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Congress Proposes Strategy For Fighting Patent Trolls 96

Posted by samzenpus from the use-fire-or-acid-to-stop-the-regeneration dept.
phantomfive writes "Congressman Charles Schumer has written a piece decrying the evils of patent trolls. 'Because of the high cost of patent litigation—the average litigation defense costs a small or midsize company $1.75 million—it is often marginally cheaper for a defendant to pay up front to make the case go away. The average settlement for the same group of companies is $1.33 million....Patent trolls cost U.S. companies $29 billion in 2011 alone.' His solution? Make it easier for low quality patents to be re-examined and rejected by the patent office."
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Congress Proposes Strategy For Fighting Patent Trolls More

Congress Proposes Strategy For Fighting Patent Trolls

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  • Can afford the endless rexaninations of their patents? Chuck is bought and paid for, so this won't help the little guy.

    • Re:Oh, So now only the big boys (Score:5, Insightful)

      by MickyTheIdiot ( 1032226 ) on Friday June 14, 2013 @08:44AM (#44005845) Homepage Journal

      Who is paying him to say this?

      I'm sorry.. the last 2 years especially have left me with nothing but cynicism. Congresscritters are ALL paid spokesman. Who is paying him to say this?

      I don't care if I agree or not... every one of these idiots is a shill in one way or another and regardless of party.

    • Re: (Score:3)

      by gmuslera ( 3436 )
      This is for protecting the big boys, not the small ones. Is not that patents cost everyone 29 billons, is that cost to big companies, they are free to do their share of the trolling, do innovation or not (i.e. MS requiring android device makers to pay them for their FAT patent). Of course, also go to some of the ones that only troll. But is not a solution, just another way to give even more leverage to the big companies.

  • Low Quality (Score:5, Insightful)

    by SJHillman ( 1966756 ) on Friday June 14, 2013 @08:21AM (#44005737)

    "Make it easier for low quality patents to be re-examined and rejected by the patent office."

    Who determines if a patent is "low quality"? A certain low quality congress critter?

    • Re:Low Quality (Score:5, Insightful)

      by cheekyjohnson ( 1873388 ) on Friday June 14, 2013 @08:29AM (#44005769)

      Easy: All patents are low quality.

      • Re:Low Quality (Score:4, Informative)

        by MickyTheIdiot ( 1032226 ) on Friday June 14, 2013 @08:51AM (#44005891) Homepage Journal

        I *hate* the idea of "Intellectual Property" in general. If you want a governmental power that has overreached its constitutional intent you can't find a better example. However I don't think EVERY patent is low quality. We need *limited* patents and limited copyrights with curbs that make them difficult to use as offensive weapons. They need to be inventor and artist focused instead of corporation focused. And we need patent examiners that have the knowledge and the time to say that patent is B.S.

        Of course we aren't going to get that in a corporate dominated government.

        • The whole idea of Intellectual Property comes in to play because companies wanted to assume monopoly over tech/entertainment markets. The current legislation behind patents and copyrights is a result of this effort via lobby, and on the public relation front of it is this crusade for IP.

          • Re:Low Quality (Score:5, Insightful)

            by tlhIngan ( 30335 ) <slashdot.worf@net> on Friday June 14, 2013 @12:19PM (#44008127)

            The whole idea of Intellectual Property comes in to play because companies wanted to assume monopoly over tech/entertainment markets. The current legislation behind patents and copyrights is a result of this effort via lobby, and on the public relation front of it is this crusade for IP.

            Except patent wars are old - they date back to the 19th century. Likewise copyright wars. It's really a case of everything old is new again - we've been repeating history for ages now.

            Anyhow, the main problem is software shouldn't be protected at all - at least not by traditional copyright NOR patents. The thing is, software is kind of strange. Before software, people wrote stuff for consumption - books, musics, movies, plays, etc, which clearly fell under copyright law. And people made "stuff" to do things - machines, tools, etc., which clearly fell under patent laws.

            But now software (which is really just tech's turn at the patent wars - everyone else has gone through it years ago - automobiles has had patent wars rage on since the late 19th century) is really quite different. Very rarely is it written for purely human consumption (the source code, that is), and the compiled/transformed form isn't usable to anything but a computer. Even worse, you write software to do useful things, which also make it fall under patents.

            And that's the problem - patents and copyrights are meant to cover things that don't overlap - pretty much mutually exclusive. Software isn't - you write it, compile it (which can make it come under copyright law) but which can do things of utility (e.g., do stuff), which falls under patent protection. Neither is right, and neither is wrong. (And to confuse things further, software can be hardware, when it's written and compiled to RTL and silicon). After all, given something can be both patented AND copyrighted (which never happened before...), that should be a red flag that the laws are inadequate.

            What needs to happen is recognition of this - the special state of software that you write, but not necessarily for purely human consumption (you can consume the *output* - e.g., games, but rarely is source or binary code appreciated as-is).

            It would offer protection, but of a different form adapted to the qualities it possesses - do you protect the algorithm (patent), or the implementation (copyright)? Why not a modified form of that protects both, respects that sometimes things can only be done one way and thus have mandatory licensing, appreciate that multiple implementations can exist and be protected as one unit, etc.?

            You still get the protections and restrictions that make open and free software possible, but you eliminate trying to bend patent and copyright laws to handle software.

        • Indeed. I'd be wiling to bet that just one tiny reversion in the patent process would drastically improve the quality of issued patents: Go back to requiring the president to personally sign each granted patent. If we were only granting a few thousand patents a year as we originally did that would be a non-issue, just a few more signatures per paperwork-filled day. But there's no way he could hope to sign the thousands of patents per day that are currently being granted. Limit the process to only a few

        • Article One, Section 8(8) of the U.S. Constitution:

          "The Congress shall have power... to promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries."

          Patents are very constitutional-- however this whole "corporations are people" thing is a complete perversion of the 14th amendment.

          • I think that's what he was pointing out: copyrights and patents don't seem to be promoting the progress of science and useful arts any longer (putting aside that there's no real evidence that they ever did so in this day and age), and since that's the entire reason they exist, the laws could be considered unconstitutional.

        • If you make it difficult to use patents and copyrights as "offensive" weapons, then how do you protect your patent or copyright? And how are the more corporation focused than inventor/artist focused?

    • Re: (Score:2, Funny)

      by Anonymous Coward

      Easy Chuck Schumer is a democrat. So if the patent is owned by a GOP supporter it is low quality, if the owner supports the DNC it is high-quality.

      Why should the patent office run different than the IRS.

  • Congressman? (Score:5, Informative)

    by mooingyak ( 720677 ) on Friday June 14, 2013 @08:26AM (#44005757)

    Congressman, while generic, usually refers to members of the House. Schumer is a senator.

  • No one else has this story?

  • Surtax on patent licensing fees (Score:1)

    by Anonymous Coward

    A 25 percent Federal surtax on patent licensing fees, excluding IP barter and deals where patent licenses are bundled with de facto goods and services, would make it tougher for patent boutiques to collect.

  • Ignorance is the problem (Score:5, Interesting)

    by Errol backfiring ( 1280012 ) on Friday June 14, 2013 @08:35AM (#44005801) Journal

    There is an interesting line of thought in the (thank goodness overruled) patenting of natural DNA (taken from this article [nytimes.com]):

    "The isolated DNA molecules before us are not found in nature," Judge Alan D. Lourie wrote. "They are obtained in the laboratory and are man-made, the product of human ingenuity."

    Sounds reasonable? Until you realize that DNA is just a chain of information blocks. Then it reads: "While these words do occur in sentences in nature, they do not appear by themselves. Therefore they are man-made, therefore patentable." Off course, once the patent has been granted, it is used to attack all other sentences that contain that word. As long as patent judges utter those patently stupid verdicts, no patent system in the world can ever do good.

    • Patent the methods used to get the DNA information, but the information itself should not be patentable. That should be somewhat obvious and not worth the effort to get it through a long sequence of court decisions.

  • Why re-examine? (Score:5, Interesting)

    by SirGarlon ( 845873 ) on Friday June 14, 2013 @08:39AM (#44005821)

    Can't read TFA due to paywall, but does he suggest a reason why re-examining "low quality" patents is a better approach than establishing stricter eligibility criteria and a more rigorous process to weed out "low quality" patents before they're granted?

    • I imagine he is thinking there are already to many low quality patents in existence. Stricter eligibility would not take care of those you would need both stricter eligibility and re-examination. Since the article is behind a paywall I can't say if this is the case.

  • Trolls are not the problem (Score:1)

    by Anonymous Coward

    Trivial patents, and a poor trial system are. The companies are stuffing their patent portfolios with trivial stuff like status bars, hyperlinks and swipe guestures. By cross patenting agreements they keep the small companies out of the market. If a small company has a "real" patent, it may just be that they cannot enforce it against a big player without beeing sued into the ground for violations of the trivial patents of that player. Now that people have found a way to force the big players to play by the

    • Most tech companies build portfolios as defensive mechanisms. It's not just trolls messing things up -- the exact same trolling techniques are used to get in each other's way.

      My old company, after getting burned over something stupid, sat us engineers down with the head company lawyer, and told us to think of things we could patent so we could put roadblocks in their way instead. It was war. "Here's a simple form. Write the ideas and our lawyers will buff it up and submit it."

  • I have a better idea. 1) Require the patent troll to pay the defendant's legal fees up front. If the troll wins (valid patent) then the defendant pays the patent troll back. 2) Instead of damages going to the troll, make them go to the patent office. This removes the profit incentive.

    • Re: (Score:1)

      by Anonymous Coward

      I have a better idea.

      1) Require the patent troll to pay the defendant's legal fees up front. If the troll wins (valid patent) then the defendant pays the patent troll back.

      2) Instead of damages going to the troll, make them go to the patent office. This removes the profit incentive.

      You are assuming anyone that enters a patent lawsuit is a troll. This idea totally screws an honest lawsuit (even though they rarely ever happen).
      There may actually be a case where, a company patents some part of their product, and then another company steals it.
      Damages should go to the original company, representative of sales lost due to the false product.

      • >This idea totally screws an honest lawsuit (even though they rarely ever happen)

        I suspect they are as common as ever in absolute terms, it's only the ratio that has changed with the massive influx of trolling. It's not like the internet where everyone eventually goes elsewhere when the troll density gets too high - if you have a legitimate grievance you have to go to the same courts as the trolls, they're the only game in town.

        Though I suppose there is a chance that in such a litigation-happy environme

    • Re:better idea (Score:5, Interesting)

      by indeterminator ( 1829904 ) on Friday June 14, 2013 @10:41AM (#44006985)

      Here's my idea: require the company to define the value of the patent (i.e. how much inventing it cost) with the patent application. And the patent application processing fee is 10% of that value. The patent owner can only sue for damages up to the patent value.

      If you actually used a billion to make that invention, then 10% of that is a small price to pay for protection of the investment. If you're a troll, you need to be a troll with very deep pockets. And hopefully some part of that 10% fee can be used to properly review patent applications and establish a court that specializes in handling patent disputes so that lawsuits can be streamlined.

      Won't help with already issued patents though.

      • Re: (Score:2)

        by rsborg ( 111459 )

        Won't help with already issued patents though.

        So instead of just having the application fee proportional to the "value" of the patent, make it a yearly tax. If it's a small inventor, they can pay tax on that property that's so valuable - as long as they're pulling in massive licensing fees, they get taxed on that (additional to normal taxation) to support the patent office. If the property isn't making money, then the taxes are lower, but not nonexistant. If it's a big company maintaining a large warchest of intellectual property, they can pay yearl

        • You two should suggest these ideas to your congressman. Something along those lines could work. It might actually get passed because the dems have never seen a tax they didn't like, and the repubs like ideas that could help businesses operate more efficiently, spending time providing products and services instead of fighting lawsuits. Both parties might like this.

          As a small inventor myself, doing R&D and rendering those inventions as software, I wouldn't mind a system where I could declare the value

          • Re: (Score:2)

            by rsborg ( 111459 )

            You two should suggest these ideas to your congressman. Something along those lines could work. It might actually get passed because the dems have never seen a tax they didn't like, and the repubs like ideas that could help businesses operate more efficiently, spending time providing products and services instead of fighting lawsuits. Both parties might like this.

            As a small inventor myself, doing R&D and rendering those inventions as software, I wouldn't mind a system where I could declare the value at "no more than $500,000" and the fee would be proportional.

            Sadly those two bolded statements you mention are pretty far from the truth. Both parties are corrupted by megacorporations (mainly owned/run by the very wealthy) to the degree that only what benefits the megacorps gets passed (whether it benefits/harms small business or individuals seems to be a minor factor). Whether it's dems passing/continuing a tax cut for the wealthy, or the repubs passing big-brother legislation that makes everyone's life more bureacratic, both parties are are not representative of

    • Re: (Score:3)

      by sjames ( 1099 )

      One idea is to requitre that if a patent is EVER found invalid, the holder must refund anyone who already paid them with interest.

      It won't stop the trolls entirely, but the more success they have, the stronger their incentive is to quit while they're ahead.

  • It would be nice if there were a way to limit the number of patents a company or individual was allowed to own. If companies couldn't stockpile their patents then they would be forced to limit their patents to the higher quality ones. Of course any such law would have to be written carefully to avoid the obvious loopholes companies would surely exploit.

    • Only humans can own patents (not legal persons which are now corporations.) The rights should be non transferable (as most rights should be.)

      This would require employees who do the actual invention get properly taken care of instead of fired for getting too old. Sure, this would result in plenty of ass kissing of SMART people (I know that sounds too unusual, but bare with me.)

      We couldn't afford to be paying CEOs so much, they'd have to give some of that up or employee #14325 (who would then be known by th

      • Only humans can own patents (not legal persons which are now corporations.) The rights should be non transferable (as most rights should be.)

        You are so right. "Intellectual Property" rights in the current system rarely rest with the people they naturally belong to. If you are to claim ownership of an idea, it should be obvious that it had to be your idea to begin with. You cannot transfer the fact that you invented something (patent), nor the fact that you wrote something (author's right), nor the fact that you designed something (trademark, design patent, etc).

        (I know that sounds too unusual, but bare with me.)

        I am not a nudist, but thank you for the invitation.

        Tying IP rights to people will no

      • One of the oddities of the former Soviet Union was the arrangements they had (at least on paper) for inventors.

        The default position more or less was that exploitation rights went to the state, but if the inventor got an 'inventor's certificate', it meant that s/he had a few useful rights. One of them was the right to be employed in connection with exploitation of the invention (that is, only if any use was made of it). They were eligible for housing preference and there was even an award title of 'Honored I

  • This is dead on arrival because Schumer proposed it, and Schumer isn't exactly liked by Republicans in the House. I would be surprised if this thing makes it to law.
    And even if it does, it's so full of loopholes.

  • Lousy Idea (Score:3)

    by the eric conspiracy ( 20178 ) on Friday June 14, 2013 @10:51AM (#44007061)

    The problem is that lots of small companies are running on shoestrings. Any requirement to hire a law firm to defend against a lawsuit = death. It doesn't matter if the patent gets rejected on re-examination, the small company is toast.

    My last two jobs ended abruptly due to someone bringing a lawsuit. Boom see ya it's been real.

    What has to happen is ending lawsuits from non-practicing entities. These companies have no skin in the game. They can't be countersued because they make nothing.

    • >What has to happen is ending lawsuits from non-practicing entities

      That has it's own problems in that the "back yard inventor" or "ivory tower intellectual" is typically a NPE, and if she can't bring lawsuits then it makes selling her invention to someone with the means to produce it very difficult - they could simply steal the idea and the inventor would have no recourse. Granted such inventors are fairly minor players in terms of numbers of patents granted, but I'd be willing to bet that they're the s

      • I don't consider the inventor, or the company he works for to be an NPE.

        > it should be trivially cheap and easy to have all legal proceedings

        Cheap and easy, and legal proceedings are two mutually incompatible phrases.

        Another step in the right direction would be to ban software and business process patents. That's where 90% of the bullshit is anyway. Nothing of value would be lost.

        • >the company he works for
          First off - as I explicitly mentioned netiher of the classes of inventors I'm discussing works for a company (or at least their inventing is not so funded, I'm sure the back-yard inventor has a day job) . As a rule companies no longer invest in developing ground-breaking technology with only long-term payoffs, though they may buy up such inventions and refine them.

          As for not being NPEs, how do you define a NPE? Researchers and hobbyists almost by definition don't have the resou

          • Oh, as for the rest - I said a cheap and easy *stay* of legal proceedings - i.e. nothing can happen and nobody gets paid until the validity question is settled. Make it a standard form you can file as soon as the case is brought to court, don't even need a lawyer to fill in the blanks for you, and BOOM, all legal proceedings (and expenses) halted until patent validity is established.

            And no argument on software and method patents, they seem to be an area that should be presumed unpatentable at *least* until

          • NPEs have one or more of the following characteristics.

            1. Not the original patent assignee
            2. Not one of the inve ntors
            3. Doesn't sell a product of technology using the patent
            4. Doesn't sell a product that competes with a product that uses the patent
            5. Doesn't sell a product using a patent cited by or otherwise related to the patent
            6. Engages in no activities that would to commercialization of the patent
            7. Avoids all activities that could result in countersuits from patent holders
            8. Gets major share of revenues from patent infringe

            • Seems like a backyard inventor has *all* of those characteristics except the first two and maybe the last.

              And yes, I'd say "stop issuing bad patents" is step one. So long as we keep flooding the system with dreck, refinements in appealing its abuse are unlikely to be significant. Once we stop the flow of new dreck then it's trivial to make the existing dreck have to be requalified under the new rules/implementation before it can be exploited.

  • My Idea is OK let people buy patents BUT they dont get to charge but a 1/3 of what they are getting now because they do nothing, they make nothing, they provide society nothing. They get 1/3 or even less, if they are not actively using the patents ie making stuff the patent is in full force. As far as what should be and shouldn't be patented i really dont have a clue some thing that get patent make no since whatsoever like a way of doing something the something should be patented the way i dont think so muc
  • Make it so that someone must be actively using the patent in a product, device, software, etc... If they are not they have a year to start using it in a product, device, software etc... If after the year they are not their patent should be voided. Maybe make it 2 years. But theis would make it hard for the patent only companies to operate as they don't generally make anything.
    • Proving active use of a patent would be difficult.
      How about acknowledging that the world moves faster than it used to and simply adjust the duration of patents.
      I suggest:
      5 years for a physical device.
      2 years for software.
      No patents for process.

      It is simple and solves most of the problems. Plus it still allows people to have a great idea and make some money off it, which was the point of the original system.
      I bet I get modded into oblivion, since I don't adhere to the party line of "Patents are bad".

  • If a patent is declared invalid, the owner of the invalid patent should be obligated to pay back all royalties with interest. In addition, penalties proportional to the total revenue should be payable to the person having the patent invalidated. That way, as a patent becomes more and more significant, there is more and more incentive and reward for challenging it.

    In addition, a strong presumption of validity should be dropped. The PTO should merely register the patent and it should only be nominally conside

  • This "solution" is not a solution at all, but a gift to large companies that can afford a full time staff to ceaselessly defend challenges to their patent portfolio from competitors. If this approach were implemented, there would be no effective means by which to discern "high quality" from "low quality" patents. Any legit inventor would need an army of lawyers to keep his/her patent. What a joke!

    REAL SOLUTION:

    1. Require a heighten pleading standard for patent cases. As it stands, one need only allege i

    • While somewhat creative, I don't think any of your ideas would work:
      1. Heightened pleading standards would require about two or three hours of attorney-time per defendant. It could conceivably help, but only marginally. Most plaintiffs would find what they need on the internet.
      2. This already is the rule. To sue on a patent, you must own the patent. If you want someone else to sue, you create shell company, assign the patent to the shell company and get them to sue. Your specific suggestion wouldn't chang
  • The patents in question should be crowd sourced. Basically people could sign up and say I know about technology X and then when a patent in that area comes into question the group is notified by email or rss feed or something and then those outside of the USPTO can help find prior art to discount the patent.

  • 1.Make it illegal under libel laws to claim that someone is violating a patent without providing details of the actual patents (i.e. if someone claims you are violating their patents and wont say which ones, you get to sue them for libel). This will stop the kind of thing companies like Microsoft have been doing where they make nebulous patent claims without actually providing details.
    2.Ban any and all patents on any part of the human genome regardless of what form the information is in (including banning p

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