> "There's bad news and there's good news," said Cheng in an interview with Ars. "The good news is, we won this case on every point. The bad news is, we're running out of lawsuits. There are fewer trolls for us to fight. I've spent a lot of time over the last seven years figuring out what to do with these guys. There are strategies I think would be really neat and effective that I literally can't execute. I can't make good law because I don't have any appellate cases left. They [the trolls] are dismissing cases against us before any dispositive motions." - Lee Cheng
""Shareholders of public companies that engage in patent trolling should ask themselves if they're really well-served by their management teams," Cheng added. "Are they properly monetizing their R&D? Surely there are better ways to make money than to just rely on litigating patents. If I was a shareholder, I would take a hard look as to whether their management was competent."
But, look, most trolls don't want to fight it out. They want you to settle. Once word gets out that you will fight to the death, the trolls move on to the next easier target.
What if NewEgg offered a membership for small tech businesses? The businesses would pay $x for year, and would get either a nominal discount on orders, or cheaper shipping, or faster shipping, or a super-special support contact, or whatever. But the kicker would be that it would include patent defense insurance. Then, anytime one of those small companies would get patent trolled, NewEgg and Cheng could go to bat for them.
I'm not suggesting this should be cheap. Adjust the value of x until the scheme is appropriately profitable for NewEgg, and Cheng can keep fighting the good fight.
Your legal officer, your attorney or anyone at your company should realize that this isn't about them nor is it about (business wise at least) protecting anyone else but the interests of your company. His quote smacks of a challenge that he liked and as such you also have to at least question whether he operated at arms length from the problem at hand.
> "Alcatel Lucent, meanwhile, they drag out some random VP—who happens to be a decorated Navy veteran, who happens to be handsome and has a beautiful wife and kids—but the guy didn't know what patents were being asserted. What a joke."
This is pathetic. You have a billion dollar company try to play legal hardball and they don't even do the most basic coaching of your executive team. They must have been getting really comfortable in East Texas to fuck up this bad.
It's not that they are good at it, but it's the others are really bad.
I've said it once and I'll say it again, say the word 'patent' and most executives (and their corporate legal representation) will shudder and think you're in the right. They have no idea of what the state of patents are, what can be done about them, and that the people suing you are most likely doing it for a quick buck.
Newegg's anti-troll stance is exactly why I bought 2 weeks ago I bought the majority of my desktop components from them, without even pricing checking on amazon/etc.
I did as well. I needed a few small rack servers and their name was on my mind. I wasn't spending my own money so it was just a case of "Newegg's fighting the good fight these days, have a cookie". It was only about $5k but if there's many people who think like me then it adds up.
Nice, a win for the good guys. I'm glad to see the '131 patent die but it died last year anyway due to its expiration. Sad that it caused pain up to this point. I keep hoping we'll plateau on the silly patents as everything between '92 and '98 starts to expire.
The other interesting thing here (and it was evident in Oracle v. Google as well) is that the judiciary is coming up to speed on both the technology aspects of these patents and the general inanity of trying to "obvious" stuff.
I really hope this is another sign of the beginning of the end for this abuse of the patent system.
Newegg and Rackspace are definitely building a reputation for pushing back against patent trolls and even borderline-legitimate (maybe?) cases like this one. I wonder how we as outsiders can go about assessing the impact of building this reputation (ex: a troll going after various retailers but not Newegg, for instance)
I'm surprised more companies don't do this, because it seems to me that the impact is clear: Like ambulance chasing, patent trolling relies on the simple principle that it's much, much cheaper to settle than to go to court -- for both sides. It's huge that they won, but they didn't need to. By sending the message that they will always go to court, my guess is they'll stop being sued.
On the other hand, the trolls know this, and may react by targeting companies that do this to demonstrate that it's not an effective strategy.
"Newegg and Rackspace are definitely building a reputation "
I can assure you that the overwhelming majority of their customers don't care about this and of the ones that do any a portion of them would be able to even change buying decisions over it.
If you are the IT director explaining to your boss that you want to deal with Rackspace or Newegg (and pay higher prices or get not as good of a product) because of this just won't fly. If anything it even makes your judgement suspect in the same way that wanting to give business to your brother in law might. It's not an arms length decision process.
Newegg's strategy here is basically applied game theory, where they loudly and publicly state that they will never pay licensing fees to trolls, and then they loudly and publicly show that to be the case. Worse, they're actually winning their court cases, and destroying the value of their opponent's patent portfolio.
Nobody in their right mind would waste time trying to troll them now - unless they have a really rock-solid case, which is unknowable before litigation.
In one hand newegg kills trolls and I'd love to buy from them... But to get close to amz prices you have to give in to mail rebates and other forms of marketing trolling.
I believe my company has purchased somewhere around $100k+ from Newegg by this point. I would suggest not always buying on price and look at what the company is offering... and one of those things has been always eggcellent (ha-ha) customer service. Also, they're not Amazon. They have that going for them as well.
I could have gotten them from Amazon for cheaper with free next-day delivery, but I bought my last set of parts from Newegg specifically because they shat on a patent troll's parade. I'm totally willing to pay a premium for that, I have not a single regret.
NewEgg is worth giving your business to. In addition to all this, they have better filtering for electronics product-finding, an excellent reputation for customer service, and the most helpful reviews database I've ever found.
(Amazon is a close second on reputation and reviews)
Prices are usually very close from what I have seen- only a dollar or three different.
Does anyone remember when plan 9 was released (I certainly don't, I'm too young) under a pseudo-open source license that contained a clause to the effect of "If you sue lucent in an ip case you lose your right to use plan 9". Imagine if people had actually adopted plan 9, since unlike real NPEs, victims could probably sue alcatel for infringing on patents of their own, although this doesn't seem to be the case yet.
Alcatel sure has fallen. My father worked for them in France in the mid-90s. He said at the time, they were one of the best run and most exciting companies in the world. They had research labs in all sorts of things all over the place. Eventually, new management was established and Alcatel began falling apart, and then they merged to form Alcatel-Lucent in 2006. I don't think anyone even knows who they are anymore.
The patent in question is pretty absurd. If I understand it correctly, Alcatel patented the concept of using an ID to reference an object:
"referencing... an object that is to be displayed on the terminal display with a particular identifier"
If I understand it correctly, I've violated this patent hundreds of times. But in Alcatel's defense, they patented it a couple years before I started using IDs.
New York City has taken a similar approach. They have now started fighting many more lawsuits even though the settlement amount would be less than the cost of defense. The problem with settling is that it emboldens others to come in as they can threaten a costly fight, while knowing that the city is not going to do that and make easy money. So while it may save money in the beginning, settling gets more people to sue you. Now that lawyers know that their bluff may be called and they may have to fight in court, they will be much more selective of what cases they take in to fight. Of course it can sometimes backfire as in Research in Motion's case, but you cannot always give in to threats.
Newegg is winning the hearts and minds of the "Tech Influencers" here. People like us who follow the news and understand the importance of supporting endeavors like this are more likely to recommend and influence the buying decisions of others.
With trolls being such a problem, why haven't companies formed alliances to defend each other against lawsuits? Wouldn't the tech world be better off if suing one company meant taking on most of the industry?
Can someone put in layman's terms the patent and how it was being applied in this case? They say in the article it was an "old cell phone patent being applied to the internet" but don't explain how/what. thx
The patent (US #5649131, there's a link in the article) covers a general scheme for standardized communication between a server and client (the patent refers to 'host' and 'terminal').
Specifically, the server and client agree on a set of defined 'objects' (in this case including text boxes, drop-down menus, and images). The client then displays said objects to the user by following instructions from the server. The claimed innovation seems to be that the server and client talk about the aforementioned objects rather than sending exact descriptions of the client's display back and forth.
Alcatel-Lucent intended to apply the patent very broadly - consider a web server as the 'host' and a web browser as the 'terminal', for example.
I'd say the patent, at least the beginning, is fairly readable. I don't see any way that it could be applied to suing any of these companies though... perhaps that's the point: http://www.google.com/patents/US5649131?dq=5649131&hl=en...
From a quick read, it appears to be about a server keeping track of menus and clicks on those menus that happen on some client (e.g. smartphone?) app. That seems like absolute nonsense to me, but I may be getting tripped up by the use of the term "host computer."
It doesn't look like anyone knew...
"Alcatel-Lucent's corporate representative, at the heart of its massive licensing campaign, couldn't even name the technology or the patents it was suing Newegg over."
When I ran a hardware oriented business, I spent tens of thousands of dollars every year at Newegg. Since moving exclusively to software, I buy a lot less hardware. But, I know where I'm buying my computers and electronics from now on.
My livelihood depends on not being targeted by trolls, and companies that fight back against trolls help me avoid the damned near certain destruction of my company that a patent troll could cause me (I'd, ethically, be compelled to fight...but I simply don't have the resources to win such a fight).
Hopefully this will provide some motivation to other companies that have been faced with similar threats by trolls and have caved. It doesn't take a lot of wins to start turning the tide in our favor.
The trolls will certainly be back after they regroup - and their tactic may shift to coming after increasingly smaller companies that can't afford to go to court in the first place, much less actually stand up a fight. Nonetheless, any movement in the right direction is a good thing as far as I'm concerned.
Going after increasingly smaller companies also means attempting to get increasingly smaller amounts of money from a larger number of defendants. Eventually this will become untenable, at least for larger operations like Alcatel-Lucent, because there is still an overhead of running such an operation.
[+] [-] buro9|13 years ago|reply
.
That's a great quote.
[+] [-] lifeguard|13 years ago|reply
""Shareholders of public companies that engage in patent trolling should ask themselves if they're really well-served by their management teams," Cheng added. "Are they properly monetizing their R&D? Surely there are better ways to make money than to just rely on litigating patents. If I was a shareholder, I would take a hard look as to whether their management was competent."
[+] [-] ak217|13 years ago|reply
[+] [-] crag|13 years ago|reply
But, look, most trolls don't want to fight it out. They want you to settle. Once word gets out that you will fight to the death, the trolls move on to the next easier target.
[+] [-] hkmurakami|13 years ago|reply
[+] [-] BrandonM|13 years ago|reply
I'm not suggesting this should be cheap. Adjust the value of x until the scheme is appropriately profitable for NewEgg, and Cheng can keep fighting the good fight.
[+] [-] fuzzywalrus|13 years ago|reply
[+] [-] larrys|13 years ago|reply
Your legal officer, your attorney or anyone at your company should realize that this isn't about them nor is it about (business wise at least) protecting anyone else but the interests of your company. His quote smacks of a challenge that he liked and as such you also have to at least question whether he operated at arms length from the problem at hand.
Newegg's business isn't fighting lawsuits.
[+] [-] dasil003|13 years ago|reply
This is pathetic. You have a billion dollar company try to play legal hardball and they don't even do the most basic coaching of your executive team. They must have been getting really comfortable in East Texas to fuck up this bad.
[+] [-] raverbashing|13 years ago|reply
I've said it once and I'll say it again, say the word 'patent' and most executives (and their corporate legal representation) will shudder and think you're in the right. They have no idea of what the state of patents are, what can be done about them, and that the people suing you are most likely doing it for a quick buck.
[+] [-] stephen|13 years ago|reply
[+] [-] hkmurakami|13 years ago|reply
[+] [-] noonespecial|13 years ago|reply
[+] [-] lifeguard|13 years ago|reply
[+] [-] ChuckMcM|13 years ago|reply
The other interesting thing here (and it was evident in Oracle v. Google as well) is that the judiciary is coming up to speed on both the technology aspects of these patents and the general inanity of trying to "obvious" stuff.
I really hope this is another sign of the beginning of the end for this abuse of the patent system.
[+] [-] chasb|13 years ago|reply
[+] [-] hkmurakami|13 years ago|reply
[+] [-] Zikes|13 years ago|reply
[+] [-] fuscata|13 years ago|reply
On the other hand, the trolls know this, and may react by targeting companies that do this to demonstrate that it's not an effective strategy.
[+] [-] larrys|13 years ago|reply
I can assure you that the overwhelming majority of their customers don't care about this and of the ones that do any a portion of them would be able to even change buying decisions over it.
If you are the IT director explaining to your boss that you want to deal with Rackspace or Newegg (and pay higher prices or get not as good of a product) because of this just won't fly. If anything it even makes your judgement suspect in the same way that wanting to give business to your brother in law might. It's not an arms length decision process.
[+] [-] _lex|13 years ago|reply
Nobody in their right mind would waste time trying to troll them now - unless they have a really rock-solid case, which is unknowable before litigation.
[+] [-] gcb0|13 years ago|reply
In one hand newegg kills trolls and I'd love to buy from them... But to get close to amz prices you have to give in to mail rebates and other forms of marketing trolling.
[+] [-] yock|13 years ago|reply
[+] [-] druiid|13 years ago|reply
[+] [-] pi18n|13 years ago|reply
[+] [-] sliverstorm|13 years ago|reply
(Amazon is a close second on reputation and reviews)
Prices are usually very close from what I have seen- only a dollar or three different.
[+] [-] frogpelt|13 years ago|reply
That little bit every three years is probably worth it to reward a company that cares.
[+] [-] rayiner|13 years ago|reply
[+] [-] 1123581321|13 years ago|reply
[+] [-] jtome|13 years ago|reply
[+] [-] jbrowning|13 years ago|reply
[+] [-] jfb|13 years ago|reply
[+] [-] unknown|13 years ago|reply
[deleted]
[+] [-] famousactress|13 years ago|reply
[+] [-] darxius|13 years ago|reply
edit: wow, spelling.
[+] [-] Xcelerate|13 years ago|reply
[+] [-] hkmurakami|13 years ago|reply
[+] [-] JakeSc|13 years ago|reply
"referencing... an object that is to be displayed on the terminal display with a particular identifier"
If I understand it correctly, I've violated this patent hundreds of times. But in Alcatel's defense, they patented it a couple years before I started using IDs.
[+] [-] specialp|13 years ago|reply
http://www.nytimes.com/2013/02/26/nyregion/new-york-to-stem-...
[+] [-] ChikkaChiChi|13 years ago|reply
You go from being a customer, to an evangelist.
[+] [-] Osiris|13 years ago|reply
[+] [-] brianbreslin|13 years ago|reply
[+] [-] yew|13 years ago|reply
Specifically, the server and client agree on a set of defined 'objects' (in this case including text boxes, drop-down menus, and images). The client then displays said objects to the user by following instructions from the server. The claimed innovation seems to be that the server and client talk about the aforementioned objects rather than sending exact descriptions of the client's display back and forth.
Alcatel-Lucent intended to apply the patent very broadly - consider a web server as the 'host' and a web browser as the 'terminal', for example.
[+] [-] jere|13 years ago|reply
From a quick read, it appears to be about a server keeping track of menus and clicks on those menus that happen on some client (e.g. smartphone?) app. That seems like absolute nonsense to me, but I may be getting tripped up by the use of the term "host computer."
[+] [-] meleva|13 years ago|reply
[+] [-] SwellJoe|13 years ago|reply
My livelihood depends on not being targeted by trolls, and companies that fight back against trolls help me avoid the damned near certain destruction of my company that a patent troll could cause me (I'd, ethically, be compelled to fight...but I simply don't have the resources to win such a fight).
[+] [-] thorntonbf|13 years ago|reply
The trolls will certainly be back after they regroup - and their tactic may shift to coming after increasingly smaller companies that can't afford to go to court in the first place, much less actually stand up a fight. Nonetheless, any movement in the right direction is a good thing as far as I'm concerned.
Way to go Newegg!
[+] [-] pyre|13 years ago|reply
[+] [-] mk3|13 years ago|reply