Saturday, May 5, 2012

Change is in Order

 Edvard Munch's just sold for $119+ Million!!
The patentsphere is a strange and scary place sometimes.  I thought I'd share some highlights on my various outings  if only to reassure myself that this stuff actually happens.

It all started simply enough.  An inventor told me that, "Apple is infringing my patent."

"Wow, really.  What patent is it?"

"It's my amazing turn your iPhone into a flying car patent  (an example since I don't want the inventor to be further enflamed.)

"Wow, you can turn your iPhone into a flying car.  Very beneficial here in the land of the Beltway and HOT Lane construction. Sounds novel but I've never seen any people flying over on (in?) their iPhones.  So what's the deal with Apple infringing?  How did you figure out that they are infringing your stuff?"

...Brace yourself for this one.

"My patent number is lower than theirs"

Poker face, poker face, poker hysterical face.

"Ok, what claims are they infringing."

"The whole thing.  All of them."

"Well, what's their priority date vs. yours.  Like the basics, who had the earlier filing date."

"Apple did but I have  lower patent number so my patent came first."

And so it began.  Mind you this is an inventor who spent over $30K on patent attorneys to get this patent.  (geez didn't they do anything other than cash his checks?)  The rest of the conversation didn't go well after that.

Next enter the Potentate of Patents.

The Potentate stopped by on his way to visit the Gold Coast.

His Patentness has been investing in patent applications.  (IV are you listening?)  $500K here, $300K there.  Real money.  Structured deals where he "invests" in the application.  When the patent is issued he invests some more with the plan being to "get" his royalties after the issuance.  It's kind of a sharing of the patent equity arrangement between him and the inventor.  No I don't know how this works but some inventors are getting some really big advances on future license fees and aren't feeling compelled to explain how things actually work to His Patentness.

"What can we do to help you?"  He needed help "getting" his royalties.  Could I help him figure out who he needs to talk to at USPTO to make arrangements on collecting the royalties.

USPTO?  Really.

"Your Patentness, USPTO examines (prosecutes was a scary word for this guy) the patent application and makes a decision on whether the invention is novel and non-obvious (another word that was hard to get through - we really need an antonym.)  If it meets their criteria, you get a patent.  Once you have the patent then you have to enforce it yourself."

"Me enforce it?  How am I supposed to do that?"

Well...and brace yourself for this one... "You will probably need to hire a good patent attorney, have the patent reexamined for good measure, and then hire someone to figure out who is infringing your patents so you know who to call up to get the money.  The gun slingers we've worked with figure out who the biggest infringer is, as in the one with the most money, and then they file a patent infringement law suit against them.  While that's going on their team of trusty wingmen call the little guys on the list to share their one time special offer to settle at a lower royalty rate before the suit goes to court after which the license fees are going to go sky high."

"How long does that take?"

"A long time."

"What do you do?"

"Support the lawyers and the wingmen.  Explain in technical terms why these guys are infringing your patent"

"You mean I have to pay for this?"  (Not just us - the lawyers, the wingmen, the reexamination.)


"So when will I get my money?"

"Not soon."

"That's ridiculous.  What good are those examiners anyway?"

The Potentate of Patents was not pleased.

Note to self - The Potentate -  retainer, cash in advance only.

Next enter the patent expert.

"The US patent system just sucks and needs to be completely overhauled.  And, these trolls are terrible.  They are sucking the life out of innovators and taking their hard earned profits."

Now I'm seeing stars.  Ok, here we go.

"The average age of a patent being asserted, that means the one the trolls are trying to enforce and get money with, is eight years.  If it was published it's been out in public for a while, maybe 10-12 years.  Your innovators must not know how to use the internet because these patents have been around for a long time and there are plenty of tools to do a basic search and plenty of guys who can do a deep dive for you (including us).  Frankly I think the problem is that the trolls have better researchers and understand the marketplace better."

What ensued was a conversation not unlike those between Nilay Patel and Joshua Topolsky of the Verge.  Suffice it to say, it didn't end well.

And finally more wisdom from our pals on the hill.  The latest is that they want to stop publication of patent applications.  They seek to keep "economically significant" patents secret.  Aside from the obvious social contract between an inventor and the public - we'll give you exclusive rights to your invention in exchange for disclosure - who will be the arbiter of what constitutes an economically significant patent?

Did anyone think that a patent that automatically figure out whether your digital device was connected to a PC or a Mac was significant before digital cameras were a consumer product was economically significant?

Did anyone think placing an order for things on the internet using only one click was economically significant when Bezos was selling books out of a warehouse in Seattle?

Are we going to let big companies determine which patents are in the public domain and which are not?  What next, don't publish peer reviewed articles because it might let people know what the scientists found out?

Read it for yourself.

USPTO makes a pretty reasoned argument that if an inventor doesn't want to have their application published, they don't have to.  The level of ridiculousness to this latest idea is mind numbing.

So that was my week.

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