Patent Troll Gets A Win In Court

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A U.S. District Court Judge has sided with a patent troll that has been demanding Wi-Fi patent licensing fees from small businesses. The case isn't over yet but, at least on the racketeering allegations, the patent troll has dodged a bullet. :(

Cisco Systems, Motorola Solutions, and Netgear filed a complaint last year against Innovatio IP Ventures, which has sued about 20 businesses for alleged patent infringement because they had purchased and were using Wi-Fi equipment made by the plaintiffs. The complaint alleged that the patent assertion entity (PAE) sent 8,000 threatening letters to business in all 50 states in an effort "to defraud and extort illegal fees" and thus violated federal antiracketeering laws.
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It's good that courts are still actually looking at evidence and making judgements based on the facts of the situation and not some stupid feelings over whether or not doing something like this is upsetting or not. The IP holding business model is great for the economy and this helps validate and vindicate them so they can more freely act without concern about whether or not they're going to get sued for protecting the IP they rightfully and legally acquired.
 
Steve said:
A U.S. District Court Judge has sided with a patent troll that has been demanding Wi-Fi patent licensing fees from small businesses. The case isn't over yet but, at least on the racketeering allegations, the patent troll has dodged a bullet. :(
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It appears that the manufacturers may have licenses to the patents in question, which would normally exhaust the rights of the patent holder to seek additional monies downstream from the licensee (e.g., purchasers of the devices). However, patent holders have been attacking exhaustion lately - basically to get money from the entire supply chain instead of at one point. The Federal Circuit and/or Supreme Court need to clarify this issue or we'll continue to see it.

Also, patent infringement covers anyone "mak[ing], us[ing] or sell[ing]," so there's nothing saying that end users couldn't be sued for patent infringement - it's just way too hard to sue 1000's of defendants rather than the manufacturer of a device.
 
SkribbelKat said:
It's good that courts are still actually looking at evidence and making judgements based on the facts of the situation and not some stupid feelings over whether or not doing something like this is upsetting or not. The IP holding business model is great for the economy and this helps validate and vindicate them so they can more freely act without concern about whether or not they're going to get sued for protecting the IP they rightfully and legally acquired.
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not sure if serious....
 
That's 8000 patent suits worth of work that have been saved to create more work for the Judge's Patent Lawyer & Patent Judge buddies.
 
The first amendment does not give you the right to use the government as a proxy to commit violent acts of extortion against other people.

Patents are already immoral and perverse; like all imaginary property, they are merely economic rent seeking designed to create an artificial scarcity to benefit the pockets of a few wealthy individuals. But even this is a perversion of patent laws; to state that merely using a device that someone else made is a violation of a patent is absurd. The wi-fi routers are the property of the respective business owners and they have the right to use it as they damn well please.
 
In addition, I find it completely hypocritical that the patent trolls have not been charged under the Computer Fraud and Abuse Act. If Aaron Swartz can face decades in prison for downloading a few too many files from an open access network, then these people should face prison for misusing private wireless networks.
 
Let me get this straight - the companies bought equipment from from Motorola, Cisco, etc and they were being asked for royalties for the patents? Hmmm, if this is OK, then Apple will be losing out big time since Samsung has the patents for 4G LTE
 
Manaknight said:
not sure if serious....
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Despite what certain people are saying...yes, I'm serious. :mad:

The court people are doing what they're supposed to do. They interpert the laws and decide what is and isn't right. The laws as they exist right now might not be the best ones out there, but if a business in buying and holding intellectual property is profitable, why should they be considered a bad thing just because they were more creative about making money then the stupid companies that waste a bunch of time and money making and producing things?
 
You can use my name Skribbel, I didn't mean that in a bad way, more joking. You seem to have incredible endurance in these posts, when trying to prove your point. If anything I find them entertaining.
 
LeviathanZERO said:
You can use my name Skribbel, I didn't mean that in a bad way, more joking. You seem to have incredible endurance in these posts, when trying to prove your point. If anything I find them entertaining.
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I'm not actually upset at you or anything and it's great to know someone gets some :D from them. Though certain people probably don't feel the same way and that's okay I guess, but I think they just didn't get enough hugs when they were little Skribbels.
 
because they had purchased and were using Wi-Fi equipment made by the plaintiffs.
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Yeah... I may not be a lawyer and didn't stay at a Holiday Inn last night, but I'm pretty sure that if you purchase something you're legally allowed to use it
 
sfsuphysics said:
Yeah... I may not be a lawyer and didn't stay at a Holiday Inn last night, but I'm pretty sure that if you purchase something you're legally allowed to use it
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HAHAHAHAHAHAHAHAHAHAHA!!!! RIAA & MPAA & Game Publishers say otherwise! You don't own shit. You bought the privilege to use that media under very limited circumstances. You go outside that tiny little box and you're breaking the license and can be sued. Don't copy that floppy!
 
sfsuphysics said:
Yeah... I may not be a lawyer and didn't stay at a Holiday Inn last night, but I'm pretty sure that if you purchase something you're legally allowed to use it
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If it infringes a valid patent, you're liable for damages based on the infringement. IAAL, but I didn't stay at a Holiday Inn last night.
 
PurduEE said:
If it infringes a valid patent, you're liable for damages based on the infringement. IAAL, but I didn't stay at a Holiday Inn last night.
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That is some pretty fucked up wall, then. Jesus...
 
sfsuphysics said:
Yeah... I may not be a lawyer and didn't stay at a Holiday Inn last night, but I'm pretty sure that if you purchase something you're legally allowed to use it
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My feelings exactly. Worst case scenario there should be a warning on the box that says "caution: contents of this cup may be HOT and burn you" no wait thats mcdonalds. i mean "caution: using products within this box may cause a lawsuit".
 
rflcptr said:
How would you gauge damages in this case?
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de minimus for a person. However, if you're a hotel chain and you have hundreds of locations and thousands of people pay you $20/day for wifi, it could be a great deal more. In the computer space, a reasonable royalty (the amount that a non-practicing entity can receive for patent infringement) could be 2-3%. Strip out the cost of internet service for the hotel (not much compared to the $20/day they charge) and you're left with the royalty base against which you multiple the rate (2-3%). Let's say the base is $10/day and the rate is 2%, just to keep the numbers easy. That would mean that the troll gets 20 cents/guest/day. A jury will go for it, because it sounds cheap, but over time, it's a lot of money. If you assume ten thousand wifi users per day for a large hotel chain, that's $2000/day. Over a year, that's ~$800k from one chain. Equitable relief might be available as well (injunction), meaning you could be a hotel without internet service which will drive you to a settlement.
 
Wait, so they are threatening legal action against those using the devices that might violate their patent and not just those producing the violating product?

If it's found that the Ford Mustang violated a patent held by say GM, could GM then sue anyone who owns a Mustang for violating the patent?

My point is while this troll may have grounds for a suit against the manufacturer of a product I don't think they would against anyone who bought and is using the product.
 
PurduEE said:
If it infringes a valid patent, you're liable for damages based on the infringement. IAAL, but I didn't stay at a Holiday Inn last night.
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So if the iphone violates a Samsung patent they could sue not only Apple but every iphone owner for damages as well?
 
DarkStar_WNY said:
Wait, so they are threatening legal action against those using the devices that might violate their patent and not just those producing the violating product?

If it's found that the Ford Mustang violated a patent held by say GM, could GM then sue anyone who owns a Mustang for violating the patent?

My point is while this troll may have grounds for a suit against the manufacturer of a product I don't think they would against anyone who bought and is using the product.
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http://www.law.cornell.edu/uscode/text/35/271

"whoever without authority makes, uses, offers to sell, or sells any patented invention, within the United States or imports into the United States any patented invention during the term of the patent therefor, infringes the patent."

If someone sells you a product that infringes a patent, and you use said product, you can be liable for infringement. End users don't get sued because the damages involved are insignificant compared with the cost of the suit (attorneys, etc.). However, that doesn't mean that YOU can't be sued personally for patent infringement.
 
SkribbelKat said:
Despite what certain people are saying...yes, I'm serious. :mad:

The court people are doing what they're supposed to do. They interpert the laws and decide what is and isn't right. The laws as they exist right now might not be the best ones out there, but if a business in buying and holding intellectual property is profitable, why should they be considered a bad thing just because they were more creative about making money then the stupid companies that waste a bunch of time and money making and producing things?
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Can't tell if serious...
 
PurduEE said:
http://www.law.cornell.edu/uscode/text/35/271

"whoever without authority makes, uses, offers to sell, or sells any patented invention, within the United States or imports into the United States any patented invention during the term of the patent therefor, infringes the patent."

If someone sells you a product that infringes a patent, and you use said product, you can be liable for infringement. End users don't get sued because the damages involved are insignificant compared with the cost of the suit (attorneys, etc.). However, that doesn't mean that YOU can't be sued personally for patent infringement.
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No state or government has the authority to violate someone's natural rights. To threaten someone with violence when they have done nothing, have not aggressed upon any person or actual property is reprehensible and no amount of sophistry changes that.

If everyone ignored the courts and their intellectual puppets, they would be powerless as they cannot arrest everyone.

The US court system is laughable. It is not about justice, it is not about right or wrong and it is not about the truth. It is simply about who can afford to do the most legal maneuvering. The majority of litigation consists not of fact finding or trying to determine right and wrong but of each party trying to bury the other in arcane motions and subpoenas. The US is one of the only countries that allows lawyers to issue subpoenas with basically no oversight and, as a result, you can be expected to be buried in them.

Someone who cannot afford expensive lawyers (whose salary and pay is vastly inflated by using the bar system to artificially limit the supply of lawyers) has no chance; with patents, you are guilty until proven innocent. Every motion and every subpoena filed by the enemy represents potentially tens of thousands of dollars in legal fees. Someone could patent a chair and the average person would not have a snowball's chance in hell of winning the lawsuit; you need millions of dollars to do that. The civil court system is little more than a legalized form of extortion. Patent trolling is profitably precisely because very few people can afford to defend themselves and those that do end up loosing more money if they try rather than just settle.
 
damicatz said:
No state or government has the authority to violate someone's natural rights. To threaten someone with violence when they have done nothing, have not aggressed upon any person or actual property is reprehensible and no amount of sophistry changes that.

If everyone ignored the courts and their intellectual puppets, they would be powerless as they cannot arrest everyone.
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Whatever you say professor. No one is arresting anyone or threatening physical violence for patent infringement, these are civil litigation issues. I've heard all your black helicopter/government oppression bullshit before. I'm a lawyer and I'm telling you how it works. Don't want to listen and instead feel the need to blather on about natural rights? Go for it.
 
PurduEE said:
Whatever you say professor. No one is arresting anyone or threatening physical violence for patent infringement, these are civil litigation issues. I've heard all your black helicopter/government oppression bullshit before. I'm a lawyer and I'm telling you how it works. Don't want to listen and instead feel the need to blather on about natural rights? Go for it.
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misleading username is misleading
 
damicatz said:
The US court system is laughable. It is not about justice, it is not about right or wrong and it is not about the truth. It is simply about who can afford to do the most legal maneuvering. The majority of litigation consists not of fact finding or trying to determine right and wrong but of each party trying to bury the other in arcane motions and subpoenas. The US is one of the only countries that allows lawyers to issue subpoenas with basically no oversight and, as a result, you can be expected to be buried in them.
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Sadly everyone is pretty much to blame for this... Liberials because they wine about judge bias' and fairness and conservatives for their "its not specifically stated, so technically I can do ABC even though I know law XYZ probably prevents it..." attitude.

The results is a bloated legal system where Judges aren't allowed to use their judgement and ba-gillions of complicated laws need to be written to specifically cover absolutely every situation/case imaginable. Thus creating loop holes and slowing the adaption of laws (mainly because politicians work by polling instead of what they actually stand for).


Yeah the legal system has issues... There is no reasonable expectation that consumers can judge and determine their liability of patent infringement of a product.

The judge did right by the law, but the law sucks. Its 1st amendment right to be able to send insane letters... though one could make the case that threat of lawsuit can be considered a threat and be judged by those laws. I have no clue about threat laws to make a statement how correct the judge was on that part.
 
PurduEE said:
Whatever you say professor. No one is arresting anyone or threatening physical violence for patent infringement, these are civil litigation issues. I've heard all your black helicopter/government oppression bullshit before. I'm a lawyer and I'm telling you how it works. Don't want to listen and instead feel the need to blather on about natural rights? Go for it.
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Tell me, Einstein. What happens if you refuse to acknowledge the court's jurisdiction? Do you think that they say gosh darn it, he refuses to pay the verdict so we'll just ignore him?

The threat of violence exists because it is comply with the court or have armed thugs sent after you. Those who cannot afford to "comply" with the court or play the game are screwed and have their lives ruined as a result.
 
dandirk said:
Sadly everyone is pretty much to blame for this... Liberials because they wine about judge bias' and fairness and conservatives for their "its not specifically stated, so technically I can do ABC even though I know law XYZ probably prevents it..." attitude.

The results is a bloated legal system where Judges aren't allowed to use their judgement and ba-gillions of complicated laws need to be written to specifically cover absolutely every situation/case imaginable. Thus creating loop holes and slowing the adaption of laws (mainly because politicians work by polling instead of what they actually stand for).


Yeah the legal system has issues... There is no reasonable expectation that consumers can judge and determine their liability of patent infringement of a product.

The judge did right by the law, but the law sucks. Its 1st amendment right to be able to send insane letters... though one could make the case that threat of lawsuit can be considered a threat and be judged by those laws. I have no clue about threat laws to make a statement how correct the judge was on that part.
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The system got bloated when the Patent Office dropped its responsibilities. Before they often didn't allow patent disputes go to the courts until it was the last recourse. Now they go to the courts as almost the first recourse. That was political decision that happens to favor layers in the Patent Litigation system made by politicians who are either lawyers themselves or sponsored by lawyers.

Although I still blame evil lawyers to a degree part of the issue was the pace of technology and patents outstripped the capacility of the PO to keep up so they decided to punt for that reason as well. But the solution to go to the courts is not the efficient alternative.
 
damicatz said:
Those who cannot afford to "comply" with the court or play the game are screwed and have their lives ruined as a result.
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Don't they first have to do something that warrants the attention of the legal system before all that other stuff happens? It might just be easier to not be a Mister Mean Pants to other people.
 
SkribbelKat said:
Don't they first have to do something that warrants the attention of the legal system before all that other stuff happens? It might just be easier to not be a Mister Mean Pants to other people.
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No they don't. There are so many laws that people are always in violation of at least one. There are so many patents that people are always in violation of at least one. Even if, by some miracle, you aren't in violation of one of the many byzantine laws, regulations, or patents, they can still sue you and force you to pay a lawyer to file an Fed. R. Civ. P. 12(b)(6) motion to get it dismissed.

Take a look here : http://www.x-plane.com/x-world/lawsuit/

This is a perfect example of someone who is simply trying to make an honest living. This guy was minding his own business and selling a product to support his family when some disgusting lawyer (vermin) decided that they would extort money from him. He has done nothing wrong and yet he is now forced to incur possibly millions of dollars in legal fees in an attempt to prove his innocence. If he loses, he will be ruined. His wife's health has been affected by the stress. He has to live with the constant fear that the US Court system will take everything he has earned, everything he has worked hard to make because of some two-bit con artist lawyer who makes money extorting other people.
 
damicatz said:
No they don't. There are so many laws that people are always in violation of at least one. There are so many patents that people are always in violation of at least one. Even if, by some miracle, you aren't in violation of one of the many byzantine laws, regulations, or patents, they can still sue you and force you to pay a lawyer to file an Fed. R. Civ. P. 12(b)(6) motion to get it dismissed.

Take a look here : http://www.x-plane.com/x-world/lawsuit/

This is a perfect example of someone who is simply trying to make an honest living. This guy was minding his own business and selling a product to support his family when some disgusting lawyer (vermin) decided that they would extort money from him. He has done nothing wrong and yet he is now forced to incur possibly millions of dollars in legal fees in an attempt to prove his innocence. If he loses, he will be ruined. His wife's health has been affected by the stress. He has to live with the constant fear that the US Court system will take everything he has earned, everything he has worked hard to make because of some two-bit con artist lawyer who makes money extorting other people.
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Can't he countersue for triple damages or something? I dunno, I only pretend to be a lawyer at expertlaw.com, but I don't think that actual lawyers are all evil or anything. They're just normal people who are making a living to pay their bills like anyone else and most of them are not at all super wealthy. Besides that, they're usually hired by a company or approached by an organization looking for representation. Your ire might be better directed at corporate entities. Then again, I don't think anything is going to change anytime very soon.
 
SkribbelKat said:
Can't he countersue for triple damages or something? I dunno, I only pretend to be a lawyer at expertlaw.com, but I don't think that actual lawyers are all evil or anything. They're just normal people who are making a living to pay their bills like anyone else and most of them are not at all super wealthy. Besides that, they're usually hired by a company or approached by an organization looking for representation. Your ire might be better directed at corporate entities. Then again, I don't think anything is going to change anytime very soon.
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In this case, the lawyer and the "owner" of the patent are one in the same. Pretty much all patent trolls are like this; it is a lawyer in an office who extorts money from people.

You could try and get a Rule 11 sanction but :

1.It costs money to do it.
2.There is no guarantee that you will win and, if you don't win, no rule 11s; juries are notoriously stupid (by design; anyone with a spine is quickly thrown out from the jury box). Courtrooms are operated by judicial fiat with the judge acting as master of his or her fiefdom; jurors are not allowed to decide what evidence is or isn't relevant and jurors are almost always kept blind to all of the facts of a case through the use of motions in limine.
3.Patent trolls are operated by shell companies. They do not keep their ill-gotten gains in that company but rather operate what is essentially a massive money laundering operating.
4.Any damages that you won would never be collected because there would be no assets to collect from.
5.Coercive state-imposed limited liability shields these thieves from any personal responsibility for an action.
6.Lawyers and judges are both members of the bar and thus look out for each other and take care of their own. It is a good old boys club.
 
dandirk said:
Sadly everyone is pretty much to blame for this... Liberials because they wine about judge bias' and fairness and conservatives for their "its not specifically stated, so technically I can do ABC even though I know law XYZ probably prevents it..." attitude.
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I'm not sure I know what a Liberial is, but liberals are the ones who do everything they can with the loosest interpretation of the law, such as Obama's executive orders and NYC's stupid gun bans that were enacted in non-compliance with their own legislative requirements. The Republicans wine about judge bias's, and rightfully so, since the judges are liberal bent.
 
damicatz said:
Tell me, Einstein. What happens if you refuse to acknowledge the court's jurisdiction? Do you think that they say gosh darn it, he refuses to pay the verdict so we'll just ignore him?

The threat of violence exists because it is comply with the court or have armed thugs sent after you. Those who cannot afford to "comply" with the court or play the game are screwed and have their lives ruined as a result.
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Just because someone gets a judgment against you doesn't mean that you have to pay. They still have to enforce the judgment. Ron Goldman's dad has a huge judgment against OJ. Did OJ pay? Nope.

Here's a list of "exempt" property in Texas - that means that a person with a judgment against you can't take any of this property:

http://www.13network.com/hupdocs/HUPexemptproperty05.pdf

Some highlights:

1. 10 acres of urban property or 200 acres of rural property.
2. $60,000 of personal property for a household or $30,000 for a single person.
3. a motor vehicle for each person with a driver's license/
4. retirement savings, pension plan, profit-sharing plan, and/or stock purchase plan.

Not exactly as barbaric as your trying to make it sound. I'd love to have my life ruined by only being able to hang on to 10 acres of property in downtown Houston.
 
PurduEE said:
Just because someone gets a judgment against you doesn't mean that you have to pay. They still have to enforce the judgment. Ron Goldman's dad has a huge judgment against OJ. Did OJ pay? Nope.

Here's a list of "exempt" property in Texas - that means that a person with a judgment against you can't take any of this property:

http://www.13network.com/hupdocs/HUPexemptproperty05.pdf

Some highlights:

1. 10 acres of urban property or 200 acres of rural property.
2. $60,000 of personal property for a household or $30,000 for a single person.
3. a motor vehicle for each person with a driver's license/
4. retirement savings, pension plan, profit-sharing plan, and/or stock purchase plan.

Not exactly as barbaric as your trying to make it sound. I'd love to have my life ruined by only being able to hang on to 10 acres of property in downtown Houston.
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You are being intellectually dishonest by using Texas State Court exemption laws. As a lawyer, you should know that Texas laws do not apply in South Carolina (where Laminar Research is located). As a lawyer, you should also know that exemptions from execution are worthless if the person in question lacks the ability, skill, or the knowledge to file a motion to prevent said execution. In addition, as a lawyer, you should finally know that such exemptions do not apply to his company or to that company's "Intellectual Property" which means that the courts could take away his ability to continue to sell or work on his own program.
 
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