Recent: Patent Trolls Roundup: The Patent Trial and Appeal Board (PTAB), Microsoft Trolls, and the Eastern District of Texas

Microsoft is still attacking GNU/Linux, it's just using what's sometimes known as 'satellite' entities

Summary: Intellectual Ventures, Finjan, RPX, and other Microsoft-connected trolls cannot be countered by LOT Network and the likes of it (notably OIN); Microsoft continues to shrewdly distribute patents to trolls, offering 'protection' from them (for a fee) [1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16] and pressuring OEMs to bundle Microsoft 'apps' or risk retaliatory patent lawsuits

AS LONG as the USPTO continues to grant software patents and as long as already-granted US software patents are not expired (or voided by PTAB) Microsoft can carry on blackmailing the whole world. Microsoft isn't alone in this; IBM, for example, does similar things. But this post will focus on Microsoft because it claims to "love Linux" and Microsoft-funded groups like the Linux Foundation (which nowadays pays even the marketing person, McPherson, more than it pays Linus Torvalds) repeated this lie as recently as Friday. It said "Microsoft Proves Linux Love" in the headline! Alluding to Microsoft fixing a trivial bug more than 3 decades late.

"...this post will focus on Microsoft because it claims to "love Linux" and Microsoft-funded groups like the Linux Foundation (which nowadays pays even the marketing person, McPherson, more than it pays Linus Torvalds) repeated this lie as recently as Friday."Let's start with Finjan, an Israeli patent troll which was backed financially by Microsoft and was (re)armed by IBM as recently as last year. Finjan basically does nothing but patent litigation. It's hardly a promising business model after Alice and Oil States, but somehow they managed to defend one of their patents earlier this year at CAFC (a decision in January against Symantec). Several days ago Finjan "Announce[d] $10 Million Share Repurchase Program". Signs of tough time and 'damage control', amid just lots of lawsuits and blackmail these days? Even former staff of theirs is turning against them. From the press release:

Finjan Holdings, Inc. (NASDAQ:FNJN), a cybersecurity [sic] company [sic], today announced that the Company’s Board of Directors has authorized a share repurchase program of Finjan’s outstanding common stock of up to $10 million.

Maybe Microsoft wishes to invest again? It's well known that Microsoft is investing in a lot of patent trolls, including the world's biggest. Irish media very recently revealed it had invested in the world's largest patent troll, Intellectual Ventures, giving it a major lifeline. "Changes in personnel and strategy at Microsoft," IAM noted yesterday, "along with a new patent climate in the US - spelled the end for IV's final acquisitions fund."

"It's well known that Microsoft is investing in a lot of patent trolls, including the world's biggest."IAM, the rather prominent propaganda outlet of patent aggressors and trolls, merely entertained the 'new' Microsoft narrative -- a fictional framing that many GNU/Linux proponents grew tired of. Joff Wild's Windows site (with occasional pieces from Microsoft executives and former executives) ended up including spin about RPX as well. To quote yesterday's column of his:

Last week we reported on a filing made by a Microsoft subsidiary in Ireland which provided details of a $136.5 million write down of an investment the company had made in Intellectual Ventures’ Invention Investment Fund 3 (IIF3). The filing also revealed that the software giant was by far the biggest investor in the fund – contributing over 70% of the cash that had been raised.

[...]

Meanwhile, what does this news tell us about Microsoft? While some of the usual blogging and Tweeting suspects have been talking about the write down as showing that the company is the facilitator of the world’s biggest patent troll, arming it with a view to going after competitors and everyone else to beat them down to a pulp – or words that effect, those that have actually bothered to follow developments at Redmond over recent years will see something different.

[...]

On top of that, of course, those changes to the US patent landscape also make the kind of defensive buying that IV sold as a significant benefit to its corporate investors much less of a pressing need. Don’t forget that Microsoft has also recently decided not to renew its membership of RPX.

The simple fact is that Microsoft no longer needs IV: its IP strategy has changed and it is less exposed to damaging patent assertions than it once was. When the fundamentals change so much for an investor that has a 70%+ stake in an entity of whatever kind, that entity is going to struggle to recover. That is exactly what has happened to IIF3.

Intellectual Ventures did not only depend on Microsoft; Bill Gates had been backing it too (it's his personal friend, whose role in the firm recently grew further). Sure, Microsoft left RPX, but only after it gave a lot of money to RPX, which almost everyone seems to be leaving these days (it's collapsing and it was recently sold to private hands for a 'paper'/virtual price that was a joke: 555).

Based on Indian media, as of a few days ago, it sure sounds like RPX has just swallowed some more software patents. The Economic Times wrote:

Bangalore-headquartered Zeno Security Corporation has entered an agreement to sell its portfolio of network security patents to San Francisco based RPX Corporation. The terms of the agreement are undisclosed. The deal includes the sale of three issued US Patents, and one pending US Patent Application.

[...]

Transactions IP LLC brokered the deal between Zeno and RPX.

They don't even name a price.

Going back to Microsoft, remember that Microsoft used software patents to sue a rival it had committed antitrust violations against (Corel). It nowadays tries to crush it completely using patent litigation. A few days ago Law 360 wrote about it:

Microsoft's Win Reduced, Atty Fees Denied In Corel IP Spat

A California federal judge has reduced an award for Microsoft from a jury that found Corel willfully infringed its Office software patents, dropping the payout from $287,000 to $124,000, and declined to make Corel pay Microsoft’s attorneys' fees, saying there was nothing exceptional about the case.

In a decision unsealed Thursday, U.S. District Judge Edward J. Davila said that Corel Corp.’s willingness to stipulate to infringement and drop its invalidity defenses against Microsoft Corp. early in the case, in an effort to reduce costs, was “rare”...

Don't believe in the 'new' Microsoft myth. The company is still suing, both directly and indirectly. The corporate media mostly turns a blind eye and the above case was mostly/only covered by Law 360, which is a niche site. Why aren't technology news sites mentioning it? Does that not suit the "Microsoft loves Linux" narrative? Remember that Corel was a major player in the GNU/Linux scene before Microsoft undermined it (a decade ago we wrote many articles about what had happened).

"Those 'free' patents would be trouble when Red Hat is dead or sold (either of those is an inevitability, it's just a matter of time)."Meanwhile, "Red Hat Inc. and Lenovo Group Ltd. are giving away free patents," says the corporate media. This is not how patents work. Red Hat basically continues to actively pursue software patents and it means that Red Hat is part of the problem. The company and its patents can be taken over. Those 'free' patents would be trouble when Red Hat is dead or sold (either of those is an inevitability, it's just a matter of time). Red Hat staff should simply refuse to apply for patents (some told us they have) because these patents expiry date will likely outlive the company itself. Where might these patents end up?

Here is Bloomberg's Susan Decker with her report on Ira Blumberg and LOT Network -- a report that has just been licensed and reposted by Indian media (Economic Times) [1, 2]. The relevant parts:

Red Hat Inc. and Lenovo Group Ltd. are giving away free patents to any startup that joins a group of more than 200 companies devoted to keeping its members and their patents out of court.

It’s a carrot to entice startup companies to join the LOT Network, a non-profit created by Alphabet Inc.’s Google and Canon Inc. four years ago to combat litigation by patent assertion companies, known derisively as “trolls,” that don’t make any products but seek royalties by challenging patents. By joining LOT, a company agrees that if they sell patents to such firms, all group members will have a free license to them.

“You’re binding yourself to the mast and saying ‘I’m not going to give in to the siren song of trolls,”’ said Ira Blumberg, vice president of intellectual property and litigation for Lenovo.

[...]

“It is difficult to get a sufficient number of companies to coalesce around a single solution that will address the problem,” McBride said. “There is a mesh of overlapping efforts and LOT is a significant player.”

It’s easy to attract larger companies, said Ken Seddon, chief executive officer of LOT, which stands for license on transfer. The group’s members collectively own some 1.1 million patents and patent applications worldwide. That provides immunity from a fraction of the patents in force worldwide -- more than 347,000 were issued last year in the U.S. alone.

LOT Network does absolutely nothing about Microsoft and its trolls. Just like OIN, it seems to be a pact whose purpose is to protect software patents from critics (software developers) rather than protect developers from such patents. These are relatively weak, corporates-led attempts to appease technical people.

"Just like OIN, it seems to be a pact whose purpose is to protect software patents from critics (software developers) rather than protect developers from such patents."Red Hat bragged that it pocketed a "patent standstill" with Microsoft, but how does that help developers who don't work for Red Hat? It does not. Generally speaking, Microsoft has bought the silence it needed from many of its potential critics (Canonical, SUSE, Red Hat, the Linux Foundation, even OSI), so don't expect them to lash out, file a complaint etc. It's a "divide and rule" tactic and money helps Microsoft tremendously with this strategy. ⬆