26 October 2011

Twitter Hit By A Software Patent

Image: I use Twitter wrong by topgold on Flickr
I use Twitter wrong

According to a report on the popular patent blog PatentlyO the Virginia based VS Technologies LLC commenced legal proceedings against Twitter earlier this year, claiming the infringement of its US Patent # 6,408,309.

The ’309 patent was filed in 2000 and comprises basically

a method and system for creating an interactive virtual community of famous people, or those people who wish to attain the status of a famous person, in a field of endeavor, such as arts, accounting, animal rights, business, education, engineering, entertainment, financing, government affairs, human rights, legal, medical, philanthropy, politics, religion, research, science, sports, etc. The virtual community of the present invention is unique in that the members of the virtual community can update, modify or revise their individual profile, and interact with other members of the virtual community, as well as the non-members of the virtual community.

Interestingly, Justice Henry Coke Morgan Jr. denied Twitter’s motion for summary judgment, ruling that VS Technologies’ patented technology satisfies the machine-or-transformation test under Bilski.

Hear ye, hear ye.

A patent attorney led patent troll in an attempt to put the fear of God into the micro-blogging giant.
Sounds promising, does it not?

However, being a doubting Thomas would not be one of my firm principles, if I was convinced of the ’309 patent’s novelty and non-obviousness. Hence, I do not expect that the patent in suit will stand serious judicial review.

Anyway, I will stay tuned in the matter and provide you with the updates.

19 October 2011

Patent Troll Goes On Sale

The Troll

Just read about the company Innovatio IP Ventures LLC, which was formed only some months ago in 2011 and, which is considered a patent troll, had purchased a number of patents that, according to Innovatio, encompass certain WiFi and WLAN technologies.

Innovatio are currently approaching small businesses such as coffee shops, hotel and restaurant chains that offer WiFi to their customers demanding the payment of royalties in the range of $ 2 000 – 5 000.

Does anyone still believe that software patents do not merit talking about?

Well, Innovatio have allegedly pledged not to pursue individuals using WiFi, but for how long since they are dealing from the bottom of the deck?

10 June 2011

Where “Preponderance Of Evidence” Is Not Enough: Microsoft Defeated Before SCOTUS

The Supreme Court of the United Statesphoto © 2009 Anthony Maki | more info (via: Wylio)
The cold war of software patents has reached the status of a nuclear winter: earlier today the Supreme Court of the United States (“SCOTUS”) delivered its ruling in the case of i4i v Microsoft.

Background

Some years ago I blogged on how Microsoft got hit by a software patent.
However, the Redmond company denied infringement and sought a declaration that i4i’s patent was invalid and unenforceable.
Specifically, Microsoft claimed that i4i marketed the software known as S4 more than one year prior to the filing for its statutory protection.

Not surprisingly,  Microsoft contended that a defendant in an infringement action need only persuade the jury of an invalidity defence by a preponderance of the evidence.
In the alternative, Microsoft insisted that a 

preponderance standard must apply at least when an invalidity defense rests on evidence that was never considered by the PTO in the examination process.

Nevertheless, Microsoft lost its case before the (patent owners friendly) District Court for the Eastern District of Texas which applied the long-standing jurisprudence of the Federal Circuit according to which

a patent shall be presumed valid and the burden of establishing invalidity rests on the party asserting such invalidity.
Under the Federal Circuit’s reading of §282, a defendant seeking to overcome this presumption must persuade the factfinder of its in-validity defense by clear and convincing evidence.

The Federal Circuit affirmed the decisions of the District Court and granted a certiorari to the Supreme Court which issued the final rejection to Microsoft’s claim of invalidity.

As PatentlyO‘s Dennis Crouch writes, Microsoft will now likely be forced to pay the $250+ million judgment for infringing i4i’s patent.

What Is The Moral Of The Story?

We must not forget that Microsoft was smote and consequently struck down by a patent troll. Since patent trolls are usually interested to sue “infringers” and force them into settlement agreements, I personally wonder why the guys from Redmond did not undertake such an agreement.

I was made aware that the patent troll allegations towards I4I might be unjustifiable.
Indeed and, unlike non-practicing entities, the company appears to have developed a product and established a sizable client base, particularly among pharmaceuticals such as Bayer, Merck and Schwartz Pharma. Obviously, Microsoft had showed an initial interest on I4I’s patented technology, but finally decided not to enter into a commercial agreement. The patent infringement lawsuit was the consequence.

One question remains: why did Microsoft act that way? Did they attempt to establish a new authority with regard to bad patents, since I4I’s patent grant showed some flaws and that remained undisputed before the Supreme Court? Was Microsoft’s challenging of the governing standard of proof, which currently favours patent owners and, their attempt to replace it with a standard more favourable to defendants in patent suits, a part of a larger strategy?

Either way, the creators of Windows failed.

All in all a disappointing decision – the Supreme Court has had a good chance to lower the threshold to invalidate bad patents, but acted pretty much as Pontius Pilate instead:

Congress specified the applicable standard of proof in 1952 when it codified the common-law presumption of patent validity. Since then, it has allowed the Federal Circuit’s correct interpretation of §282 to stand. Any re-calibration of the standard of proof remains in its hands.

4 May 2011

Who Can Win The Cold War Of Software Patents?

Looking out for Bilski: software patents v. FOSSphoto © 2010 opensource.com | more info (via: Wylio)

You know it already: Google got hit by a software patent (5,893,120).
Well, that was the decision of the court at first instance and Google is expected to appeal it, but nevertheless it must have hurt. Not the loss of USD 5 Million which Google can easily reimburse out of its petty cash account.
It is about more, far more.

According to Florian Mueller of FOSS Patents the decision is highly significant and will put all of Linux into doubt. On the other side there is Dana Blankenhorn who, citing the CTPN decision, disagrees.

Either way, the question here is why does a case like this attract such attention? I guess the reason lies in that it deals with the highly controversial issue of software patents…

What Are Software Patents All About?

A citation from Van Lindberg’s book  Intellectual Property and Open Source provides for a very good answer: Patents are the most expensive and powerful weapons in an IP arsenal. For some companies, particularly pharmaceutical companies, patents are the lifeblood of invention and the key to profitability. For other companies, particularly software companies, patents are the rough equivalent of madly proliferating nuclear weapon arsenal.

It is obvious: the current legislative framework in which software companies work and compete, allows the patenting of software-related inventions. As a matter of fact, software companies appear to amass software patents not to market and sell them, but to either drive a competitor out of business or to prevent that their competitors drive them out of business.

Having read this, you truly felt the frosty breeze of the Cold War, did you not?

Let me even further amplify this feeling: the Nuclear Non-Proliferation Treaty (NPT) signed during that time between the nuclear powers stands a good comparison to the nowadays patent cross-licensing agreements entered into by technology giants such as Microsoft, Apple, HP and Google.

But even when a nation has a

Powerful Nuclear Arsenal

it is still vulnerable to non-conventional attacks or asymmetrical threats of non abiding adversaries. Last two decades’ terror acts were a good demonstration thereof. They were not performed by the armed forces of “competing” nations, but rather by decentralised rogue organisations.

Likewise, Google’s participation in cross-licensing agreements or patent pools could not hold it harmless from the claims of Bedrock Computer Technologies (BCT).
But who or what is BCT?
It is not a technology vendor, but a so called non-practicing entity (NPE). Or a patent troll, if you prefer. Other such trolls that have gained public attention in recent time are NTP,  i4i and Acacia.

The end of the Cold War was accompanied by the rise of rogue organisations I mentioned above.
By the same token, patent infringement proceedings under the involvement of patent trolls emerged in the last couple of years. NPE v RiM, Software Tree (an Acacia affiliate) v Red Hat or i4i v Microsoft, to mention some.
Is this a sign that the software patent cold war is over? Well, not really and Nokia’s patent infringement lawsuit against Apple is a good demonstration. Will there be a winner? I strongly doubt it.

What does it mean? It means that the economy simply needs

Another Solution

Something in the sense of the SALT and START treaties which heralded the end of the Cold War. In addition, the economy needs protection against patent trolls whose objective is not to drive innovation but rather the opposite of it.
We as individuals and consumers have also a great interest in finding a solution since we pay the price of its procrastination.

The US Supreme Court missed its historical opportunity In Re Bilski.
Will it err also in i4i v Microsoft?

I hope not and will therefore provide it with a piece of advice, thereby citing (a portion of) the statement of Adobe’s Douglas Brotz during a hearing before the USPTO:

Let me make my position on the patentability of software clear. I
believe that software per se should not be allowed patent protec-
tion.  I take this position as the creator of software and as the
beneficiary  of the rewards that innovative software can bring in
the marketplace...
The problems inherent in certain aspects of  the  patent  process
for  software_related inventions are well_known, the difficulties
of finding and citing prior art, the problems of obviousness, the
difficulties of adequate specifications for software are a few of
those problems. However, I argue that software should not be  pa-
tented,  not  because it is difficult to do so, but because it is
wrong to do so.

 

22 March 2011

Thou Shalt Not Have Any Patent Courts Before Me!

European Court of Justice - Luxembourgphoto © 2006 Cédric Puisney | more info (via: Wylio)

What do the Bible and the Treaty on the Functioning of the European Union (TFEU) have in common?
Perhaps it’s that they both represent various collections of sacred scriptures that are exclusively interpreted by specifically established bodies. Yes, the Pope’s authority as the sole authentic and true interpreter of the Bible can be correlated with the rights of the Court of the European Union (“Court” ) with respect to the TFEU.

The Court’s currently published Opinion 1/09 on the creation of a unified patent litigation system and a European and Community Patents Court is a good example of this. Its holding reminds me of the First Commandment and evaporates any hope of moving the European patent system closer to the US American one.

In the beginning… was the European Patent Convention

The European Patent Convention (EPC) provides a legal framework for the granting of European patents via a single, harmonized procedure before the European Patent Office (EPO).

Nevertheless, subsequent to its granting, a European patent is not a unitary right, but a group of essentially independent, nationally enforceable and nationally revocable patents.
And this is where the problems start: a patent holder with a number of equivalent European patents might have to choose where, e.g. under which patent and legal system, to sue an infringer. Factors influencing this choice of forum would include, among other things, the likelihood of success, or the speed and cost of the proceedings.
However, if litigation in multiple jurisdictions proves to be necessary, it is possible that different courts will reach different decisions, even with patents granted by the EPO and containing identical claims…

As is known, this is not the case in the US where they have a unitary patent law, a single granting authority and a unitary patent jurisdiction.

Those who live in the European Union writhe in pain, waiting for relief

A number of reform proposals have been made to ease the difficulties I outlined above, such as: the creation of a unitary Community patent, the establishment of a Community Patent Court, or the replacement of the EPC with a Community patent system.
And, recently, it seems things have started to heat up a bit: the newly authorised Enhanced Cooperation On Creation Of Unitary Patent Protection may smooth the way to a unitary patent, granted as an EU designation within the EPO framework.
But, owing to Court’s Opinion 1/09, an EU patent will still need to be enforced country by country.
It’s still not the whole nine yards.
Besides, I do not understand why the Court behaves just like the jealous God and shows itself anxious in tolerating a parallel (patent) jurisdiction it cannot control.
By the same token, the specialists at the EPO insist on an own court, serving as the ultimate authority in patent cases . Their reasoning is that the court Court would not have the sufficiently skilled personnel and thus the capability to properly deal with patent matters.
Looks like a dead-end to me.

Revelations for holders of European and future Community patents

Given the problem with the Enhanced Cooperation, it will take years to evaluate its overall effect on the European patent system.
Moreover, without unitary jurisdiction and enforceability, its main objective appears limited to merely language -related cost savings.

So pray, my brothers and sisters! Pray that the Court in Luxembourg shall be manned with skilful judges to rule on our patent cases!

 

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26 August 2010

With the rhythm of my heart

labor - fetal monitoring: the left is the little guy's heartbeat, the right is the magnitude of his mom's contractionsphoto © 2011 george ruiz | more info (via: Wylio)

I have never doubted Apple’s inventive power. And how could I? After all I speak of the one that has made all the iDevices available to the public. The news on Apple’s recent patent filing, however, seem capable of throwing some doubts on that abovementioned inventiveness.

According to the EFF Apple prepares to take full control not only of their devices, but probably of their users. Things like voice recording, photographing or even detecting device’s user’s heartbeat definitely go too far.

In my view Apple’s patent application conflicts with morality considerations and the USPTO may have a strong case in demonstrating that the “moral utility theory” is not just a dead doctrine.

 

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26 February 2010

Facebook granted a dubious patent

what shows up in your newsfeedphoto © 2009 Cambodia4kids.org Beth Kanter | more info (via: Wylio)

The readers of the Reguligence Weblog are familiar with the fact that I am not a supporter of software and business method patents. Moreover, I am rather a doubter as to those patents’ furtherance to the Information Technology at all. Nevertheless, I should be grateful to Facebook for giving me an occasion to have another post on this issue.

As you might have already perceived, Facebook has been granted the patent #7669123 for “dynamically providing a newsfeed about a user of a social network”. Basically, Facebook has patented the news feed that provides a user of their social network with the information about what other users are currently doing or at best have done on that network.

To me this is a trivial patent par excellence. While the patent eligibility could be easily satisfied under the Federal Circuit’s holding in Bilski, in pursuance to which “a method claim is surely patentable subject matter if (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing. ” and a social network could (arguably) serve as an “apparatus”, there are some doubts with respect to that patent’s novelty and non-obviousness. According to GIGAOM, the social network Multiply.com had a similar interface for keeping track of friends’ actions before Facebook launched its own. As regards the inventive step applied, I believe that aforementioned “invention” would be laughably obvious even to a person having just basic knowledge in social networks, not to mention a “person skilled in the art”.

Notwithstanding, the patent, albeit a “weak” one, has been granted and – unless successfully challenged and invalidated- will be valid for the next 17-18 years. I am personally curious whether Facebook will at some time take the risk and attempt enforcement, and hence share the destiny of Amazon and their one-click-patent.

 

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4 January 2010

Beware of the spirits that you call: Microsoft hit by a US software patent

According to a verdict issued by a jury at the District Court for the Eastern District of Texas that the US Court of Appeals for the Federal District has affirmed ,

Microsoft Had Infringed A Patent

owned by I4I Limited Partnership and Infrastructures for Information Inc. The patent is with regard to “a method for processing and storing information about the structure of electronic documents”.
In fact the patent covers the editing of documents containing markup languages like XML and claims to improve said editing process. The patent’s essential output is to be found in an “add-on” software for Microsoft Word, which expands Word’s capability to work with documents containing custom XML.

The claimant alleged that the custom XML editor in certain versions of Word infringed their patent.

Not surprisingly, Microsoft employed the

“Attack Is The Best Defence”

strategy in an attempt to seek a declaratory judgment that the patent in suit was invalid and thus unenforceable, but has eventually failed as the jury refused to follow the brought arguments.
Moreover, the jury found not only that the patent was not invalid, but also that Microsoft’s infringement thereof was wilful.

Upon a lengthy discussion on the claim construction, validity and infringement of the claimant’s patent, the Federal Circuit affirmed the District Court’s ruling.

To me the importance of the instant case lies in that Microsoft is now being served by the consequences of a policy they have advocated in the near past. In my view it would have been better, if they had reflected the 1991 Bill Gates’ warning that patents could bring the software market to a complete standstill and drive out small players.

13 December 2009

The Federal Circuit invalidates business method patent on obviousness

In a recent patent infringement case, the US Court of Appeal for the Federal Circuit decided that claimant’s patent claims were infringed, but invalid as the Court held them obvious and thus non-inventive.

Claimant’s alleged invention claimed a “method of purchasing goods or services over a data network”. In fact the claimed invention offered an e-commerce platform to both purchasers and vendors and filtered their requirements in order to achieve a match between their demands. Could that be inventive nowadays? Upon outlining the existing prior art, the Federal Circuit said “No”.

Nothing unusual, at least from a european perspective.

2 December 2009

In Re Bilski: a setback for business method and software patents?

The PTO addresses Bilski and software patentsphoto © 2010 opensource.com | more info (via: Wylio)

 

In October 2008, the US Court of Appeals for the Federal Circuit (CAFC) issued its decision in re Bilski en banc, describing it as “an historic opportunity to fix the US patent system, as the Bilski rehearing will directly address the boundaries of the subject matter of patents.”

The re Bilski appeal arose from the rejection by the USPTO of all claims because they failed to limit the method’s performance to a specific machine or apparatus, and the method did not involve a transformation of one thing into something different from the original, with the machine-transformation test having been previously articulated in the decisions of the US Supreme Court in Gottschalk v Benson, Parker v Flook and Diamond v Diehr. The Federal Circuit’s decision is thought to have turned the tide for business method patents in the United States.

While Affirming That Business Methods Are Still Patentable

the Court has rejected State Street Bank’s “useful, concrete, and tangible result” test, which many believed had cleared the way for improper patents on fundamental principles and everyday activities that had no connection to technological innovation.

In January 2009, Bilski petitioned the US Supreme Court for a writ of certiorari, seeking to overturn the Federal Circuit decision.

In the meantime the Court

Granted Certiorari

and heard oral arguments on 9 November 2009.

Reading that transcript is a quite funny thing. The Justices seem to openly show their reluctance and, even malice, against petitioners’ alleged invention. Mr Jakes, counsel for the petitioners, had to stand for questions like the one of Justice Breyer “You know, I have a great, wonderful, really original method of teaching antitrust law, and it kept 80 percent of the students awake. They learned things — (Laughter.) — it was fabulous. And I could probably have reduced it to a set of steps and other teachers could have followed it. That you are going to say is patentable, too?”

Chief Justice Roberts went even further asking “I’m looking at your Claim 1, in Joint Appendix page 19 to 20. How is that not an abstract idea? You initiate a series of transactions between commodity providers and commodity consumers. You set a fixed price at the consumer end, you set a fixed price at the other end, and that’s it. I mean, I could patent a process where I do the same thing. I initiate a series of transactions with sellers. I initiate a series of transactions with buyers. I buy low and sell high. That’s my patent for maximizing wealth. I don’t see how that’s different than your claim number 1.”

I would not be surprised if the Supreme Court affirmed the Federal Circuit. In such an event, the Justices should take their awaited decision to, hopefully, provide for a long-expected clarity on the patentability of business methods and software implemented inventions.

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