08.08.17
Posted in America, Patents at 1:17 pm by Dr. Roy Schestowitz
The Retreat Inn
Summary: The momentum against software patents is growing as large firms which specialise in software — even proprietary software — speak out against what the US patent system has become
THE granting of software patents by the US patent office ought to stop because almost all of these patents turn out to be worthless. Courts reject them.
“We suspect there is going to be a patents battle in Wi‑Fi mesh software,” The Register wrote yesterday, but if these are patents on software they will find themselves in the ashtray of history (even if the patents state something about “Internet”).
Every now and then we find articles which make arguments similar to ours. We gave an example earlier today regarding trolls. There is another new article, this one from Dana Rao, a vice president of intellectual property and litigation at Adobe. He uses wording similar to ours in relation to patent quality and a “patent gold rush” (it’s almost as though he might be reading Techrights). To quote some portions:
Improving Patents Will Not Kill Innovation
[...]
Every patent holder is proud of their patent. As they should be. Obtaining a patent is expensive, time-consuming, and there is an adversarial process with the U.S. Patent and Trademark Office that you must overcome to establish that your invention is valid. But the business of patents has changed. It used to be a system that rewarded an inventor for a genuine innovation, one that the patent clearly described, and entitled that inventor to prevent anyone else from making that invention. That was a good system; it produced good patents, and strong businesses were built on the backs of those patents. That system provided an incentive for innovation that has kept America the technology leader for more than 200 years.
Unfortunately, that system is broken. Patent filings have surged over the years. Twenty years ago the USPTO granted 123,147 patents. Last year, the USPTO granted 333,583 patents. That’s 168 percent growth! Does anyone think that the number of true innovations has increased by more than 200,000 patents in just 20 years? Not a chance.
What happened? A patent gold rush built by patent profiteers.
[...]
History tells us that a refocus on quality in our patent system will not end innovation in this country. Good patents will still be awarded for good inventions, with clear claims that limit the patent to the invention the inventor invented — the way it is supposed to be. And businesses will be built on the backs of those good patents, just like they always have. Instead of complaining about the end of the age of bad patenting and patent profiteering, we should be celebrating the rebirth of a strong and credible patent system, one that will enable America to maintain its technology leadership now and into the future — built on the backs of good patents.
There is a lot to be criticised about Adobe, whose views may be inferred from the above. But when it comes to software patents, Adobe was rarely a problem or even a nuisance. Adobe’s Douglas Brotz once officially stated this: “Let me make my position on the patentability of software clear. I believe that software per se should not be allowed patent protection. […] We take this position because it is the best policy for maintaining a healthy software industry, where innovation can prosper.” (this was Adobe’s official position statement at the time)
“Software patents harm the industry,” he argued, “with no corresponding benefit.”
There is a patent bubble. It really needs to burst already. “A patent gold rush built [was] by patent profiteers,” Dana Rao explains, echoing what we’ve been saying for a long time. The EPO under Battistelli shows the same kind of thing right now, with low-quality patents being granted and the UPC pushed by the patent/litigation ‘industry’.
Speaking of the patent ‘industry’, watch what Frank Zhu from Baker Botts LLP (the patent microcosm) wrote earlier this week. He painted a negative picture of patent reform in order to thwart any improvements to patent quality. He also referred to trolls as “PAEs” and “NPEs” (the euphemisms). Here are some portions of what he wrote:
A troll is an ugly mythological creature that lives under a bridge, waiting to extort a hefty fee from whomever crosses the bridge. This vivid description of a patent troll often provides a sufficient reason to despise such an entity without giving it a second thought. However, missing from this picture is that the so-called patent trolls, often referred to as non-practicing entities (NPEs) or patent assertion entities (PAEs), actually own the bridge. A string of recent news reports seems to portray impending victory against the notorious troll: patent trolls were ordered to pay attorney’s fees;1 the original PAE law firm announced its shutdown;2 a number of PAEs have dramatically laid off employees;3 others announced that the environment has been so hostile and the business model is no longer feasible.4 However, today’s perceived success of the crusade against patent trolls may have come with a significant price.
[...]
he consensus of a panel discussion, titled “The Current Patent Landscape in the US and Abroad,” was “that dramatic changes to the US patent system are driving investment in research and development outside the country and threatening the future of American innovation.”
[...]
Hopefully, the Court is well aware that the fate of the despised is closely intertwined with that of the patent law system critical to the prosperity of this country.
That’s utter nonsense. As Adobe said (above), what harms innovation (or “the future of American innovation” as he puts it) is a legion of patent trolls. They use software patents to shake down companies to the point where some of these companies decide to just move overseas.
Here is a new example, courtesy of the Computer & Communications Industry Association (CCIA). Josh Landau wrote about one patent troll yesterday, noting that “CustomPlay doesn’t deal with DVDs. Instead, its patents cover basic concepts in digital video playback.”
Here’s more:
The asserted patents claim to cover the concept of skipping back in a video and turning on the subtitles in order to figure out what someone said, the concept of identifying who appears in a scene of a video, the concept of providing an icon indicating information about a video scene exists, and the concept of providing information about a current video scene and a previous video scene. (The first one is asserted against Apple; the remainder against Amazon.)
So, yes, CustomPlay has essentially claimed to own the concepts of rewinding and rewatching a section of a scene with subtitles on, annotating media, the identifier for a footnote,
[...]
This is exactly what Bilski and Alice told us was unpatentable—claiming an abstract idea, and in this case, claiming an automated process for organizing a human activity. In this case, the human activity of rewatching a segment with the closed captions on so you can figure out what exactly they said.
Yes, Bilski and Alice ought to have already rendered this patent dead, yet the patent is still being used against real companies.
And speaking of Alice, Saurabh Vishnubhakat has this new paper (presented in brief today) on why abstract patents may be invalid not just because they’re abstract but also anticompetitive. As he put it in his abstract:
Wrongly preserving an invalid patent can distort the competitive market and enable abuses, such as nuisance litigation.
Here is what he had published in Patently-O last night:
Subject-matter eligibility is becoming a sort of per se shortcut for patent invalidity, in contrast to more costly inquiries like nonobviousness or enablement analogous to the rule of reason. The historical lesson of antitrust, though, has been that per se rules should be used very sparingly because a wide range of economic practices may prove to have procompetitive effects. This does not mean the conduct is definitively legal under the antitrust laws—or that a given patent is definitively valid. It simply means that more information and more careful judicial consideration are needed before an accurate decision can be reached.
Until now, the use of subject-matter eligibility at the pleading stage may be conserving decision costs, but without sufficient regard for error costs in decisions on patent validity. In my paper, I discuss problems with the current approach and propose three ways to guard against this irresponsible borrowing from antitrust.
We wrote a great deal about antitrust aspects of patent litigation/threats back when we focused on Microsoft’s attacks on Linux and the FUD campaign it had launched with Novell in 2006. But at the same time we also pointed out that virtually all the patents were on software, so ending software patents would be an indirect remedy. Alice got us a lot closer to that. █
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Posted in Microsoft, Patents at 12:17 pm by Dr. Roy Schestowitz
The Troll in Chief, Phil Hartstein, CEO [sic] of Finjan
Summary: SonicWall, which was a Dell subsidiary from 2012 to 2016, comes under fire from a ‘company’ whose main ‘product’ is so-called ‘intellectual property’ (litigation)*
OUR previous post, a post about patent trolls, mentioned the Microsoft-connected Intellectual Ventures, which mostly uses USPTO-granted patents to ‘nuke’ Microsoft’s rivals. There are many more Microsoft-connected trolls like that. One of them is called Finjan, which we last mentioned earlier this year, having looked closer into it two years ago and even more than half a decade ago (the Microsoft links are pretty strong).
“Finjan is just busy suing the whole world or threatening the whole world (much like its sugar daddy, Microsoft).”According to this new press release from Finjan, its notorious software patents (which probably are not patent-eligible) are now being used against SonicWall, a private company with about a thousand employees. I used their software product (VPN client) very briefly after Dell had taken over. Unlike Finjan, SonicWall is actually successful. Finjan is just busy suing the whole world or threatening the whole world (much like its sugar daddy, Microsoft).
The paid press release from Finjan did not result in any press coverage we could find; Finjan uses a separate entity to do all the trolling, so it’s possible that journalists will fail to see what Finjan really is.
It’s pretty sad that real companies with real programmers who work on real products can become the target of parasites like Finjan.
“Finjan is an example of a parasite that simply relies on patents to threaten (blackmail) or even sue.”This latest paper by Jason Rantanen (mentioned here earlier this summer) is summarised by Patently-O this week and Rantanen asserts that money or greed play a major/principal role in patenting. “The conventional explanation for why people seek patents,” he said, “draws on a simple economic rationale. Patents, the usual story goes, provide a financial reward: the ability to engage in supracompetitive pricing by excluding others from practicing the claimed technology. People are drawn to file for patents because that is how these economic rewards are secured. While scholars have proposed variations on the basic exclusionary mechanism, and a few have explored alternate reasons why businesses seek patents, the question of whether individuals—human beings—seek patents for reasons other than the conventional economic incentive remains unexplored. As Jessica Silbey recently observed, human creativity is motivated by more than just the potential for immediate economic returns. But an individual’s motivation to create does not explain why that person would go through the trouble and expense of obtaining a patent absent the promise of economic gain.”
Finjan is an example of a parasite that simply relies on patents to threaten (blackmail) or even sue. It’s acting a lot like Microsoft, which played a financial role in Finjan. We hope that readers will remember that. █
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* “To date,” their Web site brags, “Finjan has generated more than $250M in income from the licensing of its intellectual property.”
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Posted in Microsoft, Patents at 11:43 am by Dr. Roy Schestowitz
This is what we’ve always been saying
Summary: The consensus on the effect and the innate nature of patent trolls is moving closer and closer to what we argued over a decade ago
Patent trolling isn’t the ‘business’ of small firms; there are some massive patent trolls out there and Microsoft, for example, is connected to quite a few (e.g. Intellectual Ventures); it also acts much like a patent troll itself. It’s a unique case. Trolls don’t just target small firms either; the small firms are an easy target when litigation is seen as a threat to the patent’s (or patents’) eligibility.
“Trolls don’t just target small firms either; the small firms are an easy target when litigation is seen as a threat to the patent’s (or patents’) eligibility.”The other day we saw this new article titled “Our legalized extortion racket: Congress must take on patent trolls” (we often use similar terms to describe what they do).
“The same thing is being allowed to be perpetrated in trademarks too,” somebody told me, “but there’s more money for the lawyers “correcting” patenting abuses.”
“Their exclusive function is legal marketing and creating barriers to entry for any and all industries,” said another person in relation to this.
Here’s a portion from the article:
There is no doubt we are living in turbulent times, fraught with controversy and anger. One of us is a Democrat, the other a Republican. Yet when cooler heads prevail, we find ourselves in agreement on many issues. Perhaps it’s time we focus on the common good, rather than what divides us. And regardless of political affiliation, patent reform is something we should all support.
Patents serve to safeguard American ingenuity and ensure our nation’s entrepreneurs have the legal protection they need to continue to invest in innovation, create jobs and bolster our economy. Yet through legal loopholes, patent assertion entities — companies that own patents but never use them to make anything, better known as “patent trolls” — increasingly use patents as weapons to extort businesses.
Each year, these trolls file thousands of baseless patent infringement claims, most targeting startups and smaller businesses. The trolls’ goal is to leverage a quick settlement, knowing that victims do not have the resources for a prolonged and costly court battle. Indeed, the cost of getting a frivolous lawsuit thrown out of court can be well over seven figures, often making it impossible for innocent victims to recover.
Thankfully, Europe does not yet have many trolls, but the number of troll cases grows rapidly in lieu with UPC hopes. The one good thing about Brexit (there’s hardly anything good about it) is that it can drive many law firms out of business, as their media openly admits this month. Well, they create nothing anyway; we won’t miss them. They enable ‘legalised’ extortion. █
“That’s extortion and we should call it what it is. To say, as Ballmer did, that there is undisclosed balance sheet liability, that’s just extortion and we should refuse to get drawn into that game.”
–Mark Shuttleworth
“Microsoft is asking people to pay them for patents, but they won’t say which ones. If a guy walks into a shop and says: “It’s an unsafe neighbourhood, why don’t you pay me 20 bucks and I’ll make sure you’re okay,” that’s illegal. It’s racketeering.”
–Mark Shuttleworth
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Posted in EFF, Patents at 11:19 am by Dr. Roy Schestowitz
Another bogus patent bites the dust, but there are many more like it out there
Summary: Personal Audio has likely exhausted its options as the whole existence of this troll boiled down to a patent that’s no longer valid
THE USPTO grants software patents; it has done so since the US Court of Appeals for the Federal Circuit allowed it several decades ago. Things are changing though; the EFF’s Mr. Nazer said yesterday that “EFF wins podcasting appeal. Federal Circuit affirms Personal Audio’s patent is invalid.” Personal Audio LLC is a Texas-based troll which we wrote many articles about.
This was published under the rare banner of “PRESS RELEASE” to say:
The Electronic Frontier Foundation (EFF) won a court ruling today affirming that an infamous podcasting patent used by a patent troll to threaten podcasters big and small was properly held invalid by the U.S. Patent and Trademark Office (USPTO).
A unanimous decision by a three-judge panel of the U.S. Court of Appeals for the Federal Circuit will, for now, keep podcasting safe from this patent.
In October 2013, EFF filed a petition at the USPTO challenging the so-called podcasting patent owned by Personal Audio and asking the court to use an expedited process for taking a second look at the patent. More than one thousand people donated to our Save Podcasting campaign to support our efforts.
There has been press coverage since, e.g. this article which says:
A federal appeals court has upheld a legal process that invalidated the so-called “podcasting patent.” That process was held by a company called Personal Audio, which had threatened numerous podcasts with lawsuits in recent years.
On Monday, the US Court of Appeals for the Federal Circuit affirmed the April 2015 inter partes review (IPR) ruling—a process that allows anyone to challenge a patent’s validity at the US Patent and Trademark Office.
“We’re glad that the IPR process worked here, that we were allowed to go in and defend the public interest,” Vera Ranieri, an EFF attorney who worked on the case, told Ars. (She told Ars that her favorite podcast is Lexicon Valley.) There had been a question as to whether EFF had standing during the appellate phase of the case.
We have been following this case for a very long time and we are not surprised by the outcome because the Federal Circuit agrees with decisions like these about 80% of the time (in spite of pressure from the patent microcosm).
Will this serve as a warning sign to patent trolls that rely on software patents? Let’s hope so. █
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Posted in Europe, Patents at 10:46 am by Dr. Roy Schestowitz
Summary: The everlasting decline of the EPO’s quality and moral compass, as evidenced by the latest words and actions
THE quality of patents at the EPO no longer matters; the President now conflates speed of decision with quality. At the same time the EPO grants patents on life — something which even the US patent office does not do. It certainly seems like Benoît Battistelli and his preached-to choir aim for the bottom of the bottom. Stakeholders and examiners do notice (they are not happy).
“It certainly seems like Benoît Battistelli and his preached-to choir aim for the bottom of the bottom.”According to this news from yesterday, the EPO grants even more monopolies on genetics (before the matter has had a chance to be examined independently/separately from the EPO). This is a recipe for disaster. All it can ever lead to is lots of frivolous litigation and this is perhaps what Battistelli aims for. He wants a UPC-like regime — something which he’ll never get to see (his days are numbered).
Earlier this week the EPO wrote “We protect inventions” and “make the world a better place!”
Really? Protect inventions? The EPO is supposed to perform patent examination. That’s all.
“Besides bribing the media (and doing a fair deal of lobbying), the EPO deems itself judge, jury and executioner before outsiders (like ILO) get a say.”Someone else noticed that and wrote [1, 2]: “Really? Is that what you do? Are you sure? I thort [sic] you decided if an invention could be protected. Have you moved into enforcement?”
Well, Battistelli’s EPO isn’t just schizophrenic. Besides bribing the media (and doing a fair deal of lobbying), the EPO deems itself judge, jury and executioner before outsiders (like ILO) get a say. Staff is preemptively fired based on bogus accusations, patents are invalidated without even a trial, and there’s a program called Patent Prosecution Highway (PPH), which helps discriminate against some applicants (like PACE).
Today we found this shameless self-promotion/marketing from Spruson & Ferguson (the third such marketing we’ve come across in the past month from that region). To quote: “The PPH pilot program enables preferential examination of an applicant’s corresponding patent applications where claims have been found patentable by the EPO or the IPOPHL/MyIPO.”
“Watching the lies (or misleading language) from the EPO is like a full-time job.”It certainly looks as though the EPO ‘forgot’ what its duties are. It sometimes seems as though the EPO is just trying to become something that it’s not. The UPC isn’t happening, so how much muscle-flexing will we see from Battistelli? How many lies?
“Surely the UK have to withdraw from the UPC due to Brexit,” someone wrote yesterday, as “UK in UPC is unworkable” (never mind a dozen other countries that have not ratified*).
Watching the lies (or misleading language) from the EPO is like a full-time job. They’re in need of a lies tracker. The EPO has not only lost world leadership; it has totally lost sight of what it’s supposed to do (as per the EPC). █
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* Bulgaria and Greece have not ratified the UPC (perhaps never will, either), but seeing this week’s spin from Bristows [1, 2] might give people a wrong impression.
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