Bonum Certa Men Certa

The US Patent System: Where One Wastes Years in Court and Spends $8,000,000 in Lawyers' Fees Fighting a Bogus Patent

The US patent office has essentially externalised the costs to the public

Alice road



Summary: A roundup of news about software patents in the US and what they have led to, owing in part to the USPTO's declining patent quality (leaving others to clean up its mess)

THE ridiculously low standards of the USPTO come at a huge cost, albeit this cost is considered an externality by this greedy patent office. Unless this mess is sorted out soon, the US might have nothing left but large multinational corporations with tens of thousands of patents each, as opposed to agile startups with none.



Elliot Harmon says that this one particular software patent, which can possibly be demolished quite easily using Alice, has been used in the Eastern District of Texas and it's the "Stupid Patent of the Month" (as per the series of the EFF). To quote:

This month, a company called Voice2Text Innovations filed patent infringement lawsuits against two voice over Internet protocol (VoIP) services, Phone.com and Vitelity. Voice2Text has no website or any other information online; its sole asset appears to be US Patent No. 8,914,003—unsurprisingly, a patent on using voice recognition to convert a voicemail into a text message. Equally unsurprisingly, it’s filed those suits in the Eastern District of Texas, whose patent-troll-friendly practices we’ve thoroughly documented on this blog. The Voice2Text patent is so absurd that we had to honor it with our Stupid Patent of the Month award.


"Unless this mess is sorted out soon, the US might have nothing left but large multinational corporations with tens of thousands of patents each, as opposed to agile startups with none."In order to destroy such a patent one might need to spend quite a lot of money rather than settle. Consider this new story titled "Court Orders Plaintiff to Pay Defendants’ $8 Million in Attorney’s Fees in Patent Row". That's a lot of money; patent lawyers grossly overcharge and the system plays in their favour by inducing additional costs at many levels (e.g. appeals), thus favouring those with bigger budgets or deeper pockets, leaving small players vastly more vulnerable. To quote the concluding words: "This case illustrates that the courts will take strong action when faced with baseless claims, hidden or altered evidence, and misleading statements made to the court or opponents. It also serves as a strong reminder to consider your counsel carefully, and the advice that they provide, or a plaintiff may have to pay its own fees and those of the defendant, which in this case amounted to another $8 million."

This case may be the exception rather than the norm, but judging by NewEgg's decision to stand up to trolls, it often costs literally millions and there is no guarantee of the plaintiff -- upon loss -- bearing the cost of the defendant's (victim's) legal bills. NewEgg actually made history by managing to compel a patent troll to pay its victim's legal fees some months ago, owing to an unusual decision by the judge.

"NewEgg actually made history by managing to compel a patent troll to pay its victim's legal fees some months ago, owing to an unusual decision by the judge."Patently-O has just recommended Lynda J. Oswald's relatively new paper which criticises the term “strict liability” and whose abstract says: "In 1995, the Federal Circuit summarily attached the label of “strict liability” to direct patent infringement, even though that term does not appear in any U.S. Patent Act of the past two centuries. The catechism of “strict” direct patent infringement liability is now so well-engrained in patent doctrine that it is easy to lose sight of how recent the advent of this terminology is in the case law, and how troublesome application of this standard has proven, even to the Federal Circuit, which created it. The first patent act (1790) preceded the emergence of tort law as a distinct field of U.S. common law (mid-1800s) by a half-century or more, and the products liability explosion of the mid-twentieth century radically altered our understanding of strict liability. The implications of this forgotten timeline are profound. “Strict liability,” particularly in its modern formulation, is not a neutral, descriptive term. Rather, the term evokes social policy choices and balancing considerations that may be appropriate within the case law context of products liability or abnormally dangerous activities, but which are incongruous and inapposite in the statutory context of patent law. Deeming direct patent infringement to be a strict liability leads to two unanticipated and unwelcome effects. First, the adoption of the “strict liability” label for direct patent infringement liability improperly inflates the courts’ role in setting direct patent infringement liability standards and suggests — incorrectly — that patent liability is a case law construct, when in fact it is a statutory construct. Second, the “strict liability” label improperly shifts the focus of the patent infringement inquiry from the Patent Act’s protection of the plaintiff’s exclusive property interest in its patent right toward a value-laden examination of the social utility of the defendant’s conduct vis-à-vis the injury to the patent holder. Jettisoning the “strict liability” label for direct patent infringement would reframe the analysis and debate, moving direct patent infringement liability out of a policy framework and back toward its proper statutory setting."

"PTAB is increasingly being used to correct the USPTO's errors, but why not dig deep into the root of the problem and simply tackle the USPTO's unrestrained greed?"What's worth noting here is that a lot of the risk has been passed to defendants, not to plaintiffs, who often rely on poor quality examination by the USPTO (resulting in the grant of bogus patents). PTAB is increasingly being used to correct the USPTO's errors, but why not dig deep into the root of the problem and simply tackle the USPTO's unrestrained greed?

CAFC won't be coming to one's rescue after PTAB, according to one example just put forth by Patently-O. To quote Patently-O: "The Federal Circuit has denied en banc review of decisions in four inter partes review proceedings brought by Gnosis. Federal Circuit had previously affirmed the Patent Trial and Appeal Board’s IPR determination that the challenged Merck and SAMSF patent claims were invalid as obvious."

The relevance of this was ever more apparent when Bass gamed the value of companies by invalidating key patents -- a move which IAM now conflates with patent trolls by comparing Bass to trolls. Spangenberg is a patent troll, Bass invalidates patents. They have a very different modus operandi, but as IAM put it, the connection lies within a team-up: "Since teaming up with former IPNav CEO Erich Spangenberg to launch their first US inter partes review (IPR) in February last year – challenging a pharmaceutical dosage-related patent owned by Acorda Therapeutics – Kyle Bass has become one of the IP business world’s highest-profile players. Whether he should primarily be seen as antagonist, protagonist or the antihero somewhere in-between depends on your point of view. What is certain is that the validity actions being pursued by him and Spangenberg through their Coalition for Affordable Drugs – targeting patents belonging to pharmaceutical ‘originator’ companies – rocked the post-America Invents IP landscape."

"The USPTO's poor quality -- a trap which the EPO growingly falls into -- helps trolls, strategic predatory investors/hedge funds, and monopolists which do a disservice to innovation."What is worth noting here is that if the patents invalidated upon request by Bass were not granted by the USPTO in the first place, none of this would have happened. The USPTO's poor quality -- a trap which the EPO growingly falls into -- helps trolls, strategic predatory investors/hedge funds, and monopolists which do a disservice to innovation. Watch IBM's patent chief having the audacity this weekend to complain about the system which David Kappos from IBM made worse (in IBM's favour; IBM pays him now for lobbying), furthermore complaining about a system outside his own country (Australia) because it attempts to improve patent quality, as we noted yesterday.

Recent Techrights' Posts

All-Time Lows for Windows in Spain and Portugal
data which became publicly available less than 24 hours ago in statCounter
 
Links 03/05/2026: Insolvent US Bailing Out Google, Microsoft, Amazon, Nvidia, Oracle, OpenAI, and SpaceX
Links for the day
SLAPP Censorship - Part 65 Out of 200: Graveley and Garrett Claims Are Word-by-Word Similar (They Also Collaborated All Along)
We'll keep it short today
IBM Has a Long and Rich History of Showing Chatbots Bear No Business Prospects (From Jeopardy to Watson Healthcare and McDonalds)
Watson Healthcare is already in the dustpan, so they are rebranding it again
Europe Decoupling is Bad News for GAFAM, Especially Bad to Microsoft
Countries want independence
India Needs to Recognise That the World Wide Web is Monoculture in India
In the US, a judge with Indian roots dealt with a case related to this; why won't India?
All-Time Lows for Windows Down Under
seeing the demise of Windows in Australia (historically a slow or low adopter of GNU/Linux) is good news
Linux Kernel Tainted by Software Patents That Make Linux Worse and the 'Linux' Foundation is Compiling Bribes to Enable This (Promotion of Monopolies and Tolerance of Software Patenting)
Why you need to reboot when a serious bug is found in Linux? "Licencing"...
IBM's Kyndryl Accounting Fraud Explained and More Recently the Insiders Talk About Mass Layoffs
Judging by how the media totally ignored 800+ layoffs at IBM's Confluent and 400+ layoffs at Red Hat a few weeks ago don't expect to hear anything about Kyndryl layoffs
Links 03/05/2026: Water Shortages Crises and Slop Fakes "Are Coming for Your Bank Account" (Slop-Enabled Fraud)
Links for the day
The Corrupt Lecture the Non-Corrupt - Part XI - EPO 'Products' to Cement Asian and American Monopolies
Only a fool would believe Lame Duck Campinos
Microsoft Windows Falls Below 9% in South Africa
As one can expect, GNU/Linux is measured as going up in France
Gemini Links 03/05/2026: The Black Side of the Web, LiveJournal, Chimarrão
Links for the day
A Month Since Mass Layoffs at Red Hat (400+ Engineers Laid Off), The Media Didn't Cover It
We are very concerned about the state of the media
Over at Tux Machines...
GNU/Linux news for the past day
IRC Proceedings: Saturday, May 02, 2026
IRC logs for Saturday, May 02, 2026
Gemini Links 02/05/2026: Strange Psychosis and TUIs
Links for the day
Links 02/05/2026: Microsoft Has Begun Rebranding Vista 11 as 'XBox' (Because the Console is Dying), Slop Rejected by Oscars
Links for the day
IBM's CEO 10 Years Ago in IBM-Sponsored Forbes: "For those willing to embrace [blockchains], the future will indeed be bright."
How well did this prediction materialise?
SLAPP Censorship - Part 64 Out of 200: Not Amused by Repeated Threats (to "Shut Down" My "Existence" While Mentioning My Wife Too)
it's about censorship
RightsCon Cancellation as a Data Point in a World Gone Astray
RightsCon should not even be controversial
The NHS is Under Attack by Anthropic and Microsoft (or Their Lemmings That Infect the NHS)
They are kidding themselves if they seriously believe Web-facing source code repositories are the real threat to patients
cPanel is Not Linux, cPanel is Proprietary Software
It's fair to say I've used cPanel for 23 years
Links 02/05/2026: Gen Z is Turning Against Slop and OpenAI/Microsoft Rift Explained
Links for the day
Storage and Memory Prices Are Rising Not Because of High Demand (Production Can Match Demand), It's Partly Because of Price-Fixing (Same as Food Price Increases)
Sophisticated robberies are still robberies
Thousands of Layoffs at IBM, So IBM Pays Mainstream Media to Claim That IBM is Hiring (Paid Lies)
This is a story about the media failing us, not just IBM failing as a company
A Look at DataStax Bluewashing (IBM and Layoffs)
IBM is a place that many people leave or get pushed out of
Gemini Links 02/05/2026: Leaving Session, Alhena 5.5.7, and Slop Failing Customers
Links for the day
Over at Tux Machines...
GNU/Linux news for the past day
IRC Proceedings: Friday, May 01, 2026
IRC logs for Friday, May 01, 2026
Links 01/05/2026: Microsoft 'Headcount' Decreasing, Apple Quietly Killing Vision Pro
Links for the day
Oracle's Debt Grew by Over 50 Billion Dollars in 6 Months
Larry Ellison spent a lot of money buying a lot of the corporate media
In Praise of Debian
30 hours ago we began an upgrade
What Linus (Torvalds, the Linux Dude) Meant by "Show Me the Code"
"Show Me the Code" is a common cultural reference
Yes, GNU/Linux Can Run on Playstation 5, But Don't Buy It, Learn From Sony's Past of Rootkit and PS3 Betrayal
Millions of Playstation 3 owners will never forget what Sony did to them
XBox Will Not Last Much Longer, XBox Chief Admits Problems
Microsoft's latest "results"
Dealing With Demagogue in Free Software
Don't spread their ideology and never participate in any of their projects
What May 1 Means to Us (and to Many Others)
To me, May 1 means something
Microsoft Lunduke is 'Pulling a Garrett' by Turning Technical and Legal Debate Over Rust Into a 'Trans Debate'
Don't fall for the demagogue
Links 01/05/2026: Regulatory Trouble for Apple, Now Even Mozilla Pushes Back Against Google
Links for the day
Microsoft "Buyout" Offer is Less Than One Year's Salary
So our assumption about this was correct
The Corrupt Lecture the Non-Corrupt - Part X - European Patent Office Managers Have Crossed Red Lines, According to Themselves
The girlfriend of the President of the European Patent Office (EPO) is trying to muzzle EPO critics
Techrights is Still Growing, Attacking Techrights Does Not Weaken the Community
Bullying us for 2+ years does not result in fear, it results in us feeling more emboldened and motivated
SLAPP Censorship - Part 63 Out of 200: Graveley as a Stripped-Down Version of Garrett in the Particulars of Claim (5RB Barrister Could Do This in One Minute)
Lazily and sloppily, it looks like the barrister took Garrett's claims and tweaked them a little (shortened) for Graveley
Lots of People Leave IBM, Today IBM Has About 1,000 Workers Fewer Than Yesterday
Confluent "last day" for 800+ people
Been a Very Busy Week
Next week, as we have no upgrades to prepare for, we should be able to publish at the usual pace of 20+ pages per day
In New Letter Sent to Chair and Heads of Delegation of the Administrative Council of the European Patent Organisation the Staff Union Explains How to End European Patent Office Strikes
If Campinos continues to behave as he does right now, the Council can show him the door
Links 01/05/2026: Poems and Continuous Privacy Policy
Links for the day
Over at Tux Machines...
GNU/Linux news for the past day
IRC Proceedings: Thursday, April 30, 2026
IRC logs for Thursday, April 30, 2026
Microsoft Debt Rose Almost $50 Billion Since We Moved to Debian
GAFAM has a new name for debt