Video #18: Autobiographical Trial Evidence

Video #17: Patent Trial Consolidation

#18: Skyhook vs. Google

“Skyhook Wireless sued Google in 2010 for patent infringement and anticompetitive contact after the company controlling Android bullied Samsung and then independent Motorola out of partnerships with Skyhook concerning its location-positioning software.”

Google was able to postpone the trial by consolidating the lawsuit over nine more patents filed in September with this one. Because of all of the work that has to be done now the trial will not take place until next year in 2014 but when it does finally take place it will be a bigger deal.  

The consolidation of the two Skyhook v. Google cases was ordered over two weeks ago. Basically another trial date will have to be established. Skyhook’s lawyers knew that this could possibly happen. The only way they could have avoided that was to further postpone the second case that was to take place in September. Skyhook decided to schedule the second case at that time because two of the four patents-in-suits were tossed and they wanted to assert themselves as much as possible despite the risk of a delay.

This is a prime example of how patent cases are taking an unbelievably large amount of time to be handled in court. This suit was filed in 2010 and will not go to trial until 2014. The industry changes too quickly for this sort of legal debacle to occur. Google can delay the trial for now but will eventually have to deal with the infringement violations. Unfortunately for Skyhook this process is far too lengthy. 

#17: Google vs. Microsoft

Google just lost out again in a preliminary ruling that stated Micosoft's Xbox gaming console dose not infringe Google's (Motoroloa's) U.S. Patent Number 6,246,862 on a "sensore controlled user interface for portable communication device." This was the only patent-in-suit left in this particular investigation because Google has already withdrawn for SEPs (standard essential patents). In october it dropped its WiRi patents, and after Microsoft told the ITC of the settlement Google wanted, Google went ahead and withdrew two H.264 video SEPs. 

"Once again the judge's decision can be reviewed by the Commission, the six-member decision-making body   at the top of the ITC. Google already told the media that it's "disappointed with today's determination and look[s] forward to the full commission's review"."

In June, Judge David Shaw, apparently already believed that Google would loose its case. In his notice he claimed that  no violation was found. "There are different possibilities: a finding of no infringemenent, a finding of invalidity, or some other (less common) reason. A detailed version of the ruling will become available. It usually takes several weeks before a redacted version is published."

I like what Fosspatent's had to say about this. Basically after every Microsoft-Google ruling in which Google looses, its 12.5 billion dollar purchase of Motorola Mobility becomes more questionable. Microsoft has one 3 German patent injunctions, 1 U.S. import ban, and will probably win another injunction in Germany due to Google Maps. Google's Motorola, on the other hand, has one a few minor cases in Germany that were never enforced. Imagine if Google was charged for its own legal fees as well as Microsoft's fees because it keeps loosing. Maybe then the company would think twice before it waisted time and money on such litigation. In addition, perhaps Google would no longer be as powerful. 

"I believe Google will soon realize, or may already have realized, that it needs to pay Android patent royalties to Microsoft, and that Motorola's patent portfolio doesn't give it enough leverage for a "freebie" cross-license."

Video #16: Three Types of Trolls

Video #15: IP Aquisition

#16: Some Empirical Data on PAEs

I found a post on http://www.patentlyo.com/ called “Paten Trolls in Public” that discusses empirical evidence on 10 publicly listed Patent Assertion Entities (PAEs) in business from 2005 to 2010. More specifically the study looked at Acacia, Asure, Interdigital, Mosaid, Network-1, OPTi, Rambus, Tessera, Virnetx, and Wi-Lam. It is interesting to take a look at this data while Congress considers the SHEILD Act. Just to reiterate the SHEILD Act would place a higher burden on PAEs, by making them liable for both sides’ legal fees if they sue and lose. They were able to come up with data for three very interesting questions.

1. How much licensing revenue do PAEs get per company sued?
Looking at these PAEs lawsuits flied in the Patent Freedom’s database of patent trolls they found that the average licensing revenues totaled nearly $6 billion. (You can find more information in there paper The Private and Social Costs of Patent Trolls for details on this database and the matching). The mean licensing revenue per defendant comes to 3.8 million in 2010 however this number is a bit low as it does not account for accruals.

2. How does revenue vary with PAE business model?

We identified three different types of business models:
A) "middlemen" who acquire or license patents from third party inventors (e.g., Acacia). Middlemen based PAEs file 80% of the lawsuits but earn only 0.7 million per defendant.
B) "R&D-based" who conduct R&D and file their own patents (e.g., Rambus). The R&D based PAEs file fewer lawsuits but their licensing revenues are greater. More specifically they account for  6% of all lawsuits but 83% of the revenues. This means that they earn about $54 million per defendant.
C) "salvage" where an operating company becomes a PAE using patents it developed for its own business (e.g., Asure / Forgent).

I think this suggests that the SHEILD Act could destroy these middlemen-based PAEs as they would have a much higher risk of loosing money because they sue so much more, inevitably they will lose some cases and will have to pay even more money. In addition, their revenue per case is lower which makes it riskier to sue as they may loose more money than they could earn from winning the case.

3. How much of the licensing revenue flows to inventors?
In addition, the study reported that only 7% of PAEs licensing revenues earned flowed to third party investors. For the “middlemen” 31% and for R&D only 26% of licensing revenue flows to third party investors. Most of the revenue then is needed for transaction costs and investors really do not benefit as much as they could at perhaps a more innovative company. If the SHIELD Act reduces profits, investors will get even less which may lead them to back off.

#15: Google vs Apple Regarding Patent 6,246,862

FOSS Patents recently posted about Google’s attempt to use Steve Job’s biography as a way to salvage a patent and win the iPhone import ban. Basically, U.S. Patent No. 6,246,862, known as a “sensor controlled user interface for portable communication device,” hinders actions made on a touch screen when a phone is held “in close proximity” to the head. This patent is a “high level idea” and therefore gives Google “some leverage” against Apple “if successfully enforced.” Judge Pender who first reviewed the case in 2012 determined that Apple did infringe a 3G patent but not the 6,246,862 patent, “which he deemed invalid for indefiniteness.” However, the U.S. trade agency reversed this indefiniteness and called for a reinvestigation. Now Google has to prove that the patent is valid and infringed an even narrower claim. Apple will win if the patent is still ruled as invalid or if it’s upheld only on the basis of a claim construction so narrow that Apple no longer infringes.

           Basically, the issue here lies in whether the invention has obviousness, meaning “that it was not known in its entirety but there was no inventive step involved that would justify the grant of a new patent” or anticipation, meaning “the invention as a whole was already known on the priority date.” In a 2002 decision the Federal Circuit said that "[a]ppreciation by contemporaries skilled in the field of the invention is a useful indicator of whether the invention would have been obvious to such persons at the time it was made".

          The biography ties into this story when “Apple's expert, Mr. Lanning, could not deny that Mr. Jobs himself characterized the incorporation of a proximity sensor into the iPhone as a 'breakthrough' to his biographer, Walter Isaacson: '[a]nother breakthrough was the sensor that figured out when you put the phone to your ear, so that your lobes didn't accidentally activate some function.' [...] The sensor described by Mr. Jobs is the very technology that the ALJ found to infringe. [...] And there can be no doubt that this passage refers to the technology of the '862 patent: it describes a sensor that prevents the inadvertent actuation of the phone when it is put to the user's ear. The recognition that the invention of the '862 patent was a 'breakthrough' weighs heavily against a finding of obviousness, particularly since it came from Apple itself.”

          “Assuming the quote is correct, Steve Jobs was impressed by the sensor that figured out when you put the phone to your ear. But Motorola's '862 patent is not a patent on a way to detect such proximity. The sensor that Google's (Motorola's) patent references is an "an infrared (IR) proximity detector" and "has an IR transmitting element [...] and an IR receiving element [for example, a photodiode] that are mounted side by side in the housing behind a lens". Motorola didn't invent such basic infrared technology.”
 
         “Steve Jobs was certainly knowledgeable about phones sold in the market, but he wasn't aware of all patent applications, granted patents and other publications relating to proximity detectors. Chances are that he had not read even one of the prior art references relevant to this case.”

#14: Living the "High" Life

Today in Businessweek an article discusses how many workers in the Silicon Valley have medical Mariana cards. Apparently, “People just don’t care,” if you smoke, “you don’t need to hide it” and if you don’t smoke, “you accept [the fact] that there are people around you who do.” However, it is not used illegally as buyers in California are allowed to have medical marihuana cards. Palliative Health is a medical marijuana dispensary in San Jose right in the heart of the Silicon Valley and sells everything from marijuana infused sodas to chocolates. 40% of Palliative Health’s customers are engineers, programmers, as well as other tech workers who get back and whist pain from programming 15 hours a day. 

MedMar Healing Center, which is only a half-mile away from Adobe, offers marijuana infused chocolates known as “Veda Chews.” Apparently, they do not give workers a “high” but do provide them with “the mental clarity…and pain relief” allowing them work more effectively.  There are even infused breath sprays available

The big tech firms are less happy about it and do not formally approve, however, companies are finding it harder and harder to find employees that can pass pre-employment drug tests. However, as the drug does not inhibit tech workers intelligence or value it seems like it will stay popular. And as for the distributes, they will probably be getting more and more business.

           

#13: Who really invented the telephone?

The article “Innovation, Intrigue, Subterfuge, and the Birth of an Industry” sheds light on the fact that patent filing has hurt inventors and stifled innovation from the very beginning. Basically, Alexander Grahm Bell, the man who was granted with the first telephone patent in 1876, represents how money has corrupted the patent industry. Antonio Meucci’s was actually came up with the idea first around 1856. However, he was unable to patent his invention because he lacked the funding. Although, some believe he may not have actually understood how the telephone would have actually worked. Elisha Gray did understand electric telephones. He was a prominent American inventor and one of the founders of Western Electric. His invention was the liquid transmitter and he would have been the first to transmit sound with this technology if it had not been for Bell. Bell and Gray were apparently working on the technology at the same time. Bill found Antonio Meucci’s work on phones and then bribed the USPTO to let him know if any other telephone patents were filed. When Gray’s lawyer filed a partial patent on Feb. 14^th, 1876, Bell filled a full application on the same day. The filings were similar and Bell received the patent, although he had not even fully tested the product.

Reading about this is frustrating as Meucci and Gray deserved to get the patents over Bell but because bell had a good lawyer and money he was able to manipulate the situation. It is a bit disheartening that even then, patent wars were happening on a smaller scale. Especially as the little guy always looses out. Small start ups truly struggle when trying to compete with Apple, Samsung, Google, and the other established giants. Although they did make it, now it is almost impossible to break into that market.

Video #14: Money Buys Influence

Video #13: Funny News

Video #12: Germany's Patent-Holder Friendly Policy

Video #11: FRAND

#12 FRAND Licensing New Policy Proposal

I read through the articles posted on http://www.fosspatents.com/ and one story caught my eye. On Tuesday March 5^th, 2013 an article called Chief economists of EU Commission and FTC make proposals for FRAND dispute resolution, discusses how three European economics professors, “believe their proposed reforms to the IP policies of leading SSOs ‘would greatly improve efficiency in patent licensing’ and help address the ‘holdup’ problem (SEP holders seeking supra-FRAND royalties at the threat of injunctions).”

FRAND is a legal term that stands for “Fair, Reasonable, and Non-Discriminatory” and is used to describe patent licensing terms. Companies often have to agree to license a patent under FRAND terms before it is fully approved. For example, Qualcomm’s WCDMA, Wideband Code Division Multiple Access which is the 3G technology, uses many core CDMA, code division multiple access, technologies created by Qualcomm. As I understand it this licensing agreement had to adhere to FRAND standards in order to be legally sound.

In case all of this sounds like gibberish to you…. This site is really helpful it defines all of these technical terms in greater detail. http://www.mobileburn.com/definition.jsp?term=UMTS

Going back to the point of the article, the CPI (Competition Policy International) has published a paper that is hoping to help solve the patent licensing problem. The views are not shared by the European Commission, Department of Justice, or the FTC. However, the ideas of these three professors has resonated due to the large amount of power and influence they maintain within each of their institutions.

FRAND licensing is continuously a core problem of pending litigations. But the professors argue that SSO can and should do more about the problem. SSO, Structure, sequence and organization, is a term used to compare one software to another in order to determine if any parts infringe on the copyright protection of a software. The term was introduced in the case of Whelan v. Jaslow in 1986. The method of comparing the SSO of two software products has since evolved in attempts to avoid the extremes of over-protection and under-protection, both of which discourage innovation. More recently, the concept has been used in a major case brought against Google by Oracle. The professors argue that the membership of SSOs are divided on the questions of SEP enforcement: “SSOs typically specify very little as to the meaning of 'fair' or 'reasonable,' perhaps partially because there is heterogeneity among the firms, technologies, and products within a given SSO."

SSOs should bring people together and unite them to agree unanimously on policy so that a serious proposal for improvement can be reached. The professors shed light on the issue and advocate for more meaningful FRAND rules inside SSOs. Experts even believe that their logic may be referenced in future FRAND-related cases as it warns against awarding excess amounts of money that exceeds the value of the technology itself. I think this has the potential to eliminate patent trolls entirely as their business model runs on the revenue they collect from suing other companies. If the financial reward one could get was low, it would completely deter people from wasting their time and money on litigations.

#11: Microsoft vs. Google: Patent Litigation in Germany

The article "Google Play and Google Maps under Patent Fire," on the FossPatents blog discusses how “Google (the parent company) and its wholly-owned subsidiary Motorola Mobility have to defend themselves against Microsoft assertion that Google Maps (with a particular focus on the Google Maps Android app) infringes EP0845124 on a ‘computer system for identifying local resources and method therefore.’" This case, which press claim to be "the climax to date in the so-called smartphone wars," will be resolved in the Munich I Regional Court. Apparently, Microsoft would have just sued Google’s subsidiary, Motorola, however, because Motorola denied that they knew about “how Google's server farms integrate map image data and geographic search results” the responsibility of infringing falls on Google. The German court system works a bit differently than the US system. In Germany, “when a litigant succeeds in an action for infringement, an injunction is immediately available.” Conversely, in America injunctions will only be “granted if a patent is deemed exploited and monetary damages remain the primary remedy.”

Furthermore:

German patent law has made the country something of a patent shelter in Europe. Germany provides expedient decisions and easy-to-obtain injunctions that are hard to challenge for defendants. All that sounds fantastic until a corporation or small business is the target of those laws rather than the one benefiting. Furthermore, in these tough economic times, Germany’s patent regime has broad consequences for economic and technological development. http://www.law.illinois.edu/bljournal/post/2012/04/17/Germany-and-Patents-All-that-Glitters-isnt-Gold.aspx

Because Germany has these different patent litigation procedures, Microsoft was able to strategically halt Google. This is a huge issue as Google allows Android producers to license their services to provide Android users with the benefit of being able to use Google maps which generates massive returns for Google though online advertising and app sales.

I am not sure how big this issue is compared to any of the other patent litigations we have had. However, I do find this interesting because it brings international patent procedures to our attention. However, I do think it is interesting that an injunction is issues so quickly in Germany, if that were the case in the U.S. perhaps less companies would sue as often knowing that they too may be at risk one day.  
http://www.fosspatents.com/

#9: First to File System

The patent system used to work on a first-to-invent basis. That system has been used for the last 200 years. This means that when 2 people file for the same patent the patent office should identify and reward the patent to the inventor who was the first to come up with the invention even if they were not the first to file the patent application.

Today the first-to-file/first-to-disclose system is being implemented which will basically de-emphasize the invention date. Many argue that this will be an issue as patent trolls may have to opportunity to file patent applications on inventions that have not yet been filed by small start ups. However, according to this article an inventor can post their idea on a site or blog and then still file that application within one year of public disclosure. This is where the American patent filing system differentiates itself from the rest of the world. In other countries, once an idea is disclosed you cannot get a patent for that idea or invention.

In order to successfully adjust to this new system, companies need to act quickly. Implementing a process to quickly identify inventions is key. If a company does not have enough funding to file an actual patent application, a carefully prepared provisional application should be filed to ensure that the invention is disclosed in a legal way.

If the technology is worthy of patent protection, filing a series of low-cost provisional applications during the course of development of the technology can be a cost-effective way to establish a series of early “first-to-file” filing dates for the technology.
On the other hand, if it is decided that an invention is not worth immediately filing a patent application for, publicly disclosing the invention should prevent others from receiving patents on the same technology. But the decision to publicly disclose an invention before filing a patent application should not be taken lightly. Public disclosure prior to filing a patent application will likely cause foreign patent rights to be forfeited. In the case of software, which is not patentable in most foreign patent systems, this is not a problem. Therefore, disclosures for software-based inventions can be an ideal way to create prior art for others without the trade-off of forfeiting any patent rights that a company would otherwise be entitled to.

Video #9: First-To-File Patent System

Video #8: Microsoft

Video #7: IPAs

Video #6: New Judge Nominations

Video #5: Protecting Your Invention

Video #4: Paten Wars Debate Continued

Video #3: Patent Wars Debate

Video #2: Why I am taking IEOR 190G

Video #1: A bit about myself

Video #10: Trolls

Video #9: First-To-File Patent System