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Blackbird's Patent Troll Suit Against Cloudflare Gets Patent Invalidated (cloudflare.com)
261 points by eldridgea 73 days ago | hide | past | web | favorite | 56 comments



Thank you, Cloudflare, for fighting the good fight.

Someone should start a collective fund for smaller companies to help with legal support so that more troll claims can be fought instead of settled.

Anyhow, I'd be genuinely curious how much it cost to get to this point, and how much you think it would have cost if you'd had a protracted battle.


> Someone should start a collective fund for smaller companies to help with legal support so that more troll claims can be fought instead of settled.

You mean the eff? Probably not exactly what you had in mind, but pretty close I think?


> You mean the eff? Probably not exactly what you had in mind, but pretty close I think?

Well, of course, that requires people to put money in the fund.

https://supporters.eff.org/donate


Also, EFF is on option for smile.amazon.com. I've generated $9 for them so far, would have been more if I had remembered to use smile more often. Amazon is nice enough to remind me once in a while to use it, I wish it would just be automatic when I'm logged in, I refuse to install a plug in for that feature.


I had the same issue until I discovered there were plugins for Chrome[1] and Firefox[2] that will automatically redirect you to smile.amazon.com anytime you are on amazon.com. I have seen issues with the Firefox one when you aren't actually logged in to Amazon at the time, but the Chrome one works great.

[1] https://chrome.google.com/webstore/detail/smile-always/jgpmh...

[2] https://addons.mozilla.org/en-US/firefox/addon/amazon-smile/


Thank you for pointing this out. I wasn't aware of that extension. I've only generated $14.12 in the multiple years I've used smile (inconsistently). It'll be interesting to see how much that changes in the next year.


Plugins make my skin crawl, especially one from Amazon :) uBO is the only add-on I make an exception for.


FWIW, neither linked plugin is from Amazon.


I guess saying "especially from Amazon" was pointless because, now that you've pointed that out, I definitely don't feel any better about them :)


Make sure you search for "Electronic Frontier Foundation". The results for "EFF" are not helpful and the first result "Eff" appears completely unrelated.


I almost said "like the EFF" but stopped short because I don't think that the EFF gets involved in individual patent troll battles unless they have a tangible negative impact on digital civil liberties for everyone.

Am I totally out to lunch on this?

https://www.eff.org/issues/patents

Note that there's an important difference between publishing a position, general advocacy work in the interest of the public good, and being a reliable financial contributor to the legal fees required to defend yourself against a patent troll.

I heart EFF regardless, because if nothing else they unapologetically offer a progressive template for how the digital world could be. They challenge us all to be better versions of our digital selves.


This is great news. Regarding the several comments along the lines of "there should be a way to pool resources across many companies to fight trolls", there are in fact several such orgs (beyond EFF, already mentioned below). The three I'm most familiar with (and of which we are members) are:

1) RPX, which is basically just troll insurance. http://www.rpxcorp.com/

2) LOT Network (LOT=License on Transfer): http://lotnet.com/

3) My favorite: Unified Patents, which actively files IPRs against NPEs: https://www.unifiedpatents.com/

There may be others and I'd be glad to hear about them. I recommend every startup join at least these three - the annual fees are modest (free in some cases) and potential benefit is enormous.


In this specific case, Cloudflare crowdsourced prior art research on Blackbird's patents:

https://blog.cloudflare.com/project-jengo/

Not exactly the same as a generic pool, but still a neat way to fight back against these trolls.


This makes me wonder: is there any downside to enacting laws to make patent invalidation due to them being overbroad applicable retroactively and forcing Blackbird to return the money it extorted? It might be challenging to enforce due to limited liability, but I don't see any obvious downsides to trying? It seems like it could provide an incentive for companies to not attempt to create over-broad patents.


Why? If it is ruled invalid today then it was also invalid the day it was issued. I would imagine any company who paid for a license under threat of suit would now be telling their legal department to file a suit to reclaim the fee paid plus interest plus any provable damages. So we already have a remedy for this situation, no need to complicate the statutes.


Victims would have waived that right when they settled with the patent troll.


These waivers should be rendered null by law. I don't see any other way to fix the problem.


Yeah, I wish there were a special place in hell reserved for patent trolls, but undermining contracts retroactively is not something to be taken lightly.


Not sure that it would be undermining contracts retroactively.

IANAL, but the approach I'd consider is fraud/breach of contract. The previous victims settled and paid a royalty to use a patentable technology. It turns out that it was not what was represented. Ergo, refund. How it plays out surely depends a lot on regional courts, precedents, etc.


I wonder how air-tight you can make that reasoning. I suspect you could structure the settlement as paying to use the underlying technology _including_ the patents etc., rather than licensing the patent per se (so the fees paid are not directly predicated on the existence of a patent).

Be interesting to see how the courts would react to that though, and if they see it as a sign you are negotiating in bad faith.


It's not retroactive if you know about it ahead of time. It would be known when the contract is made that the money would by law have to be returned in the event the patent is invalidated.

The consequence would obviously be that all the licensees of a patent that has any chance of being invalid would subsequently try to get it invalidated so they can get their money back, but isn't that the intended result?


We have a concept in US Law called “ex post facto” which means you are not liable after the fact if laws are changed.


> We have a concept in US Law called “ex post facto” which means you are not liable after the fact if laws are changed.

That's not what ex post facto means. An ex post facto law is a law criminalizing an act or increasing criminal penalties after an offense occurred. It does not prevent retroactive civil liability.

The more applicable concepts here are the binding nature of contracts (which settlements are) and res judicata (which means that, in short, once a court judgement has been entered and made final, a party cannot relitigate it to get a better outcome.)



IANAL, but I don't think this is how the law works today.


There is benefit to making settlements and final judgments final. Otherwise you are incentivizing constant re-litigation of the same issues. It would also make trolls less likely to settle in the first place.

You can put such terms inside your own settlement agreements. One common way is to use a running royalty rather than a lump sum royalty. If the patent is ever invalidated, you can stop paying.


Patent trolls are separate companies with ~zero assets outside of the patent. Think sock-puppet internet accounts.

They can just pay out any income as soon as it shows up so there is nothing to recover if their patent is invalidated.

PS: The only way to make this work is if you pierced the corporate veil when their patents where invalidated, and that would make patents even more useless to small companies.


I don't think piercing the corporate veil is the only possible solution, you could legislate that revenue from unlitigated patents couldn't be taken out as profit. Again, that might not be enough and the exact wording would need work, but I think that making it possible is the first step to making it practical.

Personally I think we should just abolish the entire patent system, since I really don't see much benefit in it for anyone but large companies, but basically everyone agrees on stopping patent trolls with garbage patents


This is so cool. Obviously it's a big financial risk to take this route, but it's great to have a large company actually fighting the good fight. Mad props to Cloudflare, Newegg, EFF, and all others in this battle.


Is it possible that a nonprofit could troll the patent trolls and start proactively suing them to get their patents invalidated? It seems to me that a consortium of above board companies could fund such a thing and come out way ahead of fighting litigation targeted at their business.


That would be prohibitively expensive. The number of overly broad patents that patent trolls own is way too large to be able to challenge them in a cost effective way.

If you want to play offense rather than defense, your money is better spent lobbying to get the law changed so that overly broad patents are more difficult to acquire in the first place.


In addition to the cost of doing this, you have to have legal standing to pursue the suit. You cannot sue to invalidate arbitrary patents unless you can prove harm to yourself. If you cannot demonstrate legal standing, the courts will not hear your case.


True, and I could see this becoming a tool of oppression by "big evilcorps" if it were possible to do. I guess its a fun thought experiment though. I generally like the patent idea, if someone comes up with something innovative then they should see the upside. I wonder if a time window would improve matters. Get a patent and you have X number of years to produce something sale-able or publicly available for consumption.


Not sure if I misunderstood, but patents do have a time window.


I think the wish there is for a “use it or lose it” window.


correct- Im thinking a time frame of up to 25% of the patent period is fair. In other words you shouldn't patent an idea, but something that is close to being "available"


For sure, the result is a good news, but it highlight what I believe is a major flaw in the modern court systems : the tax payer and the defender ends up footing the bill for what is essentially abuse of the system and pure incompetency.

Is there any follow up on the body that approved a patent that should never have been granted ? Not per the court order. Is there any punitive damage awarded to the defender against the filer ? Not per the court order.

Having been personally frivolously sued in the past, I can tell you, it's not fun and it's expensive. And even if you win, you have to sue back to pretend to any kind of financial compensation. If you have a settlement saying the opposing party is supposed to give you X amount of money, you have to sue to recover that money. And they can appeal. And even if you have an agreement saying that the winning party is entitled to have their legal fees paid by the opposing party, apparently no judge ever grants the real legal fees.

There's a major amount of work to be done in how we deal with abusive lawsuits and who pays the bill for the shared public legal system.



Yuck. I hate the way ipwire.com describes blackbird. They make it seem like they are doing something good.


For context, IPWire exists in a state of denial that there is a patent troll problem:

http://ipwire.com/podcast/ep-14-special-bloomberg-view-stron...


I think IPWire is just providing the press release written by Blackbird themselves.


This is a press release distribution service.


Yep, same patent too.

I'm curious how much Fastly paid. It's too bad that they didn't hold out for a weeks longer. Maybe they'll fight next time.


I guess they are not as well funded as cloudflare and therefore couldn't take the risk of loosing in court.


If the patent got invalidated now, wouldn't they be able to get their "fees" back?


retroactively applying a law is not very conducive to making predictions about legal matters, and therefore, it's very rarely done (if at all?).

Plus, even if blackbird has to pay back their collected fees, they can "just" bankrupt - after all, the money is gone (unless you are implying that any dividends/payment to employees etc, are clawed back...)


> Plus, even if blackbird has to pay back their collected fees, they can "just" bankrupt - after all, the money is gone (unless you are implying that any dividends/payment to employees etc, are clawed back...)

Money that was already paid is gone, but if you had some settlement where you pay some amount per device, you could stop paying them going forward.

It would also be effective against the use of invalid patents by large companies that wouldn't be bankrupted, which would reduce their incentive to lobby for their continued granting.


No. Past settlements are not undone.


While this is nice, it's still a game of whack-a-mole. How much were the legal costs for CloudFlare to invalidate this one patent?

I'm glad they did this and they've certainly gained some goodwill from me for this altruistic move. Was that part of CloudFlare's motivation, use it as PR? Because otherwise, the economics still appear to be in favor of the trolls. This battle is won, but how goes the war?


Is there any feedback mechanism to prevent the patent office from issuing more bogus patents?


There's a Stack Exchange site for that: https://patents.stackexchange.com/


You're asking for something impossible. Software patents exactly analagous to Benson, Flook and Diehr are de-facto allowed. Software is such a broad and fast-moving field that you can't expect any patent office to be able to fairly judge novelty and non-obviousness.

If there's any hope for the patent office it involves an act of congress explicitly making software non-statutory material for patents.


Honestly, it seems patents discourage competition, and in my opinion are therefore anti-Capitalism. I would not miss them, at least for software.

It's almost a bit arrogant too, how long would it really take for someone else to come to the same realizations?


They do discourage competition. Here's why that's important:

Amazon has more money than god. For whatever reason, they decide that your thing is valuable to them, and is extremely easy to create but also extremely novel in its inception (nobody thought of this before). It took you years of work to create, and you're now unable to monetize that work because Amazon/Google/Apple/Walmart/Whoever is able to create it faster using there tens of billions of dollars of muscle to stomp you out. Because they're better positioned to produce, your years of work is now financially useless.

The idea of "how long would it take for someone else to realize the same thing" is silly. They didn't. You did. innovation is a large part of what makes software valuable. Anyone can type code if you gave them a sheet of paper that would make the machine do what you need it to. The only reason software has any value is because it took someone time to figure out what code to type in the first place.


Why does doing something first give you the right to sell it? How do you deal with the problem of multiple discovery?

I'm not saying inventors aren't intelligent, but I really think that if they had not existed someone else likely would have invented the same thing.

What your saying though is that some other company could have advanced the product in a way that people would prefer it over the original. The negative effects here seem stifling to innovation.


This is true in theory, but in your example does your small company really have the leverage to take them to court anyway?

They have more money than god as you say, how can you hope to win against them in any reasonable amount of time? You would almost need angel funding, but if you have that anyway can you really not compete with them?




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