Patent trolls are bad enough on their own. But increasingly, companies that otherwise develop technology and sell products have begun outsourcing their patent portfolios to patent trolls as a strategic weapon against their competitors, and that can be even worse. So say Google, BlackBerry, EarthLink, and Red Hat in comments …
Google's assertion is that cross-licensing deals can't be made with trolls. I'd humble suggest that cross-licensing based on MAD is an unfair game favouring the bog boys. It generally protects crucial items and as such generally non-crucial filers don't get to play.
Since a patent is government-provided monopoly, how about a percentage of patent fees going back to a "patent invalidation office" which checks to see if patents really are being awarded properly - a kind of inquisitorial system looking at the post prolific filers, standards-included rights and checking rights assigned to NPE's to see if the system is being abused?
Ok, I understand the benefits of this new law describe in the article, I really do, so this is going to sound a little negative.
If we get ride of all the patent trolls, are we clearing the way for us, or big business like Google? No, I'm not in favor of patent trolls, but this seems to me that this new law could be used as a firewall between the little guy and big business. Wouldn't this law require all the little guys to hurry up there 1 man patent investigator to counter big businesses 1,000 man investigators?
Wouldn't this new law make it turn out to be that the little guy will probably patent something that is already patented, or if the patent is valid, big business would just come in and step all over them until they bought/stole/copied the patent while the little guy looses their entire bank?
I think what they mean here is that you must actually use the design you have patented, not use the patent itself.
So, if you design a superdoitallwidget which has some interest tech in there that you've patented you must actually make the superdoitall etc or properly and fairly license the tech you have developed and not just sit of the design and patent hoping that someone will infringe it at some point in the future and sue the ass off them.
If suing people for infringing your payments is how you make all or the majority of your cash then you are a patent troll (OED feel free to use this definition in future editions).
> The only benefit a patent provides is a basis to sue if you feel your patent has been infringed upon.
That shows a (wilful?) misunderstanding of what patents are for.
Without patents, all you can do with your super whizzbang design is to keep it secret, since if your competitors figure it out they can make the same gadget but without any of your R&D costs, so they are cheaper & you get screwed. Keeping it secret is not only difficult, but in a fast-moving technical field it can slow down everyone's progress.
What a patent does is to allow you to publish the design so that others can say "gee, that's clever, and I can see a way to make it even better", while the patent grants you the right to exclusive use of the design for a time, so your competitors can't just re-use your idea without your permission. It protects your idea as the inventor, and still allows other people to learn from, and improve upon, it. Supposeedly a win-win situation.
The problem we see today is not with the idea, but with the implementation. Patent offices are granting unnecessarily broad patents without understanding the technology, and big companies are abusing their size to crush competition that can't afford to defend itself even when it has a justified claim.
The solution is to fix the system, not to discard it.
There needs to be a way to correctly identify truly original ideas, and to ensure that only the minimal 'ingenious' bit is protected. There should be penalties for companies who bring, and lose, frivolous suits, and possible legal aid for small companies to defend patents. The PAEs mentioned in the article should be banned, or at least made financially unworkable for all but genuine claims.
You are correct with regards to the community & overall knowledge base but you are (willfully?) not understanding what a patent offers the patent holder. The patent gives you the right to seek financial redress through the court if you catch someone infringing on your temporary monopoly on the use & production of the clever bit. You, as patent holder, are responsible for identifying alleged infringements and the onus is on you to prove that you are in fact being infringed upon. Should you prove your case the patent allows you to ask for compensation. That's all it offers the patent holder, it does not protect your clever bits, it allows you to punish others if they use your clever bit without your permission and you catch them and can prove it.
You are granted the patent (temporary government sanctioned monopoly) in exchange for your contribution to the knowledge base. It is up to the patent holder to determine if they want to seek financial compensation for said patent. A patent does not require you to exercise your right, it only gives you the option to do so.
I don't agree that all it allows is for the holder to sue.
Consider a situation where you develop & patent something. I see your design, am mightily impressed, and (from my perhaps different background) see a way to make it even better. I patent my improvement.
Now, I can't actually do anything with my improvement, since I need your patented basic design to make use of it. (This, incidentally, is where the "implement it or lose it" option falls down). You can choose to ignore me, and continue to sell your Mark 1, but since my improvement is public your customers are likely to come along and say "why don't you add Phil's extra bit, I'd pay more for that". A third party might even look at the whole and figure out a way to effectively implement our combined design in a way that doesn't infringe either patent, and we both lose.
Ideally, we should sit down and discuss cross-licensing, and if we get that right we can both make a decent commercial success of the new, improved, Mark 2.
That's how it should work.
Does that mean that Apple can shutdown my toaster manufacture just because my toaster looks a little bit like a rectangle with rounded corners?
Does your toaster manufacturer indemnify you against this sort of lawsuit? Because I'm pretty certain that a lot of people produce slices of toast using these devices... slices of toast which look suspiciously like rectangles with rounded corners. Maybe you should fire off a legal nastygram to your baker, pointing out they're exposing you to litigation?
Hit submit too soon, sorry.
I agree the PAE'a are screwing the system and it is bad for everyone (except the lawyers). I do think the invention should have to be at a minimum level of use/production within a predefined window in order for the patent to remain valid, but there we are discussing the invention itself, not the patent. The patent can only be used to sue.
No, he just said it in fewer words than you did. And in denying that, you deny the ability to get at the root problems that plague our current system. The only direct benefit of having a patent is the ability to sue someone who infringes on it. Like any rule, it can be abused. All the stuff you highlight in your post are at best secondary benefits and not guaranteed in the same way the primary is. It is easy for us to agree that only "truly original ideas" should be patentable. You and I agree that "rounded corners" doesn't meet that. Apple doesn't. Unless I claim inerrancy, I have to admit the possibility that I am wrong and Apple is correct. (I can be doubtful about their claim based on the large number of people who agree with you and I, but I still have to grant the possibility that I am wrong.) And that is where implementation falls apart.
The trolls are only half the problem, really. The other half are the various patent offices waving through patents despite very clear prior art, and allow patents for minor design points. Case in point was the awarding of a number of patants a few years ago by the USPO for networking technologies that had clear prior art back to the early 1970s. The company which gained the patents is a known patent troll.
And of course, Apple's filing for a pantent on, basically, a rounded corner should simply be laughed away. Rounded corners have been known since the stone age. Certainly not a new technology worth protecting under patent law.
Unfortunately, such cases seem to be the norm these days. Were the patent offices not trying to catch up with the sheer amount of ludicrous filings, I guess they could also afford to be more judicious in awarding patents. Which brings us full circle back to the companies complaining about the trolls: they themselves are flooding the patent offices with ludicrous filings...
Sigh. Apple did not file for a patent on rounded corners. It filed a registered design (in European terms, or a design patent in US terms) which is very different from a patent. It included seven characteristic features of the design, of which rounded corners formed one. The case was about whether Samsung's phone, *as a whole*, had been designed to look like Apple's registered design.
They registered a blank rectangle with rounded corners. The design didn't even show the home button. There were no measurements or aspect ratio's stated meaning Apple were trying to claim ownership of the rectangle and the rounded corners.
Remember, the only thing registered in that design was the black outline, everything else can be ignored and yet you still defend this company. What does it take to break through the RDF?
We cannot forget about the companies who patent things but have no intention or ability to produce a product with that patent. I also consider these company patent trolls too. In my opinion, only an individual should be able to patent an idea without having to produce an item with the patent. If a business owns a patent, a use-it-or-lose-it clause should be in effect.
The issue with getting tough on patents at filing (and it's not that I disagree with you, but there is another side) is that it would greatly increase the cost of filing a patent. There is a choice, extensive vetting beforehand at greater cost, or vet later via the courts if there is an issue. On balance they decided upon vetting when a problem arises to reduce the initial cost of filing. Neither way is perfect, but there is a flip side.
The cynic in me believes that perhaps the method they chose results in more money for lawyers. Perhaps a better starting point would involve lawyers and deep wells.
Perhaps punitive damages should be awarded when someone asserts a patent for something they should reasonably have known wasn't patentable in the first place? For example: if it is not the type of thing that is patentable or they could easily have discovered prior art if they had tried.
It is, of course, very easy to criticise the various patent offices But what you mean is not that there is prior art, you mean that there are things around that you believe would have a strong chance of being judged as prior art if it ever came to trial.
And, the whole point is that these trials are expensive. If it takes 1million dollars minimum to defend, then it would probably take around this much to work out for any given patent that there really was no prior art.
The real problem is this: the patent system is based around arguing whether two things are the same as each other. Are these rounded edges a critical part of the Apples look. Or is it just obvious that the only thing that sharp edges on a device that fits in your pocket is going to end in holes? Are rounded edges cool? Or are they just a knock off, invalidated by the prior art of the safety pin?
And this encapsulates the real problem: we are arguing about how many angels can sit on the head of a pin.
Well put sir, but regrettably, these events are in a country which like many other ex-democracies, has a ruling group consisting of lawyers and pressure group merchants, funded by large corporate mendicants. Asking lawyers to fix legal problems reminds me of foxes and hen houses.
"I understand the benefits of this new law"
There is no new law. The filing wasn't sent to Congress asking for a new law it was sent to the FTC and DOJ asking for an examination of a practice that is becoming more common which is the "privateering" described in the article. It is believed by the petitioners that this practice may violate existing antitrust laws in the U.S. and ideally that is what the petitioners hope the FTC and DOJ decide after the investigation. This is only about the application of existing laws, no new laws were mentioned. If anything, I personally think some laws need to be pared back, specifically, patents on methods describing the operation of electronic equipment designed to perform logical and mathematical functions on a set of data, a.k.a. software.
Its not capitalism, its the law and there for government interfering with capitalism. Pure capitalism would not have patents, and people would just compete. But they actually don't want to compete, that's too hard, so there are laws in place to protect them.
Remember copyright? Or even bank bail outs. Same thing. Government interference. Why? Well, in the US the lazy corporations pay for or as most would call it, buy their government with "donations", or bribes as again most would call it.
Unfair competition I hear the lazy bleat? In capitalism, there is no such thing. And, no, we don't actually have real capitalism. We have a massively corrupted form of capitalism.
"And, no, we don't actually have real capitalism. We have a massively corrupted form of capitalism."
Absolutely. Pure capitalism, like pure communism, is a fantastic ideal on paper or as backing for revolutions and upheavals, but because of the innate greed and perversity of human nature, neither can actually work in a real-life scenario.
Because no matter how fair or just a political ideal may be, someone, somewhere, wants to gain at the expense of the other guy, and it's the ones who discover ways to game the system to their own advantage that always end up winning; and what you then have is an inevitable return to the old aristocratic feudal society where the rich descendants of the gamesters who ruined the ideal system for their own gain, become the dynastic rulers of the new order.
Historically, humanity's method of dealing with this sort of dynastic corruption has always been revolution and upheaval; a group of disaffected revolutionaries extol the virtues of either a communist or capitalist idealistic system as described above, enlist the help of the proles in overthrowing the dynastic rulers with the promise of a bright new future for all, and if they win, for a brief golden age everything is wonderful. But invariably some new gamester appears to exploit the new system, and so the cycle continues.
Until now. With the advent of technology, and more so psychology, revolution has become impossible. With psychology, the dynastic rulers can control and manipulate public opinion, tying the disaffected up with minutiae until an absolute hierarchy prevails forever. The days of storming the Bastille with pitchforks and torches are well and truly over. One only has to look at the fate of the Occupy movement and the public perception of them to understand exactly how this works. Expressions like "first-world problems", "hippies expecting handouts", "get a bloody job", "I work my arse off so should you" echoed by huge numbers of middle-class office sheep, like many on this forum for one example, show the effectiveness of psychology and manipulation of public opinion in derailing revolutions.
Technology was supposed to free us and make our lives easier. Back in the 70s, the average working week was 38 hours, with talk of automation leading to a future where the three-day-week would be the norm. People would have more time for leisure, and everyone would benefit from the many new ways in which technology would free us from the exigencies of manual labour.
Yet it didn't happen, did it? Now, your average working and middle class wage slaves toil 60-to-80 hour weeks AND rubbish the hell out of anyone who doesn't want to do the same. The buying power of the average Joe has decreased massively: for example, in 1975 my Dad earned $108 per week working 38 hours a week and bought his house for $25,000. Today, a worker in that same job works minimum 47 hours for $620 a week and can expect to pay $350,000+ for a similar house. You work it out: 25,000 / (108 pw / 38 hrs/w) = 8,796 hours' work for a house; 350,000 / (620 pw / 47 hrs/w) = 26,532 hours' work for a house. That's less than ONE THIRD the buying power per hour of labour today than what we enjoyed in 1975.
So it would seem that the same thing has happened to the ideal of capitalism under today's leaders, as what happened to communism under Lenin and Stalin. Except that the revolution that brought the Soviet Union to its knees won't be repeated in the West. The abuse of technology, and the master manipulators of psychology and all the bleating sheep who worship their own slavery at their hands, have seen to that.
(1984 icon because Orwell beat me to it by 65 years)
yes the grip is pretty tight on free human thinking :(
i'm afraid the only way out of this misery is possible only after we reach technological singularity (and the ruling parasites are fighting the progression towards it at every step, derailing promising tech in favor of dead end technologies - the ones which do not lead to any progression towards technological singularity and which allow the most subliminal control, sidetracking population towards technological banalities)
Isn't this one more a grey area between outsourcing corporate functions and full-blown patent trollery?
Companies generally employ the services of a patent/trademark specialist firm to handle registration of intellectual property and employ outside legal firms when it comes to court action rather than employ in-house specialists.
Is this a modern "letter of marque" ? A British privateer brought the bounty back to the Admiralty and received a cut of the sale. Does the PAE own the portfolio, or is it managing it in the same way a company unloads a bundle of cash to an investment. If the former then trollishness is obvious, if the latter not so clear.
And a last question, if a company truly sells off its patents then doesn't it risk becoming hostage to its own fortune as it must pay licence fees to the troll it sold them on to?
As for your last question/scenario, I sometimes pondered it heavily. My solution, which I suspect is in play in many places, is to set up the license sales agreement that in exchange for not only a price for the sale, you as the patent/idea owner get a perpetual, fully-paid-up, usable-throughout-the-universe license and right to use the patent you are selling. Further, you get to improve upon it and own the improvements, without having to offer first right of refusal to the patent buyer.
Of course, if you let on that you DO know of an improvement, the buyer might walk if s/he thinks s/he can figure out the improvements. OTOH, for fear of losing the chance to own the product/patent/idea, s/he may just make a counter offer, or just shut up and buy the rights while the offer still is available.
I think we need to see a heavier shift into idea owners refusing to sell out 100%, and that they need to retain SOME significant rights. Look at how authors -- veteran and new -- are brazenly/bravely standing up to the publishing industry and demanding more royalties, or they retain worldwide e-publishing rights as a hedge against the publisher just "shelving" the book as a way to avoid paying royalties to an author, or as a hedge against a sloppy/lazy publisher not mazimizing the availability of the physical materials. Interestingly, some paper publishers indicate, grudgingly, sometimes positively, that the e-sales did not adversely impact the sales of their physical books.
Inventors need to think about that and stop selling out at 100% unlesss the offer is EXTRAordinarilay too good to quibble over. There is a risk, though, in that if there is a flaw in the patent or the basis of the patent, any and all co-owners might be severally and jointly liable for litigation or damages.
Well, we'll see!
So to paraphrase the article:
"The corporate cabal wishes to complain about Patent Trolls in order to get the law changed. One of the foundations of their argument is that since a Patent Troll has no products, the corporates have no ability to threaten counter-litigation as a means of negotiation."
I'm no fan of patent trolls, but in this instance I'd say "Bad luck!"
I can understand why mobile industry incumbents, like Nokia, which has spent well over 35 Billion dollars in R&D in recent years, would be aggressive in defending these investments by partially outsourcing defense of one of the largest IP portfolios in the world. I also understand why a company like Google might fear this approach because it fundamentally puts its Android business model at risk.
I suppose we must also look at core innovation...real developments and how Google's approach might impede such colossal investments in R&D going forward. Who's really stifling innovation in this scenario? At the end of the day, nothing is for free...not even Android.
$35 billion real dollars on research or $35 billion on accounting fiddles and unresearch.
Unresearch is where you spot someone with talent working for the opposition and employ them in a research post, give them a huge salary and all the toys to keep them happy but, because management generally doesn’t have a technical clue the chances of their work ever being used is about 0.
This is a legal way of preventing competition but means that really large corporations tend to have a massive negative effect on technological development.
Its completely unaffordable to the man on the Clapham omnibus. I looked into patenting something and rapidly discovered that I couldn’t afford a world wide patenting set up without first getting funding. I couldn’t get funding without exposing the non-patented idea to others to fund! I even discovered a friend who coughed up for a provisional patent for a device, he went around looking for funding an received none and within weeks of his provisional patent expiring the market was near flooded with his invention - from the very people he sought funding for, who must have spent more getting their production lines ready before the patent expired than he would have accepted for a complete buyout if they'd asked him.
Now to fix the problem of patent offices giving patents away to any idiot that asks for them then they have do do some very serious research to ensure there is no prior art.That means even SME's will no longer be able to afford patents and a patent system that works just for big business is - well not far off the shit we have.
And if the patent offices did have people who could perform their jobs correctly then they would go the way of tax inspectors or those who work for the FSA and can spot a failing bank - they move to the other side making leaving inexperienced people to do their job.
Tom, last para. There is a reason for this. The under-valuing of public servants, especially specialist skilled ones. I know of one tax dodger chasing specialist working for a government tax office who is targetted by tax minimisation specialist firms with huge $$ offers. But public servants, no matter how necessary their skills and public benefit, are routinely portrayed as a cost that must be cut, cut, cut. Meanwhile the senior PHBs, get bigger packages. In self interest, what is a rational person to do if their own employers demonstrate a hatred of the the staff who fund them ?
This may also explain patent offices being gamed by patent application requests. If any staff are not valued, why stay and suffer various forms of abuse, especially from PHBs, HR droids and loudmouth media ? The experienced staff leave, and quality of service drops. Number of cases in and out become PKIs, not whether a decision is sane or correct.
The simple thing here is for patents to only be maintained where the owner is either exploiting the technology, or has credible plans for its potential use. That could be tested in court. It would immediately get rid of the issue of patent trolls just sitting on patents, often of dubious merit (but still costly to fight in court). In a lot of cases, patent trolls are counting on being paid off as an alternative to a costly action.
It would also be of economic value. It should be remembered that patents, which grant a limited life monopoly on a technology, where only introduced in order to provide incentives for companies to innovate and develop by allowing them a window of opportunity to recoup their investment. This temporary monopoly was never intended to provide some form of trade-able capital asset or as some form of moral right to "intellectual capital".
An answer may lie in the (periodic) renewals process.
Put in a requirement that, at renewal, the owner proves to the USPTO use in manufacture of the invention by (a) the owner or, if not using, (b) a licensee. Make the proof requirement subject to an anti-falsifiction rule and attach heavy penalties for false submissions.
No, I'm going for a beer.
Any patent reform needs to take into account the interests of the little guy; the lone mad inventor, the small start-up and not just big business.
It needs to to do this via increasing the focus of patents and by effectively nationalising patent portfolios such that a patent become a nation's intellectual property with the licence money minus admin costs paid to the patent filer. Since all patents are held at a national level the little guy will not incur excessive legal bill protecting his IP, and nations will benefit from increased innovation,and be the gate holders against stupid broad patents.
Thus more beer for the little guy!
Given how the trolls tend to have more corporations than patents and can simply have the corporate entity behind failed legal action X go bust rather than pay up. I can understand why even big corporate players are asking, not before time, for some balance.
Yes we have seen how big payers if they are given free reign, will abuse the system. Google will want to SHARE eveything. For Patents to work these days you need almost a productivity test.
Is the patent being used by a small biz, is their production (sales value or volume) enough to allow them to be trodden on.
Does the patent holder just hold the patent or do they produce goods with it.
Are any of the parties engaged in nuisance litigation. Are they the inventor, produce goods directly based on the invention, or have enough financial capital to really fight it out?
The easy approach is not to do an in depth analysis of what is actually good for the country. The result is that the big corporates win.
So anything, that seeks to get a meaningful report on the mess HAS to be applauded.
The simplest approach would be that any case involving patent infringement should require a re-investigation of the contested patent by the Patent Office prior to further legal action. Only if the Patent Office review concludes there is still merit in the patent, could any other court action take place. This review could be done for a fixed few thousand dollars in an open format (ie open for submissions from the public, but at the judgement of the patent examiners).
Once the Patent Office has stated there is still merit to the patent, the rest of the court case a judge/jury led investigation of the validity, if infringement has taken place, and to what level, and with what financial impact can take place and then sanctions and penalties.
Patent trolls would then be required to pay upfront for the initial re-examination (a barrier to frivolous claims). If the Patent Office throws out the patent at re-examination, the trolls would sue the Patent Office, not the target company and so, only strong and pre-tested cases would make it to the courts.
Patent trolls would not exist if patents were not stolen on a regular basis.
(read through before jumping for the down vote)
Many a small time inventor HAS to rely on a specialized company to protect his patent because lawyers are far too expensive. Patent litigation can take years, which for the guy in his backyard workshop, is not even remotely possible to pay for. Is that fair? Of course not.
Sure there are some really nasty trolls out there, but the MAJORITY of the complaints is by companies who steal from the little guy everyday and want a free pass to so. Because when they loose to the little guy, it costs them millions for dragging it out so long and that's just the award to the plaintiff.
The other reason for the complaints is the ridiculous patents being granted. Rounded corners? Push buttons? The companies who get away with this want to be the only players in the patent troll game.
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