomat is then supposed to be judged there.

The Vienna convention was never designed so that diplomats can kill little girls with impunity. It was designed to protect, for example, USA diplomats to be judged for “anti-communist activities” in the former USSR.

In the case of International organisations, however, I am not really sure how the “persona non grata” concept is supposed to apply.

The above continues with more direct statements rather than hypothetical analogies:

Something else.

It has been 3 months since the Enlarged Board published that the EPO President violated judicial independence and nothing has happened. This is outrageous.

There is also the subject of the frivolity of the accusations. The board of appeal member who is the subject of the decision did, as far as I can tell from the available documents, nothing wrong. The accusations were downright ridiculous: having “objects which can be constructed as weapons” and “nazi memorabilia”. The exact wording at the time fails me, but it really sounded as if they combed his office and found nothing but a pocket knife and an history book to frame him.

This is also absolutely outrageous. It looks like the so called “investigation team”, even with major breaches of confidentiality (they bugged the computers used by the Council themselves, remember?) could not find anything serious and yet the board member is still guilty. Of what?

Next, we have had members of Suepo dismissed for, apparently, also nothing. Pure “coincidence”, according to a vice-president. Apparently, a few more will be dismissed soon.

As it was said on German TV: this is “Gantanamo auf Deutschem Boden”. How long will this scandal last?

From what we understand, it was sports equipment (a club), not a knife. It’s amazing how far Battistelli would go to get his way… we can also envision Parallel Construction being used to entrap or perhaps wrongly/falsely accuse the person, who in principle enjoys complete independence from the Office of Battistelli (evidently not in practice, especially when the Council and the Board of Mr. Kongstad become lapdogs rather than watchdogs of Battistelli).

The comment above is interesting and it is new. It’s a comment to which one person replied with a famous saying: “For evil to prevail it is only necessary that good men do nothing …”

I agree. There is a moral duty here. All my coverage regarding the EPO was done for zero financial gain. It’s just the right thing to do.

Another person said this:

The original accusation was that the member of the board of appeal used the public computers of the Office to spread “defamatory” material on VP3 – the weapons and nazi memorabilia were conveniently found later in his office and used for a classical case of character assassination.

To further reinforce the narrative about defamation, VP3 sued the member of the board of appeal for in a German court – you may have read the outcome above (28/09): it appears that the Procurator dismissed the case recently.

How long will this scandal last?

Scandal? Who says this is a “scandal” – you? And what about Newspapers, Lawyers, Judges, the IP world? Did you see any reaction from them? Because I didn’t. Therefore, it’s not a scandal. The Administrative Council is acting like this is totally normal. No scandal here.

If you wanna a scandal read TMZ.

The corporate media — and even so-called ‘IP’ media for that matter (we put IP in scare quotes because it’s a vague term that can refer to a plethora of entirely different things, not necessarily patents) — aids the EPO’s abuses by a conspiracy of silence and indifference. We spoke to some people from within this media and we know how and why they are gagged regarding the EPO. We think that a lot of so-called ‘IP’ media wants to just receive prepared ‘articles’ or advertise in ‘article’ form for the EPO, not engage in actual journalism. We recently covered examples from two major 'IP' media sites. Don’t expect them to cover the EPO scandals because they’re not designed or equipped for that. It’s just not their business model.

“Something is not just rotten at Eponia. Rotten is far too gentle a term and we intend to dig as deep as necessary to show what the EPO has truly become.”“Isn’t that just the point,” asked another new commenter (clustered deep inside an article from June at IP Kat, as the site no longer covers the scandals, just promotes the UPC for Battistelli). “The EPO’s immunity is designed to protect French Enarques from being pursued for “anti-union activities” on the territory of EPOnia. I see no incompatibility with the aims of the Vienna Convention …”

Tomorrow we shall continues our series about Mr. Kongstad. There will be a total of (by our estimation) nearly 10 parts.

Something is not just rotten at Eponia. Rotten is far too gentle a term and we intend to dig as deep as necessary to show what the EPO has truly become. █

Reference: Impunity

Summary: Impunity at the EPO, a subject of growing fury inside and outside the EPO, is revisited in light of the expectation that Dutch courts won’t hold the EPO accountable, and Board 28 quit caring about the crisis which it itself had admitted

THE EPO is a politically-connected or politically-infiltrated institution. No wonder it’s so abusive. We are going to provide evidence of it in the coming week. The politician/President Battistelli has a 0% approval rating at the EPO, much like politicians (they too have low degrees of public trust). The Board (28) and the Council, who are complicit and largely supportive of Battistelli, are also politically-connected and despite admitting there is "a crisis" at the EPO they do nothing to address it. The Board (28), for example, shows no intent to kick Benoît Battistelli out any time soon. Combine all this with immunity from the outside and what we have is a rogue entity totally above the law, including international law. See our prior (first) post about it. It’s unthinkable that such a thing can be tolerated in the so-called ‘developed’ world.

It does not look like SUEPO is likely to resolve the issue on its own. Here’s a recent new comment (correcting an error):

Obviously, it should have been “and a decision in favour of SUEPO in January look improbable.”

Sorry for that.

This was said in relation to the Dutch “AG [who] forgets that the immunity of the EPO is not absolute according to the PPI,” to quote this other new comment:

Well, IMHO the AG forgets that the immunity of the EPO is not absolute according to the PPI.
It is limited to “within the scope of its official activities” (Art 3 PPI).
Seeing the the EPO is continuoisly violating the PPI (by refusing any negotiations under Art. 20(2)PPI), where does the “scope” of official duties end?
Art 3(4) gives a hint:
(4)
The official activities of the Organisation shall, for the purposes of this Protocol, be such as are strictly necessary for its administrative and technical operation, as set out in the Convention.
Anything outside of the convention is not falling under immunities… And anything in implementing regulations, or other secondary law, is too easily amended, and can therefore not be protected by the claimed immunity grom everything.

There larger issue working against SUEPO is the requirement of the Office not being allowed to be put under restraints in one site, but not in the others. And the Dutch courts jurisdiction does not extend to Munich and Berlin and Bruxelles and Vienna……
Immunity might not be given, but a decision against the EPO may be refused under this requirement.

There is another new comment on the current situation and it makes it clear that people are very much disturbed by the situation at the EPO. We also saw some reactions — some of them quite strongly worded — in sites like Twitter. What the AG has said infuriates some EPO insiders. They’re almost at a loss for words, except very strong words.

We have spent some time researching the potential causes of the immunity of the Office and the Organisation. Some people looked into the family background of Battistelli and also the secret life of Kongstad. In the run-up to the next big meeting we are going to reveal to readers some of our findings. █

Summary: A struggle brewing between the patent ‘industry’ (profiting from irrational saturation) and the highest US court, as well as the Government Accountability Office (GAO)

The Supreme Court in the US (SCOTUS) has contributed a lot to woes for patent lawyers and a relief to software developers. It is abundantly clear that Mayo and Alice are being taken quite seriously by lower courts, especially the Court of Appeals for the Federal Circuit (CAFC).

“In short, this is just self-serving USPTO propaganda, serving perhaps to distract from the recent GAO report which chastised the USPTO for patent maximalism.”It is not hard to see that patent lawyers are frightened and mortified by SCOTUS and CAFC, both of which have been limiting patent scope more so than district courts and the USPTO (trying to just maximise its own income rather than provide a service^*). Design patents may be next to be axed by the US Supreme Court, as we noted earlier this year (in summertime) and various maximalists of patents speak about it, including Watchtroll [1, 2] (the Kool-Aid of patent law firms if not somewhat of a lobbying site).

“USPTO publishes new estimates of “IP-Intensive” industries, spin results,” according to KEI (very good Web site by the way). “We have seen same spin in Europe,” Benjamin Henrion wrote. To quote all the key points about this think tank-esque activity:

USPTO has just published its new estimates of “IP-intensive” jobs for the US economy. The report is titled: Intellectual Property and the U.S. Economy: 2016 Update, and is available as a PDF file here. USPTO press release here:

I took a quick look at the report, and below are some initial bullet points:

1. In the new USPTO study of “IP-intensive” jobs, 85 percent are included because of trademarks.

2. Just 14 percent of the “IP-intensive” jobs involve patents.

3. 20 percent of so called “IP-intensive” jobs involve copyright industries.

4. Just 2 percent of the “IP-intensive” jobs involving patents are in the pharmaceuticals sector.

5. According to USPTO, less than 1 percent of all “IP-intensive” jobs are in the pharmaceutical sector.

6. USPTO’s top three “IP-intensive” industries are:

Grocery stores: 2.6 million jobs
Computer systems design: 1.8 million jobs
Management consulting: 1.4 million jobs

7. According to USPTO, a “majority of patenting firms are in the services and wholesale sectors.”

8. According to USPTO, the “Sound recording Industries” only provide 23.5 thousand jobs which is 0.0008 of all “ip-intensive” jobs.

9 Almost none of USPTO’s copyright sector jobs benefit from long copyright terms.

In short, this is just self-serving USPTO propaganda, serving perhaps to distract from the recent GAO report which chastised the USPTO for patent maximalism. Our next post will look more closely at the software patents lobby. █
___
^* This new blog post from a patent maximalist (and longtime proponent of software patents for Bristows) says that there is “presumption of validity under US patent law,” but patent validity for pre-Alice patents is a joke because USPTO approved almost every application and by some standards it's estimated that as much as 92% of applications eventually led to a grant. To quote the maximalist, writing about ChIPs Global Summit: “The panel also noted that the presumption of validity under US patent law assists the patentee in showing that they have something of real value and that the burden of proving that the patent is invalid falls on the other side. However, in reality if we took a poll, many would comment that there are a lot of weak patents out there. It was suggested that perhaps the focus therefore should be on patent quality so that the presumption of validity and the standard of evidence to rebut that presumption (clear and convincing) is actually appropriate. Just because a patent has survived one patent challenge does not mean that the patent is necessarily stronger. If the patent has survived a challenge in front of a really good judge, then the panel noted that that may deter opponents. However, in reality, that decision is not binding on anyone who is not party to that case. Those parties will try a different tactic before different judges in a different forum. This is of course correct – it is not fair to an absent party to be faced with the bias of a decision in a case they had no right to participate in. There cannot be a time bar for bringing a challenge to a patent in district court as potential litigants and controversy may not be in existence at the time of the first action.”

Summary: Decisions against software patents continue to be ignored or intentionally overlooked by patent law firms, which instead saturate the media with the few cases where courts unexpectedly rule in favour of software patents

LAST week we said that the patent microcosm would start amplifying (repeatedly mentioning and hyping up) McRO for software patents agenda [1, 2, 3]. We have since then seen several dozens of so-called ‘analyses’ from the patent microcosm (these drown out actual press articles) and just like with Enfish, this can on for weeks (here are some of the latest examples [1, 2, 3]). It’s not hard to see what patent law firms are trying to accomplish; they want more power for themselves at the expense of everybody else.

“It’s not hard to see what patent law firms are trying to accomplish; they want more power for themselves at the expense of everybody else.”The Eastern District of Michigan (not Texas) has just had a court foolishly accept a software patent. To quote the patent lawyers’ media: “Bruce Zak, an individual, sued Facebook, Inc. for patent infringement in the U.S. District Court for the Eastern District of Michigan on two of his software patents — United States Patent Nos. 8,713,134 and 9,141,720. Facebook moved for summary judgment arguing that the subject matter of the two patents is not eligible for patent protection under § 101. The District Court denied Facebook’s motion for summary judgment even though the representative claim was found to be directed to an abstract idea, since the claim was further found to recite enough details to specify how a solution will be implemented that addresses a business challenge particular to the Internet.”

Facebook itself has been stockpiling and suing with software patents as well.

In other news, trolls in the Eastern District of Texas (we mentioned this before because Acacia is involved) got some money out of Apple. As MIP put it: “A jury in the Eastern District of Texas has found Apple willfully infringed a wireless technology patent, and awarded $22.1 million to Acacia subsidiary Cellular Communications Equipment. The case is before Judge Nicole Mitchell.”

“Facebook itself has been stockpiling and suing with software patents as well.”Don’t sob for Apple. As Daniel Nazer (EFF) shows this week (see image), “Apple has applied for a utility patent on a white paper bag. Here, in its entirety, is Claim 1 of the application…”

And speaking of Apple, here we have CAFC interfering in PTAB matters, in order to help Apple in “patent bully” mode with its software patents. To quote this short report from Patently-O: “In a divided opinion, the Federal Circuit has sided with Apple Inc. and reversed the Patent Trial & Appeal Board (PTAB) — finding that no substantial evidence supported the USPTO’s factual findings regarding what was taught by the prior art. Application No. 11/968,067 (2007 priority date). The application here is one of 75+ that all claim priority to the same 2007 provisional application.”

“The patent microcosm tries hard to restore the potency of software patents and we oughtn’t lose sight of that.”Patently-O published another new post about CAFC, this one about Yeda Research v Abbott. “On appeal,” explained Patently-O, “the Federal Circuit ruled that the original disclosure “inherently discloses the remaining amino acids in the N-terminus sequence” and therefore “serves as adequate written description support for the patent claiming TBP-II.””

The Court of Appeals for the Federal Circuit (CAFC) has generally been more vigilant and strict after Alice, but historically it was very lax/lenient, especially when it comes to software patents. Therefore, it’s worth keeping abreast of what it does, especially after the McRO decision. There is enormous pressure being put on SCOTUS (or Section 101), CAFC, PTAB and even US Congress. The patent microcosm tries hard to restore the potency of software patents and we oughtn’t lose sight of that. █

Summary: Increasingly desperate to convince people to pursue software patents and/or use their software patents to initiate growingly risky lawsuits (high risk of losing), the patent microcosm hugs McRO v Namco while distorting the complete record of the Court of Appeals for the Federal Circuit (CAFC) on this subject

WITH patent quality still a huge problem at the USPTO, as we last noted in our previous post, it’s only expected that many invalid software patents remain inside the system, probably hundreds of thousands of them (some have expired by now and will thus never be invalidated).

After Alice (2014 decision by the Supremes) a lot of software patents essentially became invalid, but only upon reassessment/assertion/challenge/appeal. The Court of Appeals for the Federal Circuit (CAFC), quite notably, finds them invalid about 80%-90% of the time. CAFC is where software patents typically come to die (the question has not returned to the Supreme Court since 2014). There’s rarely a chance for appeal after that, maybe just a referral or some other extraordinary circumstances.

“They’re most upset at (and growingly vicious against) PTAB because it reverses decisions to grant (post-grant) at a very high rate and at a low cost (to the petitioner/appellant).”Patent lawyers are rightly upset (from their point of view that is hinged on profits from legal fees) at the Supremes for ‘interfering’ with the patenting of software. They are also upset at CAFC for invaliding so many software patents. They’re most upset at (and growingly vicious against) PTAB because it reverses decisions to grant (post-grant) at a very high rate and at a low cost (to the petitioner/appellant).

How do patent law firms respond to the current situation? Simple! They lie. They cherry-pick, they spread half-truths, they insult judges, they shame or block other people (yours truly included), and they generally show their true selfish selves. I have spent years writing about this and I saw how bad this can get. These people are not friends of investors and inventors. They’re leeches. They just try to come across as professional, objective, and law-abiding.

Last week we wrote several articles about McRO v Namco noting (quite correctly as it turned out) that patent law firms would start another Enfish-like extravaganza in the press. They latch onto this decision in an effort to market themselves and mislead the public (potential clients). Here, in one of their blogs, the predators are trying to take down the Supreme Court’s decision on Alice. Section 101 is named as though it’s a nuisance that needs to be removed. Here is one of the predators saying that he is “not sure CAFC using “preemption” in same way envisioned by SCOTUS in Alice-MCRO seems more like “passes step 2″ case” (refers to steps in the law).

“They just try to come across as professional, objective, and law-abiding.”An ‘article’ or ‘analysis’ (really marketing/self promotion) by Joel Bock, David Metzger, andEric Sophir of Dentons says “McRo decision gives software/computer-based patents a big boost,” but that’s pure sensationalism. This headline is wishful thinking nonsense as it ignores ~90% of CAFC’s decisions on the subject. How convenient…

Where were sites like these each time CAFC ruled AGAINST software patents? Don’t believe patent lawyers who say software patents in the US are suddenly fine. For those who think it’s just an isolated article or few articles, see also [1, 2, 3, 4, 5, 6, 6, 7, 8, 9, 10, 11, 12]. We don’t have time to rebut each of these individually, but what we have here is rigged “media” of lawyers. Over 20 articles have been produced about a CAFC decision in favour of software patents and usually there are zero or very few about decisions against software patents. “Liars” might not be the right word to describe the authors by; they’re just opportunistic and they are selectively covering things so as to promote software patents under the guise of ‘analysis’. We saw this many times before and provided evidence of it.

“Don’t believe patent lawyers who say software patents in the US are suddenly fine.”Noteworthy is the fact that the legal firm which fought for software patents here is the same firm that works for Microsoft (on patents) and the EPO hired to bully me (Mishcon de Reya). Here is their press release about it. They are clearly hostile towards people like me, for at least 3 reasons (EPO pays them to send me threatening legal letters, Microsoft pays them to fight on the patent front, and they are working to defend software patents). Speaking of Microsoft, the company still says it “loves Linux” but it also loves software patents which are inherently not compatible with Linux. Here is yet another ‘article’ (from a Microsoft advocacy site) showing that Microsoft celebrates the above decision. We gave another example of this several days ago. The intersection of interests here is uncanny.

What did Watchtroll say about all this? We mentioned some of his responses before (widely-cited by others in the patent microcosm on the face of it), but now there’s more on other subjects [1, 2], still advancing a patent maximalism agenda (as if limiting patent scope is a sin).

Proponents of software patents, including those who track the impact of Alice closely, latch onto this one single decision in favour of a software patent while mostly ignoring the rest.

IAM’s writers, longtime propagandists of software patents and PTAB bashers, carry on passing off agenda as 'news', this time with the headline “After the CAFC’s Planet Blue decision early Alice motions may now fade away” (citing only the patent microcosm, e.g. a partner in New York-based firm Kroub Silbersher & Kolmykov).

“Proponents of software patents, including those who track the impact of Alice closely, latch onto this one single decision in favour of a software patent while mostly ignoring the rest.”We are still waiting for IAM to give a platform not just to patent lawyers who profit from software patents but actual programmers. Not that it ever happens…

“In the following piece,” IAM wrote, “Silbersher argues that the true significance of the case is not what it says about software patentability, but in the way it may affect how and when courts handle motions to dismiss based on the Supreme Court’s Alice decision. Read with the earlier CAFC judgments in Enfish and Bascom, Silbersher states, Alice motions at the front end of a litigation are set to become significantly less attractive. For patent owners, that is very good news.”

That’s just another example of lawyers name-dropping Enfish and Bascom, hoping that readers will pay attention to none of the other decisions (all against software patents as of late). This isn’t reporting, it’s lobbying.

Speaking of lobbying, David Kappos rears his ugly head again. He was hired by large corporations including IBM (his former employer) to help demolish Section 101 and “IBM’s Chief Patent Counsel Manny Schecter welcomed the McRO decision,” according to the above. Indeed, based on his tweet, IBM is still against the Supreme Court and for software patents. Benjamin Henrion told him that “freedom of programming is a one liner.”

“How far will the patent lawyers go in their attempt to save software patents?”The software patents proponents of IBM, a huge patent bully, are at it again. They just don’t seem to care what the Supremes say. Here comes IAM trying to shoot down Section 101 at a legislative level. To quote: “Of course, the likes of former Chief Judge Michel would argue that the fundamental test that the court is trying to apply to determine whether something is patent eligible remains inherently flawed. But as the case law on 101 as it applies to software begins to mount from the Federal Circuit, members of the tech community can at least rest a little easier that question marks no longer hang over large parts of their patent portfolios. If nothing else, that is to be welcomed.”

IAM says that “members of the tech community can at least rest a little easier” with software patents, but that’s a lie because technical people dislike these. Reading IAM about patents is like watching Fox ‘news’ coverage of all things Obama. It’s just agenda disguised/dressed up as news. It’s agenda presented in the form of ‘news’, and truly a great service to Battistelli when he needs to support some lies of his.

Watch the patent microcosm trying to resurrect software patents by trashing the Supreme Court [1, 2] in light of the above. It’s like that pack of hyenas we wrote about a week ago. How far will the patent lawyers go in their attempt to save software patents?

“Is the Technology for Self-Driving Cars Patent-Eligible?”

“Had the USPTO never granted these software patents, all these efforts, time and money (going into the pockets of patent law firms) would be spared.”That’s the headline of this new ‘analysis’ from the patent microcosm, writing about software patents that are disguised as 'device' (cars), prior art being the driver. The answer is probably no; no for the courts but yes for the USPTO, which continues to grant almost everything that comes in, irrespective of quality, scope, prior art, etc. The examiners cheat on their timesheets (defrauding taxpayers), so shoddy work seems to be the norm. Here we have an article about Goldman Sachs filing for software patents on electronic payments — the one area where the invalidation rate of software patents is extremely high (around 90% of patents invalidated). Blockstream says it is pursuing patents in this area/domain, but it has not got any. Patent examiners oughtn’t grant any, either (citing the CLS Bank case).

Elsewhere in the news we find this short docker report about a case in the court of choice of patent trolls, one of several in the Eastern District of Texas. It upholds software patents, as usual, probably because it’s a farce of a court and it likes to brag about being friendly to the plaintiffs, especially trolls. Upon appeal, and if it reaches CAFC (expensive), the patent would probably be invalidated. This can be a rather traumatic experience to people who thought they had earned valid patents from the USPTO. Take the case of Keith Raniere; he used several software patents for frivolous litigation and got penalised very badly for it, as we noted earlier this month. Another new report about it says: “The plaintiff, Keith Raniere, filed the suit in February 2015 against AT&T and Microsoft, alleging the companies were using a number of his patents for intelligent switching systems for voice and data. In his lawsuit, Raniere claimed that AT&T used the software patents in its AT&T Connect service and Microsoft used the patents in its Lync 2010 products. [...] Following dismissal, both AT&T and Microsoft filed a motion to have their attorney fees covered by Raniere. AT&T requested that $935,300 be paid by the plaintiff and Microsoft presented $202,000 in costs and fees to be covered. Lynn requested both parties present proof of the costs and fees incurred from the case and denied Raniere any chance to correct or modify his lawsuit.”

Had the USPTO never granted these software patents, all these efforts, time and money (going into the pockets of patent law firms) would be spared. But therein lies the key point. The greater the mess, the more profit the patent microcosm makes. This isn’t only a US problem but a European one too (see all the UPC lobbying).

“The greater the mess, the more profit the patent microcosm makes.”We previously wrote about software patents in Australia (they sort of exist). This new post from the patent microcosm says: “The expansive approach of NRDC was subsequently relied upon by the Federal Court in 1991 to establish that computer programs were not excluded from patent eligibility under Australian law, a decision that effectively opened the gates for software patents in Australia.”

As we wrote about this before, we can safely say that Australian software developers are upset by that. They never wanted such patents; it’s the patent microcosm that did (while trying to convince developers that they too need software patents). █

Summary: New evidence suggests that software patents continue their plunge in the United States and those who make money from software patents cannot help shooting the messengers (in the media) and smearing those who simply do their job by applying the criteria agreed upon by the US Supreme Court

TECHRIGHTS has been watching very closely matters pertaining to software patents for about a decade (I’ve watched them much longer than that, predating this site’s existence). After so much activism we finally see tremendous progress; they’re dropping like flies and litigation involving software patents is so uncertain (for the plaintiff who takes a huge risk) that numbers indicate a sharp decline if not dampening. Only a fool would spend money pursuing new software patents; reckless patent holders would dare have them subjected to scrutiny by a court (the higher the court, the higher the risk, thus suing deep-pocketed players is riskiest).

“The number of some types of software patent lawsuits in the US has taken a nosedive since the 2014 decision in Alice v CLS Bank.”
      –WIPRthe numbers are on our side. As WIPR put it the other day (note the use of the word nosedive): “The number of some types of software patent lawsuits in the US has taken a nosedive since the 2014 decision in Alice v CLS Bank.

“This is the finding of Patexia, an online patent research platform, which reported that software patent suits have declined heavily, although the fall was not equal across all software patent classification codes.

“Patexia identified 14 different US classes that describe some sort of software-related system or process.

“Patexia identified 14 different US classes that describe some sort of software-related system or process.”
      –WIPR“These classes covered more than 14% of the 22,791 unique patents involved in patent suits from 2010 through to the first half of 2016.”

We are pleased to see that even insiders, such as Patexia, recognise the trend and write about it. Patent law firms prefer not to talk about it because it discourages their clients (or prospective/possible clients). Writing for “Canadian Lawyer Magazine”, one person gave 10 reasons you need a Canadian Lawyer (the real headline is “Ten reasons you need a Canadian patent”). This is an example of marketing/advertising in the form of an “article”. To quote from this — cough — article: “You may have heard that it’s not worthwhile to patent your company’s technology in Canada, with its smaller market, its conservative judicial remedies and its skepticism toward software-based patents.”

Well, recall i4i v Microsoft (Canadian company) and how things worked out [1, 2, 3, 4, 5]. They pretty much risked going out of business after wasting years in court bickering over software patents. They still have a Web site which is active (last news item was a week ago), but we have not seen them in the media for literally more than half a decade. Recently, another Canadian company chose to turn into a patent troll down in Texas. This failing company, falling back on its patents, is Blackberry. How has it worked out so far? Any better than Nokia, which is still arming patent trolls in pursuit of cash? A lot of these patents are totally worthless, more so after Alice (Nokia — or Symbian at the time — had a famous software patent case in the UK nearly a decade ago).

“A lot of these patents are totally worthless, more so after Alice (Nokia — or Symbian at the time — had a famous software patent case in the UK nearly a decade ago).”Lexology, a site for lawyers, has just reposted (verbatim) an analysis from Fenwick & West LLP. It’s an analysis which we mentioned and also cited here the other day, showing a trend of invalidation of software patents in the US. It’s not looking good for software patents and it’s not getting any better, irrespective of what patent law firms are trying to tell us (by blatantly selective coverage of events or overt cherry-picking).

Dealing with a particular CAFC case, a pro-software patents propaganda site (for a long time) says it’s “keenly awaited” (by the vultures maybe) and that it relates to Alice. Expect it to change nothing at all, even if it somehow ends up in favour of a software patent (like in Enfish). CAFC rules against software patents around 90% of the time, so there’s probably no more of Enfish in the pipeline. Two years and about 3 months after Alice it’s effectively the end of software patents in the United States. Wait and watch how patent law firms (and their media mouthpieces) continue to deny this, hoping to convince the readers (or clients) that all is “business as usual…”

It’s not.

“It’s not looking good for software patents and it’s not getting any better, irrespective of what patent law firms are trying to tell us (by blatantly selective coverage of events or overt cherry-picking)”When pro-software patents propaganda Web sites want to undermine the importance/relevance of Alice they typically resort to insulting those who apply Alice (even judges are insulted!). To quote IAM: “In December last year the Court of Appeals for the Federal Circuit heard oral arguments in McRO Inc., DBA Planet Blue v Bandai Namco Games America et al, a case that many, particularly in the software industry, hoped would bring some much needed clarity to the issue of subject matter eligibility.”

Nonsense. It has nothing to do with clarify, that’s just what lobbyists for software patents — people like David Kappos — like to say while they simply object to Alice and the Justices at the Supreme Court. Oh, the vanity!

To quote further from IAM: “As with any 101 case, in the McRO suit there’s not only the matter of the law but also of the Federal Circuit’s complicated relationship with the Supreme Court. A string of decisions from SCOTUS, which have reversed the lower court, has helped create much of the uncertainty around patent eligible subject matter. According to former CAFC Chief Judge, Paul Michel, the stark divisions that have clearly arisen between members of the judiciary, might be the reason for the delay in the McRO decision.”

“When pro-software patents propaganda Web sites want to undermine the importance/relevance of Alice they typically resort to insulting those who apply Alice (even judges are insulted!).”That’s another pattern of FUD we have come across. Proponents of software patents like to scandalise the status quo and pretend there is a fight — if not actually ignite one — between different divisions, courts, boards, etc. It’s typically a fictitious framing that seeks to discredit the system and shake/destablise Alice, making it seem too “controversial” a decision to refer to/cite as precedent.

These software patents proponents, usually patent law firms that never wrote any software, are actively trying to undermine the US Supreme Court. Shame on them for doing that. Watchtroll, with its big mouth, is attacking PTAB again (it won’t stop until they’re gone). They’re like a gang of hyenas. Writing about PTAB, MIP has two more articles on the latest trends. One is titled “Don’t Estop Me Now” and the latter is a subtle attempt to discredit PTAB by associating it with “patent trolls” (again, total fiction!). Making money by trashing patents granted in error by the USPTO (for quick monetary gains) does not make one a “patent troll” and it has nothing whatsoever to do with the definition of “patent troll”. Watch this headline, “Hedge funds and reverse patent trolls” (nothing to do with trolls).

“These software patents proponents, usually patent law firms that never wrote any software, are actively trying to undermine the US Supreme Court.”To quote MIP: “A big story last year was the emergence of hedge funds and other entities using the Patent Trial and Appeal Board. While Kyle Bass is seeing his IPRs through to final decision, other entities are acting as reverse patent trolls, a phenomenon that is predicted to gather pace” (again, nothing to do with trolls and probably a good thing that will compel the USPTO to do its job properly).

Patent lawyers and their mouthpieces reject the term "patent troll" (denying such a problem exists, a lot like those denying global warming), but suddenly, when someone kills bad patents, then they adopt the term and call the actors that. How pathetic and self-serving. Fish & Richardson P.C., which represents patent trolls, pretends patent trolling is all just a myth (published almost a decade ago, but revisited now via Patent Buddy, who is a pro-software patents attorney). To quote the author from Fish & Richardson: “A new breed of companies has emerged, and they are being called patent trolls. A patent troll is a person or entity who acquires ownership of a patent without the intention of actually using it to produce a product. Instead, it licenses the technology to an entity that will incorporate the patent into a product, or it sues an entity it believes has already incorporated the technology in a product without permission. The government, corporate America, and the media are fervently acting against these trolls. New proposed legislation, a blizzard of Supreme Court cases involving trolls, and endless newspaper and magazine articles are all trumpeting the same story line: Patent trolls are bad for society and must be stopped.”

Well, that is very different from those who use IPRs at PTAB to correct the USPTO’s errors (spurious granting of patents). But this kind of distortion of terminology certainly would not bother those with dishonest agenda.

“Put another way, they’re protesting against PTAB because to them — the patent microcosm — less litigation would be a corporate disaster (litigation is their most expensive product, whether as defendants or plaintiffs).”AIA (Leahy-Smith America Invents Act) gave us PTAB, which demolishes software patents by the thousands, so now it’s considered “trolling” to apply quality control to patents and prevent these from going to court? Here is a new Bloomberg piece (titled “Five Years In: The AIA’s Effects on Patent Litigation (Perspective)”) in which it’s stated upfront that “The authors are IP lawyers at a large law firm.” The article is by Daniel Zeilberger, Michael Stramiello, Joseph Palys, and Naveen Modi from Paul Hastings LLP. Their conclusion is as follows: “AIA-created post-grant proceedings are changing the landscape of patent litigation. Complaints and declaratory judgment actions are down. Potential cost savings for accused infringers are huge. And PTAB outcomes historically disfavor patent owners, who have appeared willing to settle a large percentage of disputes. It remains to be seen whether these trends will continue as PTAB practice evolves, guided by an expanding body of caselaw and potential legislative tweaks.”

Put another way, they’re protesting against PTAB because to them — the patent microcosm — less litigation would be a corporate disaster (litigation is their most expensive product, whether as defendants or plaintiffs). They might actually have to find another job — one in which they produce something other than paperwork for monopoly and litigation. One thing we have noticed is, the authors of pro-software patenting pieces are sometimes choosing to write anonymously. Apparently they’re too shamed of their self-serving lies that they want to hide behind pseudonyms or no name/s at all.

Expect more attacks on PTAB (which needs to be defended from them) and expect a lot more attacks on Alice. These attacks typically come from patent bullies, their lobbyists, and their law firms. “A decade of court decisions has shaken the basis of patent law,” says this new article, sending across the message that this is terrible news when fewer cases go to court. To quote:

Earlier this summer, the U.S. Supreme Court made it easier for patent holders to seek larger damage awards when their patents are infringed.

For patent watchers, however, the high court’s ruling was only just the latest in a particularly active decade of major patent litigation.

Beginning in 2006, the Supreme Court ruled that holders who license their patents cannot win an injunction to stop third parties from infringing on their patent. That lawsuit, eBay v. MercExchange, L.L.C., changed the way patent lawsuits could be waged, altering incentives along the way.

“eBay substantially changed the world of patent litigation by limiting almost every verdict solely to monetary damages,” Robert W. Morris and Michael R. Jones, attorneys at Eckert Seamans Cherin & Mellott L.L.C., wrote in March.

[...]

“The effect is harshest on individuals and smaller businesses that depend on the value of intellectual property for their livelihoods; these are the same inventors that have, for decades, produced many of our greatest technological advances,” MCM argues.

That last part promotes a myth, unless they speak of patent trolls. Those who benefit the most from the status quo are patent bullies like IBM and the only small entities to also benefit (as a side effect) are trolls, not startups that actually produce things.

“We hope that more people will recognise the problem with software patents and react accordingly.”In the area of militarism, arms manufacturers (or war contractors) have taken over the system and became a burden (or a parasite) inside it. The same goes for the area of patent, but the products are patents and lawsuits rather than weapons and wars. We hope that more people will recognise the problem with software patents and react accordingly. █

Summary: With the Patent Trial and Appeal Board (PTAB, part of AIA), the International Trade Commission (ITC), the Court of Appeals for the Federal Circuit (CAFC) and even the Supreme Court (SCOTUS) showing disdain for software patents time is running out for patent examiners and lower courts that still pretend such patents sometimes have merit

THE USPTO‘s examiners now face the challenge of PTAB. It’s professionally embarrassing to be proven to have granted patents in error, so the examiners cannot simply ignore Alice, not any longer. “On USPTO Oversight,” Patently-O wrote yesterday: “I am generally in favor of additional Congressional oversight of the U.S. Patent & Trademark Office – this is especially true because members of the House and Senate Judiciary Committees tend to be smart, well informed, and act with intention to improve the patent system.* Although partisan politics do come into play, much of the focus tends to be on real issues and real solutions. The oversight process forces additional USPTO transparency and is the standard mechanism for getting information from Executive Agencies. On this point, I will note that the information exchange is often done in the background lead-up to the actual hearing — thus, although a hearing might not be too exciting or informative, the associated deadlines force the new communications.”

We are overwhelmingly in favour of having oversight affecting examiners at every patent office, as otherwise the profit motive takes over and quality control is virtually abolished (until the late and expensive stage which is a lawsuit in the court/s). Management of every patent office too needs to be subjected to scrutiny. The USPTO’s former Director, for example, has become somewhat of a lobbying giant, disgracing not only the Office but the entire system (he is now lobbying on behalf of large corporations in favour of software patents and against Alice, i.e. against a Supreme Court‘s ruling).

“Management of every patent office too needs to be subjected to scrutiny.”According to Mr. Loney from New York, “143 PTAB petitions [were] filed in August, down from 157 in July and 2016 high of 176 in June. Monthly average for year now 140.8 petitions.” Here is his full analysis (partly behind paywall), showing that PTAB activity has been increasing over the years, throwing out a lot of software patents (which courts would throw out anyway). As time goes on it ought to become apparent also to holders of such patents (not just their rivals) that these patents are worthless piles of paper and not even PTAB will be needed to prove it, let alone the courts. “The number of Patent Trial and Appeal Board petitions filed in August was slightly above 2016 average,” Loney wrote. “The month also saw notable Federal Circuit decisions on common sense, motions to amend and claim construction [...] The 143 Patent Trial and Appeal Board petitions (PTAB) filed in August was down from 157 in July and the 2016 high of 176 in June. The monthly average for the year is now 140.8 petitions.”

Up-to-date statistics regarding software patent invalidations in the courts of the United States (mostly lower ones, i.e. friendlier to plaintiffs than CAFC) got published last night. “June, July and August showed an uptick in the number Section 101 decisions from April and May, the majority of these being motions to dismiss and judgments on the pleadings,” the expert notes (he has been tracking this closely for years). “The rates of invalidity holdings continue to be steady: 70% overall, and 66.3% in the district courts. Success on motions on the pleadings is up to 68.1%. We’ve recently started tracking ITC proceedings as well, as shown above in the last row. Three of the five holdings of invalidity recorded above involved direct competitors and counterparties, Fitbit and Jawbone. In March 2016, Fitbit invalidated Jawbone’s fitness tracking patents in an ITC proceeding brought by Jawbone (ITC 337-TA-963). In July, Jawbone returned the favor and successfully invalidated Fitbit’s patents (ITC 337-TA-973); the ITC judge in the latter decision even relied upon Fitbit’s arguments that it made in its own motion against Jawbone.”

“That seems like wonderful news, but sites of patent law firms portray that as terrible news (to them it is).”We previously covered these rulings from the ITC, which certainly seems to be software patents-hostile. According to this new article, “above 90 percent” of patents on payment technologies (such patents are a subset of software patents) are dead/dying. Thanks to Alice! “Since Alice,” says the article, “the reject rate for patents for payment technologies is above 90 percent. This is a development that many contend has been crippling the innovation in this space. However, one company CardinalCommerce has secured one, and according to many lawyers, if someone can manage to get an e-commerce patent in this environment, it is worth a lot.”

That seems like wonderful news, but sites of patent law firms portray that as terrible news (to them it is).

Here is a new paid-for article, published in MIP by the patent industry last night. Having seen MIP becoming somewhat of a Battistelli/EPO platform, we worry they’re going to do more of those “Sponsored posts” (at least this time there’s disclosure). This one particular article speaks of telematics patents post-Alice and says “the patentability of such inventions could be impacted by the Supreme Court’s 2014 decision in Alice Corp Pty v CLS Bank Int’l, because inventions that arguably can be performed by humans are not patent-eligible subject matter under 35 USC § 101 (134 S Ct 2347, 2354-55 (2014)).”

Well, so be it. These patents should never have been granted in the first place. If patents (applications) never get granted, then they cannot be used for litigation or even for shakedowns, where the accused fears having to go to court not because of the outcome but because of the legal fees, obviously prohibitive unless one works for a large company. █

Summary: Raniere needs to pay $1.1 million (legal fees of the defendants) in a patent lawsuit which he himself initiated, only to find that his software patents are a worthless pile of papers

EARLIER this year we noted that Jericho Systems threatened a resurgence of software patents at a time of sunset for them (they’re dropping like flies these days). “Jericho could be the next Alice,” Benjamin Henrion noted, pointing at “No. 15-1502 (Eligibility of Patent No. 8,560,836 under Section 101 – Abstract Idea)” though we very much doubt it will ever reach SCOTUS as Jericho Systems might hope. In fact, this latest SCOTUS roundup from Patently-O (published earlier today) suggests there will be no more tests regarding software patents. “Three eligibility cases are pending before the Supreme Court,” says the site. “Of these, the most interesting is likely Genetic Tech v. Merial.” As we noted yesterday, there is also one case regarding the eligibility of design patents. Still, nothing that can refute/annul Alice or even the Bilski case. What does it all mean? Well, expect a lot more software patents, once properly challenged, to die in a fire.

Another death has just been reported for several software patents, demonstrating that holders of such patents oughtn’t bother with software patents (neither application nor litigation). It’s not just a waste of money but it can cause tremendous financial damage to oneself, as this latest story illustrates. Raniere basically sued two large companies and now he needs to pay them a fortune (over a million bucks for an individual, putting aside his own legal bills). In other words, rather than them being the victims it is him who is the victim of his own reckless actions. It’s him who will pay the price for suing with software patents that are not even patent-eligible. This story has been covered by WIPR (behind a time-sensitive paywall). Yesterday it said that “Microsoft and telecoms company AT&T have been granted more than $1.1 million in attorneys’ fees after succeeding in a patent suit against an inventor. Keith Raniere had claimed that the companies had infringed his software patents in February last year. The patents concerned were US numbers 6,373,936; 6,819,752; 7,215,752; 7,391,856; and 7,844,041. The order was filed at the US District Court for the Northern District of Texas, Dallas Division, on September 2.”

This case shows that holders of software patents can be (self-)bankrupted if they choose to sue using software patents post-Alice. Also behind paywalls today we found this report from Law 360. It says that “A Texas judge Friday granted Microsoft Corp. and AT&T Inc. attorneys’ fees after the companies defeated an inventor’s suit claiming infringement of his software patents, saying the man’s litigation conduct “demonstrates a pattern of obfuscation and bad faith.”

“Keith Raniere filed suit against AT&T and Microsoft in February 2015, asserting the technology giants infringed upon five patents that he owned for technology covering network conferencing systems. (Credit: AP) In her 13-page ruling, U.S. District Judge Barbara M.G. Lynn determined the cases filed by plaintiff Keith Raniere…”

This happened in Texas, so it is a major warning sign to a lot of patent trolls. “Hopefully many more judgements like this to come,” an activist against software patents told me yesterday. Another person, one who is making excuses for the rocket docket of patent trolls (Texas), said “it depends on who owns the #swpats – if owned by corporate entity better chance they will survive & flourish – #patentdeform” (always brandishing the hashtag “#patentdeform” as if cracking down on patent troll is a horrible things).

So, as expected, a major win for opponents of software patents and more excuses from their proponents, like Daniel Henry in this case (his Twitter activity suggests he’s likely part of the patent litigation industry).

Not many sites have written about this case (at least not yet^*) and software patent propagandists like IAM are just shedding tears for parasites that elevate the price of phones without actually making any (patent assertion firms). Well, next week they’re running a Webinar titled “Readying a Patent Portfolio for Sale: What You Need to Know to Be Successful” (often sold to trolls or patent assertion firms) and yesterday they noted that the “Beijing-based patent buying fund Ruichuan – the closest thing that China looked to have to an SPF – has recently gone private, after Zhigu, the firm that managed it, was absorbed into the IP department at consumer tech company Xiaomi.” SPF is a Sovereign Patent Fund and it typically achieves little more than enrichment of parasitic elements like patent lawyers — the same sort of people who bemoan the demise of software patents. █
____
^* They typically keep intentionally quiet when there’s bad news for them, instead cheering and shouting for weeks if not months when there’s good news for them (like Enfish). That’s the propaganda pattern of deception by omission or selective coverage.

Blind leading the blind

Summary: An update regarding the sordid state of patents on software in the US, where one has to rely on examiners and/or judges ignoring the US Supreme Court in order to have these granted/upheld

Software patents have always been the primary topic here. Longtime readers can attest to that. Thankfully, after Alice (2014), no imminent resurgence of software patents is expected, at least not in the near future. Several months ago when it was predicted that the SCOTUS (US Supreme Court) would deal with low-quality design patents of Apple we noted that no SCOTUS case was bound to reconsider the patentability of software. There wasn’t even another Bilski in the pipeline.

“Thankfully, after Alice (2014), no imminent resurgence of software patents is expected, at least not in the near future.”According to this new SCOTUS preview from Patently-O, only design patents would be questioned. Nothing would change when it comes to software patents, at least not at SCOTUS. To quote Patently-O: “When the Supreme Court’s October 2016 Term begins in a few weeks, its first patent hearing will be the design patent damages case of Samsung v. Apple. In Samsung, the Court asks: Where a design patent is applied to only a component of a product, should an award of infringer’s profits be limited to those profits attributable to the component? The statute at issue – 35 U.S.C. § 289 – indicates that, someone who (without license) “applies” the patented design (or colorable imitation thereof) to an article of manufacture, “shall be liable to the owner to the extent of his total profit.” Up to now, courts have repeatedly held that the “profits” are profits associated with the product (i.e., the article of manufacture) being sold, but Samsung is asking that the profits be limited only to components of the product closely associated with the patented design. Although Apple’s position is supported by both the text and history and is the approach easiest to calculate, I expect that many on the Court will be drawn to the potential unjust outcomes of that approach. Apple wins in a 4-4 split. Oral arguments are set for October 11, 2016.”

We previously explained why design patents are similar if not overlapping software patents (the user interface angle in particular). We therefore hope that Apple will lose this case — a case which we wrote about nearly half a dozen times so far this year.

“When it comes to software patents, empirical evidence typically shows that their existence harms innovation and causes more harm than good.”“Professors Feldman and Lemley are well-known for their skepticism about the current form of the patent system,” wrote Neil Wilkof yesterday in IP Kat. It’s not a bad post and here is what it says about the seminal/cited paper: “The authors make a basic distinction between ex ante and ex post with respect to technology transfer and licensing. A significant amount of meaningful technology transfer is “ex ante”, namely it takes place before the patent issues, and sometimes even before it is filed. To the contrary, licensing demands and litigation leading to payment for freedom to operate, occurs “ex post”, after the patent is issued, sometimes long after grant. Even in the life sciences field, where one might expect more evidence that technology transfer would be taking place, the authors found that the “modal license” was primarily for payment for freedom to operate rather than technological transfer of the underlying technology.”

When it comes to software patents, empirical evidence typically shows that their existence harms innovation and causes more harm than good. “Despite Alice,” Benjamin Henrion wrote yesterday, “specialized patents courts keeps issuing software patents in the US” (known issue), but as long as the Supreme Court repudiates such nonsense we’re probably OK in the long run. Upon appeals, e.g. to CAFC (a bit pricey), software patents almost always die. Lower courts need to heed the warning and stop ignoring policies imposed (or handed down) from above.

“Suffice to say, “open source software” as the above names it (Free/libre software) is not compatible with software patents.”Dropbox, according to this page, has “4 new DROPBOX patent applications,” to quote Fresh Patents. They are pursuing software patents (the titles suggest so) on all sorts of basic Web operations. Will USPTO examiners be negligent enough to grant in spite of prior art and Alice? We shall see. One sure thing is, the courts (the higher, the better) won’t tolerate these.

We recently wrote about Blockstream making a patent pledge despite having no patents. This new report suggests that Blockchain technology faces patent-related problems. To quote IP Watch: “Blockchains, such as the well-known bitcoin, are not yet well-defined but are creating a lot of hype, speakers at a 23 August Intellectual Property Owners’ Association webinar said. Two things are clear so far, they said: the technology is in its infancy, and there are lots of unresolved questions about what is patentable and how IP laws intersect with the mostly open source software used in the systems.”

“If the Supreme Court was to be respected rather than ignored for convenience (or maximisation of profit), there would no longer be trials over software patents, let alone new grants of software patents.”Suffice to say, “open source software” as the above names it (Free/libre software) is not compatible with software patents. Neither are APIs (lesser form of “open source”), yet according to this new patent survey, there are more than 23,414 API patents. To quote D-Zone: “After looking through the 23,414 API related patents from between 2005 and present day from 4,283 companies, it is clear that the API patent game will be all about which companies decide to litigate using their “intellectual property.” There is definitely a lot of education that could occur across all industries where these patents will be put to work, and hopefully we can see some reforms at the USPTO regarding how important it is to the economy that the APIs themselves to remain open and reusable, but I think that ultimately the world of API patents will be hammered out in courts across the United States, and other countries around the world.”

Oracle now claims copyrights on APIs, in a case which involves a mixture of software patents and copyrights inherited from Sun upon acquisition. We hope that readers are able to see just how profound an impact all these efforts to apply ‘IP’ to code can have. When can developers go back to coding in peace? Well, hopefully when all courts and patent examiners pay attention to Alice and apply the corresponding test. If the Supreme Court was to be respected rather than ignored for convenience (or maximisation of profit), there would no longer be trials over software patents, let alone new grants of software patents. █

Summary: Details about the latest developments in the union-busting campaign of Battistelli at The Hague, where Laurent Prunier and colleagues who are staff representatives face “demonstrably fabricated accusations,” according to Prunier

The disciplinary case of Laurent Prunier became more public a few months ago and we saw some details about it (both before and after). The atmosphere of sheer fear limits communication about these cases (there are threats being made to prevent/limit communications), but without any outside access to information the thugs who manage the EPO after a de facto coup can do just about anything without facing scrutiny, judgment, sometimes even backlash. That’s just what they want and to help them maintain this secrecy isn’t necessarily helpful (they eventually do whatever they please, experiences in Munich show). The significance of the attack on Prunier is that attacks on unions became apparent not just in Munich but also in The Hague (maybe Berlin too is somehow affected). Already, bearing in mind what we wrote about Mr. van der Eijk (the name indicates which country he is from) in past years, there were allegedly attacks on his independence at the boards. The latest message from AMBA says: “The present situation seems to be that the Boards of Appeal are now constituted within the BoAU, that the post of President of the Boards of Appeal is not yet occupied, that Mr van der Eijk is acting President of the Boards of Appeal, but that no power has been delegated to him. Thus, the President of the European Patent Office can be seen as exercising direct control over the Boards of Appeal.”

Feedback from Laurent Prunier, a SUEPO Secretary, was sent to us yesterday. Recipients were, as expected, colleagues from The Hague. Some of them deemed it worthwhile passing it on and after thinking about it for longer than a day I decided that portions of the message deserve to be publicly available, for Prunier’s protection (as when the public/press is aware of the situation there’s less leeway for this charade to carry on). We are aware of at least one more case which is similar to that of Prunier, culminating in a letter of dismissal. It’s often disguised as “health reasons” to hide the real motivations, such as union-busting endeavors.

Here are some selected bits (DG4 is Željko Topić, who apparently plays a big role in this attack, having done similar things in Croatia):

The Netherlands, 01-09-2016

Dear colleagues, Chers tous,

I hope this letter finds you well. This report is a little longer than usual because there have been new developments; it covers the months of June to August included. Once more UN GRAND MERCI for your solidarity, which allowed me to stay afloat [...] DG4 did not want to recognize my sick leave, in spite of valid medical certificates. They put me on unauthorized absence¹ and cut 100% my remuneration as from January 2016. The Office has now changed tactics. At the end of June², I have been suspended with immediate effect “awaiting trial” for alleged misconduct.

The letter of suspension was another punch in the stomach that left me knocked out for several days (by the way, thanks to those of you who sent me messages). As you may imagine getting back a stable health condition in such circumstances is a real Sisyphean task. Each new punch wastes the forces recovered from the previous one. But I will continue to defend my rights by all legitimate means: what is done to me may be tomorrow done to you; all this happened in the course of and because of my activities as staff/union representative. I thus sense it is my duty not to throw in the towel.

The Codex does not allow me to share the insights with you but:

• I firmly deny any wrongdoings.
• The whole is a genuine insult to anyone’s intelligence. The file against me contains so many demonstrably fabricated accusations that I have little doubt I can defend myself – or, rather I would be able to if, our internal system were not what it is currently, a kangaroo court.

The terms of the suspension

No date for the “trial” has been set, but I am “forbidden to enter any EPO premises as well as ordered not to travel away from The Hague without permission of the Office and to remain available for delivery of further correspondence and contact with the Office in (my) official address”. Basically, I am assigned to home arrest without any indication of the duration. The alleged legal basis for this restriction is Article 23 ServRegs – which does not concern suspensions. Just to illustrate the creativity of DG4 when it comes to use and misuse legal provisions to serve their ends.

______
¹ In the meantime (on 26.07.2016), I received a letter from the Chairman of the Administrative Council concerning my Request for Review addressed to the Administrative Council (AC) on this matter. On 4th April 2016 my lawyer asked them to review my placement on unauthorized absence in spite of valid medical certificates. My lawyer asked the AC to review the matter since the President and his associates have an obvious conflict of interest, having expressed publicly and repeatedly their aversion to me. Well, Mr Kongstad informed me that since I wasn’t nominated by the AC, the AC does not see itself in charge of reviewing my RfR, and considers that the Office should deal with the RfR. My RfR will thus be examined by those who are causing my troubles, and who in fine, will take the decision on my internal appeal. So much for impartiality, conflict of interests and independence of judiciary vs. executive.

² Also worth being noted, my suspension occurred only a few days after SUEPO filed a Kort Geding with the Court of Justice in The Hague to challenge its harassment by the Office. I can already hear VP1 muttering “pure coincidence”…

---

I was also ordered to hand back my EPO badge, my offices keys, laptop, mobile etc. This had to be done urgently but I was informed that my badge had been de-activated and the lock of my office had been changed in my absence (!) These orders had thus no purpose other than humiliation.

According to the Codex the suspension can last for a maximum four months (in my case this means up to end October 2016), but there too I remain prudent since the way DG4 interprets the Codex may deviate from its literal wording.

The suspension letter further states: “You shall receive your full salary; however the Office reserves its right to impose a deduction thereof under Art. 95(2) ServRegs if grounds for that arise”.

Again DG4 cannot help itself to systematically formulate the perspective of even more sanctions, always in unclear circumstances, so as to maintain a constant psycho-threat on those they target.

The consequences of the suspension

In July my “full salary” actually amounted to 1***EUR (!) only since… the EPO levied 3*** EUR as contributions for health and pension, retroactively from the date of my placement in unauthorized absence at the beginning of 2016. Another 1*** EUR for “arrears in June” was also retained (the explanations provided so far are cryptic to me). In August however my salary was finally paid in full for the first time since 01.01.2016. [redacted].

[...]

And other emergencies there will be. In March the Administrative Council adopted the resolution CA/26/16, urging the President to take concrete steps to de-escalate the social tensions. We all expected them to follow-up on this matter. They did not: in the June council, they only had time to try and fix the President’s attempts to extend his claws on DG3. Legitimate as that concern was, it is disappointing that they did not have time to tackle social issues. Given the fate of Staff and Union representatives, unjustly accused and punished [redacted]

---

Thus, not only your donation will have helped me to stay afloat, but if justice is done, it will also help others.

Again MANY THANKS for your support. Without you I would have faced harsh problems on the top of the “special treatment” by DG4/Mr Battistelli. This proves again that solidarity is the only way to move forward in our present work environment.

[...]

It looks as though Battistelli and his goons may be preparing to do in The Hague what they already did in Munich, having made it abundantly clear/explicit that they don’t give a damn about what Dutch courts say. How can anyone step aside at this sight of gross injustice? What has Battistelli turned the EPO into? █

Summary: Discussion about the closure of patent law firms and the inability to defend software patents, which were granted in error for many years and are finally facing proper scrutiny

THE patent landscape surely came under long-overdue judgment and certainly it is changing. It’s changing quite rapidly. It is not changing in favour of patent law firms, that’s for sure; it’s actually the other way around as these firm are trying to adapt to these recent changes and learn new tricks — if any exist at all (here is Alexander P. Ott from McDermott Will & Emery trying new tricks to patent software in spite of the rules this week) — in order to pretend that everything is the same as before and ultimately convince examiners/judges likewise. As we have shown in recent months, this rarely works anymore and they have very little control over what PTAB does (appeals by the patent holder/s are rare and usually ineffective). The figures and the facts are out there, but patent lawyers actively suppress them and even attack the messengers. For few instances of this, see the example above (Breyer) and recall more recent insults. It makes patent law firms look rather mean-spirited and vindicative. They’re like a pack of hyenas now.

“The figures and the facts are out there, but patent lawyers actively suppress them and even attack the messengers.”As one might expect, uncertainty over a large proportion of patents (existing and prospective/pending) reduces confidence among patentors. They might as well not bother attempting to patent (or renew patents on) abstract things like “something on a device” or “something over the Internet” (notorious but ubiquitous types of patents). There’s plenty of prior art therein and usually no inventive step, just the ‘dressing up’ of an old idea. Judges can see that. Judge Jacob would have said “technical” = restatement of the same problem,” Benjamin Henrion wrote, suggesting that they should formally “abolish swpats and the biggest negative points disappear. Otherwise face abolitionists. Will find Pilch’s quote” (see Henrion’s tweet to that effect; Pilch is the FFII’s founder).

We sometimes hear about patent law firms struggling, but rarely do we hear about large ones (with nearly 100 staff) taking the beating. Let’s face it; reduced demand for patents would inevitably shrink the market (or meta-industry which is patent bureaucracy). Deflation is to be expected now (or soon), as growing realisation of the status quo spreads further than just to lawyers, who still try to keep their clients in the dark (longing for pre-Alice days and selectively covering new developments so as to maintain an illusion).

“They might as well not bother attempting to patent (or renew patents on) abstract things like “something on a device” or “something over the Internet” (notorious but ubiquitous types of patents).”Another patent law firm has just imploded and there was plenty of press coverage about it early in the week, e.g. [1, 2, 3, 4, 5, 6, 7, 8, 9]. The patent bubble seems to be bursting with Alice and Mayo, so this patent law firm — like others before it — is virtually being taken over by another firm from Texas (the capital of trolls where there is still affinity for software patents). Here is the ‘damage control’ or the face-saving PR about this now-defunct patent law firm. They try to make the staff transfer look like good news. “Lipstick on a pig” comes to mind here.

One patent lawyers’ site meanwhile bemoans the departure from an era of software patents (it’s a rare exception for them to be upheld by courts or boards post-Alice).

The detailed breakdown of the post-Alice situation for software patents is preceded by the following text:

It has now been a two years since the Supreme Court rendered its now infamous Alice v. CLS Bank decision. It is safe to say that the Alice decision has had a profound impact on software patent enforcement, both at the Federal Circuit and in the Federal district courts.

Here is a summary of Federal Circuit Section 101 software eligibility decisions. As you will see, very few software patents have been upheld by the Federal Circuit in the last few years.

Breakdown of Federal Circuit 101 Cases, Post-Bilski, by Inventive Subject Matter

Here come the patent maximalists to berate PTAB, quoting something new from CAFC. “The Federal Circuit has remanded the Veritas v Veeam Software case back to the Patent Trial and Appeal Board, finding its reason for denying a motion to amend “unreasonable”,” Michael Loney writes in MIP. This is probably seen by them as an opportunity to overturn, but still, that would not count in the figures above.

CAFC‘s hostility towards software patents is especially noteworthy because it’s the fault of this court that software patents exist in the US in the first place. Suffice to say, more people now recognise the correlation between software patents and trolling. It’s also unsurprising that patent attorneys are unhappy about this new “Unpatent Manifesto”, which attempts to take things even further. The person behind it explains his point with a hypothetical analogy, stating “it wouldn’t be possible for anyone to patent the next biological change in the human body, it shouldn’t be possible for anyone to patent the next invention that will represent a great evolution of our species.”

“The “Unpatent Manifesto” might as well just be renamed the Patent Quality Manifesto.”The author is especially concerned about patent trolls, which are a symptom of no (or far too little) patent quality at the USPTO. He wrote: “The patent system is also the home of the so called “patent trolls”, or non-practising entities. Their mission is to accumulate patents with the only purpose of extorting money to those pushing for innovation. They patent already invented things, and patent or buy obvious inventions so they can later threaten companies with a lawsuit.”

The “Unpatent Manifesto” might as well just be renamed the Patent Quality Manifesto. In our view, patents themselves are not inherently the problem to tackle; the lack of quality control means that in the US, for example, there are now nearly 10 million patents (including expired ones). That’s far too much as it shows that the system long ago got detached or deviated away from its original purpose. And it’s impossible for any one person or firm to keep abreast of. There’s a huge overhead. █

Giving aggressors like Microsoft sacks of patents to breed Mafia-like behaviour, not healthy competition

Summary: Revisiting the EPO’s vision of poor patent examination and the effect of discriminatory granting practices, favouring patent bullies such as Microsoft (which actively attacks Linux using low-quality and usually pure software patents)

“A skilled patent attorney working with a qualified searcher could cobble together a colorable obviousness argument against the vast majority of issued patent claims,” says a new article from Patently-O. Not to mention “abstract” criteria, prior art and so on. “Part of the difficulty for patentees,” continues the article, “stem from the the billions of prior art references available via increasingly effective search tools. Even when an invention results from a ‘flash of genius,’ patent law typically back-fills extensive knowledge for the obviousness analysis – even when that knowledge was not actually available at the time of the invention. The larger difficulty though is likely the large number of hard-to-pin-down facts such as the motivations, common sense, and level of creativity of a person having ordinary skill in the art.”

“In the case of large companies like Microsoft, mountains of patents (granted in bulk by the EPO]) can be used to compel companies to pay up without even a trial.”If the EPO replaces examiners with algorithms, things will exacerbate further and patents get granted incorrectly, leading to an ocean of frivolous lawsuits. In the case of large companies like Microsoft, mountains of patents (granted in bulk by the EPO) can be used to compel companies to pay up without even a trial. Recall the Microsoft v TomTom case. Picking on small companies is Microsoft’s thing; it doesn’t sue Google.

The above reminds us of the danger of poor patent quality as well as streamlining grants, which is what Battistelli’s EPO has in effect done for Microsoft (and evidence we showed for that led to legal threats from the EPO). They — like the USPTO — in effect facilitate patent racketeering by Microsoft.

“They — like the USPTO — in effect facilitate patent racketeering by Microsoft.”Watch this new article titled “Primetime: Microsoft’s Android Cross Patent Dealings”. That’s misleading because it's not cross-licensing, it's a patent settlement (in bundling form) and it’s essentially a patent shakedown without even a trial and without an opportunity to properly assess the quality (and thus in/validity) of patents. The article says that “to press on this advantage, Microsoft does need to sign into more cross licensing or similar patent deals with manufacturers. Given Microsoft’s patent portfolio and how useful this will be to those manufacturers wishing to break into the North American market, such as Xiaomi, we may be seeing more of these arrangements in the coming months. The alternative might be Microsoft suing any manufacturer that tries to sell devices into a patent-friendly market.”

But again, these are not cross-licensing deals, these are patent shakedowns. One might even call this extortion or racketeering, even though Microsoft is too well-connected to face court charges brought forth by the government.

It is worth noting that many of Microsoft’s patents — those which it uses to shake down Android players (OEMs) — are not even valid anymore (if properly scrutinised), but there are so many of them that it would cost a fortune to demonstrate it to the court. It’s a numbers game, quantity rather than quality. It’s cheaper to just settle and let Microsoft continue to wield software patents like a weapon, even post-Alice. PTAB cannot take a request to review hundreds of patents from just one single company because it’s already overburdened by a growing number of reviews (IPRs).

Speaking of patent aggressors, there is this new software patent from Facebook (the usual, see our Facebook wiki page). These are oftentimes surveillance patents, but this time is’s about languages, at a time of increased competition with Google. Facebook's growing stockpile of patents is a real problem (Facebook has a history of going aggressive with them) and The Next Web says that “the US patent office issued 6,789 patents. Each patent adds a little something new to the human knowledge base. As we cannot list all six thousand, the PatentYogi team has selected the five most interesting patents.” How many of these are software patents that oughtn’t have been granted? How many of these will be toothless some time in the near future?

Patently-O says “The number of pending Ex Parte appeals continue to drop. Great work PTO.” There are other statistics of interest, based on PDFs from the USPTO (like this one). Patently-O claims they suggest that: “Design patent applications expected to reach 40,000 for FY2016 – up from under 30,000 in FY2010. The PTO is working to improve design patent prosecution speed – current wait of more than a year for a first office action.”

Well, the Office may have granted 40,000 patents on designs, but once reassessed the Office may need to throw them all away, on a per-request basis (post-Apple v Samsung at SCOTUS). Granting again for the sake of granting? Until the next Alice happens?

Patent quality control is the principal pillar of true and potent patent offices, otherwise they would be just archives of untested claims (a registration/filing system). █

Summary: Apple’s insistence that designs should be patentable could prove to be collectively expensive, as patent trolls would then use a possible SCOTUS nod to launch litigation campaigns

TROLLS, or patent sharks, typically use software patents, but what if they also had design patents at their disposal?

Apple‘s war on Android, which manifested itself in a now-settled case against HTC and later in a long patent war against Samsung, may prove to be counterproductive now that Apple attracts patent trolls like VirnetX, to which it might be forced to pay billions of dollars. A pro-software patents site now says that “Apple will also be an even richer target for the new breed of design patent trolls” if it wins its case against Samsung/Android (over design patents). To quote this new article:

On October 11, 2016, the Supreme Court will hear Samsung’s appeal of the Federal Circuit’s affirmation of the jury’s damage award to Apple of Samsung’s “total profits” on sales of the infringing smartphones even though it had only infringed Apple’s design of the iPhone’s outer shell. In upholding the “total profits” award, the Federal Circuit determined that it was bound to uphold the jury’s award by the “explicit” and “clear” statutory language relating to design patent infringement damages.

[...]

The importance of the Supreme Court’s ultimate ruling here is underscored by the numerous amicus curiae briefs filed (27 at last count). With over 205 billion in cash reserves at last count, Apple certainly doesn’t “need” the full nine-figure damage award. And, given the far reaching implications of this case, Apple may live to regret its aggressive pursuit of “total profits” for design patent infringement by finding itself battling design patent holders seeking to recover Apple’s total device profits for infringement of even a minor design feature. Apple will also be an even richer target for the new breed of design patent trolls already surfacing based, at least in part, on Apple’s success in this case. Clearly it is time for Congress to step in and amend Section 289 to add apportionment language.

No wonder technology companies are overwhelmingly supportive of Samsung in this case — a high-profile case over design patents.

In other news, Vera Ranieri from the EFF has this new update about one of their high-profile cases against patent trolls. Ranieri writes:

There has been significant activity relating to cases and patent infringement claims made by Shipping & Transit, LLC, formerly known as ArrivalStar. Shipping & Transit, who we’ve written about on numerous occasions, is currently one of the most prolific patent trolls in the country. Lex Machina data indicates that, since January 1, 2016, Shipping & Transit has been named in almost 100 cases. This post provides an update on some of the most important developments in these cases.

In many Shipping & Transit cases, Shipping & Transit has alleged that retailers allowing their customers to track packages sent by USPS infringe various claims of patents owned by Shipping & Transit, despite previously suing (and settling with) USPS. EFF represents a company that Shipping & Transit accused of infringing four patents.

The above is a timely and good example. It demonstrates not just of the harms of patent trolls but also the harms of software patents, which in the large majority of cases rely on them. If Apple made design patents stronger, with affirmation from the Supreme Court (SCOTUS), the damage would be enormous.

Apple is on the wrong side of history. █

IN our only article about the EPO yesterday we mentioned the RFPSS meeting. Things are eroding if not disintegrating at the EPO and it’s taking its toll on staff while no effective oversight exists anymore. Someone in IP Kat‘s comments remarked on the contents of yesterday’s material as follows:

On the subject of pensions, there is some interesting commentary from the CSC on the latest RFPSS meeting.

http://techrights.org/wp-content/uploads/2016/08/sc16129cp.pdf

“The Office thus unnecessarily lowers the probability of reaching our long-term objective for the return on investment, thereby deliberately creating a situation that could be used to trigger further major reforms.

The governance in terms of risk monitoring is still unclear through inadequate role clarity, while such governance deficiencies are recognised as often leading to under performance”.

If one were inclined to believe in conspiracies, the actions of the Office (including eliminating independent oversight of finances, and seemingly ensuring “underperformance” of the pension reserve fund) could all be interpreted as preparation for an attempt to sequester the approx. EUR7,000 million in the reserve fund.

In such a hypothetical conspiracy, the Office would “manufacture” excuses to cut / eliminate pension benefits to those who should be the beneficiaries of the RFPSS fund, only to then conduct a new study that miraculously discovers a massive surplus in that fund. The conspiracy would then conclude with the pension fund surplus being “liberated” by the Office.

Of course, this is all very far-fetched and so ought to easy to dismiss as nothing more than pure speculation. Indeed, a far more plausible explanation is that there is no plan for a cash-grab, just an attempt to deal with the pension liability issue that I have discussed before. Still, the effectively lawless behaviour of the Office in recent years (especially when it comes to matters of staff rights / benefits) does make one wonder…

Someone then responded to that as follows:

I have been entertaining similar suspicions since before Mr. Battistelli’s too office, when his immediate predecessor generously spouted expressions like “fit for the future”, “doing nothing is not an option” (in other words: TINA — but what is the problem in the first place?) and imposing the IFRS charade. I would however employ a much stronger word than “sequester”.

The questions are IMO: who would be the happy beneficiaries of that heist, how would the loot be split among them, and how would it be transferred out of the EPOrg while maintaining appearances?

As we stated yesterday, we have no accounting expertise here (not even in our IRC channels), so we need to rely on input from those who understand such matters and can interpret the financial reports of the EPO. The following remark bemoans Battistelli's political background, which basically makes him unfit (as per qualifications) for the post he has held for over half a decade. To quote:

Don’t forget that there is a French Presidential election campaign coming up in 2017.

https://en.wikipedia.org/wiki/French_presidential_election,_2017

“Primaire à droite : les Amis de Sarkozy lancent un appel aux dons”

http://www.leparisien.fr/politique/primaire-a-droite-les-amis-de-sarkozy-lancent-un-appel-aux-dons-11-04-2016-5704991.php

This is why people who hold elected office for political parties should never be put in change of international organisations with large cash surpluses and no effective oversight.

Right now at the EPO there is virtually no accountability, as pointed out in another thread in relation to a subject we first covered here 2 years ago:

Perhaps we will never know. With the full knowledge and approval of the AC, one of BB’s first actions as president was to disband the only body (the Audit Committee) that could have provided transparency / independent oversight in connection with the EPO’s finances.

The ILOAT also placed its seal of approval on this dastardly act in Judgment 3698:

http://www.ilo.org/dyn/triblex/triblexmain.detail?p_lang=en&p_judgment_no=3698&p_session_id=122&p_language_code=EN

“The authority to establish or abolish the Audit Committee was vested in the Administrative Council alone, and these decisions did not infringe the complainant’s rights in any way, regardless of his role in the EPO.”

Judgment No. 3698 (originally in French) is dated a month ago (when many decisions came out, more than 80% of which rules against the EPO's management) and it relates to a decision we covered here last month. It’s Bernard Paye's complaint to ILO, which gave him a Pyrrhic victory many years too late. Here is the text of this decision with highlights in yellow. The complaint was made by “the principal author of the proposal to establish [the A]udit [C]ommittee,” based on the text:

Organisation internationale du Travail
Tribunal administratif

International Labour Organization
Administrative Tribunal

Registry’s translation,
the French text alone
being authoritative.

P.
v.
EPO

122nd Session
Judgment No. 3698

THE ADMINISTRATIVE TRIBUNAL ,

Considering the complaint filed by Mr B. Y. P. against the European Patent Organisation (EPO) on 15 March 2013 and corrected on 7 May 2013, the EPO’s reply of 5 March 2015, the complainant’s rejoinder of 24 April and the EPO’s surrejoinder of 31 July 2015;

Considering Article II, paragraph 5, of the Statute of the Tribunal; Having examined the written submissions and decided not to hold oral proceedings, for which neither party has applied;

Considering that the facts of the case may be summed up as follows: The complainant challenges the abolition of the Audit Committee of the EPO’s Administrative Council.

On 30 June 2011, following a proposal by the President of the European Patent Office, the Administrative Council adopted decision CA/D 4/11 abolishing the Audit Committee, one of its subsidiary bodies, with immediate effect. On 28 September 2011 the complainant, who was then Head of Internal Audit (Principal Directorate 0.6 of the European Patent Office), and Ms H., who chaired the Staff Committee, filed an internal appeal against this decision. They complained, inter alia, that the General Advisory Committee had not been consulted prior to the adoption of the challenged decision. In November 2012 Ms H. withdrew her appeal. Having heard the complainant, the Appeals Committee of the Administrative Council unanimously recommended on 11 December 2012 that his appeal be dismissed, considering, in particular, that the challenged decision had not been taken in breach of any “applicable legal provision”. By a letter of 20 December 2012, which constitutes the impugned decision, the complainant was notified that the Administrative Council had decided to dismiss his appeal.

In his complaint filed on 15 March 2013, the complainant asks the Tribunal to quash the impugned decision as well as decision CA/D 4/11 and to order the EPO to submit the initial proposal of the President of the Office to the General Advisory Committee. He also seeks compensation in the amount of 30,000 euros for the moral injury that he considers he has suffered and an award of costs.

The EPO submits that the complaint is irreceivable, in particular on the grounds that the complainant is impugning a general decision that does not adversely affect him. In the alternative, it asks the Tribunal to dismiss the complaint as unfounded.

CONSIDERATIONS

1. The Tribunal has jurisdiction under Article II, paragraph 5, of its Statute to hear complaints alleging “non-observance, in substance or in form, of the terms of appointment of officials and of provisions of the Staff Regulations”. In consequence, when “[t]he complainant does not allege the non-observance of any of the terms of his appointment or of any of the Staff Regulations applicable to him”, his complaint must be held to be irreceivable (see Judgment 2952, under 3).

2. The Tribunal observes that the complainant does not allege any violation of the terms of his appointment or of staff regulations that are applicable to him. His case does not relate to his administrative status but rather to the organisation of the EPO, his employer, for which he is plainly not responsible. The fact cited by the complainant that he was “the principal author of the proposal to establish [the A]udit [C]ommittee” that was subsequently abolished does not grant him any right to intervene in a decision to maintain that subsidiary body or not.

The authority to establish or abolish the Audit Committee was vested in the Administrative Council alone, and these decisions did not infringe the complainant’s rights in any way, regardless of his role in the EPO.

3. It ensues from the foregoing that the complaint, which the Tribunal is not competent to hear, is irreceivable and must be dismissed.

DECISION

For the above reasons,
The complaint is dismissed.

In witness of this judgment, adopted on 28 April 2016, Mr Claude Rouiller, President of the Tribunal, Mr Patrick Frydman, Judge, and Ms Fatoumata Diakité, Judge, sign below, as do I, Dražen Petrović, Registrar.

Delivered in public in Geneva on 6 July 2016.

(Signed)

CLAUDE ROUILLER
PATRICK FRYDMAN
FATOUMATA DIAKITÉ
DRAŽEN PETROVIĆ

The above relates to our previous post about complicity of the Administrative Council, in this particular case actively removing accountability or oversight from Battistelli, which the Council appears to be in bed with.

Citing another case, we have already shown how Battistelli worked against the European Patent Convention (EPC). How Battistelli can get away with all this isn’t something we can now defer to the Founding Fathers of the EPO anymore (most of them are deceased by now). █

If EPO management cannot guarantee justice to its own staff, will it ever guarantee justice to patent holders (defendants and plaintiffs)?