back to article Take off, nuke 'em from orbit: Kill patent trolls NOW, says FTC bigwig

Julie Brill, one of the four commissioners of the US Federal Trade Commission (FTC), wants Congress to quickly pass legislation against patent trolls, which are companies that buy up intellectual property solely to sue successful designers and manufacturers – and even their customers – for infringement, whether it was accidental …

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Childcatcher

Nice thought, logical ideology, BUT...

Lawmakers never pass laws that might stop them making money. Those billions in legal costs are not disappearing into both in air...they are going into pockets of lawyers. These guys will continue to blur the boundaries of the obvious so that they keep the fight, hence their going. The only sure winners of a war are those that sell the weapons, and victory goes not to the right, but the one for whom the cost of surrender is less than that of the weapons.

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Re: Nice thought, logical ideology, BUT...

I'd have thought being liable for the sum you're seeking from the defendant (to be paid to the defendant plus costs) if your troll case goes against you would be a simple, effective remedy for many cases.

Of course, having to declare the sum you're seeking in your filing would then be mandatory if it isn't already.

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Re: Nice thought, logical ideology, BUT...

Or even limit the damages you can claim to a multiple of the amount of product revenue you have made in which the patent is employed.

Oh, you don't make anything? That's unfortunate...

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Re: Nice thought, logical ideology, BUT...

Lawyers, and law-makers should not-and are not the same entities in most cases. The lawyers may put the pressure onto teh law-makers, through lobbying, etc., but the law makers are politicians, most of whom are much less qualified to do anything useful than your average holder of a law degree.

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Re: Nice thought, logical ideology, BUT...

The trouble here, as ever, is that there are many small inventors out there, trying to sell their inventions to a company big enough to make it viable. Many of those companies are unscrupulous, can do the maths, and just rip off the idea without paying anything. How do you differentiate between these people, who need MORE patent protection, and those that we all recognise as trolls?

We all know them when we see them, but how do you define it properly?

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FAIL

Re: Nice thought, logical ideology, BUT...

I'd have thought being liable for the sum you're seeking from the defendant (to be paid to the defendant plus costs) if your troll case goes against you would be a simple, effective remedy for many cases.

The easiest way around that would be to use a 'shell company' with essentially NO assets that can be garnished if the PAE patent troll fails.

IOW, it won't accomplish a thing!!!

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Re: Nice thought, logical ideology, BUT...

Didn't they already pass a law that says that shell companies holding patents must disclose its owners, meaning they have the power to look under the shells?

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Vic
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Re: Nice thought, logical ideology, BUT...

> I'd have thought being liable for the sum you're seeking from the defendant

Liability on loss seems like a good idea (although I'd have made a losing plaintiff liable for the defendant's costs), but it won't actually work.

These patent trolls spawn off multiple shell companies, and it is those shells that do the litigation. They have assets of three odd buttons and two beans, yet can still afford some hot-shot legal team. So if they ever do lose, there are no assets to recover; the shell simply vapourises in a puff of insolvancy.

AIUI, to fix this problem would require changes to America's bankruptcy laws, and that's not going to happen in Delaware...

Vic.

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Re: Nice thought, logical ideology, BUT...

The inventors of a patent are listed on the patent itself.

If no named inventor is part of a lawsuit involving the patent, that's a good indicator (but only AN indicator) that the scenario you've presented is not applicable.

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Fix the bottom

Jail time should slow those Trolls down a little.

Bottom feeding should not be so attractive. Instead of serving up million dollar extortion payments we should be serving up juicy amounts of jail time instead.

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Re: Fix the bottom

If you pass a law telling the trolls to stop it, you need an out to ensure that justified action can still go ahead. An so trolls will just argue with the courts that they are a special case and should be allowed to continue. Meanwhile, the poor manufacturers are still bleeding money in legal fees.

On the other hand, if there is a cost in failed court action, such as having to pay the legal costs of their intended victims, suddenly there is a whole lot less frivolous court action. Justifiable court action can still go ahead, though.

The second thing that needs to be done is to reform the patent law itself. It would be hard to argue against my assertion that patent law is far too lenient of abuse. Examples such as a system to use a laser pointer to entertain a cat, use of a square box with rounded corners, a "bounce back" to show the end of a list has been reached, all show the patent law is in a terminal state. And yet some of these are being used to interfere in the operation of billion dollar companies.

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Holmes

Only one option really...

Stop software patents.

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Re: Only one option really...

No need to stop them altogether. In fact, I would be more in favor of speeding them up: nonphysical patents can still be allowed, but on a MUCH shorter timeframe: say, three years, long enough to present products using them for a cycle, but then it's not only fair game but open to the public. That's one overlooked aspect of patents--once they expire, they become public domain. So instead of being covered up as trade secrets (because they can't be patented), anyone can take advantage of them after a REASONABLE period.

Because in the end, the problem with software patents has not really been that they're nonphysical but that they last too long relative to their product lifecycles.

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Re: Only one option really...

I was thinking much the same as charles. Traditional patent systems are still fairly applicable, The key fault here is design / software patents.

In my mind at least, consumer facing software patents should be lowered to say 5 years. (3 years to gain a market lead, 2 more as a 'bonus round') while business facing software patents (software on embedded systems for businesses etc) should be protected for a bit longer, since it takes longer to gain a market lead on the business end (since peoplel hate spending money on new stuff) lets say 15 years (10 to gain the market lead, 5 for bonus round)

Design patents etc should be removed all together, and instead replaced with trademarked design. Patents award far too much protection for a design that, quite frankly anyone could come up with. And if we had this design patent nonsense all those years ago we probably wouldn't even be driving cars the way we do right now.

I could however still approve of longer lasting software patents on algoryhtms etc, y'know cryptographic bits, some complex equation that allows you to perfectly simulate real world physics stuff like that.

The reason for this teired approach is that it's the front facing patents that are causing the most trouble.

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Re: Only one option really...

I was right with you up until you started mentioning mathematical algorithms.

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Re: Only one option really...

Basically that'd be more for patents in scientific computations where holograms etc would be a key point in it, doesn't really apply in 99% of cases.

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Re: Only one option really...

But there's no time limit on a trademark. Trademarks are PERMANENT. Furthermore, to qualify for a trademark, the company must ACTIVELY use them as an identifying mark of their business (example: the Coca-Cola bottle shape, the UPS logo and color scheme).

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Re: Only one option really...

Why not? If you were the first to something, why not get rewarded for it? I'm just saying that the reward needs to be scaled to its pertinent industry and product lifecycle, which would likely limit an algorithmic patent to just a few years. Also recall, once the algorithm patent expires, it's public domain and open to everyone.

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Should lawmakers wait for the research before making a law ?

No - they should act now before the next news story pushes them off the front page.

If we were able to draft such a complex legislative framework as the banning of dangerous dogs without any subsequent embarrassing loopholes/side effects/misinterpretation why shouldn't we be able to reform such a trivial subject as Patent law with a quick knee-jerk sound byte, ?

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At minimum, the US Congress should pass a law stopping the Trolls from going after the users of "infringing" products. If Company A manufactures a gizmo that you think infringes on your patent, then by all means take a shot. But if Company B uses the gizmo from Company A, *they* are not infringing on the patent and should be left out of the fray.

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Anonymous Coward

Exactly, that would be a good start, and stop all these big linux users paying out to MS just INCASE Linux infringes one of the mythical patents they won't tell us that they are!

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Happy

As far as I am concerned the lady is well named.

Absolutely Brill.

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Re: As far as I am concerned the lady is well named.

Still sounds a bit fishy to me.

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Re: As far as I am concerned the lady is well named.

Still sounds a bit fishy to me.

That's krill.

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Headmaster

Brill v. Krill

Nope, I think I'm going with Paul, on the basis that brill is a fish, and hence certainly fishy, whereas krill isn't. Isn't a fish, at least.

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Mushroom

The outlook for the economy in East Texas

would look grim if this were to happen.

Suddenly the trolls would have to nowhere to go to get easy vistories.

Bring it on.

Icon ----------> Nuke the trolls

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Re: The outlook for the economy in East Texas

Today patents are worht a lot on the books of the companies that invented/placed/own them.

However, if the trolling companies no longer have reason to buy patents then the demand for them decreases, reducing their value. Some innovation companies will need to put provisions in place for such legislation to pass, because their asset values are going to take a bit hit. It's likely started already, I wouldn't buy patents alone with this uncertain future.

I hope the legislation passes, but it's only a first step.

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Anonymous Coward

Re: The outlook for the economy in East Texas

If I could buy a patent and then license it out, that is a valid business model, it would give incentive to small inventors to patent something and then sell that patent to a larger company that deals with licensing...

The key thing is to stop a fine line of companies buying patents for the purpose of suing other companies...

and primarily get rid of idiotic patents, i.e. rounded corners?? WTF??? bounce-back? obvious right? not to patent clerks...

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Patent values

> patents are worth a lot on the books of ... companies

I'd make things much simpler, if I could. I'd make patents non-transferable. Then they'd have a value to the inventor, personal or corporate, exactly commensurate with the demand for the innovation that they disclose. Companies could continue to be able to value their patents as assets, but they wouldn't become items of commerce in their own right.

Patents were instituted to foster progress (explicitly so in the case of the USA), not to become a sort of pseudo-currency and biz-weapon. PAEs are a perversion.

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Vic
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Re: Patent values

> I'd make patents non-transferable

If that were the case, the eponymous "small inventor[1]" would be unable to patent his invention, since he'd have to fund any legal action when someone infringed. Most small inventors can't afford the protracted legal process in any country, let alone the US. So patents get infringed because the owner cannot afford to defend them, and thus the patent is rendered worthless.

Patents will be transferrable, and rightly so IMO. What needs to happen is that the legal system needs to put in place real penalties for idiotic lawsuits - such as the directors of the company becoming personally liable for costs should the troll company become bankrupt. But I'm not holding my breath...

Vic.

[1] Disclosure: with sveral patents in my name, I guess I qualify as a "small inventor".

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Anonymous Coward

sorted

Simples:

You get 1 day to argue your infringement case. The defence gets 1 day to argue their case, then verdict within 1 day. Judge has power to kill any patent he sees as crap / obvious

If you win, you get your damages.

If you lose, the company you sued gets the same amount from you + fees + public apology. If the judge thinks its a frivolous case you get 3x the amount

He who sues gets no appeals. He who gets sued gets 1 appeal on same terms

You cant sue the companies customers

Tech patents expire after 2 years

Anything obvious automatically gets auto-licenced under FRAND terms

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Re: sorted

OK, how do you stop big companies that can bully both the plaintiff AND the courts? Remember, the little guy can't get the hotshot lawyers who are masters at legalese.

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stop inappropriate PAE abuse

I agree.

PAEs should be limited to appropriate abuse only.

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Simple solution

If a company buys a patent, they can license it to third parties but there is a cut-off at the date of purchase to sue others for infringement, so that if someone is using it unlicensed before that date they cannot be sued.

They would then have a 'cooling-off' period, after this date, in which time the new patent owner can inform patent users of the new licensing conditions. There is a time limit for those not meeting the license conditions to either stop using the patent, or license it. If the patent owner does not inform those infringing the paten within the cooling off period, then they have missed their chance and cannot sue. If the infringer is informed, and does not meet the licensing terms within their time limit, then they can be sued.

Such license terms should be fair and reasonable, and potentially liable to oversight by the courts to ensure they are not extortionate.

This should cover both legitimate patent ownership and transfer, and remove the fear from others of being sued by trolls.

edit - This should only cover the case where ownership of patens changes hands. Those originally registering a patent and not transferring it should continue to be protected against unauthorised use.

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Not so fast

The amusing thing to me is how quick people are to pile on to stopping patent "trolls". These trolled patents often come from startups or bankrupt enterprises, and could have been added to any particular large company's pile of patent trading cards if that PLC had felt like spending the money to purchase the assets. They judged that the IP was not then worth their money. These NPEs felt differently, and put some money in the pockets of the investors of a failed startup or other company. The effect of stamping out NPEs is to say that if the Big Boys don't buy the IP of your failed startup, then it is truly worthless -- you'll never get any money, they'll use your patented inventions, with no chance of compensation.

If people want reform, the right place is in the quality of the patents themselves. What ought to be a simple description of an invention becomes obscured by layers of abstract gobbledeygook (hard enough for someone allegedly skilled in the art to understand, never mind an East Texas jury) that creates too much uncertainty in court and creates a space for opportunists to make extravagant extrapolations about what a patent really claims. More clearly written patents would also be more to the point of what the patent system is supposed to be about -- communicating the invention to other people.

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The most obvious thing they could do right now is make it an offence to threaten the customers of an alleged patent infringer with lawsuits. That kind of behaviour is simply unacceptable. You should not need to factor in the risk of potentially getting sued for patent infringement into your decision whether or not to buy a god damned photocopier.

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Patents that simply "Lurk"

Why is this too simple: 1) If you are not asserting the patent yourself, i.e., using it in a product, within, say, 1.5 years after being granted the patent, you can't enforce it, or 2) If you or your heirs/assignees didn't actually invent the thing, you can't enforce it--unless it's in a product you or your heirs/assignees actually sell and people actually buy.

In other words, you can't patent something and then bury it for your own benefit and you can't sell the patent for the sole purpose of screwing other people. You can patent something to make money off it yourself or sell it to someone who will. Regardless, the 1.5 year drop-dead date applies.

IBM and other tech titans have tens of thousands of patents that will never appear in products, but sit there lurking over the shoulders of anyone who actually wants to DO something in this business. How is that helpful? How does that foster innovation? The patent system should foster innovation, that's all.

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Re: Patents that simply "Lurk"

You can fix that simply by shortening the terms of such patents. The problem is that in the tech world, product lifecycles are very short, so patents in that field should reflect that. If you knew the patent you got expires in just a couple years, you can't hibernate it. You have to either snap now or lose your asset. Furthermore, you better have a clear-cut case in order to avoid having lengthy court proceedings drag you past the expiration date.

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