> In actuality, it is a bit more complicated. Our dealings with this particular troll reach back to December 2010 when IP Navigation Group (IP Nav), as agent for a supposedly secret patent owner, now known as Parallel Iron, accused Rackspace of patent infringement. IP Nav told us that they could not divulge the details of their infringement claims – not even the patent numbers or the patent owner – unless we entered into a “forbearance agreement” – basically, an agreement that we would not sue them. IP Nav was worried that as soon as we found out what their patents and claims actually were, Rackspace would sue to invalidate their patents or for a declaration that Rackspace does not infringe. We were unwilling to enter into such a one-sided agreement, so we negotiated a mutual forbearance agreement that required either party to give 30 days’ notice before bringing suit.
It's worth noting that it's very very close to the same tactic Microsoft pursued in targeting Android OEMs. Basically forcing them to sign non-disclosure agreements before letting them even know which patents they violated. Then when Barnes and Noble finally refused and forced (some of) the patents into the open something like 90% of them were found to be bogus. But this was after dozens of OEMs were extorted into licensing these dodgy patents based on the up front NDA.
This one act of Microsoft's has made it very hard for me to buy any of their products. I feel like I'm funding a patent extortionist (I would call them a "troll" but I know many people would nitpick the definition of that).
I can't understand why anyone would sign away their right to counter-sue in order to obtain information on something which can't possibly damage them until the information is disclosed anyway (IANAL)
Is there even a reasonable situation where a one-sided "forbearance agreement" is ever appropriate? Or even remotely fair? That seems like basically writing up a contract that says "By signing this you owe me $100" but entrenching and obfuscating it in 75 pages of legalese.
Well, it's not exactly news that patents are an extortion racket. And where there's a racket, you will find someone to use it, be it the mafia or a patent troll.
I don't see this as shady. Suing and defending being sued is expensive enough to worry even medium sized companies. Exploring other options first seems like good business practice to me.
Interesting, patent trolls have reached the level of public relations foil. I think its great that Rackspace is suing these guys but I found the press release made me feel like I do when somebody is trying to impress me with all of the charities they've donated money to. Mutual forbearance agreement? Seriously? Why not sue them right then and there when they foisted that bit of "strategy" on you and charged them with criminal extortion?
My reasoning is like this, either you infringe or you don't. So the patent holder can say "We believe you infringe claims x, y, and z on patents q, r, and s." Or they can't. So if someone tells you infringe but they won't tell you the patent or the claims, and they are threatening to sue anyway, that is a protection racket and actionable under the RICO statutes as far as I can tell.
We couldn't sue because we didn't know what we would sue on. They wouldn't even tell us the patent numbers - so we didn't have the knowledge necessary to even file a complaint.
As for suing because of the forbearance agreement, they try to write these things so they are just on the side of the line, and it is really hard to make a RICO suit stick (see Cisco and Innovatio).
We, of course, think that it is just BS. Now we are on record saying so.
If I read it correctly Rackspace probably wanted to see if they could be legitimately (in the eyes of the law) at fault.
The way I read that mind bogglingly stupid forbearance dance was as if a bill collector calls me up and says I have a bill to pay, but they won't tell me what it's for unless I promise not to dispute it. I'm not going sue then and there because maybe I really do have a bill outstanding, so I play their stupid game and agree neither side will do anything for 30 days, now show me the damn bill.
From what I read, it seems like the suit may be mostly predicated on the agreement that required IP Nav to wait 30 days. I don't believe they could have just sued for "patent extortion" originally.
It is nice that they are asking for a declaratory saying they are not infringing, but I believe they only could have done this on the defensive originally whereas now they can be on the offensive.
It is awesome to see a company put their money where their mouth is, the good will with the dev community they are building with this will easily exceed the costs of fighting a troll in court.
This builds up LOTS of good will with me. But still, I'm not sure you are right. The cost of fighting a troll in court can be shockingly large. If it were worth MORE in public relations than it cost in legal fees then it would obviously be an investment they should make, just to become more profitable. I doubt that... I think it is worth a lot in public relations, but less than the same amount of cash would buy in advertising. Nevertheless, it is worth it for two reasons: (1) because it scares patent trolls off of Rackspace in the future, and (2) because it's good for the world, even if it isn't profitable. Sometimes you just have to do things that aren't profitable.
Whenever I see several different groups behaving in a manner I find obnoxious, I wonder incentives encourage this kind of behavior, and how those incentives might be reduced.
One such way is countersuit, which Rackspace is doing. If everyone (successfully) countersued, the incentive to be a patent troll would diminish.
There might be other ways. Is there some common property patent trolls depend on that might be penalized or forbidden? I've noticed that patent trolls rarely seem to produce anything. Perhaps some sort of "use it or lose it" clause, in which patent holders have a certain amount of time to effectively license their technology to some degree of effectiveness before they can't enforce infringements.
It works in other areas. For instance, in my home state, many people would love to live in the country extremely cheaply, so there's an incentive to set up dubious Christmas tree farms to get nice tax rates. To combat this, you have a certain number of years to turn a profit, and if you don't, you lose the farm credit.
I always wondered what would happen if a neutral party (EFF?) got a lot of money to essentially defend and countersue all patent troll claims, regardless of if they'd win or not. Hopefully this "scorched earth" plan would get the notice of judges and lawmakers to change the law.
>One such way is countersuit, which Rackspace is doing. If everyone (successfully) countersued, the incentive to be a patent troll would diminish.
I was under the impression that these patent troll shell companies are set up so that they have virtually no assets under them. Does countersuing even hurt these shell companies significantly? The only thing I can see countersuits costing patent trolls is time in court (maybe that costs the parent of the shell company money if they operate on a scale where they're hiring lawyers to go sue companies?)
I've said this here before more than once. The solution is for tech companies to fund a massive entity who's only purpose in life is to mercilessly sue patent trolls. Destroy them. Go after their patents. Invalidate them. Make it so costly to even attempt to enforce a bullshit patent that they will only dare take that step if they have a really good solid patent.
If the top 100 companies in tech donated just ten million dollars a year to this effort you would instantly have a one billion dollar "kill the trolls" fund. If the fund is not fully consumed during the first year it could become three or four billion in five to seven years. How many trolls are going to be willing to go up against any company with that kind of a war chest to protect it?
Small entities would contribute less. The way I see it, in the US alone, this kind of protection is easily worth $50K to $100K per year for a small entity.
Yes, we are at a point where you might have to consider paying a membership fee to a troll protection association that is equivalent to the salary of a full-time employee. Sad.
The US government ought to also provide a sizable chunk of money to this fund as well as tax-exempt status. Say, a billion dollars a year. Considering the economic damage being done this is chump change. Now you have a kill-the-trolls association that, through public and private funding, could end-up with nearly ten billion dollars in five to seven years. Scary enough?
I am not one for government getting involved in private matters, much less blowing money like they did in Solyndra and others. However, this is a government-sponsored monopoly that they crated. You and I did not create this. This mess is 100% on government hands. And, like most things government does, it eventually went off the rails. It's an absolute mess. They have a responsibility to fix it.
The first step is to grant a sizable amount of money to a private entity that will shield entrepreneurs from trolls. They should hand over the money and get out of the way. Consider it reparations for running such a fucked-up patent office. Then they can go off and take ten years to reform the system.
Oh, yes, they should also make the patent invalidation process 100% free. In other words, anyone should be able to file a patent invalidation action and it should be 100% free. Then we could crowd-source patent invalidation runs on all the patents held by trolls. Form crowd-sourced teams that target trolls and file away.
Seriously folks, this is war. And in war you have to have more powerful weapons than your enemy. The enemy has the power of the monopoly they were granted by the US government. What they don't have is unlimited and massive capital. An association of practicing entities --no trolls allowed-- with billions of dollars available to mount a shield and defend members would be massively intimidating.
The association's mission statement should state that all engagements will have, as a goal, the invalidation of the patents in question. In other words, if you screw with us we will go directly to rip those patents out of your hands. No middle ground. No deals. No mercy. Attacking us means you, as the attacker, risk it all and you better have a real patent.
How many trolls are going to risk that? How many will do it after one, two or several are absolutely decimated in court and their patents invalidated.
One more thing. If a non practicing entity has a patent invalidated they are also put through a bankruptcy style procedure whereby a trustee takes a look at what moneys were derived from licensing the invalid patents. The idea is to refund ill-gotten funds to those who paid the fees.
In other words, hit them with a nuke.
EDIT: Also, on the subject of patent invalidation. This should be ripped out of the hands of the government and run just like a trial. I don't know exactly how it works today, but this is what I have in mind: A judge is appointed to oversee the process. A jury of people well-qualified in the patent's subject matter is assembled. Both parties present their case. The jury deliberates and decides. Fast, efficient and 100% in private hands with the blessings of the US government. Rough strokes.
You are overlooking the fact that patent trolls do have real patents.
From the blog post, for example:
"""
Until Congress reforms the patent laws, companies of all sizes and industries could – and likely will – find themselves in the crosshairs of a greedy patent troll looking for a quick cash-grab. No company is immune, and, sadly, small companies can’t afford to fight. If they don’t succumb to the troll’s demands by settling, they face certain ruin.
"""
Patent trolls are on the right side of the law. The law is the problem.
And invalidating a worthless patent doesn't harm the troll at all -- no harm in trying, right? They can always get another patent. As non-practiciing entities, they don't have any business at risk. It's asymmetric.
I personally believe the same thing is necessary in a similar area; I've been discussing it with friends recently. In games in particular (but I'm sure other fields as well), big actors often violate contracts with impunity, safe in the knowledge that the small companies they deal with cannot possibly afford to challenge them in court. Milestone payments delayed indefinitely (to empty out a smaller partner's coffers), contracts outright violated, etc.
It definitely feels like there are a lot of problems facing software developers in general that could be addressed if collectively the industry would take a stand for civilized, rational behavior and pool their resources. In some cases, you could possibly turn a profit doing it!
It looks like they are taking a different approach to the problem (though the bill still hasn't passed yet):
> The next legislative effort will likely center around what is known as the SHIELD Act, which has been introduced by Rep. Peter DeFazio (D-Oregon) and Representative Jason Chaffetz (R-Utah). This bill would require plaintiffs to pay defendants’ legal costs if the suit is unsuccessful. -- http://www.rackspace.com/blog/patent-trolls-make-them-pay/
While this is a less drastic strategy, I think it's a more realistic one. It would have an immediate, deterrent effect on all trolls--big and small--because there would be direct, legal repercussion for their actions. This way, you don't need new infrastructure and new funding to support a watchdog group, and nobody can "slip through the cracks"--trolls paying for all the costs of a failed suit is just part of the system they are using to file the suits. This may not prevent the "big players" from throwing their weight around with patent litigation, but it would certainly help the current situation quite a bit, imo.
Here's the relevant text of the bill:
> [I]n an action disputing the validity or alleging the infringement of a computer hardware or software patent, upon making a determination that the party alleging the infringement of the patent did not have a reasonable likelihood of succeeding, the court may award the recovery of full costs to the prevailing party, including reasonable attorney's fees [...] -- http://www.gpo.gov/fdsys/pkg/BILLS-112hr6245ih/pdf/BILLS-112...
[EDIT: Link to bill wasn't including the trailing colon ':', linked to PDF]
The issue with this stance is that your 'opponent' can easily shift assets and IP ownership so as to absorb the loss via litigation in a company which has non-transferable licenses, but maintain ownership over the patents in a seperate corp, essentially shielding them from any substantial loss that litigation would bring. Even if they lose, they just need to open another corp and re-license.
The problem? That means that your mega-corp would be at a net-loss for every patent suit filed. What's more, it would create the issue wherein parties who couldn't adhere to the standards of whatever mega-entity are exiled from the industry.
The only corps that can be sued effectively are those with cash. This is why people are willing to innovate in patented areas; if they succeed, they're rich and can afford to pay for litigation. If they lose, they won't get sued anyways.
Additionally, how exactly do you sue an NPE? They aren't infringing a patent. That's the entire idea behind being an NPE in the first place; you're not dissuaded by counter-patent litigation because you don't practice. NPEs were a reaction to the exact type of litigation broadside that you're talking about, specifically that patent-rich corps (Apple, Google, Microsoft and most of the companies in the telecom industry, for instance are a notable subset) could amass a patent portfolio so large that any encroachment you made into their industry would saddle you with massive search and negotiation costs in order for you to pay licensing fees, or open yourself up to being demolished in court the moment they needed you out of the market.
Non-practicing entities aren't really the issue. Most companies cannot, and do not, have the skills and assets to effectively enforce their rights. If you're a developer, you're better at focusing on developing. Accordingly it makes sense to allow people specialized in IPR enforcement to do that work for you. The idea that 'anything under the sun' can be captured under a method patent is far more sinister, and it accounts for the massive inflation in patents. The fact that protections over electronics are receiving overlapping IPRs from copyright, trademark, patent, trade secret is a far larger issue. It shouldn't be an issue of 'who' is asserting the patent rights, but rather 'what' patent rights they can assert. You bring this up in one of your replies, and I think your follow-up argumentation is a lot closer to a solution than this initial post.
Circuit topography's protection in the law makes a lot more sense, as its tailored to the industry it seeks to regulate. Patent, however, is a circus with too many clowns under the big-top.
I'm curious why more smaller and medium sized businesses haven't banded together to form some kind of larger entity to combat these trolls.
There's security in numbers. If I was a patent troll and knew if I was going to sue a company like RackSpace and knew they had 25-50 companies standing behind them with a large pool of legal and financial resources, I'd be more apt to try and find an easier target.
> why more smaller and medium sized businesses haven't banded together to form some kind of larger entity to combat these trolls
Well, one reason is that it may be illegal. We have antitrust laws that prohibit companies that make up a large percentage of an industry from coordinating in certain ways... this is an edge case but might be a problem.
But the main reason is just that it is prohibitively expensive. It's really, really expensive to fight a patent troll, and if you win then they turn out to be a shell company with no assets so you can't be reimbursed for your costs (and probably wouldn't be eligible for that anyway in the US). So for small companies, flying under the radar and hoping they won't notice you seems to be the way to go.
Can anyone explain if it's possible for this patents to just go from one company to another? Like what's is stopping IP Nav and Parallel Iron from just creating a new corporation and transferring their IP if Rackspace succeeds in this lawsuit?
Seems like they can just start shell companies in order to avoid being counter-sued.
Not exactly sure what you're going for, but you sue based on facts as they were at a particular point in time. Transferring a patent or doing a hide the ball move doesn't work so well in court, particularly federal court.
Res judicata is the concept that once a party in a suit has facts determined of a particular situation in one court, that party can't then go into another court and argue the opposite.
I'd love to see a patent troll lose a case, but their breach of contract case seems a bit weak (without seeing the actual contract, since they didn't include 'Exhibit B' in the PDF).
As I understand it:
* Parallel Iron owns IPNav.
* IPNav and Rackspace signed a contract saying that IPNav won't sue Rackspace without giving 30 days notice first.
* Parallel Iron sues Rackspace without giving notice first.
* Rackspace sues Parallel Iron and IPNav for breach of contract.
But IPNav and Parallel Iron are separate legal entities, and so unless Rackspace can argue that they can 'pierce the corporate veil' (which might be difficult if they followed appropriate standards to separate the companies, which I presume lawyer heavy patent trolls would be careful to do) and treat them as the same legal entity, IPNav isn't responsible for Parallel Iron filing the suit, and Parallel Iron isn't subject to the contract entered into by IPNav.
I'm all in favor of fighting groundless patent infringement claims, but a bit surprised to see so much commentary from Rackspace about a pending legal matter. The normal lawyer response would be "we don't comment on pending litigation."
It's definitely out of the norm. Especially when the VP of IP (I'm guessing also general counsel) participates in a forum discussion on the topic. Then again, he's the one who can, and is supposed to, speak on such matters for the company.
It could also be an attempt to get Google juice for anyone else looking for info on these jokers.
Question for someone who knows something about patent law: does Rackspace have a chance of actually making any money here? Simply based on seeing other stories like this, it seems that all these trolls operate through shell companies, which can simply declare bankruptcy without (1) every paying any actual fees and (2) without hurting the parent. Is that true here as well?
It already is, at least IP lawyers should be aquainted with the term, even some scholarly articles at ssrn.com use it. But it probably wouldn't be a prominent term in judgements, because it is too broad and doesn't describe "what the troll did and why it is bad", so it isn't really useful in that sense. I guess the standard formulations would be more like "abusive conduct" etc. (My own jurisdiction isn't angloamerican)
I like the use of "duck test" in this. Just like the notorious Interplay manager decreed for the queen animations in Battle Chess... we should get rid of the duck.
[+] [-] rayiner|13 years ago|reply
That's some shady shit right there.
[+] [-] zmmmmm|13 years ago|reply
This one act of Microsoft's has made it very hard for me to buy any of their products. I feel like I'm funding a patent extortionist (I would call them a "troll" but I know many people would nitpick the definition of that).
[+] [-] notahacker|13 years ago|reply
[+] [-] aroman|13 years ago|reply
[+] [-] _ak|13 years ago|reply
[+] [-] SeanDav|13 years ago|reply
[+] [-] ChuckMcM|13 years ago|reply
My reasoning is like this, either you infringe or you don't. So the patent holder can say "We believe you infringe claims x, y, and z on patents q, r, and s." Or they can't. So if someone tells you infringe but they won't tell you the patent or the claims, and they are threatening to sue anyway, that is a protection racket and actionable under the RICO statutes as far as I can tell.
[+] [-] VanL|13 years ago|reply
As for suing because of the forbearance agreement, they try to write these things so they are just on the side of the line, and it is really hard to make a RICO suit stick (see Cisco and Innovatio).
We, of course, think that it is just BS. Now we are on record saying so.
- Van (Rackspace VP of IP)
[+] [-] themgt|13 years ago|reply
Presumably because if given a choice, Rackspace would rather spend its time and energy on hosting servers than in court.
[+] [-] jbigelow76|13 years ago|reply
If I read it correctly Rackspace probably wanted to see if they could be legitimately (in the eyes of the law) at fault.
The way I read that mind bogglingly stupid forbearance dance was as if a bill collector calls me up and says I have a bill to pay, but they won't tell me what it's for unless I promise not to dispute it. I'm not going sue then and there because maybe I really do have a bill outstanding, so I play their stupid game and agree neither side will do anything for 30 days, now show me the damn bill.
[+] [-] kodablah|13 years ago|reply
From what I read, it seems like the suit may be mostly predicated on the agreement that required IP Nav to wait 30 days. I don't believe they could have just sued for "patent extortion" originally.
It is nice that they are asking for a declaratory saying they are not infringing, but I believe they only could have done this on the defensive originally whereas now they can be on the offensive.
[+] [-] codesuela|13 years ago|reply
[+] [-] mcherm|13 years ago|reply
[+] [-] unknown|13 years ago|reply
[deleted]
[+] [-] 51Cards|13 years ago|reply
[+] [-] kevinalexbrown|13 years ago|reply
One such way is countersuit, which Rackspace is doing. If everyone (successfully) countersued, the incentive to be a patent troll would diminish.
There might be other ways. Is there some common property patent trolls depend on that might be penalized or forbidden? I've noticed that patent trolls rarely seem to produce anything. Perhaps some sort of "use it or lose it" clause, in which patent holders have a certain amount of time to effectively license their technology to some degree of effectiveness before they can't enforce infringements.
It works in other areas. For instance, in my home state, many people would love to live in the country extremely cheaply, so there's an incentive to set up dubious Christmas tree farms to get nice tax rates. To combat this, you have a certain number of years to turn a profit, and if you don't, you lose the farm credit.
(here's an example of why they do this: http://www.huntingnet.com/forum/wildlife-management-food-plo...)
[+] [-] ROFISH|13 years ago|reply
[+] [-] hkmurakami|13 years ago|reply
I was under the impression that these patent troll shell companies are set up so that they have virtually no assets under them. Does countersuing even hurt these shell companies significantly? The only thing I can see countersuits costing patent trolls is time in court (maybe that costs the parent of the shell company money if they operate on a scale where they're hiring lawyers to go sue companies?)
[+] [-] robomartin|13 years ago|reply
If the top 100 companies in tech donated just ten million dollars a year to this effort you would instantly have a one billion dollar "kill the trolls" fund. If the fund is not fully consumed during the first year it could become three or four billion in five to seven years. How many trolls are going to be willing to go up against any company with that kind of a war chest to protect it?
Small entities would contribute less. The way I see it, in the US alone, this kind of protection is easily worth $50K to $100K per year for a small entity.
Yes, we are at a point where you might have to consider paying a membership fee to a troll protection association that is equivalent to the salary of a full-time employee. Sad.
The US government ought to also provide a sizable chunk of money to this fund as well as tax-exempt status. Say, a billion dollars a year. Considering the economic damage being done this is chump change. Now you have a kill-the-trolls association that, through public and private funding, could end-up with nearly ten billion dollars in five to seven years. Scary enough?
I am not one for government getting involved in private matters, much less blowing money like they did in Solyndra and others. However, this is a government-sponsored monopoly that they crated. You and I did not create this. This mess is 100% on government hands. And, like most things government does, it eventually went off the rails. It's an absolute mess. They have a responsibility to fix it.
The first step is to grant a sizable amount of money to a private entity that will shield entrepreneurs from trolls. They should hand over the money and get out of the way. Consider it reparations for running such a fucked-up patent office. Then they can go off and take ten years to reform the system.
Oh, yes, they should also make the patent invalidation process 100% free. In other words, anyone should be able to file a patent invalidation action and it should be 100% free. Then we could crowd-source patent invalidation runs on all the patents held by trolls. Form crowd-sourced teams that target trolls and file away.
Seriously folks, this is war. And in war you have to have more powerful weapons than your enemy. The enemy has the power of the monopoly they were granted by the US government. What they don't have is unlimited and massive capital. An association of practicing entities --no trolls allowed-- with billions of dollars available to mount a shield and defend members would be massively intimidating.
The association's mission statement should state that all engagements will have, as a goal, the invalidation of the patents in question. In other words, if you screw with us we will go directly to rip those patents out of your hands. No middle ground. No deals. No mercy. Attacking us means you, as the attacker, risk it all and you better have a real patent.
How many trolls are going to risk that? How many will do it after one, two or several are absolutely decimated in court and their patents invalidated.
One more thing. If a non practicing entity has a patent invalidated they are also put through a bankruptcy style procedure whereby a trustee takes a look at what moneys were derived from licensing the invalid patents. The idea is to refund ill-gotten funds to those who paid the fees.
In other words, hit them with a nuke.
EDIT: Also, on the subject of patent invalidation. This should be ripped out of the hands of the government and run just like a trial. I don't know exactly how it works today, but this is what I have in mind: A judge is appointed to oversee the process. A jury of people well-qualified in the patent's subject matter is assembled. Both parties present their case. The jury deliberates and decides. Fast, efficient and 100% in private hands with the blessings of the US government. Rough strokes.
[+] [-] trhtrsh|13 years ago|reply
From the blog post, for example: """ Until Congress reforms the patent laws, companies of all sizes and industries could – and likely will – find themselves in the crosshairs of a greedy patent troll looking for a quick cash-grab. No company is immune, and, sadly, small companies can’t afford to fight. If they don’t succumb to the troll’s demands by settling, they face certain ruin. """
Patent trolls are on the right side of the law. The law is the problem.
And invalidating a worthless patent doesn't harm the troll at all -- no harm in trying, right? They can always get another patent. As non-practiciing entities, they don't have any business at risk. It's asymmetric.
[+] [-] kevingadd|13 years ago|reply
It definitely feels like there are a lot of problems facing software developers in general that could be addressed if collectively the industry would take a stand for civilized, rational behavior and pool their resources. In some cases, you could possibly turn a profit doing it!
[+] [-] coolj|13 years ago|reply
> The next legislative effort will likely center around what is known as the SHIELD Act, which has been introduced by Rep. Peter DeFazio (D-Oregon) and Representative Jason Chaffetz (R-Utah). This bill would require plaintiffs to pay defendants’ legal costs if the suit is unsuccessful. -- http://www.rackspace.com/blog/patent-trolls-make-them-pay/
While this is a less drastic strategy, I think it's a more realistic one. It would have an immediate, deterrent effect on all trolls--big and small--because there would be direct, legal repercussion for their actions. This way, you don't need new infrastructure and new funding to support a watchdog group, and nobody can "slip through the cracks"--trolls paying for all the costs of a failed suit is just part of the system they are using to file the suits. This may not prevent the "big players" from throwing their weight around with patent litigation, but it would certainly help the current situation quite a bit, imo.
Here's the relevant text of the bill:
> [I]n an action disputing the validity or alleging the infringement of a computer hardware or software patent, upon making a determination that the party alleging the infringement of the patent did not have a reasonable likelihood of succeeding, the court may award the recovery of full costs to the prevailing party, including reasonable attorney's fees [...] -- http://www.gpo.gov/fdsys/pkg/BILLS-112hr6245ih/pdf/BILLS-112...
[EDIT: Link to bill wasn't including the trailing colon ':', linked to PDF]
[+] [-] lukeholder|13 years ago|reply
[+] [-] white_devil|13 years ago|reply
Or it could just, you know, stop this whole patent troll madness altogether.
[+] [-] LucasCollecchia|13 years ago|reply
The problem? That means that your mega-corp would be at a net-loss for every patent suit filed. What's more, it would create the issue wherein parties who couldn't adhere to the standards of whatever mega-entity are exiled from the industry.
The only corps that can be sued effectively are those with cash. This is why people are willing to innovate in patented areas; if they succeed, they're rich and can afford to pay for litigation. If they lose, they won't get sued anyways.
Additionally, how exactly do you sue an NPE? They aren't infringing a patent. That's the entire idea behind being an NPE in the first place; you're not dissuaded by counter-patent litigation because you don't practice. NPEs were a reaction to the exact type of litigation broadside that you're talking about, specifically that patent-rich corps (Apple, Google, Microsoft and most of the companies in the telecom industry, for instance are a notable subset) could amass a patent portfolio so large that any encroachment you made into their industry would saddle you with massive search and negotiation costs in order for you to pay licensing fees, or open yourself up to being demolished in court the moment they needed you out of the market.
Non-practicing entities aren't really the issue. Most companies cannot, and do not, have the skills and assets to effectively enforce their rights. If you're a developer, you're better at focusing on developing. Accordingly it makes sense to allow people specialized in IPR enforcement to do that work for you. The idea that 'anything under the sun' can be captured under a method patent is far more sinister, and it accounts for the massive inflation in patents. The fact that protections over electronics are receiving overlapping IPRs from copyright, trademark, patent, trade secret is a far larger issue. It shouldn't be an issue of 'who' is asserting the patent rights, but rather 'what' patent rights they can assert. You bring this up in one of your replies, and I think your follow-up argumentation is a lot closer to a solution than this initial post.
Circuit topography's protection in the law makes a lot more sense, as its tailored to the industry it seeks to regulate. Patent, however, is a circus with too many clowns under the big-top.
[+] [-] BuddhaSource|13 years ago|reply
IP laws are little weak and innovation can thrive. If somebody wants to copy paste it can happen anywhere, irrespective of laws.
[+] [-] rdl|13 years ago|reply
[+] [-] tomjen3|13 years ago|reply
[+] [-] recloop|13 years ago|reply
[+] [-] at-fates-hands|13 years ago|reply
There's security in numbers. If I was a patent troll and knew if I was going to sue a company like RackSpace and knew they had 25-50 companies standing behind them with a large pool of legal and financial resources, I'd be more apt to try and find an easier target.
[+] [-] mcherm|13 years ago|reply
Well, one reason is that it may be illegal. We have antitrust laws that prohibit companies that make up a large percentage of an industry from coordinating in certain ways... this is an edge case but might be a problem.
But the main reason is just that it is prohibitively expensive. It's really, really expensive to fight a patent troll, and if you win then they turn out to be a shell company with no assets so you can't be reimbursed for your costs (and probably wouldn't be eligible for that anyway in the US). So for small companies, flying under the radar and hoping they won't notice you seems to be the way to go.
[+] [-] danielpal|13 years ago|reply
Seems like they can just start shell companies in order to avoid being counter-sued.
[+] [-] jstalin|13 years ago|reply
Res judicata is the concept that once a party in a suit has facts determined of a particular situation in one court, that party can't then go into another court and argue the opposite.
[+] [-] jtchang|13 years ago|reply
[+] [-] mitchellhislop|13 years ago|reply
[+] [-] A1kmm|13 years ago|reply
As I understand it:
* Parallel Iron owns IPNav.
* IPNav and Rackspace signed a contract saying that IPNav won't sue Rackspace without giving 30 days notice first.
* Parallel Iron sues Rackspace without giving notice first.
* Rackspace sues Parallel Iron and IPNav for breach of contract.
But IPNav and Parallel Iron are separate legal entities, and so unless Rackspace can argue that they can 'pierce the corporate veil' (which might be difficult if they followed appropriate standards to separate the companies, which I presume lawyer heavy patent trolls would be careful to do) and treat them as the same legal entity, IPNav isn't responsible for Parallel Iron filing the suit, and Parallel Iron isn't subject to the contract entered into by IPNav.
Disclaimer: IANAL
[+] [-] coldpie|13 years ago|reply
[+] [-] austenallred|13 years ago|reply
[+] [-] rainkinz|13 years ago|reply
[+] [-] ams6110|13 years ago|reply
[+] [-] reeses|13 years ago|reply
It could also be an attempt to get Google juice for anyone else looking for info on these jokers.
[+] [-] avaku|13 years ago|reply
[+] [-] eykanal|13 years ago|reply
[+] [-] gesman|13 years ago|reply
[+] [-] saraid216|13 years ago|reply
[+] [-] Atropos|13 years ago|reply
[+] [-] ceautery|13 years ago|reply
[+] [-] jarmitage|13 years ago|reply
[+] [-] ropman76|13 years ago|reply
[+] [-] chris_wot|13 years ago|reply