The US patent system was developed to protect true innovators from dubious thieves who attempt to steal inventions and make fortunes without paying the creator.
I believe it is a flagrant abuse of the system, to scour through a failed company's portfolio of patents and initiate a lawsuit against a firm succeeding and adding value in their space. The latest tangle of legal battles over wireless messaging, offers a poor reflection of NTP and Visto -- two companies that appear to be using their patents as lottery tickets or a final "Hail Mary" exit strategy to collect an unearned payday.
Having watched the NTP v. RIM case from the front row, my impression is that the case had nothing to do with actual patent infringement, and everything to do with exploit and greed. There should be more at stake for both for the companies and lawyers attempting to extort money from an inadequate patent system.
If you look at Visto’s recent history, they have been suing Microsoft Corporation and Good Technology for violating some of the same patents. And Visto took their turn in line, right behind NTP and Seven Network, before initiating this next suit against RIM. Isn’t it clear to everyone that the US Patents system and is in desperate need of an overhaul?
Let’s look at restoring innovation in industries across the board with tort reform. It’s high time the scales of justice tipped in favor of companies actually making a difference to corporations and to society as a whole.
3 comments:
http://quote.bloomberg.com/apps/news?pid=10000103&sid=a41rWoungkUc&refer=news_index
EBay Wins at U.S. Supreme Court on Patent Orders (Update4)
May 15 (Bloomberg) -- The U.S. Supreme Court, siding with EBay Inc. and its allies in the technology industry, said companies found to have infringed patents shouldn't always be ordered to change their products to avoid future violations.
The high court today unanimously set aside a ruling that would have barred EBay, the world's largest Internet auctioneer, from using patented technology owned by MercExchange LLC, a Virginia company. The justices said a federal trial judge should have discretion whether to issue such an order.
The ruling is a victory for technology companies that backed EBay, including Microsoft Corp. and Intel Corp., which said they are under siege from small patent owners who use the threat of those orders to seek high licensing fees. The decision is a setback for Pfizer Inc., Johnson & Johnson and other drugmakers, which said any lessening of that threat would reduce the value of their inventions.
``It appeared they were concerned about large corporations held hostage to minor innovations,'' said Brad Wright, a patent lawyer at Banner & Witcoff in Washington who also teaches at George Mason University School of Law.
The U.S. Court of Appeals for the Federal Circuit had said trial judges almost always should bar future infringement. Justice Clarence Thomas, writing for the Supreme Court, said trial judges instead should consider four factors, including the adequacy of damages to compensate the patent owner.
``The decision whether to grant or deny injunctive relief rests within the equitable discretion of the district courts,'' Thomas wrote.
Ruling Reversed
The ruling is ``the right way to redress a system that, over time, has become quite imbalanced,'' Intel General Counsel Bruce Sewell said in an interview.
Chief Justice John G. Roberts Jr. and Anthony Kennedy each added a separate opinion. Roberts, writing for three justices, said that historically judges have barred use of the disputed invention in ``the vast majority of cases.''
Kennedy, writing for four justices, pointed to an increasing number of companies that seek patents as a means of extracting ``exorbitant'' licensing fees, rather than selling products. He said damages may be adequate ``when the patented invention is but a small component of the product the companies seek to produce and the threat of an injunction is employed simply for undue leverage in negotiations.''
A jury found that EBay's ``Buy It Now'' service, which lets customers buy products at a set price instead of bidding in an auction, infringed a software patent owned by MercExchange LLC. A trial judge rejected a bid by MercExchange to force EBay to stop using the software.
BlackBerry Dispute
The Federal Circuit then reversed that ruling, saying shutdown orders should be denied only in rare cases, such as when an invention is needed to protect public health.
The Bush administration backed MercExchange, saying that patent owners shouldn't be forced to license their inventions when they don't want to.
Shares of EBay, which is based in San Jose, California, were unchanged at $31.49 at 12:15 p.m. New York time on the Nasdaq Stock Market.
The EBay case raised issues connected to those in a highly publicized dispute that had threatened to shut down the BlackBerry e-mail service. BlackBerry maker Research In Motion Ltd. agreed in March to pay NTP Inc. $612 million to avoid an order to halt U.S. service and sales.
That fight may have been in the minds of the justices as they considered the EBay case, according to Robert Yoches, a patent lawyer with Finnegan Henderson Farabow Garrett & Dunner in Washington. ``They read the papers and I believe they are aware of the issues,'' he said.
Backing EBay
Companies backing EBay in the case, either directly or through their trade groups, included Adobe Systems Inc., Cisco Systems Inc., Nokia Oyj, Time Warner Inc. and Yahoo! Inc. Trade associations representing the securities and communications industries also sided with EBay.
On the other side were General Electric Co., Procter & Gamble Co., Qualcomm Inc., research universities such as the University of California and trade groups for the pharmaceutical and biotechnology industries.
Drugmakers view patent protection differently than technology companies because blockbuster drugs may be based on single patents held by manufacturers who fear generic competition, lawyers say. Drug and biotech companies, as well as universities, say strong patent protection is needed to encourage costly research to develop new products.
By contrast, devices such as computers may include thousands of patented inventions. A computer maker may prefer to pay a licensing fee to a patent holder rather than risk being forced by a judge to shut down an entire product line over a single component.
The case is EBay v. MercExchange, 05-130.
To contact the reporters on this story:
Greg Stohr in Washington at gstohr@bloomberg.net;
Susan Decker in Washington at sdecker1@bloomberg.net.
Last Updated: May 15, 2006 12:26 EDT
Coming up with new products is difficult. Hiring lawyers for abuse is easy and only takes money. Money one of the most common and abundant things available to a business.
Here is a neat example of "Corraling the IP" that is along the same line as granting a "software patent". Ebay using "Buy It Now" is a patent violation???
May 16, 2006
Baseball Is a Game of Numbers, but Whose Numbers Are They?
By ALAN SCHWARZ
Like no other corner of American popular culture, baseball communicates in numbers. From .406 (Ted Williams's 1941 batting average) to 755 (Hank Aaron's record home run total) to countless digits bandied about water coolers every morning, statistics convey ideas and images that, even overnight, become inseparable from the players to whom they belong.
This relationship between players and numbers, so often romanticized, is now being stripped to its skeleton in a lawsuit with considerably wider ramifications. While the dispute focuses on fantasy baseball — in which millions of fans compete against one another by assembling rosters of real-life major leaguers with the best statistics — a real legal question has arisen: Who owns that connection of name and number when it is used for such a commercial purpose?
Many onlookers have cast this issue as a tiff over batting averages — as if children were squabbling over the backs of baseball cards — but legal experts are saying it could affect the wider arena of celebrity rights, freedom of the press and even how the press is defined as the Internet age unfolds.
The dispute is between a company in St. Louis that operates fantasy sports leagues over the Internet and the Internet arm of Major League Baseball, which says that anyone using players' names and performance statistics to operate a fantasy league commercially must purchase a license. The St. Louis company counters that it does not need a license because the players are public figures whose statistics are in the public domain.
According to the Fantasy Sports Trade Association, more than 15 million people spend about $1.5 billion annually to play fantasy sports, virtually all of them using an outside service to keep track of rosters, players' statistics, trades and more. Most participate through Web sites run by CBS SportsLine, Yahoo and ESPN, which have paid Major League Baseball Advanced Media approximately $2 million apiece this year for licenses to display players' names and photographs, team logos and varying add-ons like video highlight clips.
The St. Louis company, CBC Distribution and Marketing Inc., operates through the Web site CDMsports.com. It runs its customers' leagues without player photographs (which are controlled by players in nonjournalistic commerce) or team logos (which are trademarks owned by the major league clubs). Like those of many smaller operators, the St. Louis company's games present only players' names and seasonal statistics, which the company says are newsworthy facts whose publication is protected by the First Amendment.
"We're disseminating information to the public about baseball players no different than what a newspaper does," said Rudy Telscher, a lawyer representing CBC. "The American populace, at least a significant portion of it, has a fascination with baseball, they have a fascination with following the statistics, and I think the popularity of fantasy sports is borne right out of that passion for tracking the game and the statistics."
Major League Baseball Advanced Media, which purchased the players' Internet and wireless rights from the players union in January 2005 for $50 million over five years, contends that the players' identities are being exploited in a business venture distinct from conventional journalism.
"What a company like CBC is selling is not nearly a repackaging of statistics," said Lee Goldsmith, a lawyer for Major League Baseball Advanced Media. "They're selling and they're marketing the ability to buy, sell, draft and cut Derek Jeter, Alex Rodriguez, Albert Pujols. And part and parcel of the reason that people are willing to pay for that ability is the persona of Jeter, of Rodriguez, of Pujols."
Bob Bowman, Major League Baseball Advanced Media's chief executive, said: "The business here is not publishing statistics. The business here is running a league."
The case is scheduled for jury trial in United States District Court in St. Louis beginning Sept. 5. CBC and Major League Baseball Advanced Media filed motions for summary judgment that the court could rule on in July.
Major League Baseball Advanced Media, which runs its own array of fantasy games on the league's portal, MLB.com, has decreased its number of licensees from dozens in 2004 to 19 last season to 7 this year, focusing on large multimedia outlets like CBS SportsLine and cutting out many of the four-figure licenses that had covered smaller operators' use of only names and statistics. CBC, which had a license from 1995 to 2004, filed suit to confirm that it has the right to use those limited materials freely.
Dozens of small, unlicensed fantasy-league operators, as well as their customers, are watching the case intently because a Major League Baseball Advanced Media victory could put those operations out of business, said Jeff Thomas, president of the Fantasy Sports Trade Association.
Mr. Telscher said: "It's not hard to figure out what's going on here. This is moving toward a monopolistic market where M.L.B. controls everything that happens, when it was these smaller companies that built the fantasy industry into what it is today. This is not good for consumers. The reason that beer costs $10 at the ballpark is because there's no competition, and that's what M.L.B. is doing here."
Major League Baseball Advanced Media is not making a copyright claim to the statistics themselves; a 1997 decision in the United States Court of Appeals involving the National Basketball Association ruled sports statistics to be public-domain facts that do not belong to the leagues.
Rather, the central issue concerns celebrities' ability to control use of their names in commercial ventures, and how this "right of publicity," which has developed under state common law and statute over the last half-century, may commingle with Constitutional press protections under the First Amendment.
The term "right of publicity" was coined in 1953 when, in a case involving baseball, a court ruled that Topps Chewing Gum company could not print trading cards that featured baseball players' names and likenesses without their permission.
In 1970, in a case starkly similar to the CBC case, a Minnesota state court found that two baseball board games, each of which used only names and statistics, misappropriated the players' marketable identities and was subject to license.
But other subsequent cases have favored First Amendment concerns over the celebrities' right of publicity. Several courts have maintained that the dissemination of information, even for profit or for entertainment, cannot be curtailed by any state's right-of-publicity laws. In its court filings, CBC argued that it relied on baseball players' names and statistics "as their lifeblood in much the same way that the sports sections of newspapers do."
Major League Baseball Advanced Media, however, says that selling a service that helps customers pick and trade players crosses the line between reporting on games and running a nonjournalistic, commercial enterprise.
"What constitutes a commercial use — beyond advertising — becomes quite broad and hard to define," said Diane Zimmerman, the Samuel Tilden Professor of Law at New York University.
Several other experts added that courts were still reconciling the right of publicity with the First Amendment's press and free-speech guarantees, leaving the outcome of the CBC case significant beyond baseball stadiums.
"If anything, this case is even more impactful if the court rules for the players, because it will speak to any time you use a name in a commercial venture," said Eugene Volokh, a professor of law at U.C.L.A. "What if you use a historical figure's name in a historical novel? Or other games, like Trivial Pursuit? How about 'Jeopardy!'? Would they be liable as well? That seems to be the logical consequence of this. How do you identify what is news, and other times when there's communication of factual information?"
One interesting wrinkle is that Major League Baseball appeared to take the argument's other side in 1996. When several major leaguers from the 1940's and 50's sued Major League Baseball over use of their names and statistics in materials like promotional videos and game programs, baseball argued that such use was protected by the First Amendment.
While deciding in baseball's favor, a California Court of Appeal said that freedom of the press allowed for "mere recitations of the players' accomplishments," and that the public was "entitled to be informed and entertained about our history." The court agreed with Major League Baseball's argument that players' appearing in such materials did not imply a commercial product endorsement, and therefore did not violate their collective right of publicity.
But other cases, in which celebrities' names have been used in things like video games and comic books, have been decided in favor of the public figure.
"Fantasy leagues are an intermediate case," said Rod Smolla, dean of the University of Richmond Law School. "This could become like the Grokster case in the music-downloading world, where the Supreme Court could be asked to draw that line between the benefits of public use and ownership of property."
Fame, Mr. Smolla said, "belongs in part to the people who earn it and the public that gives it." This September, the court will decide the part in which baseball statistics belong.
Title Cranky customer forces Amazon patent review
Date 2006.05.18 7:00
Author Tina Gasperson
Topic
http://trends.newsforge.com/article.pl?sid=06/05/17/1934246
Peter Calveley is an actor who went through the motions to provide animation for the computer-generated orcs and elves in the "Lord of the Rings" film series. Last year, he generated a motion to have the Amazon one-click patent re-examined, and last week, the US Patent and Trademark Office (USPTO) agreed to have another look at the patentability of the controversial technology.
Calveley, a native New Zealander, says he spends about 50% of his work time in front of the camera. Recently has been working on designing fighting styles for a new computer game, "which is a bit of a change from live shows," he says. Another change has been his recent foray into the world of software patents.
Calveley got irritated with Amazon last year when, he claims, the company took too long to ship a book he ordered and paid for. "They insisted that they sent it via UPS but there was no tracking number," he writes in a blog entry. "UPS, when I called them, insisted that there had to be a tracking number!" A few weeks later he received the book, but felt that the slow delivery merited revenge in the form of "utu," an ancient part of Maori Law, which says that exacting payment from others for wrongdoing is an obligation.
So Calveley, who is not an attorney but says he once passed one of the tests required to become a patent attorney in New Zealand, dug up some prior art on Amazon's one-click technology and drew up the papers. Specifically, he challenged the eleventh section of Amazon's patent application, which states:
11. A method for ordering an item using a client system, the method comprising: displaying information identifying the item and displaying an indication of a single action that is to be performed to order the identified item; and in response to only the indicated single action being performed, sending to a server system a request to order the identified item whereby the item is ordered independently of a shopping cart model and the order is fulfilled to complete a purchase of the item.
"This seems to give Amazon a monopoly on the very idea of 'shopping with one click,'" he writes. He referenced patent 5,729,594 and some old Web archive information about DigiCash. With that technology, Calveley writes, "If the client has been configured to respond automatically, the requested item identified by the payment link (such as a downloaded file or access to a web page) is automatically delivered to the client and payment is made by the client."
Through outside donations, Calveley raised the $2,520 filing fee, and last week, the USPTO notified him that his request for re-examination was granted. The response states in part that the request raises a "substantial new question of patentability of claims."
Calveley thinks that a final resolution could be a long time coming. And then there are the lawyers. "As I had to serve a copy on Amazon's lawyers when I first sent my request to the USPTO, they have had a log of time to prepare their first response," he says. "However, I suspect they will try to drag things out for as long as possible."
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