Business Method Patents: Characters in Search of Legal Protection
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THE DEFENSIVE PATENT PLAYBOOK James M
THE DEFENSIVE PATENT PLAYBOOK James M. Rice† Billionaire entrepreneur Naveen Jain wrote that “[s]uccess doesn’t necessarily come from breakthrough innovation but from flawless execution. A great strategy alone won’t win a game or a battle; the win comes from basic blocking and tackling.”1 Companies with innovative ideas must execute patent strategies effectively to navigate the current patent landscape. But in order to develop a defensive strategy, practitioners must appreciate the development of the defensive patent playbook. Article 1, Section 8, Clause 8 of the U.S. Constitution grants Congress the power to “promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.”2 Congress attempts to promote technological progress by granting patent rights to inventors. Under the utilitarian theory of patent law, patent rights create economic incentives for inventors by providing exclusivity in exchange for public disclosure of technology.3 The exclusive right to make, use, import, and sell a technology incentivizes innovation by enabling inventors to recoup the costs of development and secure profits in the market.4 Despite the conventional theory, in the 1980s and early 1990s, numerous technology companies viewed patents as unnecessary and chose not to file for patents.5 In 1990, Microsoft had seven utility patents.6 Cisco © 2015 James M. Rice. † J.D. Candidate, 2016, University of California, Berkeley, School of Law. 1. Naveen Jain, 10 Secrets of Becoming a Successful Entrepreneur, INC. (Aug. 13, 2012), http://www.inc.com/naveen-jain/10-secrets-of-becoming-a-successful- entrepreneur.html. -
Do the Anticompetitive Risks of Standards-Essential Patent Pools Outweigh Their Procompetitive Benefits?*
Glory Days: Do the Anticompetitive Risks of Standards-Essential Patent Pools Outweigh Their Procompetitive Benefits?* JOHN “JAY” JURATA, JR. & EMILY N. LUKEN1 TABLE OF CONTENTS I. INTRODUCTION………………………………………...…………2 II. BACKGROUND ................................................................................ 3 A. Patent Pools & Similar Arrangements...................................... 3 B. SEPs, FRAND, and Competition Law ....................................... 4 III. PATENT POOLS AND COMPETITION LAW ....................................... 6 A. Overview……………………………………………………………...6 B. Historical DOJ Business Review Letters on Patent Pools….….8 C. DOJ Avanci 5G Business Review Letter…………………………10 IV. SOME OF THE PROCOMPETITIVE ASSUMPTIONS FOR PATENT POOLS ARE NO LONGER ARE TRUE WHEN APPLIED TO FRAND- ENCUMBERED SEPS ..................................................................... 13 A. Market Power ......................................................................... 13 B. Reduced Transaction Costs ..................................................... 16 V. ANTICOMPETITIVE RISKS OF CERTAIN SEP POOLS ARE HIGHER TODAY COMPARED TO THE POOLS REVIEWED BY THE DOJ IN HISTORICAL BUSINESS REVIEW LETTERS .................................... 18 A. Licensing Agents Refusing to Comply with FRAND ............... 19 B. Structural Mechanisms Designed to Deter Adhering to FRAND Commitments ............................................................. 21 C. Including Non-SEPs to Collect Supra-FRAND Royalties ....... 25 D. Using Pools to Exploit -
Inhibiting Patent Trolling: a New Approach for Applying Rule 11 Eric Rogers Molecular Templates, Inc
Northwestern Journal of Technology and Intellectual Property Volume 12 | Issue 4 Article 2 2014 Inhibiting Patent Trolling: A New Approach for Applying Rule 11 Eric Rogers Molecular Templates, Inc. Young Jeon e-Litecom Co., Ltd. Recommended Citation Eric Rogers and Young Jeon, Inhibiting Patent Trolling: A New Approach for Applying Rule 11, 12 Nw. J. Tech. & Intell. Prop. 291 (2014). https://scholarlycommons.law.northwestern.edu/njtip/vol12/iss4/2 This Article is brought to you for free and open access by Northwestern Pritzker School of Law Scholarly Commons. It has been accepted for inclusion in Northwestern Journal of Technology and Intellectual Property by an authorized editor of Northwestern Pritzker School of Law Scholarly Commons. NORTHWESTERN JOURNAL OF TECHNOLOGY AND INTELLECTUAL PROPERTY Inhibiting Patent Trolling: A New Approach for Applying Rule 11 Eric Rogers & Young Jeon November 2014 VOL. 12, NO. 4 © 2014 by Northwestern University School of Law Northwestern Journal of Technology and Intellectual Property Copyright 2014 by Northwestern University School of Law Volume 12, Number 4 (November 2014) Northwestern Journal of Technology and Intellectual Property Inhibiting Patent Trolling: A New Approach for Applying Rule 11 By Eric Rogers & Young Jeon* There has been an alarming rise in the number of litigious entities—commonly referred to as patent trolls or non-practicing entities—that make no products but file dubious patent infringement lawsuits merely to extract money from commercially productive companies. High litigation costs provide a fertile environment for an exploitive business model that uses shotgun tactics to threaten patent infringement claims against numerous companies, many of which will make a purely financial decision to pay patent trolls rather than expend even more money in litigation. -
Predictably Expensive:Ac Ritical Look at Patent
PREDICTABLY EXPENSIVE: A CRITICAL LOOK AT PATENT LITIGATION IN THE EASTERN DISTRICT OF TEXAS Brian J. Love* James Yoon† CITE AS 20 STAN. TECH. L. REV. 1 (2017) ABSTRACT In this Article, we compare U.S. patent litigation across districts and consider possible explanations for the Eastern District of Texas’ popularity with patent plaintiffs. Rather than any one explanation, we conclude that what makes the Eastern District so attractive to patent plaintiffs is the accumulated effect of several marginal advantages—particularly with respect to the relative timing of discovery deadlines, transfer decisions, and claim construction—that make it predictably expensive for accused infringers to defend patent suits filed in East Texas. These findings tend to support ongoing efforts to pass patent reform legislation that would presumptively stay discovery in patent suits pending claim construction and motions to transfer or dismiss. However, we also observe that courts in the Eastern District of Texas have exercised their discretion in ways that dampen the effect of prior legislative and judicial reforms that were aimed (at least in part) at deterring abusive patent suits. Given courts’ broad discretion to control how cases proceed, this additional finding suggests that restricting venue in patent cases may well be the single most effective reform available to Congress or the courts to limit patentees’ ability to impose unnecessary and unwarranted costs on companies accused of patent infringement. * Assistant Professor and Co-Director of the High Tech Law Institute, Santa Clara University School of Law. My work on this Article was supported in part by the INPRECOMP Project of the Center for Law, Science & Innovation (LSI) at the Arizona State University Sandra Day O’Connor College of Law. -
Notice Failure and Notice Externalities
Journal of Legal Analysis Advance Access published January 3, 2013 NOTICE FAILURE AND NOTICE EXTERNALITIES Peter S. Menell and Michael J. Meurer1 Downloaded from ABSTRACT The emergence of intangible resources, such as intellectual property illuminates a pre- viously unrecognized market failure: what we call a “notice externality.” The incentives http://jla.oxfordjournals.org/ of those claiming intellectual property diverge from the social interest. Inventors and creators can sometimes benefit from obfuscating the scope of rights and keeping others in the dark about their intellectual property. This article explores the principal causes of notice failure in the development of intangible resources and offers a multifaceted framework for diagnosing, preventing, internalizing, and ameliorating its adverse effects. 1. INTRODUCTION at UNIVERSITY OF CALIFORNIA BERKELEY on January 11, 2013 The institution of private property addresses a prime resource allocation con- cern in market-based economies: appropriability (Even 2009). Property rights encourage investment in resource development by granting property owners rights to exclude and develop their resources, which can enhance owners’ ability to derive value from their investments. The right to exclude encourages farmers to cultivate crops by ensuring that they, and not interlopers, will be able to reap the harvest. It also encourages land developers to build homes knowing that they can prevent squatters from occupying the dwellings. In these ways, the 1 Peter S. Menell, Robert L. Bridges, Professor of Law and Director, Berkeley Center for Law & Technology, University of California at Berkeley School of Law; Michael J. Meurer, Abraham and Lillian Benton Scholar and Professor of Law, Boston University School of Law, E-mail: pmenell@ law.berkeley.edu. -
Artikelen PRIVATEERS and TROLLS JOIN the GLOBAL PATENT WARS; CAN COMPETITION AUTHORITIES DISARM THEM?
Mr. M. Dolmans1 Artikelen Privateers and trolls join the global patent wars; can competition authorities disarm them? Computerrecht 2014/37 a component that is subject to network effects, and you can threaten producers with catastrophic loss. On Halloween of 2013, patent assertion company – Patents proliferate in the ICT sector. This is partially Rockstar, owner of one of the largest patent portfo- due to patent mining and strategic patenting – firms lios in the world, 2 filed patent law suits against seven creating dense thickets of overlapping patent claims mobile phone makers and Google in the Texas ‘rocket covering and surrounding a product to block rivals. As docket’. 3 This heralded an escalation in the mobile patent offices are overwhelmed by applications in new, patent world war raging since 2010. fast-moving and complex technology areas, some think they grant patents without adequate review, leading to This ‘Halloween Attack’ is symptomatic of an in- lower patent quality. 4 Yet, in a portfolio, volume makes creasing problem: opportunistic exploitation of up for weakness. Patents are presumed valid, and chal- patents by Patent Assertion Entities (‘PAEs’, or less lenging patents is costly and time-consuming. More politely, ‘trolls’), and the strategic use of such PAEs important, if one patent is annulled or found not in- by firms to hamper their rivals. The war stories from fringed, patentees will have others. Litigation becomes the mobile phone sector are interesting as examples like a fight against the Hydra: chop off one head and of a competitive game, but even more as a harbin- two more grow. -
Some Observations on the Patent Troll Litigation Problem
Intellectual Property& Technology Law Journal Edited by the Technology and Proprietary Rights Group of Weil, Gotshal & Manges LLP VOLUME 26 • NUMBER 8 • AUGUST 2014 Some Observations on the Patent Troll Litigation Problem By Christopher Hu atent infringement cases brought by so-called problem can be addressed. In brief, the problems P patent trolls have received considerable atten- stem from the way nonpracticing entities (NPEs) tion in recent years, enough so that both Congress use or misuse the judicial system, not the US Patent and the White House have chimed in on the sub- Office. Accordingly, the solution primarily involves ject.1 The number of cases filed by patent trolls, the applying existing judicial procedures more vigorously cost of defending or settling these cases, the size with minimal changes to existing substantive law. of some judgments, the perceived frivolousness of some cases, and the use or abuse of litigation as a The Patent Troll “Problem” tool to “extort” settlements have all drawn atten- tion to this issue. Adding to the controversy is the Some Statistics on Patent Troll Litigation sentiment among some that it is inherently unfair NPEs, also known as patent trolls or patent asser- or economically wrong for an entity that does not tion entities (PAEs), are a fact of business life in the practice a patent to profit by asserting it. United States. Definitions of a patent troll vary but Although there is some statistical data concerning the common element of every definition is that a the assertion of patents by trolls, and a considerable patent troll is an entity that does not itself practice a amount of anecdotal evidence, there appear to be patent but instead asserts the patent against entities no rigorous studies on the economic effect of trolls. -
Patent Trolls' Hefty Tolls
0125.012456.84151 3PAT0125.PAT-012456.8 28 | INTELLECTUAL PROPERTY Patent18254520.321.654921 Trolls’ Hefty Tolls Lawmakers target shell companies that threaten small businesses with bogus25167282012456012456 claims of patent violations. BY012456012456012456 JONATHAN GRIFFIN ampires, zombies, werewolves (especially the teen variety) and aliens have captured people’s inter- est once again. On TV, at the movies and in books, these fantastical beasts entertain and thrill those brave enough to watch or read about them. But there is one creature that entertains no one and Vevokes only groans3PAT0125.012456.86465 and sighs when its name is uttered, and that’s the “patent troll.” These real-life ogres are largely to blame for more than doubling the number of patent lawsuits in the last 10 years, and in 2011 alone cost U.S. businesses $29 billion in legal fees. Beyond the Tolkien-inspired name, what is a patent troll? And more important, what, if anything, should state lawmakers do to curb the harm many claim they do to small businesses? Patent trolls,67641353PAT0125.012456.8 formally known as patent assertion entities (PAEs), generally are holding or “shell” companies that don’t manufacture anything but hold a number of patents, typically purchased legally from bankrupt firms. They make their money by sending threatening letters to companies claiming they have been violating one or more of their (often vaguely defined) pat- ents. The letters say that if the companies pay the license fees to use their patents,0125.012456.84151 they won’t be sued. PAEs usually request unreasonable fees in light of the alleged infractions and often fail to give companies any details about under fire. -
Patent Assertion Entity Activity: an Ftc Study
Patent Assertion Entity Activity AN FTC STUDY Federal Trade Commission October 2016 PATENT ASSERTION ENTITY ACTIVITY: AN FTC STUDY A REPORT OF THE FEDERAL TRADE COMMISSION EDITH RAMIREZ Chairwoman MAUREEN K. OHLHAUSEN Commissioner TERRELL MCSWEENY Commissioner Heather Hippsley Chief of Staff David B. Robbins Executive Director Deborah L. Feinstein Director, Bureau of Competition Jessica L. Rich Director, Bureau of Consumer Protection Ginger Zhe Jin Director, Bureau of Economics David Shonka Acting General Counsel Randolph W. Tritell Director, Office of International Affairs Jeanne Bumpus Director, Office of Congressional Relations Tara Isa Koslov Acting Director, Office of Policy Planning Justin Cole Director, Office of Public Affairs Donald S. Clark Secretary of the Commission Andrew I. Gavil Former Director, Office of Policy Planning* Martin S. Gaynor Former Director, Bureau of Economics Francine Lafontaine Former Director, Bureau of Economics Marina Lao Former Director, Office of Policy Planning Report Drafters and Contributors Suzanne Munck, Deputy Director, Office of Policy Planning & Chief Counsel for Intellectual Property Daniel S. Hosken, Deputy Assistant Director, Bureau of Economics John E. Dubiansky, Office of Policy Planning J. Elizabeth Callison, Bureau of Economics Julie A. Carlson, Bureau of Economics Jason O’Connor, Bureau of Economics Elizabeth A. Gillen, Office of Policy Planning Benjamin Chartock, Bureau of Economics Christopher Bryan, Office of Policy Planning Henry C. Su, Office of Chairwoman Edith Ramirez Inquiries -
Standards-Essential Patents and Injunctive Relief
April 2013 StandardS-ESSEntial PatEntS and injunctivE rEliEf StandardS-ESSEntial PatEntS and injunctivE rEliEf Table of ConTenTs Page I. InTroduCTIon 1 II. baCkground: The Standard-setting ProCess and InjunCTIve relIef To enforCe PaTenT rIghTs 2 a. SEPs and FRAND CommITmenTs 2 b. InjunCTIve relIef and exClusIon orders In PaTenT InfrIngemenT Cases 3 1. The United States 3 2. Rest of the World 4 III. AvaIlabIlITy of InjunCTIve relIef for InfrIngemenT of FRAND-enCumbered sePs under relevanT PaTenT laws 4 a. The unITed StaTes 4 1. Injunctions and FRAND-Encumbered SEPs in U.S. Courts 5 a) Apple v. Motorola (N.D. Ill.) 5 b) Microsoft v. Motorola (W.D. Wash.) 5 c) Apple v. Motorola (W.D. Wisc.) 6 2. Recent ITC Developments 6 a) The ’745 Investigation (Complainant: Motorola; Respondent: Apple) 7 b) The ’752 Investigation (Complainant: Motorola; Respondent: Microsoft) 7 c) The ’794 Investigation (Complainant: Samsung; Respondent: Apple) 8 d) Comments by Agencies and the Public Regarding FRAND-Encumbered SEPs in ITC Investigations 8 b. EuroPe 9 1. Germany 9 a) Orange Book Standard—The Framework for the FRAND Defense 9 b) Lower Court Application of Orange Book Standard 10 2. The Netherlands 11 3. France and the United Kingdom 12 C. AsIa 1 2 1. Japan 12 2. China 12 Iv. ApplICabIlITy of anTITrusT laws To Attempts To obTaIn InjunCTIve relIef wITh resPeCT To FRAND-enCumbered sePs 13 a. The unITed StaTes 13 1. District Court Decision in Apple v. Motorola 13 2. DOJ Investigation of Google/Motorola Mobility 14 3. FTC Antitrust Enforcement Actions 14 a) In the Matter of Robert Bosch GmbH 14 b) In the Matter of Google, Inc. -
Patents and Standards
Patents and Standards A modern framework for IPR-based standardization FINAL REPORT A study prepared for the European Commission Directorate-General for Enterprise and Industry This study was carried out for the European Commission by and as part of the DISCLAIMER By the European Commission, Directorate-General for Enterprise and Industry The information and views set out in this publication are those of the author(s) and do not necessarily reflect the official opinion of the Commission. The Commission does not guarantee the accuracy of the data included in this study. Neither the Commission nor any person acting on the Commission’s behalf may be held responsible for the use which may be made of the information contained therein. ISBN 978-92-79-35991-0 DOI: 10.2769/90861 © European Union, 2014. All rights reserved. Certain parts are licensed under conditions to the EU. Reproduction is authorized provided the source is acknowledged. About ECSIP The European Competitiveness and Sustainable Industrial Policy Consortium, ECSIP Consortium for short, is the name chosen by the team of partners, subcontractors and individual experts that have agreed to work as one team for the purpose of the Framework Contract on ‘Industrial Competitiveness and Market Performance’. The Consortium is composed of Ecorys Netherlands (lead partner), Cambridge Econometrics, CASE, CSIL, Danish Technological Institute, Decision, Eindhoven University of Technology (ECIS), Euromonitor, Fratini Vergano, Frost & Sullivan, IDEA Consult, IFO Institute, MCI and wiiw, together with a group of 28 highly-skilled and specialised individuals. ECSIP Consortium p/a ECORYS Nederland BV Watermanweg 44 3067 GG Rotterdam P.O. Box 4175 3006 AD Rotterdam The Netherlands T. -
Licensing Terms of Standard Essential Patents. a Comprehensive Analysis of Cases
Licensing Terms of Standard Essential Patents A Comprehensive Analysis of Cases Authors: Chryssoula Pentheroudakis, Justus A. Baron Editor: Nikolaus Thumm 2017 EUR 28302 EN This publication is a Science for Policy report by the Joint Research Centre (JRC), the European Commission’s science and knowledge service. It aims to provide evidence-based scientific support to the European policy- making process. The scientific output expressed does not imply a policy position of the European Commission. Neither the European Commission nor any person acting on behalf of the Commission is responsible for the use which might be made of this publication. Contact information European Commission, Joint Research Centre Address: Edificio Expo. c/Inca Garcilaso, 3. 41092 Seville (Spain) E-mail: [email protected] Tel.: +34 954488318 JRC Science Hub https://ec.europa.eu/jrc JRC104068 EUR 28302 EN PDF ISBN 978-92-79-64458-0 ISSN 1831-9424 doi:10.2791/32230 Print ISBN 978-92-79-64459-7 ISSN 1018-5593 doi:10.2791/193948 Luxembourg: Publications Office of the European Union, 2017 © European Union, 2017 Reproduction is authorised provided the source is acknowledged. How to cite: Chryssoula Pentheroudakis, Justus A. Baron (2017) Licensing Terms of Standard Essential Patents. A Comprehensive Analysis of Cases. JRC Science for Policy Report. EUR 28302 EN; doi:10.2791/32230 All images © European Union 2017 Title: Licensing Terms of Standard Essential Patents. A Comprehensive Analysis of Cases Abstract The prospect of licensing patents that are essential to standards on an industry-wide scale is a major incentive for companies to invest in standardization activities.