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back to article Patent trolling to go under anti-trust spotlight

America’s Department of Justice and Federal Trade Commission are to take a look at whether patent trolls are breaching US anti-trust laws. The Wall Street Journal is reporting (paywalled) that the process will be kicked off by informal hearings in December. That report claims that Cisco and Nokia have confirmed they will attend …

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I hope that this thing really takes off. Patent trolls are becoming the enemy of technological advances everywhere.

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If you chop the heads off a few trolls the rest will crawl back under the bridge

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The only way to kill a troll is with acid, fire, or a vorpal sword. Considering the cost and luck required for the final option, I say we kill them with fire.

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Anonymous Coward

Unfortunately it won't have the intended effect

The term "Patent Troll" was promoted by Nokia back in the late 90's and early noughties when they were relevant and close to dominant in mobile. They were patenting software and hardware like crazy (still are in fact) and seeing growing anger at software patents, came up with the term "patent troll," to channel that anger into getting another, equally problematic, big business agenda through. Their suggested solution (that they were lobbying government in EU and US with); Only companies which own means of production should be able to own patents. That all seems fine and dandy at first glance. Until you realise there is no way easy way to define a patent troll and Nokia's definition would also net the patents held by many small companies out there utilising the services of patent holding companies pooling of resources so that they can afford patents they couldn't afford to maintain them on their own. These companies are the exact opposite of what should be defined as a patent troll. You don't hear about them if they don't harm anyone or get any headlines. They service the small startups with new ideas, that need protection or else they will be stomped all over by the big guys as soon as their idea turns out to be a monetarily viable one. If patents are worth a light, it is innovative small business breaking into new areas where existing dominant multinational corporations operate that need to be protected the most. And many small businesses, a business strategy, don't own anything in terms of the means of production (that is even small of large businesses, but you can be sure the definitions will take account of that in a way that is OK for the big businesses and much harder for the small).

As it happens I don't think the idea is entirely without merit. However there needs to be really strong protections for the small business and the policy needs to be formed with special regard to preserving small business innovation, and I just don't see where that protection is going to be championed. Also when you really start thinking about the definition of what a "patent troll," is it becomes incredibly difficult in this regard. Similar to - we all know what a rapist is and can define it - but setting practical rules for judging, from the outside, if someone *is* a rapist is far less clear cut and far more difficult. My fear is the way things are, and as skilful as big business lobbyists are, this one will swing the pendulum even further to the advantage of big business and screw the small guy.

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Hopefully they will rule patent monopolies illegal under section 2 of the Sherman Act. Also, copyrights and trademarks while they're at it.

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Anonymous Coward

So you want everywhere to be like china where you can't produce a product with a given name for 5 minutes before someone has ripped it off and produced a cheap clone?

Why would any company bother to design a product and spends lots of money on R&D knowing someone will copy it? this is why china has loads of cheap tat for sale instead of high quality premium products.

Samsung Galaxy S3, iPhone and others would never have been produced without copyrights and trademarks. The Galaxy name is a trademark mark, the iPhone is a trademark.

Would you really want to go to a phone shop and see 50 Galaxy S3 phones, but only one being the genuine article? it would be like the last scenes of Indiana Jones and the Last Crusade. Trying to choose the holy grail from all of the fakes.

Patents are the problem, not trademarks and copyrights.

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Surely it's a question of degree? Even then, China's economy doesn't seem to be suffering too badly given their relatively extreme position.

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trademarks quite useful

I'm in favour of a copyright system balanced in the interests of society as a whole, with shorter terms and enforcement limited to commercial use only. But trademarks don't create a monopoly, because anyone can create a new trademark to compete with existing players. Trademarks do reduce marketplace confusion, in the sense customers recognise trademarks and if they are enforced they mean you don't need to carry out an entire supply chain validation for everything you purchase yourself because you can obtain some level of confidence that someone else is doing this for you. I like to know when I buy organic that that's what I'm getting for example. The Soil Association and other reputable trademarks in this area help me know this to be the case. Remove legal protection of trademarks and it's difficult to see how you would distinguish dangerous fakes in the marketplace from reputably manufactured and supplied items.

If you wouldn't buy your medicines based on Internet spamvertising or at a car boot sale then I think this point is clearly enough made.

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Holmes

Competing with cheap tat

It's very simple, you don't compete on costs, you compete on quality and standards, people won't always purchase the cheapest product they can get in range, often, there will be factors such as support, style, 'official' merchandising and owning an 'original'.

Those who buy cheap tat often fall victim to the consequences soon after by finding it inferior and easily broken, or that it just stops working. Having fallen victim to that myself in the past, I will always buy quality over cost (those who can't afford quality aren't exactly a lost sale anyway -they'll just go from one cheap product to another).

In this way, trademarks are useful, but in modern times corporations have come to misinterpret the granting of trademarks. A trademark is for protection of the consumer, not something you own to smash others over the head with. So the idea is that it makes it easy to prosecute someone else selling a phone badged with the Apple logo as an inferior or dangerous product - not so that you can make extra money suing grocery stores for selling fruit.

Why they were created:

Copyright - To promote the Progress of Science and useful Arts (US). For the encouragement of learned men to compose and write useful books (UK).

Trade Marks & Brand Names - A 'promise of an experience’ and conveys to consumers a certain assurance as to the nature of the product or service they will receive and also the standards the supplier or manufacturer seeks to maintain.

Patents - To promote the progress of science and useful arts by securing for limited times to authors and inventors the exclusive right to their respective writing and discoveries (US). Monopolies are things contrary to our laws... we expressly command that no suitor presume to move us... [except for] projects of new invention so they were not contrary to the law, nor mischievous to the state by raising prices at home or hurt of trade (UK).

What corporations now think, lawyers argue and some courts lose sight of:

Copyright - Mine forever. For the advancement of revenue by exclusive licenses and monetizing non-commercial (previously non-revenue producing) activities.

Trade Marks & Brand Names - Mine forever. For exclusive use in every single industry or non-commercial use that exists - regardless of whether a product is offered or competing in that market.

Patents - Mine for 20 years (for now). For the use of banning or preventing competitors bringing product to market; gaining revenue from an invention without need of investment.

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Surely it's a question of degree? Even then, China's economy doesn't seem to be suffering too badly given their relatively extreme position.

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China has only just started to create its own IP. It has large corporations that manufacture, but they all grew up as outsource manufacturers, without their own patents, trademarks and the like.

They are starting to move towards that, and the Chinese government will be watching very closely. Observe over the next few years as China massively increases enforcement of intellectual property internally and externally as Chinese companies will actually make a profit from them doing so.

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@Andy 73

Andy, I understand how you can have come to feel like that. But consider a couple of things.

1) Let's get some perspective on this "patent nonsense".

Yes there are bad patents. Yes patent reform is needed. But also consider this:

Name a single patent that is actually causing a problem for end users and preventing you getting the device you want. It should be easy as they are so dreadful. But really, try. There are no banned devices where there are not better devices out already in the same category.

There are no features that are must have features. Slide to unlock ? Has that caused a real problem for Android users, are they really suffering ? Amazon has a patent on place synching for e-books between devices - as an Apple iPad/iPhone user I have to set a bookmark in iBooks. Is that really a big deal, is that really killing me as an end user ?

Samsung/Apple design patent infringement. Are Samsung customers complaining Samsung's latest phone the GS3 doesn't, unlike their earlier offerings, look like an iPhone?

The original software patents which stoked outrage - BT's hyperlink patent, Amazon's One Click patent. Both are overturned as unenforcible.

Most tech essential patents for standards are covered by patent pools and can be accessed licensed by all. I look at the system as a whole and I see a system where users *are* getting what they want, with few very minor exceptions. I see a system where there is real brand distinction and companies don't suffer from other companies camping on their brand. Sure sometimes this leads to headlines such as that "Outrage XXXX have patented the color Blue" or some such like and where there is any law/regulation you will always find the rules pushed at the margins will be found wanting somewhere. As an end customer I know each company and they have room to operate under their own identity without others confusing the picture or trampling so much on their coat tails they can't move.

So what really is all the anger really about ?

2) Now look back at China. What original tech have they produced ? Historically they are an incredibly inventive nation. But that was now hundreds of years ago. What new innovative products of late have they produced that aren't a rip off of others? Please name something, anything !!!???

Look at the market immediately outside any high quality store in China and you will see a million copycat rip-offs with low quality and low margins. There are many instances where those companies can and do overwhelm the higher quality business that has invested in innovation. The lack of protection leaves no breathing space for the innovator and makes it a high risk game - too high a risk. So yes China is doing well, but at the expense of a fair return to the innovator. It is a system where the incumbent copy-shop that has perfected the art of copying and "tooling up" takes all (god knows that even happens enough as it is in "the West" even with our protections).

When Europe and the US expanded as industrial powers, they did so *on the back of innovation*. Innovation was everywhere. In Britain, the steam engine. The Kay's flying shuttle lead to mass production of textiles. Germany the petrol powered car. In the US the railroad was taken to the next level. The Wright Brothers got the first aircraft off the ground. Back to Britain again for the invention of the first computer by Alan Turing. The US again for Silicon Chips. All this has happened in countries with strong IP protection, where respect for the inventor is backed by regulation. But the equivalent can't be said for countries that don't have strong IP protection (I know co-incidence is not causation, but we should at the very least pause to think before the barbarians storm the citadel walls).

There is a real danger of throwing the baby out with the bathwater here. Of course there are bad patents. Of course reform is needed in some areas. But in general the system works better today than we are giving it credit for. So just a bit of balance please.

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Re: @Andy 73

Sorry started out addressing Andy 73, but ended up addressing the general anger at the IP system as it is. For the record, I didn't intend to sound like I was calling for balance in your comment Andy, which I think is quite balanced.

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What do you call it when

Someone, or a corporation, makes a negative economic contribution? Theft? Extortion? Sabotage? Hopefully this process will come up with better vocabulary and a clearer definition that applies to those who profit by doing economic damage.

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Joke

Re: What do you call it when

Pomification?

(I'm surprised, 5 comments and none of them Apple-related?)

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Re: What do you call it when

It won't be long

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Re: What do you call it when

Agreed - there should be a name for the version of Godwin's Law that applies to Apple and patent discussions on El Reg.

I hope that doesn't mean i'm implicitly comparing Apple with Nazis myself by saying that as that would be ironic...

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Trollface

Re: version of Godwin's law

Newton's Fourth Law - stop banging on about that bloody Apple.

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Devil

Re: version of Godwin's law

Stop banging on about??? What, are you kidding? Then there'll be no reason to read the El Reg forums any more!

Still, Newton's Fourth Law... I like it.

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simple solution

they should just implement a "use it or lose it" clause. You have two years to implement a patent otherwise it expires. and once implemented you need to continue using it otherwise it expires two years after the last product to use it is released.

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Anonymous Coward

Re: simple solution

That already applies to trademarks, you have to use and defend them or you lose them.

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Re: simple solution

I'd like to see that extended to copyrights as well, although I'd be willing to make it a bit longer for copyrights. Say 7 years instead of 2.

It surely wouldn't fix all the problems, but it would be a decent start.

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Patent Troll = whoever is suing me at the time

While there are some bad actors, a lot of the screaming about Patent Trolls is coming out of the PR departments of very well funded companies that simply don't want to pay to license technology. For something that supposedly "stifles innovation" - we seem to have had an unprecedented level of innovation in the last 30 years.

It's sort of like how conservatives always go on about how regulation is harming their business when their real aim is to get rid of the very regulation that stops them from screwing over everyone else. The companies that go on the loudest about how bad patents are seem to be very successful already and don't appear to have been stifled to the point of choking. They just don't want to pay licensing fees and they are in the process of convincing enough people to go along with it to ensure that the next generation of people who come up with bright ideas - who might challenge the status quo - won't be able to benefit from those ideas and overthrow those that are currently at the top of the heap.

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I am not a well funded company PR department

Innovation continues despite patents, not because of them. Getting a patent takes years and defending one in the courts takes at least £250,000. Startups do not have the time or money. What they do have is first mover advantage: by the time someone else has copied their product, the startup has released version 2.

Patents are most valueable to established companies who do not innovate. They can use patents to keep startups out of the market.

Patents are supposed to increase the rate of technological progress by rewarding inventors with a monopoly in return for publishing details of how their inventions work. In the real world, people only read patents when they are threatened by lawyers. This is because:

*) Patents are written in patent language which is difficult for non-patent specialists to understand.

*) Reading a patent almost never helps you implement a product. This is most obvious with software patents because they do not include source code.

*) Thousands of new patents are awarded every month. It is impractical to search through all that junk for a useful patent.

*) Reading a patent leaves you open to triple damages for willful infringement.

As inventors no longer read patents, they entire reason for the patent system disappeared decades ago.

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Re: I am not a well funded company PR department

Patents are written in patent language which is difficult for non-patent specialists to understand.

I'm not a "patent specialist" (I think, since it's not clear whom that category attempts to describe), but I've never had any difficulty understanding patents.

Reading a patent almost never helps you implement a product. This is most obvious with software patents because they do not include source code.

Rubbish. To take just one example, the original patent for Latent Semantic Analysis (a software patent, US 4,839,853) provides all the information a practitioner with experience in the subject area should need to implement it (in its basic form, as described in the patent). Anyone with a little background in natural-language processing and a basic understanding of linear algebra should be able to discern and implement the algorithm from the patent. Source code is entirely unnecessary. A software developer who needs source code to implement an algorithm isn't much of a developer.

It is impractical to search through all that junk for a useful patent.

That rather depends on what you're looking for. If you have a specific method in mind and you want to see whether there's an applicable patent, and you can arrive at a decent set of query terms, you can probably complete the initial research in a day or so for patents listed in the USPTO and Google collections. Yes, depending on your needs, you might need to have a patent lawyer or other expert do a more extensive search, but what is "impractical" depends on the subject, the need, and the resources that can be devoted to it.

I agree there are far too many junk patents. I believe current IP regimes are excessively biased toward rights-holders in various ways. I'm suspicious of methods (including "software") patents. I'm very suspicious of NPEs.

But their other drawbacks aside, patents are still a viable way of publishing inventions. I've used patents as reference material, and I know a good number of other people who have done so as well.

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FAIL

Patent trolling to go under anti-trust spotlight?

Without Apple, for the Trolls, hardly worth attending.

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Is there anything fundamentally wrong about having a patent and licensing it to the people who wish to use it?

It seems to me that the problem is that it is too easy to patent something that is obvious.

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Anonymous Coward

The US department of Justice will be hearing from my lawyers.

I patented patent trolling several years ago.

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Coat

This is easy to solve

Since patent trolls are holding back innovation (and more important to politicians, taxable profits) by spreading fear of litigation throughout the IT industries, label them all as "terrists" and ship'em off to Gitmo. Job done!

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Devil

Re: This is easy to solve

If you want to try that root, you've taken the wrong exit.

Instead, outline the characteristics of patent troll companies and tax their gross income at 50%.

Since it generates money for politicians to give to their constituents, they are sure to guarantee that the laws are both enforced and enforceable.

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