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Paul Allen Sues Apple, Others Over Patents (wsj.com)
110 points by JereCoh on Aug 27, 2010 | hide | past | web | favorite | 76 comments

"We recognize that innovation has a value, and patents are the way to protect that."

Innovation has no value to the public if you don't produce and ship a good product. In my opinion the company that actually ships something should always have the upper hand because it's good for consumers. Patent reform should follow a use-it-or-lose-it model. If a company comes up with an innovative idea, ships a product, and that product stays on the market (in one form or another) for many years they probably deserve to own the patent. If people are buying it then it must be halfway decent. If they never produce a shipping product they shouldn't be able to hold the patent hostage. If they decide to stop selling a product that uses the patent someone else should have the opportunity to dust it off.

I mostly agree, but patents were partly intended to protect small-fry scientists/inventors who came up with good ideas that they couldn't necessarily commercialize themselves, by providing a legal mechanism to keep manufacturers from just ripping off the idea as they shopped it around. It makes more sense when it's not a portfolio company holding hundreds of patents, though, and when the inventions are genuine breakthroughs: e.g. if a biotech researcher comes up with something that really would improve pharmaceutical research greatly, it seems okay to me if there's a legal mechanism to make pharmaceutical firms pay him licensing fees if they want to use the invention, even if he himself never ramps up into pharmaceutical research. This becomes much more of a minefield if the bar to novelty/nonobviousness is low, though, because then you just get people preemptively "inventing" a bunch of things that other people would've found anyway, and then demanding licensing fees.

Patents are good for protecting inventions that require a large amount of capital investment to bring to production.

Fashion and food were traditionally not protected by patents because to make a cake or a dress, one only needed an oven or a sowing machine. On the other hand, complicated manufactured goods needed patent protection because the factories needed to produce them would cost millions to build, and a small inventor could never raise the money without patent protection.

In the age of computing, the cost of the equipment to create software is negligible, so it's far more optimal to not grant patent protection.

"Fashion and food were traditionally not protected by patents because to make a cake or a dress, one only needed an oven or a sowing machine. "

Is that really true? I don't know I am just asking. I personally don't think capital investment should have anything to do with the patent. It's like giving no value to the innovative technologies made by people in garage. Just doesn't make sense to me.

On a side note, do you consider time as capital investment?

>Is that really true?

Yes. Or more precisely because clothes and food are too "utilitarian".

"Lessons from fashion's free culture"


"Copyright law's grip on film, music and software barely touches the fashion industry ... and fashion benefits in both innovation and sales, says Johanna Blakley."

So then music, software, books, etc. - all requiring low capital, should be in the same realm of fashion - right? If you don't believe that's true: please compare capital of an industrial bakery to a software company of the same revenue/profit.

The important distinction between fashion and software is that clothing is useless unless properly manufactured. The materials and manufacturing process are an integral part of the final product. To duplicate a garment is to reverse engineer it, source the materials, and then remarket it as a knock-off, or as some imitation item under another brand.

Fashion doesn't need strict copyright enforcement because by the time you've reverse engineered something and put it into production, it's already wildly out of date.

You can see how Apple applies this principle to their main products, aggressively innovating so that by the time their products are copied, which is inevitable, they have already obsoleted them.

Software can be duplicated at effectively zero cost to produce an identical copy. It also has a much longer lifespan for mature packages (Office, XP, etc.), where people will use the same software, plus or minus patches, for five years or more.

There needs to be some kind of reasonable limitation on what people are able to do with software that they purchase, so at the very least a form of copyright is required, not unlike protections offered to books.

The real thorn is that software patents are mostly preposterous, with very few requiring actual innovation to produce. It's like trying to patent a plot twist or a character quirk and then suing all authors that use it.

Copywright != patent

copyright protects the expression of an idea, while a patent protects the idea itself

thanks for the link. That was very interesting. It's really amazing how the entire fashion industry even without any sort of protection is running well.

While the fashions themselves aren't protected, the names of the labels etc. are trademarked. That's why you're seeing the Gucci and Dolce & Gabbana names on everything. And the Luis Vuitton luggage pattern contains their logo. A lot of stuff produced is basically nothing but a vehicle for the logo itself, without much fashion/innovation around it.

True. However analogously software companies also have trade-secret protection from employees divulging source code independent of the software patent process.

I agree that a straight "use it or loose it" is too harsh... how about a mechanism for forced licensing with the fee based with upon some reasonable criteria, including but not limited to attempts to use the patient well? Oh wait... I forgot this is the USA, can't assume a competent ability to set up good bureaucracy with fair rules.

That's got to be the mother of all patent lawsuits to date.

I hope that it will now become clear to the world at large that a patent without any intention to produce a product is simply a waste of time and money. I'd much prefer it if all these patent filing clowns would keep their 'research' locked up in their vaults and called them trade secrets, that would give nobodies like me a chance at just getting on with our jobs without stepping on someones patented toes.

The optimistic side of me hopes that people are seeing the writing on the wall for software patents, and are hoping to extract value before the landscape changes.

I have a question: what makes software different from other disciplines/domains with regards to patents? Why are "software patents" more often pointed out as pointless than other kinds of patents?

Software patents have a strong tendency to be both vague and obvious. Although these are supposed to make something unpatentable, this doesn't happen in practice with software patents (possibly due to the relative novelty of software and lack of understanding among non-technical people).

More people on the internet both

    - write software, and
    - don't stand to benefit directly from software patents.
Kind of troll, kind of serious. Consider the source and all that. I also think software patents are dumb, but then again I also don't stand to benefit from them and I write software.

This is the problem with Patent troll "portfolio companies" like his: It doesn't make anything, so there can never be a countersuit with protective patents.

So, even if we had IBM step in with its portfolio of 30,000 patents (and growing by 5000 each year) and snarl up the entire industry to prove a point, Allen would be like "whatever" and soldier on, because he makes nothing.

disclaimer- I'm against software patents in general. However, in this case, to argue against my own opinions:

The research and resultant patents in this case were in the public record for all to see, read, and if they found the idea useable, free to contact the patent holder to discuss a deal.

The patent systems a broken mess - no argument here. But a firm that actually did research on specific items, kept track of a relatively small portfolio and then selectively went after some big boys isn't as much of a patent troll as those who just buy up thousands and thousands of them and muscle people around.)

Take your not-so-much-of-a-troll company and allow them to hire not only researcher-employees, but also researcher-independent-contractors. Are they more trollish now? If not, what if some of their researchers band together to lower their insurance costs and improve their tax situation; they establish their own contracting firm which the not-a-troll company pays to supply researchers. Finally, what if this contracting firm works on a part-time or short-term basis with many companies who want research done?

The problem with trolling is not that properties that can be sold and monetized by the new owner. It is that ideas are being treated as (material) property. Ideas can be formed by multiple persons independently, and any given idea can be shared among any number of thinkers without diminishing the strength of the thought. In particular, you can have submarine patents that nobody realizes they're infringing until the day the troll emerges from under his bridge to tell the whole world to pay up. Or, one can be granted a patent on an idea that's actually quite common and obvious, and this patent can back up a threat of costly and risky litigation, effecting the coercive transfer of money from productive members of society to patent-system-abusers.

Innovators need access to scarce material goods and they have limited lifetimes, but extending our effective scheme for managing scarce resources to the ideas they develop is not working so well.

> because he makes nothing

He does license patents, if IBM can prove one the licensed patent is based on one or more IBM patents, they could counter sue.

as i understood it you can patent improvements on patented technology even if you don't hold those patents. You just can't ever use your improvements without a license.

If that really is true, then Paul Allen isn't infringing, the people who are licensing from him are.

Sad to see him become a Patent troll.

Also, what could be the point of such a lawsuit? Surely Paul Allen cannot think that he can have out-of-court settlements (no cross-licensing since his company does not produce anything) with all the listed companies. Some of them will surely fight back.

> Sad to see him become a Patent troll.

Yes, quite. Paul Allen had an excellent reputation up to this point. He always struck me as the one with the interesting projects, such as backing Burt Rutan.

> Some of them will surely fight back.

all of them will fight back.

Maybe he is trying to destroy the patent system.

If you have valid patents that read on various valuable products, and you can bank roll a credible law suit asking for injunctions and not accepting any other kind of relief, that might create enough chaos to get the attention of law makers.

I'll believe that when I see it. But it's a possibility.

The breadth of this is certainly something to give food for thought, this is not an 'ordinary' patent troll lawsuit.

Part of me has Paul Allen as a very nice and visionary guy and part of me reminds me that he didn't exactly distance himself from microsofts illegal practices during the Gates' years.

The fact that he is leaving out Microsoft and Amazon says to me that he is exactly what he appears to be: a complete troll.

Reading the headline, that was exactly my hope. The details make that appear unlikely, but it may be the result regardless.

Reminds me of the BlackBerry patent case a couple of years ago. The Department of Defense had to come in and say something like "hey, guys, the government uses so many BlackBerrys that if you slam an injunction on them and shut their US operations down, we're in deep trouble."

Whether that is his intent or not, we can hope that a consortium of the defendant/victim corporations might be able to launch some action (in-court or in-congress) to begin at last the patent-reform process.

Can you patent patents and then sue the patent office for patent violation? I hope so.

The only way they can fight back is to invalidate the patent or prove it doesn't apply to their situation.

And "patent trolls" tend to collect and file tons of almost meaninglessly broad patents and hten send armies of analysts and lawyers to look at them and find some small or big fish to sue, depending.

In this case, the patents were filed by Mr. Allen's venture itself, a venture created as a think-tank to do research and come up with ideas - which were then published (via the patent mechanism) for the world to see, and potentially license - all they had to do was keep an eye on the patent system and contact the right people to ask for a license.

It's really odd that Paul Allen is doing this, he certainly doesn't need the money or the hassle. Is it possible that he's suing these high profile companies to spark some kind of legislative reform re: software patents?

Little is known publicly about Allen's state of health these days, or who is really in control of his holdings, for that matter.

Some background info from a /. comment: http://yro.slashdot.org/comments.pl?sid=1768970&cid=3340...

This is amusing. Here's some history on the company. Interval Research was an R&D outfit that Paul Allen founded back in the 1990's. You've never heard of it, because they were incredibly secretive. So hush-hush that when they went belly-up no one outside of the company knew about it. Literally. It took months before the Press finally got wind of it.

The place was a great place to be if you were doing research. Literally "let a thousand roses bloom". Unfortunately, they were horribly mismanaged. Allen blew hundreds of millions of dollars, mostly over budget, before he finally realized that he wasn't getting anything out it. They wanted to be the next version of SRI. Unfortunately, that didn't turn out.

Top management was, at best, incompetent. At worse, downright crooks. They hired some people on certain terms, and then shortly afterwards said "Opps - we really meant to hire you at a lower level". Truly a boneheaded move. Fortunately it didn't happen to me, but the look on people's faces when they found out was unforgettable.

Interval did some really amazing stuff; years ahead of its time. But they could never get the products out to market (though they tried), mostly due to amazing incompetence on the part of the lead engineers. You know the type. Big egos and no talent. Perhaps there was an exception to that rule, but I don't recall it.

I'm not surprised that Paul Allen has turned into a Patent Troll; it will be the only way he can get his money back. The only thing surprising is that it took him so long. But he never impressed me as being the sharpest knife in the drawer. As for other history, they had a number of big names there, from many fields. In tech, you may have heard of Lee Felsenstein if you're familiar with history. Their office was in the Research area of Palo Alto. Near Stanford, down the street from the Wall Street Journal, between Page Mill and Hillview

Despite that unfortunate ending, I still look back fondly on Interval. They paid well, too. I made lots of money off of Paul Allen. Thanks, Paul!

So he's suing Apple, Google, AOL, eBay, Facebook, Netflix, Office Depot, OfficeMax, Staples, Yahoo and YouTube.

Amazon.com is missing. Also missing are any Seattle-based companies.

Paul Allen owns the entire Vulcan group. One division of that, Vulcan Real Estate, owns and is developing all the brand new buildings on South Lake Union in Seattle that Amazon is now leasing out for their new campus.

No, no, you don't understand. Amazon and Microsoft didn't violate any of his patents. Thats why he's not suing them.

Why waiting so long ? There should be a prescription on this type of claims. This technology is used in a very visible way for years now. So they could not ignore it and thus implicitly permitted to use it.

If they didn't knew they had these patents, how could the other company know ?

This type of pattent 'mines' will have the consequence to scare to death companies. Foreign companies will stay away of US just to avoid the risk to step on such mine. And US companies may move their business in countries with much less risks (i.e. europe, Asia).

The only one missing from that list is Microsoft, wonder why... and youtube == google.

> "The only one missing from that list is Microsoft"

FTA: "Notably missing from the defendants' list are Microsoft, in which Mr. Allen remains a major investor"

That was the point.

Wonder if microsoft has a deal with Allen or if he just doesn't want to sue the company he has a stake in.

This could easily be spun as Allen as the attack dog against microsofts competition.

If I had to guess, it's because he doesn't want to sue a company he has a stake in. That's like suing yourself. Patent and intellectual property copyright is a funny thing; the owner can enforce (or try to get it enforced) when they feel like it. They usually let it go when it's to their benefit.

It's obvious why - nobody said patents were "fair". The patent holder has his own discretion.

He's not suing microsoft because he'd be shooting himself in the foot. He might have a deal with them to license it, or he may just be letting it slide (he can always sue them later). Same with google.

He's under no obligation to enforce his patents - it's up to him.

I'll burn a hundred points but somebody has to say it:


It would be really cool if mainstream media would link to the patents the article talks about because their description is horrible.

Patents are referenced here: https://docs.google.com/viewer?url=http://online.wsj.com/pub...

U.S. PATENT NO. 6,263,507 U.S. PATENT NO. 6,757,682 U.S. PATENT NO. 6,788,314 U.S. PATENT NO. 6,034,652

- 6,263,507: Browser for use in navigating a body of information, with particular application to browsing information represented by audiovisual data http://patft.uspto.gov/netacgi/nph-Parser?Sect1=PTO1&Sec...

- 6,034,652: Attention manager for occupying the peripheral attention of a person in the vicinity of a display device http://patft.uspto.gov/netacgi/nph-Parser?Sect2=PTO1&Sec...

- 6,788,314: Attention manager for occupying the peripheral attention of a person in the vicinity of a display device http://patft.uspto.gov/netacgi/nph-Parser?Sect2=PTO1&Sec...

- 6,757,682: Alerting users to items of current interest http://patft.uspto.gov/netacgi/nph-Parser?Sect2=PTO1&Sec...

Just going by titles it sounds like the NYTimes related article popup at the bottom of an article would be covered by these even more than some of the alleged companies.

I hope such lawsuits bring an end to software patents.

Could this be the commencement of the long feared software patent Mutually Assured Destruction?

No, because patent trolls that don't make products can't be destroyed by patents.

Who cares? It sounds big and scary and really bad... especially to us start-up types but I'd bet that there is nothing that hasn't been patented or could be deemed to be covered by a patent that's been put out on the web.

Seriously, start looking through the patents filed on Google (I started with one of these Paul Allen ones, then moved on to others filed by others but which were cited) and came to the conclusion that this is all ridiculous.

Here we see that Apple could possibly sue anyone for invoking the "mouseover" or "hover" events: http://www.google.com/patents?id=mPYiAAAAEBAJ&printsec=a...

While I wholeheartedly agree with protecting IP, to me that is more of a copyright issue (not ripping off code) rather than ideas.

Ultimately what it means for us is: Go forth and code. Create whatever you want and ignore the patents out there. If you are successful, and a patent troll sues you, you can come to an agreement (license or otherwise). Really, no worries here.

You know what I think we should do? Institute a law where you can't sue a company for patent infringement unless you do so before they introduce and make a substantial amount of money off that product. Say, 1 million in revenue or something.

Company A makes patent infringing product. Company A makes puppet Company B that licenses product for <substantial amount of money>, successfully fulfilling any sort of patent infringement limitation you can think of for the low low cost of a few lawyers.

Any policy you think of is going to have ridiculous loopholes and require companies to have patent 'watchdogs' who will need to search out fledgling products to make sure they're not infringing on any patents. These company watchdogs will have to justify their wages... by making even more patent lawsuits than there are now.

Even marketing a product (or service) employing the patent I would be happy with.

Fuck, even implementing the patent I would be happy with.

Requiring some minimum revenue before the patent counts for you is a great way to have your patents wantonly violated by larger firms before you can get started. Software startups are too agile for patents to matter much, but that's not as true for other industries.

Some seem rather obvious:

"The technology behind one patent allows a site to offer suggestions to consumers for items related to what they're currently viewing, or related to online activities of others in the case of social networking sites.

A second, among other things, allow readers of a news story to quickly locate stories related to a particular subject. Two others enable ads, stock quotes, news updates or video images to flash on a computer screen, peripherally to a user's main activity."

Another interesting way to look at it, if he did win big in this case then gave it all to worthy causes it could be a net win for society.

Hopefully it draws attention to software patents flaws. If government were hesitant to move away from them altogether maybe they could try a 2 year trail of no new patents or something.

> Paul Allen says he owns the technology behind all these ideas

It's hard to imagine Allen owning any technology Google or Apple are using...

He should have sued Oracle too.

Octopus ain't free, you know.

someone should patent being a litigious prick

Halliburton specifically disclaimed any intent of actually using the patent against anyone but trolls - see http://news.ycombinator.com/item?id=1608302

Aristocracy is completely out of touch. Good news in a way.

Maybe it's performance art?

or reverse psychology? I find it hard to imagine that someone who agreed to donate his billions to charity suddenly becoming a patent troll. Maybe he is trying provoke a repeal of business method patents the most direct (and expensive) way possible.

Paul Allen and Nathan Myhrvold (former-Msft CTO) must be two peas in a pod:http://www.techdirt.com/articles/20100217/1853298215.shtml

Allen, unlike Myhrvold, has done a lot of good. This is a weird move by his previous standards.

True, it's just intriguing that they're both high-ups from MSFT.

my estimation of Mr. Allen has just plummeted

Check first who is on the administrative board of his company or who are the big share holders. Mr Allen may just be the visible tip of the iceberg.

point of evidence 5,436 that US software patents are a joke and need to be destroyed.

If Larry can, why Paul cannot? ^_^

"This lawsuit against some of America's most innovative companies reflects an unfortunate trend of people trying to compete in the courtroom instead of the marketplace," a Google spokesman said.

I nearly choked. Are you shitting me? Marketplace doesn't allow you to "steal" others technologies. How would they feel about others infringing their search engine patents. Before anyone go wild on me, let me make it clear I am not supporting Mr. Allen or software patents or even know if there is a patent infringement here. All I am saying is if there is an infringement, I don't get this Googler.

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