04.14.16

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Patent Trolls in the US, Storm of Patent Litigation Expected in China, and Yahoo’s Patents (Potentially on Sale) Become Subject of Intrigue

Posted in America, Asia, Google, Microsoft, Patents, Search at 9:25 pm by Dr. Roy Schestowitz

“Along with many other computer scientists, I would like to ask you to reconsider the current policy of giving patents for computational processes.

“There are far better ways to protect the intellectual property rights of software developers than to take away their right to use fundamental building blocks.

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

Donald Knuth

Summary: The ugly side of patent systems with little or no quality control, including the resultant chaos, as demonstrated in the United States and soon in China too

THE epidemic of patent trolls in the US is a result of the USPTO granting patents on software as if doubling the number of grants can somehow be achieved while maintaining quality. A lot of patent trolls don’t even need to be challenged in courts (which would likely invalidate these patents in this post-Alice era), primarily because their victims — companies and individuals whom they prey on — are too poor to afford many months (if not years after various appeals) in a court of law, thus would rather settle by paying ‘protection money’ to the troll/s. Now there’s a ‘Mafia economy’, motored by the broken US patent system.

Apple, by contrast, can afford to go to court with trolls and based on this new report from Reuters:

A federal judge has rejected another bid by Apple Inc to get rid of a mobile phone patent that a U.S. appeals court said should not have been knocked out of a lawsuit filed by licensor MobileMedia Ideas LLC.

In a ruling on Monday, U.S. District Judge Susan Robinson in Wilmington, Delaware, refused a motion by Apple and its O’Melveny & Myers attorneys to rule on summary judgment that Apple does not infringe the patent or that it is invalid.

Even right here in Europe, despite resistance from the public, patent trolls are already a reality. Over at IAM, patent lawyers now report on patent trolls in Europe (the Openwave troll a.k.a. Unwired Planet, a notorious patent troll of Ericsson). It’s a case that’s based in the UK rather than Texas and as the lawyers put it: “In 2014 Unwired Planet asserted six of its European patents against the defendants, Huawei, Samsung and Google, which were acquired from Ericsson, in both the United Kingdom and Germany. To date, the judgments for three technical trials in the United Kingdom have been handed down. This article examines the third technical trial. After the technical trials have been completed in the United Kingdom, assuming that the proceedings continue, there will be a fair, reasonable and non-discriminatory terms (FRAND) trial to decide on the licensing dispute.”

“Now there’s a ‘Mafia economy’, motored by the broken US patent system.”What can be seen here is how a once-practising (and successful) company has turned into a patent aggressor, even if the aggression is carried out by proxies/shells/satellites/trolls. It’s highlighting a trend (see IBM for example) and it is highly relevant in light of the news about Yahoo, which got hijacked by Microsoft several years ago. IAM looks at the vocation of its patents, noting: “As a point of comparison he highlighted AOL’s sale of a portfolio to Microsoft for $1.1 billion in 2012 and raised the possibility of a consortium bid a la the Nortel auction. Of course, comparing the value of patent assets today with those of 2012 is a bit like comparing the value of your Florida condo in 2009 with what you paid for it in 2006. You quickly end up with two very different numbers.”

Remember what we wrote about Microsoft’s buyout of the patents from AOL (after some preying). Microsoft is one of the worst patent aggressors out there, but it typically hides behind shells. IAM believes that China too might be interested in Yahoo’s patents, noting: “Could, for example, a company looking to grow aggressively in the US that wants the freedom to operate in a notoriously litigious market be interested? The Chinese internet giant Alibaba might fit that bill and others may not want it to get what Yahoo has. That could drive the price up, but even then it’s hard to see how the portfolio goes for $4 billion.”

“It’s a broken system and it will lead to a broken economy where only rogue elements and super-rich actors stand to gain.”To quote an article just published, China patent “quality of the protection is so poor that a flood of litigation is bound to result.”

“Experts expect flood of litigation as a result of huge numbers of Chinese patent filings and poor quality protection,” noted the author in Twitter. As we wrote here many times before, one thing that China has in common with the US is low patent quality, as the goal is quantity, irrespective of the merit/novelty of an application. It’s a broken system and it will lead to a broken economy where only rogue elements and super-rich actors stand to gain.

Remarking on the value of Yahoo’s patents, another person thinks that it may or may not be in the billions (with a B, not an M) and patent maximalists, citing IAM and the latter, e.g. Daniel Ballard and J Nicholas Gross, whom we mentioned here before (not favourably), say “think these [are] generous + assume perfect monetization of these assets-which is impossible in current judicial climate” (probably Alice).

“Whenever Microsoft attacks Android/Google with patents it acts (towards Linux) like a wife beater being seen by an alibi ‘in the action’, then stating calmly “it’s nothing personal, don’t mind what you’re seeing here!””The term “perfect monetization” means litigation and extortion. They make it sound so legitimate with their euphemisms, don’t they? Just like IAM…

There are other patent boosters who wrote about it. They also cited the Murdoch-owned tabloid and criticised it as follows: “The New York Post reported this week that Yahoo’s patent portfolio could be worth up to $4 billion, as the company is currently seeking bidders in an auction for its core businesses. While the company has not explicitly discussed a separate patent sale, the value of the patent portfolio is likely to be a key factor in any ultimate sale price.”

Our main concern is that a Linux foe like Microsoft might try to take these patents, just like it took Novell’s. Remember that at least twice (just recently) Microsoft was abusing Google/Android/Linux with patents. That’s many times so far this year. Whenever Microsoft attacks Android/Google with patents it acts (towards Linux) like a wife beater being seen by an alibi ‘in the action’, then stating calmly “it’s nothing personal, don’t mind what you’re seeing here!”

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