Robert Z. Cashman, Esq.

Ethics question regarding using a domain name other than my law practice name.

2009-10-05T07:14:00.000-07:00

I had a few questions regarding my http://www.patentprophet.com web site regarding the New York ethics rules as to whether you can use a name other than your law firm name as your domain name, and whether you are able to advertise using the domain name in addition to your law firm name. The reason I was asking was because the name "Patent Prophet" is a trade name of sorts, and I was reading the ethics rules which discussed the prohibitions of using trade names, and thus I was wondering whether the prohibition applied also to domain names. I found the answer below (which I believe is current), and I am pasting it here so that any of you who also have this question can easily find the answer.

In short, the answer I found was that YES, you can use a name other than your law firm name as long as the name is not misleading or doesn't hold you out as being an expert in something you are not an expert in, and as long as you do not use the domain name in lieu of your law firm name when referring to your law practice.

In my case, I registered http://www.patentprophet.com to provide non-legal services to inventors. I believe that the service I am setting up can be very valuable to companies with regard to streamlining their research and development efforts, and the company and trade name will be Patent Prophet. However, my law practice, Cashman IP Law will provide services for Patent Prophet, and is currently featured on the Patent Prophet web site for contingency fee patent litigation services. Once I have completed the preparations to launch Patent Prophet as a non-legal business entity of its own, I plan to either move the Cashman IP law pages off the domain and possibly purchase its own domain, or simply move the pages to another location on the Patent Prophet web site.

Pasted below is the ethics opinion I am referring to:

Source: http://www.abcny.org/Publications/reports/show_html.php?rid=123

THE ASSOCIATION OF THE BAR OF THE CITY OF NEW YORK
FORMAL OPINION 2003-01

LAWYERS’ AND LAW FIRMS’ SELECTION AND ADVERTISING OF INTERNET DOMAIN NAMES

TOPIC: Lawyers’ and law firms’ selection and advertising of internet domain names.

DIGEST: A lawyer or law firm may use a domain name that does not include or embody the firm’s name or that of any individual lawyer, under certain conditions: the web site bearing the domain name must clearly and conspicuously identify the actual law firm name; the domain name must not be false, deceptive or misleading; the name must not imply any special expertise or competence, or suggest a particular result; and, it must not be used in advertising as a substitute identifier of the firm.
CODE: DR 2-102(B); DR 2-101

QUESTIONS: In choosing a domain name, is a lawyer obligated to follow the rules applicable to the selection of law firm names, thus requiring the domain name to comprise some variation of the law firm’s name? If a domain name may under certain circumstances not include the law firm name, may the law firm ethically advertise its services by reference to its domain name rather than its firm name?

OPINION: The Committee has received an inquiry regarding the selection of Internet domain names for lawyers and law firms, and the corresponding use of such domain names in advertising the services offered by such lawyers and firms. This inquiry raises two questions of general significance to the bar: First, in choosing a domain name, is a lawyer obligated to follow the rules applicable to the selection of law firm names, thus requiring the domain name to comprise some variation of the law firm’s name? Second, if a domain name may under certain circumstances not include the law firm name, may the law firm ethically advertise its services by reference to its domain name rather than its firm name?

The Committee addresses these areas in the following factual context: A law firm primarily engages in the representation of personal injury plaintiffs. The law firm’s name consists of the names of three of its partners and complies with the requirements of DR 2-102(B) relating to law firm names. However, in considering its advertising and marketing activities, the firm believes that it can achieve better results if it is able to establish a web site using as its domain name a generic name or phrase that contains the word ‘attorney’ or ‘lawyer.’ (Examples of such an identifier might include phrases such as ‘Dial-a-lawyer’ or ‘New York Lawyer’). The firm has, accordingly, set up a web site that does not include its lawyers’ names as part of the domain name, but instead includes the generic name or phrase followed by ‘.com.’ The firm also wishes to advertise on television and radio using the domain name as its primary identifier and to include client testimonials alluding to the domain name rather than the name of the firm or any of its lawyers.

1. Law Firm or Attorney Domain Names
New York forbids a law firm or legal clinic from practicing under a trade name or other name that does not convey the identity of one or more of the lawyers practicing. DR 2-102(B) states in pertinent part:

‘A lawyer in private practice shall not practice under a trade name, a name that is misleading as to the identity of the lawyer or lawyers practicing under such name, or a firm name containing names other than those of one of more of the lawyers in the firm ...’ 1

Similarly, EC 2-11 states that "The name under which a lawyer practices may be a factor in the [lawyer] selection process. The use of a trade name or an assumed name could mislead non-lawyers concerning the identity, responsibility, and status of those practicing thereunder.’

Numerous opinions from New York have prohibited a law firm from identifying itself by a trade name because of the likelihood of confusion as to the identity and composition of the firm. See N.Y. City 95-8 (prohibiting trade name based on firm’s location; ‘the Code on its face prohibits all forms of trade names, and opinions construing the Code have applied that prohibition to locational trade names as well as other types of trade names.’); N.Y. City 82-44 (improper to engage in a law practice under the name "The 777 Lawyers Group"); N.Y. State Bar Op. 709 (operating proposed law practice under trade name ‘The Trademark Store’ is impermissible); In re Shephard, 459 N.Y.S.2d 632, 633 (3rd Dep’t1983) (finding ‘The Peoples Law Firm’ was a prohibited trade name); In re Shapiro, 455 N.Y.S. 2d 604, 605 (1st Dep’t 1982) (finding ‘Peoples Legal Clinic, Inc.’ was a prohibited trade name).

The threshold issue presented here is whether a law firm otherwise compliant with the rules of DR 2-102(B) can establish a domain name that does not include the names of one or more lawyers, but instead uses a ‘trade name’ or other terminology. There are no reported New York ethics opinions on this subject.

Two states, Arizona and Ohio, have issued opinions stating that domain names are not subject to the same regulation or scrutiny as a firm name and are permissible unless they are false or misleading. See Ohio 99-4; Arizona 97-04. In the Ohio opinion, the ethics panel concluded that domain names were governed by the general rules for lawyer advertising and, while it was preferable to use the firm name as a domain name, it is ‘not improper for an attorney to use letters, words or numbers provided that the domain name is not a false, fraudulent, misleading, deceptive, self-laudatory or unfair statement.’ Nor can the domain name be permitted to ‘imply special competence or experience.’ The Arizona State Bar opinion agreed that domain names were subject to the general advertising rules against false or misleading communications, and concluded that: (1) a law firm’s use of ‘countybar.com’ was misleading because it falsely implied an affiliation with the county bar association; and (2) the designation ‘arizonalawyer.org’ was misleading because the top level domain name ‘.org’ falsely indicated that the firm was a non-profit organization.

The Committee notes that many New York lawyers and law firms have established domain names that closely track the firm name. We also note the risk that permitting domain names that do not include any reference to the name under which the firm practices might in some cases cause some initial confusion among visitors to a web site.

However, the Committee believes that the mere designation of a domain name does not mean that the firm or lawyer is ‘practicing’ law under that name; accordingly, DR 2-102(B)’s strictures on law firm names should not apply and, instead, the selection of a domain name is more appropriately governed by the ethical rules and considerations affecting legal advertising and publicity. See DR 2-101. In so concluding, we specifically do not address the First Amendment and other legal issues that may affect attorney advertising, solicitation of business and professional designations because these issues are beyond the scope of this Committee’s jurisdiction.

As a matter of legal ethics, we conclude that a lawyer or firm may employ a domain name that does not include the names of lawyers under the following conditions:

(1) The web site clearly and conspicuously includes the actual name of the law firm and the law firm in no way attempts to engage in the practice of law using the domain name. At a minimum, the web site must clearly present information including the law firm’s name, office address and the telephone number of the attorney or law firm (DR 2-101(K));

(2) The domain name complies with DR 2-101(A), which forbids ‘any public communication or communication to a prospective client containing statements or claims that are false, deceptive or misleading.’

(3) The domain name does not imply any special expertise or competence, or suggest a particular result. In this regard, we note the abundance of existing law firm domain names accessible on the Internet that would appear to violate this requirement, e.g., ‘bigverdict.com’ and ‘bigjudgment.com.’ In addition, although New York’s Code includes no specific prohibition on puffery or statements that cannot be objectively verified, we believe names that seek to promote the lawyer’s skill or talent may be considered misleading, e.g., ‘bestlawyer.com,’ ‘greatattorney.com,’ and ‘personalinjuryexpert.com.’

2. Use of Domain Names in Advertising
Having concluded that it is permissible under certain circumstances for a law firm or lawyer to employ a domain name that does not embody the name of the firm or its lawyers, we believe this domain name may be publicized in advertising so long as the domain name is used to identify a web site rather than as a substitute identifier for the firm. Thus, assuming the law firm was authorized to use the ‘NewYorklawyer.com’ domain name, it would be permissible to refer to that domain name for the purpose of directing readers or listeners to the firm’s web site, but it would not be permissible to refer to the services offered by ‘NewYork lawyer’ or otherwise to replace the law firm’s name with its domain name in describing itself, its services or its personnel.

Similarly, a lawyer or law firm may use bonafide, non-misleading client testimonials in advertising provided the clients do not use the domain name as a sobriquet or substitute for the firm’s name. It would presumably be ethical for the client to identify the domain name as a means to learn more about the firm.

Conclusion
As set forth above, we conclude that it is ethical under certain circumstances for a lawyer or law firm to employ a domain name that does not include or embody the firm’s name or that of any individual lawyer. However, we caution that domain names may not be used as a substitute identifier for the law firm and must comply with the strictures of DR 2-101 as applied to legal advertisements generally.
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A Powerful Lesson on the Merits of Settling a Patent Litigation Case and the Dangers of Ego and Greed

2009-10-01T11:01:00.001-07:00

[Originally published by Robert Z. Cashman, Patent Litigation Attorney on the Patent Prophet web site.]

There is a short and simple lesson in today's article from law.com, "Federal Judge Tosses Out $388 Million Patent Verdict Against Microsoft" written today by Alison Frankel from the American Lawyer.

Last April, Paul Hayes of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo representing Uniloc in a patent infringement lawsuit won a $388 million dollar patent infringement verdict against Microsoft. Today, Judge William Smith from the Rhode Island federal district court vacated the $388 million jury verdict and ruled as a matter of law that Microsoft did not infringe Uniloc's patent, stating that the jury did not understand the issues when they gave their ruling in Uniloc's favor.

The lesson here is that while every patent litigator has his or her day in court, so to speak, "going all the way" [to trial] in a patent litigation suit is not always the most responsible course of action. In trial, many twists and turns can occur where within the dance between the patent litigation attorneys, results may surface with a motion, a hearing, or a ruling which can destroy an otherwise valid case of patent infringement. On top of that, the Federal Rules of Civil Procedure (FRCP) are set up to reward the party that offers to settle and penalize the party who pushes their case to trial after a settlement where their case is found not to have merit. For example, if a defendant in a patent lawsuit offers to settle and the plaintiff refuses the offer, even if the case ends up in the favor of the plaintiff, if the judgment is for an amount that is equal or less than the amount that was offered in the offer to settle, the defendant can ask for sanctions and attorney fees for the time and money spent fighting the case after they offered to settle. (This was actually the source for a defense tactic that I suggested to my peers when interning at Scully, Scott, Murphy and Presser PC, a subject to be discussed in another article.) Returning to the content of this article, the point is that going to trial has its benefits and its risks.

An alternative strategy to consider is settling the claims out of court. Too often in patent litigation (both with regard to plaintiffs who are suing because a company stole their patented idea and the companies being sued for patent infringement), ego takes a more prominent role than a sincere analysis of damages which hinders discussions of settling the claims before they go to trial. Too often a company accused of infringing a patent refuses to discuss licensing the technology from the often-seen-as "little" inventor and delegates any legal matters to their patent litigation attorneys who are instructed to fight this little guy with everything they can both regarding the merits, and via procedural tactics to boost the cost of litigation to a point in which the inventor simply cannot afford to move forward with the litigation and s/he just "goes away." If the companies ethically sit down with the inventor and review the patents involved and try to resolve the case and to determine damages without involving a billable-by-the-hour patent litigation attorney, they can save often hundreds of thousands of dollars and often millions of dollars in attorney fees and costs.

Case in point, Paul Hayes, a skilled patent litigation attorney went through the whole trial process and won a $388 million dollar patent infringement verdict against Microsoft. As of today he lost the whole case and both his firm and his client still need to account for all the likely thousands of hours of costs and fees spent litigating Uniloc's case. In some cases, the law firm can "eat" the loss of the billable hours, but depending on the jurisdiction, in some places the client is still on the hook for out-of-pocket expenses which can be expensive when the case goes all the way to trial. Had the two sides agreed to a reasonable settlement which compensated Uniloc for Microsoft's use of their patented technology, everybody would have been happy. However, I can't help but to think that somewhere along the line, greed, ego, or both stepped in and forced their case into trial.

If both sides came to an agreeable settlement early on, imagine how much money could have been saved in attorney fees on both sides. ...and Unicom would have some money in the bank whereas now they have nothing except for a gaping hole in their pockets.

-- Robert Z. Cashman, owner of Patent Prophet is a contingency fee patent litigation attorney in Houston, TX. He works for a law firm that specializes in contingency fee patent litigation, and in the past, he worked in house for a patent company as both a patent attorney and a patent acquisition specialist, where he interacted daily with inventors looking to sell their patents.

Patent auctions are where patents go to die.

2009-09-21T04:37:00.001-07:00

I was just reading the New York Times article by Steve Lohr about how exciting it is that Zoltar Satellite Alarm Systems will be placing their patents up for auction as if a patent auction were some new and exciting forum where valuable patents can be made available for the public to benefit from them. The funny thing is that in my opinion, patent auctions are where patents go to die.

The article continues to boast Zoltar's patents stating that they have been litigated many times as if that boosts their value. I chuckled when I read this because the fact that the patents have been litigated only indicates that the value of the patents have deflated (like air escaping from a ruptured balloon) because there are no longer valuable prospects to sue. On top of that, I was surprised to see that the article mentioned that even in the lawsuits they initiated, the patents were found NOT to infringe which suggests to me that the value of the patents are even less that I thought they were by the impressive subject matter description of being a personal alarm device that transmitted a person’s location. In other words, it suggested to me that the patent claims were too narrowly drawn or were vague and unenforceable. Otherwise, unless the settlement offer was substantial (and a few million dollars is substantial, but the article suggests that they also spent a few million dollars which means they are only breaking even if they are lucky), there is no reason to settle unless Zoltar just wanted to get out of the lawsuit with the shirts on their backs because they learned at the Markman hearing that their patents had serious flaws and that it was not clear that they would have succeeded at trial.

I also found it interesting (and even funny) that the author gave a plug to venture capital companies like Intellectual Ventures, Acacia Technologies, Altitude Capital Partners, Intertrust, IPotential, Ocean Tomo, Rembrandt IP Management and Thinkfire. The reason I found it funny is that some of these companies (e.g. Acacia) are well known as being patent trolls who purchase patents for the purpose of licensing them to others under threat of suit.

Some of the other names on this list, such as IPotential, are not patent trolls, but are actual patent service companies who take a patent portfolio, wrap it up in a nice package where the value of the patents are clearly visible to buyers, and then find buyers who pay top dollar for the valuable patents they sell (quick plug and regards to Ron Epstein, the founder and CEO of IPotential). I find this service to be valuable because Ron knows the patent market and is not about to broker the patents off to a venture capital company who wants to pay pennies on the dollar for the patents. If I had some good patents to sell, I'd seek out Ron and convince him to take me on as a client before looking to any of these others on the list.

Another name on this list is Ocean Tomo, a patent auction house which holds fancy auctions in foreign countries making the whole process seem beyond five-star; I have written about them in the past. I like the concept of Ocean Tomo -- they'll package your patents in their high quality catalog with glossy pictures and fancy photos (I wouldn't be surprised if each catalog cost them upwards of $15-20 each based on the high quality). However, the chuckle here is that just because their catalog is beautiful doesn't mean the patents have any value. A prospective buyer will need to analyze the patents in depth as they would for any other patent purchase because listing it on Ocean Tomo's auction does not mean that there is any value to the patents. On another note, sadly, I hear that attendance to Ocean Tomo's auctions have been dying down and that only a fraction of patents listed recently have been sold which means that the auction house patent sale model might be losing momentum. That being said, I still like their idea of trading stocks on some kind of stock market forum. I'd succeed there because as a patent attorney and a patent litigation attorney, I'd see the valuable stocks and buy shares in them in an instant and watch the value grow in my patent stock portfolio.

All this being said, it's sad that the NY Times article is describing old players and making them seem new. Intellectual Ventures has been buying up patents forever. Acacia has been a patent troll forever. Ocean Tomo has been around forever. Some of the newer names such as Rational Patent Exchange in my understanding are offshoots of Intellectual Ventures (the same guys are running each patent chop shop), except they run the business like the mafia, stating, "buy into my elite club and you we'll protect you against patent trolls. Decide not to buy into our club, and we'll sue you ourselves with our army of patent litigation attorneys."

I could go on, but in sum, there doesn't seem to be anything new or exciting presented by this article. Just old sheep in new clothing, however the cliche goes.

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Robert Z. Cashman, owner of Patent Prophet, is a contingency fee patent litigation attorney in Houston, TX. He works for a law firm that specializes in contingency fee patent litigation, and in the past, he worked in house for a patent company as both a patent attorney and a patent acquisition specialist, where he interacted daily with inventors looking to sell their patents.

2009-09-18T12:00:00.000-07:00

I am looking for a way to add this blog into the mapquest.com directory. Hence, I am adding the tags below.

# Where:Houston-TX
# Where:Houston+Texas
# Where:Houston%20TX
# Where:77096

Houston, TX

Black hats and white hats in the patent law system (summary)

2009-09-09T23:01:00.000-07:00

Pasted below is a summary version of the article posted on JD Supra on "Black hats and white hats in the patent law system" that I wrote on 8/16/09.

Within patent law and the patent litigation system, there are good ways and bad ways to make use of the rules and laws that have been set forth for us to follow. Many patent practitioners and patent litigation attorneys follow these rules to further technology and to protect the rights of inventors via their patented inventions. In the analogy of white hats and black hats (terms used in the information security / hacker communities), people who do good by the law would be considered white hats.

However, within the patent litigation system, there are also black hats, namely venture capital companies, inventors, and attorneys who seek to harm others by writing, enforcing, and suing on patents where the protection does not cover the technologies these often non-practicing entities (NPE's) hope to target through the patents they assert. This causes havoc by overburdening the court systems with frivolous lawsuits, by devaluing patents already in existence, and by causing inventors to sell their patents to those who wish to profit and do harm with them. Often this results in the inventor making only a fraction of what she is entitled to, and the NPE's taking the majority of profits by suing or licensing on a technology they did not invent.

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If you are interested in a patent litigation attorney or a patent attorney in Houston, TX, I have started an informative website using the name Cashman IP Law Firm which will be a resource for those who wish to obtain a patent or for those who would like to find out how to prevent companies from stealing their inventions. Services include help with entering into IP Agreements & Licensing options, IP Enforcement and Litigation, Strategic Counseling, and much more.

Black hats and white hats in the patent law system.

2009-08-16T23:53:00.001-07:00

It took a few seconds to come up with this analogy, but after reading the “Wear a White Hat” article by Scott Gibson, I couldn’t stop thinking about how relevant the concept of black hat, white hat was not only to archetypes, hackers, and network security professionals, but also to patent practice professionals.

In the hacker / network security / cybercrime world, a black hat is a hacker who, among other things, penetrates networks and security systems and often wreaks havoc on the systems s/he has gained access to. Viruses can be installed, information can be exploited and/or manipulated, and general bad things can happen when a hacker penetrates your system.

On the other hand, there is also something called a white hat, which generally refers to an “ethical” hacker. Frequently, this is a programmer or a team of network security professionals who are hired by a company for the purpose of testing the company’s network for security holes, vulnerable entryways, and for weaknesses in the company’s network security system. While they may work with grey hats (best described as those who walk the fine line between violating laws and ethical hacking), these white hats help companies combat black hats who are intent in finding a security hole, penetrating a network, and exploiting the vulnerabilities inherent in that vulnerable network.

I see patents the same way. There are white hats who practice traditional patent practice whether on the side of patent prosecution, patent licensing, or patent litigation. These are the practitioners who write the patents and advance technology by sharing inventions with the public in return for amulti -year monopoly so that the inventor can benefit from their invention. The goal with white hat patent practitioners is that they are looking to help their inventors to find where the inventor’s understanding of the invention is lacking, and to help their inventors secure protection of their inventions by covering as many embodiments of the invention as possible to most completely and to most broadly describe the invention. This is similar to the white hat ethical hacker who finds security holes with the intent of writing a patch to fill those holes and to keep the network secure.

In licensing and in litigation, there are also white hat patent practitioners. These are the attorneys who help the inventor protect their inventions against companies who have knowingly or unknowingly taken the protected invention and have used the invention to make a product or a service which incorporates the protected subject matter of the patent. This white hat patent practitioner will often approach the company or individual using the protected invention of the inventor and will ask the company to properly compensate the inventor for the value of his/her contribution. If and when the company decides not to pay the inventor for the invention that is protected by law as belonging to him through his patent (whether their decision is in bad faith, e.g. denying the inventor compensation based on the company’s greed or whether their decision is based on a good-faith belief that the patent is invalid), the white hat patent practitioner (here a patent litigation attorney) will file suit to enforce the inventor’s patent rights. Throughout the proceedings, the white hat patent litigation attorney will develop evidence and will ethically move through the lawsuit proceedings so that the judge or jury will find that their client was wronged by the company who refused to take a license and pay the inventor his/her fair share of the value their invention contributed to the company’s profits, and in the end, if the inventor is in the right, the court will find for the inventor and will order the company or infringer to pay the damages rightly owed to the inventor.

Interestingly enough, just as there are white hat inventors and patent attorneys, there are also grey hat and black hat inventors and practitioners. Often known as patent trolls, these individual or companies will patent or acquire patents to inventions with the sole purpose of using them as a weapon to harm another company, whether it be to block them from making a product, or more frequently, to carve out a profit for themselves by asserting the newly acquired patent against the company. The stated purpose of patents are to promote and to reward innovation and to further the growth of technology; forcing a company to “pay up or else,” or to stop producing a product under threat of lawsuit blocks and hinders technology.

Black hat patent practitioners and black hat inventors usually fall into the category on non-practicing entities (NPE’s). These individuals generally see a patent as a commodity to be mined and exploited rather than an invention to further technology. You’ll often find black hat practitioners trying to reverse engineer and to invent around existing inventions for the sole purpose of suppressing the next step in the furtherance of technology, or to try to induce the real inventors and companies to “trip” (so to speak) over the patent and infringe it and then WHAM! the lawsuit and threats start pouring out. You’ll also find many venture capital companies acting in a black hat capacity by aggregating patents for the sole purpose of making a pretty penny by enforcing one or more patents against a target company with deep pockets who stand to lose the most by being confronted with one or more patents which may or arguably may cover the technology they are practicing.

Lastly, the distinction between a black hat patent litigator versus a white hat or grey hat litigator is how they conduct themselves in the preparation for and during trial. Black hat litigators will threaten, scream, intimidate, and will use scare tactics and legal maneuvers to intimidate the other side into settling with them WHETHER OR NOT they really are infringing the patents being asserted against them. Sometimes a party facing a lawsuit will settle giving money to a black hat litigator who has no leg to stand on just to save money on the expensive costs that will be incurred if they decide to fight the black hat litigation attorneys.

In the network security world, the job of the good guy belongs to the white hats who write security updates and patches to prevent the hacker black hats from causing damage through their illegal and often immoral activities. However, in the patent world, a white hat is often at a disadvantage when facing a black hat, and their only remedy is to endure the high costs of litigation and attempting to file a declaratory judgment and or summary judgement motion, or defending their client all the way through trial until a judgment is granted in their favor.

However, the real white hats in the patent world belong not to the patent attorneys and the patent litigators who ethically run their practice, but to the congressmen, the senators, and the lawmakers who are able to explore how black hat patent practitioners exploit and abuse the system, and they can pass laws to patch up the vulnerabilities in the law which allow black hats to do their damage. This can only happen through advice and letters from ordinary people like you and me who write them and share their thoughts, their feelings, and their experiences to best empower the real white hats to propose legislation changes to remedy vulnerabilities in the patent system as it is today.
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If you are interested in a patent litigation attorney or a patent attorney in Houston, TX, I have started an informative website using the name Patent Prophet which will be a resource for those who wish to obtain a patent or for those who would like to find out how to prevent companies from stealing their inventions. Services include help with entering into IP Agreements & Licensing options, IP Enforcement and Litigation, Strategic Counseling, and much more.

Encryption when searching for patents?

2009-07-27T09:38:00.000-07:00

LinkedIn Question by Vagelis Hristidis: Desired Features or Properties of a Patents Search Engine

I have been working for a year now on a search engine for patents. Clearly, a key property is the quality of search, that is, discovering the most relevant patents. But are there any other useful features (e.g., automatically email the results of a search) or properties (e.g., encrypt queries for privacy) that are missing from current patent search systems?

Dear Vagelis,

Interesting question regarding encryption. Generally, I have never seen anything in terms of encryption on the public patent searching sites. However, any web site that offers SSL or https:// access is encrypted and thus you likely won't have any issues when using those.

More generally, I have found that simply by using proper security on your system (e.g. connecting to routers with WPA) is sufficient to achieve your needs of privacy. In other words, if you're worried about people snooping on your patent searches, then don't connect to public internet wireless access points without proper protection.

As for e-mailing the results of a search, offhand I've seen that feature in a number of places. My favorite search tool is patentlens.net (http://www.patentlens.net/patentlens/structured.cgi) which allows me to save and e-mail my search results.

I hope this helps.

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If you are interested in a patent litigation attorney or a patent attorney in Houston, TX, I have started an informative website using the name Patent Prophet which will be a resource for those who wish to obtain a patent or for those who would like to find out how to prevent companies from stealing their inventions. Services include help with entering into IP Agreements & Licensing options, IP Enforcement and Litigation, Strategic Counseling, and much more.

RIMM vs. Visto Venture Capitalists - Little Guys Win.

2009-07-16T21:35:00.000-07:00

Today in Barron's, there was an article "RIMM To Pay $267.5 Million To Settle Visto Patent Suit" by Eric Savitz.

I'm actually not that sad about this settlement. If Visto's patents genuinely covered the technology used by RIM, then they had a duty to license their technology and not to steal it. Without delving deeper into the facts, I'd give RIM the benefit of the doubt that they just didn't know about Visto's patents when they went into that technology area. That happens quite often, and is the reason the patent system is in place. Here, Visto bought patents owned by Motorola and I would expect that RIM should have known about these patents and should have sought a license for the use of the subjects they cover, but I'm guessing that their GC thought, "hey, these patents were just bought by some venture capital (VC) company. What are the chances they'll sue us?" Silly GC, VC's are often trolls under a legitimate business structure.

Nevertheless, even if Visto was not some VC, it's likely the same story -- Big companies don't take little companies / inventors holding patents seriously. They fail to realize that inventors pour out their life's savings to develop a technology with the hopes of one day achieving some kind of financial renumeration for their inspiration and innovation. It is only fair that an inventor can hold a legal monopoly and can go to court to sue when their patent is infringe (noting that laches is always a good defense for the infringer as a side note because inventors often don't act fast enough or they trip up while trying to send threat letters to the big companies letting them know of their infringement and then doing nothing when the big companies retort).

That being said, companies as big as RIM often take the little guy not seriously when they come with a valid patent in which they are practicing. They'll stall, hee and haw, and will cost them thousands just to convince the huge companies to take a license from them.

Any inventor / small company that has to resort to going to court to resolve a patent disagreement deserves a good judgment because if it has come to a lawsuit, the licensing negotiation and stalling tactics by the big company has taken too long.

Obviously patent trolls are a different story. They didn't invent the technology; they bought it at a fire sale and now they're trying to assert it EVEN when they don't have a strong case.

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If you are interested in a patent litigation attorney or a patent attorney in Houston, TX, I have started an informative website using the name Patent Prophet which will be a resource for those who wish to obtain a patent or for those who would like to find out how to prevent companies from stealing their inventions. Services include help with entering into IP Agreements & Licensing options, IP Enforcement and Litigation, Strategic Counseling, and much more.

"Facebook Huddles with Patent Vampire"

2009-07-13T19:46:00.000-07:00

It just occurred to me that social networking sites are about to become fewer in the coming months. There is an article in the Jewelry BlogStore Blog, "Facebook Huddles with Patent Vampire" referring to talks between Nathan Myhrvold from Intellectual Ventures, and Mark Zuckerberg, the founder of facebook.com. In the article, it shows the two icons talking.

Here is how I would think the conversation likely went:

Zuckerberg: "What do you think you can do for me by me selling you my patents for millions of bucks?"

Myhrvold: "How would you like to be the only social networking site in existence?"

Zuckerberg: "You can do that? How?"

Myhrvold: "Well, you know all those me-too social networking sites? Do you have any idea how many of them are infringing patents?"

Zuckerberg: "My patents don't cover their activities. I'm not so sure it will work."

Myhrvold: "Think a bit bigger, my friend. We've been buying patents on social networking for years, so much so that we can even put you out of business with our patents. We obviously wouldn't of course, and we're friends, and I'd like it to stay that way."

Zuckerberg: [a bit nervous] "Uh huh..." *frown*

Myhrvold: "If you sell us your patents, we will give you a license to keep practicing your patent forever. Think of it as a royalty-free lifetime license. We -- together -- will bring the other social networks down to their knees, and we'll share the profit 60/40."

Zuckerberg: "I'm not so sure about this."

Myhrvold: "You can't lose. The patents speak for themselves. Plus, imagine what you'll be allowed to do on your own facebook.com site because we'll license you these patents which will allow you to expand your capabilities. You'll have the #1 social networking site in the world!"

Zuckerberg: "What about the Twitter problem?"

Myhrvold: "We're working on it. ;)"

--
If you are interested in a patent litigation attorney or a patent attorney in Houston, TX, I have started an informative website using the name Patent Prophet which will be a resource for those who wish to obtain a patent or for those who would like to find out how to prevent companies from stealing their inventions. Services include help with entering into IP Agreements & Licensing options, IP Enforcement and Litigation, Strategic Counseling, and much more.

Follow-up on possible good motives of the supertroll patent conglomerates.

2009-07-12T01:16:00.000-07:00

It's assumed in the blogworld that IV is evil and that Nathan M. is public troll #1. I keep wondering in the back of my mind, what if he is up to good rather than no good.

Everybody agrees that there are serious kinks in the patent laws and that the USPTO is backlogged until Moshiach comes. ;) There IS a hole in the system regarding people being able to enforce patents they did not invent. This is one of the big holes IV is exploiting.

The thought is -- what if they're trying to gather enough political clout to force a change in the law? What if as the biggest potential troll in the world, they are able to eradicate all other trolls from the patent system? What if they are trying to bring justice to the system (in a socialistic kind of way which I don't quite understand or support) by bringing huge companies down to their knees?

There is a lot of money behind those patent conglomerate companies, and they're obviously doing what they do for some reason. G-d knows they own enough patents to cripple the patent litigation system forever with valid (not frivolous) lawsuits should they choose to. It would take a flick of a pen and we could say goodbye to the system as we know it.

How's that for an apocalyptic view of the patent litigation system and those who hold the true power of it? ;)

Not always so clear when a patent acquisition company has gone troll.

2009-07-11T23:58:00.001-07:00

Recently when I've searched for "Intellectual Ventures" on the Twitter web site, all I've been seeing are comments about how they hit up a big company for a large sum of money over a license based on a number of patents they owned (a.k.a. purchased). The opinion, as described in the "Microsoft Wants to ‘Save’ the World, Using Restrictive Monopolies" article suggests that IV has gone bad.

It's both surprising and not surprising to me that IV is said to have gone offensive, especially with the recent Intuit license that has everyone in a frenzy.

I thought the whole purpose of IV/RPX was to form a patent protection conglomerate to protect against frivolous lawsuits claiming patent infringement when there was none. The purchase of all those patents as far as I understood was for the use of member companies (those who paid to join in) to defeat those claims that ordinarily would cost companies millions.

I'm not so quick to start calling Intellectual Ventures a super-troll. There is probably a lot going on there behind closed doors. Some good may come of it.

On the point of the article regarding Microsoft giving open source programmers a difficult time because of their patents, that somewhat hits a nerve between the programmer in me who believes in open source and the attorney in me who believes in copyrights, patents, and protection of intellectual property. On the one hand, I suggest that Microsoft leave the open source community alone as there are bigger fish to fry, so to speak, as there are commercial applications infringing many of Microsoft's longstanding patents. However, if their method of attack is to sue members of the open source community to go after lost profits based on what they claim they would have made had they sold the same program for which they own the patent, I understand that their damages would be greater, however their ability to collect would be nominal.

Maybe it's more about acquiring a meaningful judgment to bolster the strength of their patents and in patents in general rather than a small-to-moderate judgment that will make their shareholders a few dollars (more likely a few pennies on their stock, if even that), as I'm sure they don't need the latter or the aggravation of collecting a judgment against a small fish.

--
If you are interested in a patent litigation attorney or a patent attorney in Houston, TX, I have started an informative website using the name Patent Prophet which will be a resource for those who wish to obtain a patent or for those who would like to find out how to prevent companies from stealing their inventions. Services include help with entering into IP Agreements & Licensing options, IP Enforcement and Litigation, Strategic Counseling, and much more.

Future Issue: PATENT TYING.

2008-12-08T07:56:00.000-08:00

Thinking about the possible future issues with regard to larger companies entering the "patent pooling" / patent enforcing business model, I believe a future issue might be the concept of "tying," (a concept I learned about during my time in China) where a company is approached to take a license for patents relating to one or more of their products, and as a condition to accepting a license [in lieu of a threat to be sued for patent infringement], that company is forced to take licenses on patents that are only remotely relevant (or not relevant at all) to the subject matter in which their products cover. In other words, it seems to me that this could lead to an abuse of the patent system where companies would be forced to take licenses to practice patents they have no intention of practicing just to get the license that is forced upon them regarding the patent they are actually being accused of infringing. It obviously goes the other way too, namely, that companies seeking licenses for patents which they wish to practice might be forced to take licenses which they really don't need just to get the license they are seeking. With companies having so much muscle these days, I see this as becoming a real threat that can cause some damage within the patent law system.

For example, see the articles, IEEE joins move to patent pools by Rick Merritt @ EE Times, and IEEE to get into the patent pool business? by Lawrence Ebert, to which I posted the comment below:

The prospect of another company (or organization) entering the "patent pooling" business is not unexpected. The patent pooling business model in my opinion is quite effective, profitable, and certainly poses more of a threat to infringing companies who would otherwise be hesitant to take a license where they were clearly infringing certain patents.

One topic I foresee as a future issue which I would enjoy reading in one of your future blogs is the idea of "tying" in regard to companies being coerced to take licenses to patents they don't need and wouldn't want. I would say that is a possible and realistic outcome of these big companies with litigation and licensing muscle entering the patent world.

--
If you are interested in a patent litigation attorney or a patent attorney in Houston, TX, I have started an informative website using the name Patent Prophet which will be a resource for those who wish to obtain a patent or for those who would like to find out how to prevent companies from stealing their inventions. Services include help with entering into IP Agreements & Licensing options, IP Enforcement and Litigation, Strategic Counseling, and much more.

Solicitor General looking for "a slow pitch" in a patent infringement suit against an aggressive State of California hiding behind 11th Amendment.

2008-12-04T06:48:00.000-08:00

I was reading this morning's post on the Patently-O Patent Law Blog about the Biomedical Patent Management Corp. (BPMC) v. California Department of Health Services (on petition for certiorari) brief by the Solicitor General.

In short, I feel that the Court is spending too much time looking for the perfect case to justify the ruling (a.k.a. law) they are looking to implement. However, I believe that injustice is being done because bad law is being formed on the lower courts because the Court is not hearing these poorly-decided cases. I feel this is bad practice, and I implore the courts to stop this practice. Their job at their level is not to "legislate from the bench," but to resolve issues where the lower courts have made errors. My comments to the Patently-O article is below:

TJ, I think the problem is that the SG is looking to pick and choose the best cases to create the law they're looking to implement. Metabolite v. Labcorp was a good candidate to take on the "thinking step" patentability issue, but nothing significant happened, thus no material change to the patent law system. Now, we have a case where the Cali gov't is enforcing their patents, but hiding under 11th Amendment immunities. Again, the SG claimed this was not the right case to create this kind of law, noting that the issue is really a problem. I can think of a few more examples of this off the top of my head.

Pardon the baseball analogy, but it's unfortunate that the courts are looking for a slow pitch down the middle to assert the law they wish to implement. Perfect cases only come once in a while, and we are racking up issues that need to be addressed, and the courts keep going silent. This is not justice -- not for the litigants, not for the patent law system, and not for the country. Stop looking for the perfect cases, and make the wronged litigants whole by hearing cases where there has been an injustice done at the lower courts, because by being SILENT, you are creating precedent and BAD LAW. Just stop it.

The Court needs to put a stop to looking for the "perfect" cases so that they can "legislate from the bench" and must return to adjudicating cases to right a wrong when the lower courts have gone awry.

--
If you are interested in a patent litigation attorney or a patent attorney in Houston, TX, I have started an informative website using the name Patent Prophet which will be a resource for those who wish to obtain a patent or for those who would like to find out how to prevent companies from stealing their inventions. Services include help with entering into IP Agreements & Licensing options, IP Enforcement and Litigation, Strategic Counseling, and much more.

Ethics and morality, too little enforcement and too much regulation.

2008-11-26T06:23:00.000-08:00

I was thinking about Zusha Elinson's "New Business Targeting Patent Trolls Signs IBM and Cisco" article in which he discusses how RPX Corp appears to have the business model of aggregating patent assets (likely relevant to their members) "off the street" so that patent trolls cannot get to the assets first and enforce them against their members. Additionally, the article discusses how the company is buying NOT to enforce their patents against their members.

The issue here is two-fold: 1) whether RPX can control itself regarding costs to its own members and not become a mafia-type of organization extorting funds from corporations who have the choice of "join or be sued," and 2) what RPX will do to companies who choose NOT to join their organization.

As per the question of whether RPX can control itself internally, I see from looking at Wall Street that companies do not and can not control themselves when there is opportunity to get away with an abuse. It reminds me of the old "moral versus legal" discussion I used to have in law school about whether one should be permitted to do something immoral and wrong even though it is not illegal, and whether all immoral activities should be illegal (obviously the answer is no -- when there too much control, wrongdoers surface and look to find loopholes in the system, and the question becomes only whether something is legal versus whether it is moral.) With the over-regulation and under-enforcement by the federal regulators, my opinion is that there are few controls and risks for companies who violate laws and it is simply too costly to enforce the laws against those companies breaking them. Thus, people do what they can to make a profit and their conscience has no part in the equation. My opinion about this issue is that government must cut down on the regulations and must stop over-regulating, but MUST significantly increase their enforcement of rules that are on the books.

Similarly with regard to RPX's activities towards companies that choose not to be part of their posse, the danger is that a for-profit organization has a profit motive, and often the ability to grow profits will overtake ethical considerations such as fairness and morality, as discussed above. A company infringing a patent soon-to-be-owned by RPX obviously should either 1) take a license, or 2) get sued for patent infringement. However, my question is more about questionable bullying practices which are likely to occur as soon as a for-profit organization has muscle.

I have read on the web about some questionable litigation tactics where abuses of the legal system force a company take licenses when they are not necessarily infringing the patents being asserted against them. The reason here is that the cost of litigation ends up being HIGHER than settling and taking a license to the assets even though the company is not infringing them. This is a serious abuse and is something that should be addressed in the form of legislation and/or regulation.

--
If you are interested in a patent litigation attorney or a patent attorney in Houston, TX, I have started an informative website using the name Patent Prophet which will be a resource for those who wish to obtain a patent or for those who would like to find out how to prevent companies from stealing their inventions. Services include help with entering into IP Agreements & Licensing options, IP Enforcement and Litigation, Strategic Counseling, and much more.

Ocean Tomo and patent valuation methods.

2008-11-26T05:47:00.000-08:00

There was an informative article on Phillip Brooks' Patent Infringement Updates web site where a user inquired about valuation methods and Ocean Tomo, an auction house for patent transactions. My comment to that article is below.

Ocean Tomo appears to be the next step in moving patents from A) being property that can be sold by the inventor to an individual looking to benefit from ownership of that patent, to B) a commodity that can be valued and traded by public opinion and/or rules of supply and demand, akin to stocks the stock market.

I have spoken to guys at Ocean Tomo, and my opinion is that what they intend to do is quite innovative. Right now patents are generally valued by analysts who work either independently and know the technology field or work for the company doing the purchasing. The problem with valuation in its current form is that there are usually only a few people looking at the value of a particular set of patents before an offer is presented for the purchase and/or sale of the patents. However, with Ocan Tomo's method, the value of a patent is not only (hopefully) valued initially by an analyst, but that value is then CONFIRMED by bids and valuations by those looking to purchase the patents and/or by those who have some sort of input as to the value of the patents.

Of course there is room here for fraud where one can have individuals bidding up the price where the valuations would end up being inflated, but while this will eventually need to be addressed, for now, the goal is to have more of a "consensus valuation" method rather than a valuation by an individual analyst.

Hearing all this, I have not yet formed my opinion which is better. An individual analyst lacks bias. Consensus pricing invites bad behavior which can undermine the goal of their model. However, all this being said, they do run a good business.

"Patenting Past" innovation.

2008-11-25T15:58:00.000-08:00

As I was writing this comment (below) to the "New patent aggregator RPX may have an Oedipal complex" article by Matt Asay, I got chills down my back. You know I'm all for business and profits, but I am also for innovation and the furtherance of technology. If for no other reason, I got into patent law to help be a part of the future, as I believe that technology can solve the world's problems... it can also cause and aggravate them. When you have patent holding companies that are so big and who wield so much POWER and CONTROL over those who have patents in subject matters which fall within their line-of-sight, it stuns me how quickly these conglomerates could kill businesses by "patenting past" their technologies.

Okay, first of all, very cute analogy to Oedipus. You even got a chuckle out of me. Secondly, a business model such as theirs IS something to be feared, but ALSO in an awe-stricken kind of way. Companies who cheated inventors out of licenses that rightfully should have gone to the inventors have created trolls and troll conglomerates. Obviously patent reform will somehow address this issue because corporations are shaking in their pants when a conglomerate such as this one or its family knocks on the door. Perhaps they'll eventually have to hang on to the same patent law they threw under the bus when they decided to infringe in the first place. I equate a conglomerate to the Angel of Death (AoD). If one is virtuous (e.g. if a company stays within their protected rights covered by their patents and rightfully takes licenses to those inventors whose patents they are practicing), then that company will get a pass and they won't have to submit to the will of the AoD.

What scares me is not the acquisition of patent rights from inventors who have been cheated out of licenses that rightfully belong to them, but think tanks of scientists who patent "just to stay ahead of technology." Now that is freightening, because a company with enough resources can rule the world if they speculate and patent each and every speculation. This appears to be exactly what is happening, and from a corporate perspective, it is HIGHLY profitable.

That being said, I am sure that once patent conglomerates begin to stifle business' ability to grow because they have to pay the keeper to cross the bridge -- the true meaning of a troll -- then at that point if not before, government will have to step in to preserve the patent system and restore it so that patents are returned to being used to further innovation rather than to stifle productivity.

Loosely using the term "patent troll."

2008-11-25T15:12:00.000-08:00

Another article appeared discussing patent trolls. The article is called, "Looking to fend off patent trolls, IBM, Cisco support startup RPX" by John Cook. It appears I have a crusade here to properly define the issue of patent trolls for the patent community. My comment is below.

"Look, you are throwing around the term "patent troll" too loosely. A patent troll is one who acquires a patent for the sole purpose of enforcing it against someone else in litigation.

Everybody admits that the issues are 1) frivolous patents are awarded which duplicate subject matter in the prior art, 2) corporations infringe patents and bully inventors who deserve to be compensated for their innovations, 3) big patent-holding conglomerates are SCARY because they hold too much political and commercial power (according to some).

While the concept of a troll, e.g. company who buys patents to enforce them, seems to make them appear to be evil, remember that there would be no trolls if corporations were fair in their licensing practice and if they took licenses where licenses were appropriate. Instead, they play games and initiate stalling tactics to force the inventor into bankruptcy or to scare them into not pursuing them due to lack of funds. THIS is the problem. Get rid of this problem, and these helpless inventors will not sell their patents for pennies on the dollar."

Regarding Intellectual Venture's interest in the purchase of Transmeta's patent assets...

2008-11-25T14:09:00.004-08:00

I was just reading the "Secretive IP Holder Funds Tech Acquisition" article where it mentions that Intellectual Ventures (IV) had a stake in the recent purchase of the Transmeta assets. My opinion about their interest is below.

First of all, and this is off the top of my head, there are those who claimed that Transmeta Corp. was a troll in that their goal was to patent around Intel's patents. Obviously I have no backup for this other than word of mouth. However, when Transmets did sue Intel, Intel settled because the Transmeta claims did read on products Intel created and was in the process of creating.

Thus, IV purchasing Transmeta's many patent assets would be nothing more than one IP holding company purchasing the assets of an IP holding company. I suppose it all relates to intent. So far, their intent appears to be to acquire assets and assert them against companies who are infringing their patents to force them to take a license on those patents. I don't have anything wrong with this because IV rightfully purchased those assets, and as patents currently stand, they are PROPERTY which is transferrable. (Whether I believe the right to assert should belong to big companies or to the inventor is a different topic.)

But in sum, Intellectual Ventures is doing nothing wrong by purchasing Transmeta's assets. All you can hope for is that IV will use them in a more productive and "friendlier" way than Transmeta has.
Remember, the goal in patent law should always be "to promote innovation" rather than to promote corporate profits.

A Patent Conglomerate, a.k.a. "Mafia"

2008-11-25T14:09:00.003-08:00

Another paste of a comment from the TechDirt article on "New Patent Buying Firm Swears It'll Never Litigate Over Its Patents"

Re: Mafia - Nov 25th, 2008 @ 1:29pm
There is no reason that those looking for patent protection have to pay the equivalent of a mafia in order to have protection from would-be infringers. The laws themselves should provide enough patent protection to the inventors, but they don't in their current form.

Maybe the issue is allowing patents to be TRANSFERRABLE PROPERTY.

2008-11-25T14:09:00.001-08:00

A paste of a comment from another TechDirt article on "New Patent Buying Firm Swears It'll Never Litigate Over Its Patents"

Comment - Nov 25th, 2008 @ 1:27pm
I agree. The goal of the whole patent process is to INNOVATE and to protect the INVENTOR against others reverse engineering and copying his/her ideas. Perhaps the problem is allowing patents to be transferrable.

Obviously I don't have a solution, but the patent law system is obviously broken at the point where inventors no longer can enforce their patents and are forced to sell to larger companies (often called trolls) who have the muscle to enforce. Maybe in addition to giving inventors more protections to enforce their patents, preventing the purchase and sale of patents in itself is also a solution. I know a solution like that would upset a lot of people, but at least it would protect the integrity of the patent system.

Being proactive regarding patent reform, on the issue of trolls and non-practicing entities (NPEs).

2008-11-13T14:52:00.000-08:00

I thought the conversation in the comments section of the Techdirt article about Bill Gates working with Nathan Myhrvold was a good one. I wanted to paste a copy here.

Peter,

I agree that forums such as these are good for voicing concerns about those who are benefiting from the patent law system in its present form. However, it does nobody any good until someone on the federal level *who has legislative power* gets interested in the subject matter and takes action on it. My experience is that this almost never happens until people like YOU, ME, and OTHERS start writing letters, sending e-mails, and making phone calls.

Those in power need to be EDUCATED on the issues we are discussing on this mini-forum, but they will likely not come to you or read this article and its many comments. HENCE, WE NEED TO BE PROACTIVE AND DO SOMETHING about issues we see that affect the integrity of our patent system.

Someone below referred to me as a "self-labeled troll." I find that comment to be slightly ignorant. Rather, I'm an activist and I prefer to fix the problems at its source rather than fighting those who have figured out a way to benefit from the system as it is. While I am very against those who abuse the system with frivolous law suits, patent assertions, and litigation tactics, ESPECIALLY from NPEs (non-practicing entities), ***always remember that there would be no such thing as a patent troll if companies would be fair about taking licenses from little guys (individual inventors and/or small companies who cannot afford the patent enforcement process.)***

My opinion is that there should be stronger patent protection for inventors so that there would be no incentive to sell to a troll for pennies on the dollar.

As for the topic of NPEs, I don't quite have a solution, nor do I know what to do about them, but I do see it as being an issue.

Aristocrat Technologies v. International Game Technology (IGT) decision.

2008-09-25T08:56:00.001-07:00

I just read the US Court of Appeals opinion for the Aristocrat v. International Game Technology (IGT) case, and I want to mention that I am unhappy with the decision and I feel that the judge played semantics with the availability of defenses for patent infringement suits, although I do believe he properly applied the law on its face. My opinion is that the law in its present form is broken and needs a bit of revision.

To summarize the lower court's decision, in short, when Aristocrat was prosecuting their gaming patent, they paid a fee one day late. While this is a minor oversight, bottom line, according to the rules, this is enough to have the USPTO determine that the patent was abandoned and they did. Now according to the law, the applicants can only revive the abandoned application by stating that the lateness and its resulting abandonment was unavoidable. Yes, there are provisions regarding fees that state the cost of reviving an abandoned patent under the "unintentional" standard, but reading the statute on its face only allows an abandoned patent to be revived under the higher "unavoidable" standard. Whether this should be changed is a moot issue for now. The applicants claimed that the abandonment was "unintentional," the USPTO said okay and revived the application, which later issued into US 7,056,215. Aristocrat later filed a continuation patent which also issued into US 7,108,603.

The lower court held that because the USPTO revived the abandoned application under the "unintentional" standard, because this type of revival is not supported by the statute on its face, the '215 patent is invalid (as is its child, the '603 patent).

Here in the US Court of Appeals decision, the judge reversed the lower court opinion stating that regardless of whether the patent is valid or not, "improper revival" of an abandoned patent is NOT a valid defense in an infringement action. What?!? He then goes ahead citing weak proofs as to why certain defenses are defenses and why others are not, and because improper revival was not one of those defenses that were explicitly listed as a defense, the judge precluded its availability completely ignoring the catch-all provision of 35 USC s.282(4) "Any other fact or act made a defense by this title."

Now here is the pickle. Judge Jenkins appears to be technically correct in that improper revival is not explicitly stated as a defense to an infringement action so it's not so clear whether section 282(4) applies to improper revivals of abandoned actions. However, the USPTO improperly revived the application and issued a patent which it should not have because it went beyond the powers granted to it.

So what do we do here? The patent should NOT have been issued, so technically, it SHOULD be invalid, as should its child. But, the appellate court interpreted the issue of availability of a certain defense, not the issue of invalidity based on a procedural and/or legal defect in the prosecution.

My opinion is that IGT will likely appeal to the Supreme Court, but regardless of whether they hear the case, their decision will spark some legislative controversy. If the Supreme Court hears the case and determines that 35 USC section 282(4) applies to the defense of improper revival, people will ask "what else constitutes a defense?" In my opinion, this is not a bad thing. I believe that if an examiner makes an error in the prosecution and a patent issues which should not have issued, there is nothing wrong with a patent litigation attorney later "combing the file-wrapper" looking for procedural and/or legal reasons why the patent being asserted is invalid. This is and should continue to be an available method of invalidating a patent. In short, if a patent should not have been issued, it should not have been issued, period! The problem with this alternative is that the Supreme Court by invalidating the patent will loosely interpret section 282(4) and strictly read the provision requiring the higher "unavoidable" standard, and this would be a contradiction.

Alternatively, if the Supreme Court hears the case and determines that the Court of Appeals was correct, it will essentially provide the rule that "notwithstanding certain exceptions which we will deal with on a case-by-case basis, regardless of what error the USPTO examiner committed during prosecution, if a patent issues, it is valid." In its essence, the Supreme Court would give the USPTO full power to act outside its legislated powers awarding patents which should be invalid and vice versa. This is not an acceptable option. The USPTO is bound by the laws just as any federal agency should be. It has no rights to interpret the laws to mean something that is contra to powers explicitly granted. Thus, if the Supreme Court hears the case and affirms the Court of Appeals' decision, who will control the USPTO and its examiners who make incorrect decisions?

In sum, this is one more case of where the law should have written something that it didn't, and like many others, it needs a revision to clarify Congress' position of 1) whether the unintentional standard is enough to revive an abandoned patent, and 2)whether 35 USC s.282(4) should include other defenses not explicitly stated as being a defense.

Troll-Evading Trust Formed To "Catch & Release" Patents

2008-07-30T14:26:00.000-07:00

...Companies Band Together as the Allied Security Trust to Buy IP Before Any Trolls Can Take Them To Court
By: Maureen O'Gara
Jul. 9, 2008 02:45 AM

Source: http://wireless.sys-con.com/node/605480

“Verizon, Google, Cisco, HP, Motorola, Sun, Telefon AB and Ericsson have banded together as the Allied Security Trust to buy IP before any trolls can take them to court.

They’ve paid $250k to join and are each kicking it about $5 million in funding. They will then get non-exclusive licenses to the acquired technology and afterwards sell it on. The non-profit calls the concept “catch and release.” It currently has 11 members and is expecting 30-40.

It swears it won’t assert any of the acquired patents.

According to the new non-profit, It costs operating companies an average of $3.2 million through the end of discovery and $5.2 million through trial to defend infringement cases when there is more than $25 million at stake. It says “even a small claim is highly disruptive and requires significant time and legal costs to defend.”

It says companies often settle for a smaller amount than whatever is sought, even when the company knows that it would eventually win. “These lawsuits are not only a huge distraction for management, but they also draw R&D and other resources away from other projects.”

The place is being run by former IBM VP of IP and licensing Brian Hinman.”