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Patent Troll Ordered To Pay For the Costs of Fighting a Bad Patent

timothy posted about 1 month ago | from the once-in-a-while-justice-peeks-through dept.

Patents 191

We mentioned last year that FindTheBest CEO Kevin O'Connor had taken an unusual step, when confronted with a demand by patent troll company Lumen View that the startup pay $50,000 for what struck O'Connor as a frivolous patent: He not only refused, but pledged to spend a million bucks, if necessary, to fight Lumen View in court. Now, as Ars Technica reports, O'Connor has succeeded on a grand scale. Before trouncing Lumen View in court, Ars reports, "FindTheBest had spent about $200,000 on its legal fight—not to mention the productivity lost in hundreds of work hours spent by top executives on the lawsuit, and three all-company meetings. Now the judge overseeing the case has ruled (PDF) that it's Lumen View, not FindTheBest, that should have to pay those expenses. In a first-of-its-kind implementation of new fee-shifting rules mandated by the Supreme Court, US District Judge Denise Cote found that the Lumen View lawsuit was a 'prototypical exceptional case.'"

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191 comments

Newegg did that too? (5, Informative)

Anonymous Coward | about 1 month ago | (#47145789)

http://soylentnews.org/article.pl?sid=14/05/23/1347205

"Unlike the other 36 codefendants, Newegg chose to go further and recover its legal fees, an action that most companies choose not to pursue because prevailing defendants were, until recently, required to demonstrate that a plaintiff acted in bad faith."

Re:Newegg did that too? (4, Informative)

Sique (173459) | about 1 month ago | (#47145905)

This case is mentioned at the end of TFA.

Re:Newegg did that too? (-1)

Anonymous Coward | about 1 month ago | (#47146031)

This is /. Who reads TFA? In fact, who reads TFS?

Re: Newegg did that too? (-1)

Anonymous Coward | about 1 month ago | (#47146389)

Right! Everybody knows that Linux... Wait, what's this article about?

Re:Newegg did that too? (4, Funny)

rmdingler (1955220) | about 1 month ago | (#47146043)

Per Slashdot's unwritten rule, and there are more of them than in baseball, a poster may be generously moderated for jumping on the grenade that is reading the flocking article.

but (-1, Flamebait)

Anonymous Coward | about 1 month ago | (#47145795)

Silly lawsuits are the American way!
It's well known all around the world.

Re:but (5, Interesting)

jythie (914043) | about 1 month ago | (#47145827)

To be fair, it is how our legal system was crafted. The US has a strong streak of 'handle your own problem, power to control your own fate' to it, and the civil suit system was built to support that. There are lots of crimes which in other countries would be prosecuted by one agency or another (for better or worse) but in the US the only redress one has is a civil suit. Even in situations where there are criminal laws on the books, the complaints about the police not doing anything even when supplied with all the evidence they need are significant. Actually convincing a prosecutor to go forward with your case can be an exercise in frustration.

Re:but (1, Informative)

drinkypoo (153816) | about 1 month ago | (#47145845)

To be fair, it is how our legal system was crafted. The US has a strong streak of 'handle your own problem, power to control your own fate' to it,

But US law has a strong streak of "you may not handle your own problem, we will tell you what your fate is" to it. That's why, for example, it's harder to start a small business here than in most of the world. Where I live, it costs more in permits than materials to build a two-bedroom house.

Re:but (2, Insightful)

GrumpySteen (1250194) | about 1 month ago | (#47145897)

re I live, it costs more in permits than materials to build a two-bedroom house.

Bullshit.

Even in the most expensive parts of the country, you could barely manage to build an uninhabitable, unfinished shell of a house for the price of a building permit.

Re:but (4, Informative)

PIBM (588930) | about 1 month ago | (#47145943)

There are some places in Canada were the permits cost are huge.. Think about a construction permit fee based on the lot size (multiple $$$ per square feet) where the minimum lot size is required to be at least something close to an hectare...

Re:but (0)

Anonymous Coward | about 1 month ago | (#47146777)

There are some places in Canada were the permits cost are huge.. Think about a construction permit fee based on the lot size (multiple $$$ per square feet) where the minimum lot size is required to be at least something close to an hectare...

Some actual numbers would have been nice. Otherwise you're just saying mumble mumble blah blah

Re:but (3, Interesting)

jythie (914043) | about 1 month ago | (#47145975)

I had a similar thought. Yeah permits and inspection costs are non-trivial, but they are no where near the material or labor costs unless you are stripping an old house for parts (i.e. free materials) and using near-slave immigrant labor. Though at that point the bribes needed would probably be greater then the permit costs too.

Re:but (4, Informative)

drinkypoo (153816) | about 1 month ago | (#47146153)

Even in the most expensive parts of the country, you could barely manage to build an uninhabitable, unfinished shell of a house for the price of a building permit.

It's over $30,000 in permits to build a small two bedroom house (say, 1000 square feet) in Lake County, CA, counting the water connection fee and other bullshit. You can buy a kit home for $45/ft^2 or less. A seasoned contractor who purchases materials at the right time of year can absolutely get the materials for less. It'll be a little shit-shack of a house like virtually all of them are, made out of chipboard and sheetrock, but that's what at least nine in ten of the houses being built today are like anyway so let's not be discriminatory. And I've got to add that this is one of the cheapest parts of the state, at least, that nominally still has water. Oh, did I mention that people on municipal water are being subjected to restriction? No new wells are being permitted, so you can only build where there is municipal water, which is mostly really bad here?

Sometimes, I hope I live a long time. Sometimes, I think human lifespans are too damned long. The crusty old fucks holding up progress in this town really get my goat.

Re:but (4, Interesting)

Idarubicin (579475) | about 1 month ago | (#47146251)

It's over $30,000 in permits to build a small two bedroom house (say, 1000 square feet) in Lake County, CA, counting the water connection fee and other bullshit.

So, not just the price of the building permit, then?

The purpose of development charges is to defray (some of) the costs to local government that they would otherwise incur for doing things like connecting your new home to the water, sewer, electrical, and any other utilities; construction of roads and streetlights; construction and purchase of additional emergency services equipment (fire trucks and fire houses, etc.); construction or enlargement of water reservoirs, sewage treatment plants, and electrical substations....

In other words, there's a heck of a lot of new infrastructure capital costs associated with new expansion of a community--costs that wouldn't be incurred without the new construction. (The rest of your comment notes how precious a commodity water is, and how difficult it is to secure access to more of it.) Instead of loading those costs on to people already living in town, the municipalities put the costs on the developers, who in turn pass them on to the new home buyers.

If you were to instead demolish an existing home and replace it with a new one of similar size, the building permit costs would be far less than $30,000, since the home would already have water, sewer, roads, electrical service....

Re:but (1)

thejynxed (831517) | about 1 month ago | (#47146627)

That is only true based on the local and state laws where you may happen to be. Where I am for instance, it doesn't matter if you're doing a complete rebuild of a property that already has hookups, all permits are treated as "new builds" for the purposes of connecting to sewer, water, electricity &/or natural gas.

Re:but (2)

thaylin (555395) | about 1 month ago | (#47146661)

Still, water connection is a construction cost, not a permit cost. It is a requirement to pass inspection.

Re:but (1)

Curunir_wolf (588405) | about 1 month ago | (#47146935)

The purpose of development charges is to defray (some of) the costs to local government that they would otherwise incur for doing things like connecting your new home to the water, sewer, electrical, and any other utilities;

Except there is no legal way to opt out of those things, due to revenue-generating requirements in the local ordinances. So that makes it just as onerous and unnecessarily expensive. That is, you can't just say "I will be using X and Y homesteading technologies to supply my own water, sanitation, and power".

construction of roads and streetlights;

Those things are provided by local property taxes, developer stipends, and other fees unrelated to specific new home construction. And, again, there is no provision for allowing discounts / credits for putting in your own security lighting at the street, or having built your own access road.

construction and purchase of additional emergency services equipment (fire trucks and fire houses, etc.); construction or enlargement of water reservoirs, sewage treatment plants, and electrical substations....

Again, there are developer fees and stipends as well as property taxes that pay for these things. You're claiming that the local government is required to double, triple, and quintuple -dip because every stage of development planning is subject to multiple levels of zoning, land use planning, urban development planning, and developer approval requests all of which the government gets more dips. Presumably the government should already be ready for this new single family, because the lot is available, sold, zoned, and all it needs now is 4 walls and a roof - but, no, you'll need to double your budget because the local Lord needs his tribute, shitizen!

Re:but (2)

Curunir_wolf (588405) | about 1 month ago | (#47146953)

If you were to instead demolish an existing home and replace it with a new one of similar size, the building permit costs would be far less than $30,000, since the home would already have water, sewer, roads, electrical service....

This is actually 100% false. Instead, it would cost you more, because now you have permitting from several agencies required for the demolition and removal of debris, and you still have to pay all the concomitant costs required for new construction.

Re:but (2)

thaylin (555395) | about 1 month ago | (#47146279)

Your first comparison of 42000 to 30000 does not prove your point, and your using of a seasoned contractor twists the argument. A seasoned contractor gets his materials from bulk, not typically time of year. Also part of building costs are the appliances, such as stove, which are considered in most places as part of the house.

Re:but (1)

Anonymous Coward | about 1 month ago | (#47146395)

Oh, did I mention that people on municipal water are being subjected to restriction? No new wells are being permitted, so you can only build where there is municipal water, which is mostly really bad here?

Yeah, what could be the reason for that? A years-long drought perhaps?

Unless you want to personally finance the massive cost of new aqueducts and reservoirs, you can deal with being prohibited from further draining the water resources we all share.

Re:but (0)

Anonymous Coward | about 1 month ago | (#47146977)

What kind of moron moves to a desert and expects water to be plentful and chep?

Re:but (1)

standbypowerguy (698339) | about 1 month ago | (#47146641)

re I live, it costs more in permits than materials to build a two-bedroom house.

Bullshit.

Even in the most expensive parts of the country, you could barely manage to build an uninhabitable, unfinished shell of a house for the price of a building permit.

It's not the cost of the building permit itself, per se, but the hidden cost of kickbacks...

Re:but (1)

aurizon (122550) | about 1 month ago | (#47146865)

Well, If you build a new house in Toronto as part of a development you are forced to pay an infrastructure fee = huge cost. If you build on an existing infill lot it is a lot less, and cheapest is if you buy a house, tear it down and build a new one.
This process can take years because it is part of a scheme to increase housing costs

Re:but (-1)

Anonymous Coward | about 1 month ago | (#47145915)

I doubt there are many countries that have laws preventing the serving of hot beverages. Yet only in America does it result in a lawsuit...

Re:but (4, Informative)

jythie (914043) | about 1 month ago | (#47145957)

Ah, that old case. It should be noted that there were actually hundreds of injury cases associated with their coffee. They had really bumped up the temperature to unsafe levels and were fully aware that that the standard accidents people had with beverages were resulting in significant burns compared to normal serving levels. The government should have intervened long before that, but they did not because civil suits were the 'solution'.

The problem was not that it was 'hot', but that they were serving it much hotter then would be typical since that was cheaper then using cups with marginally more insulation.

Re:but (1, Informative)

will_die (586523) | about 1 month ago | (#47146229)

The coffee was not at an above normal temperature, in fact the temperature is lower then the temperature recommended by various coffee drinking group.
The way the low temperature got in was the lawyer sueing went around to places that were selling less amounts of coffee and recorded the temperatures of those places.
McDonalds stilll tells its franchises to sell at the temperature of the lawsuit and if you purchase from any major coffe chain that is the temperature range you will mostly likely get.

Re: but (0, Flamebait)

Anonymous Coward | about 1 month ago | (#47146299)

Drink the fox FUD much? You really have no clue do you?

Normal coffee temp is not 190 degrees. Try spilling some water that was just boiling on yourself, now that is what happened in this case.

Re: but (3, Informative)

Dishevel (1105119) | about 1 month ago | (#47147111)

Right from the National Coffee Association USA [ncausa.org]

Your brewer should maintain a water temperature between 195 - 205 degrees Fahrenheit for optimal extraction. Colder water will result in flat, underextracted coffee while water that is too hot will also cause a loss of quality in the taste of the coffee. If you are brewing the coffee manually, let the water come to a full boil, but do not overboil. Turn off the heat source and allow the water to rest a minute before pouring it over the grounds.

So, Umm....

The real thing to know here is that no one at the time did not know that McDonalds coffee was really hot. Many went there for that reason. Fuck that bitch.

Re:but (2, Informative)

UnknowingFool (672806) | about 1 month ago | (#47146531)

From the trial, the plaintiff had documented evidence where McDonald's told their restaurants to keep coffee at 180-190 F. This is 30 F from boiling. The recommended temperature is between 155 and 175 for taste and comfort considerations.

Re:but (0)

Anonymous Coward | about 1 month ago | (#47146387)

coffee and tea is made with near boiling water so of course it is hot, so what now they have to wait for the fresh coffee to become lukewarm before they serve it?
because some people think it is McDonalds fault they are clumsy

Re:but (2)

deniable (76198) | about 1 month ago | (#47146233)

Coffee hot enough to give 3rd degree burns to the genitals will probably get a lawsuit anywhere. That case gets trotted out as a negative example every time, but if you take the time to read up on it, it's the opposite.

Re:but (3, Insightful)

Truth_Quark (219407) | about 1 month ago | (#47146321)

Quite.

The lady's labia melted to her thigh [blogspot.com.au] .

It was not a frivolous law suit.

Re:but (4, Informative)

seebs (15766) | about 1 month ago | (#47147105)

That's a vast oversimplification. [stellaawards.com]

Most significantly, the temperature people generally serve coffee at is, in fact, hot enough go give third-degree burns. The general recommended temperature to store coffee at before serving is 185 degrees (farenheit, obviously). The truth is neither that the lawsuit was totally frivolous, nor that it was totally justified, but that this was a complicated situation with a number of issues that generally get glossed over.

Re:but (1)

mmell (832646) | about 1 month ago | (#47146519)

There's no law preventing the service of extremely hot beverages here. There is a precedent in US civil law that doing so could leave one open to lawsuit. That's just one bad example. Not all civil lawsuits in the US are that idiotic; nor are the judgements rendered.

As has been noted elsewhere, McDonald's hasn't changed the brew temperature for their coffee, although I thought I'd heard somewhere that they did drop the hold temperature for coffee down somewhat. I could be mistaken on that point, but I do know that now they label their coffee cups with a message to the effect "this cup contains hot liquid. Do you think you can avoid spilling it in your crotch? Can you? Huh?" After all, I don't think McDonalds ever said their coffee was good for bathing genitalia.

Re:but (0)

Anonymous Coward | about 1 month ago | (#47145981)

and the civil suit system was built to support that.

Civil suits are enforced by the government. That's not an example of handling one's own problems at all.

Re:but (5, Insightful)

dbIII (701233) | about 1 month ago | (#47146009)

Before you blow your own trumpet too much consider the very bad US example of moving copyright from civil to criminal law which has spread like a cancer around the world. It would be very nice if it went back to Hollywood lawyers suing people instead of SWAT teams through people's windows for copyright violations.

SWAT. MPAA. RIAA. (2)

mmell (832646) | about 1 month ago | (#47146547)

Everyone's so worried about the three-letter organizations. Guess we'd better worry about the four-letter ones (best described using four-letter words).

Re:but (1)

bobbied (2522392) | about 1 month ago | (#47146593)

Silly lawsuits are the American way! It's well known all around the world.

I suggest we fix it... One simple rule change will do it. If you file suit and loose, you pay both sides' legal fees.

This would make it less likely for folks to file marginal lawsuits .

Re:but (4, Insightful)

Hotawa Hawk-eye (976755) | about 1 month ago | (#47146873)

So John Smith files suit against MegaCorp Inc. (with a legitimate claim) but MegaCorp's army of lawyers buries Smith in motion after motion, draining his coffers dry. When he loses (because he doesn't have enough money left to continue) he's on the hook for the millions of dollars in expenses MegaCorp's army of accountants can somehow link to the case.

There needs to be some protection for this situation, but there also needs to be consequences for "spaghetti suing" -- filing lawsuits against anyone and everyone and seeing which ones get settled and which ones stick. Maybe a superlinear increase in the cost to file suits based on the number of suits you've filed? If you want to file suit in a given issue against two or three people, you're not going to pay much extra, but if you want to sue a hundred people separately you're going to pay through the nose. [And you're not allowed to "lump together" people without showing a good reason to lump them together.]

In soviet america troll patents you! (-1)

Anonymous Coward | about 1 month ago | (#47145811)

That's all I've got this morning without coffee.... Thanks I'll be here all week, try the fish!

Sounds awesome except.... (5, Insightful)

Anonymous Coward | about 1 month ago | (#47145813)

The Patent troll will probably just declare bankruptcy and reform under a new name, all in the same day.

Not even looking at how it is structured I'd blindly wager that they are held by no fewer than two shell companies. So the problem is that the people pulling the strings never suffer any real repercussions.

Sounds awesome except.... (5, Insightful)

Anonymous Coward | about 1 month ago | (#47145837)

The problem is also that the USPO granted the patent in the first place :/

Re:Sounds awesome except.... (5, Insightful)

fuzznutz (789413) | about 1 month ago | (#47145913)

The problem is also that the USPO granted the patent in the first place :/

Amen. The "experts" who are supposed to know better are accepting these bullshit patents all the time. The courts have to sort it out while the victims get to pay. How about we personally make the patent examiners financially liable for the costs involved in defending one of these bullshit patents. I'd bet that they'd be looking at these patents with a much more critical eye then...

Re:Sounds awesome except.... (2)

Jason Levine (196982) | about 1 month ago | (#47146083)

The patent examiners are approving patents figuring that the courts will sort it all out. And the courts just assume by default that the patent examiners did their job and reviewed the patent. The end result is patents that shouldn't have been granted being held up in court or requiring lengthy, expensive litigation to get invalidated. I completely agree that there needs to be some accountability in these patent applications. If one of your patent applications is overturned by the courts, you go on probation for two years. If, while on probation, another patent you approved is overturned, you are fired. Furthermore, if you go on probation three times, you are fired. Maybe this would make the patent examiners think a bit more before approving patents.

Re:Sounds awesome except.... (3, Interesting)

Anonymous Coward | about 1 month ago | (#47146119)

The problem is that there are not enough examiners. Apparently as an examiner you have about 2 minutes to look at a patent and say yay or nay.

Re:Sounds awesome except.... (4, Interesting)

deniable (76198) | about 1 month ago | (#47146271)

You're also expected to be a subject-matter-expert on every application that crosses your desk. And remember, you have 2 minutes to review an application written by lawyers paid to write confusing applications.

Re:Sounds awesome except.... (5, Interesting)

msauve (701917) | about 1 month ago | (#47146421)

"you have 2 minutes to review an application written by lawyers paid to write confusing applications."

This.

Patents are supposed to be provided in exchange for an inventor disclosing the invention for future public benefit. But, they're written in such an obtuse manner that they can't be used that way - they're expected to be used to extract money out of the people who come up with something similar, not provide a workable explanation of how to make something useful.

The solution is for examiners to simply outright reject any patent which isn't readily understandable. A person "skilled in the art," shouldn't have to learn deliberately obtuse patent-speak to even begin to understand a patent.

Re:Sounds awesome except.... (0)

Anonymous Coward | about 1 month ago | (#47146709)

That *was* the pattern, and probably still would be, but the USPTO changed their employee evaluation criteria to be based on the number of patents *approved*, not *evaluated*.

Re: Sounds awesome except.... (0)

Anonymous Coward | about 1 month ago | (#47146781)

Approvals are where the money is.

Re:Sounds awesome except.... (5, Insightful)

stealth_finger (1809752) | about 1 month ago | (#47146827)

You're also expected to be a subject-matter-expert on every application that crosses your desk. And remember, you have 2 minutes to review an application written by lawyers paid to write confusing applications.

Well if the examiner cant understand it immediately, they should deny it, if in doubt dent. Yeah I know they get paid for approvals and all that but really, the whole system sucks, it needs pulling out, burning, having the ashes jumped on then started again using common sense.

Re:Sounds awesome except.... (3, Funny)

stealth_finger (1809752) | about 1 month ago | (#47146841)

Well if the examiner cant understand it immediately, they should deny it, if in doubt dent. Yeah I know they get paid for approvals and all that but really, the whole system sucks, it needs pulling out, burning, having the ashes jumped on then started again using common sense.

Or if it isn't immediately obviously what the patent is even for.

Re:Sounds awesome except.... (4, Insightful)

swillden (191260) | about 1 month ago | (#47146295)

The problem is that there are not enough examiners. Apparently as an examiner you have about 2 minutes to look at a patent and say yay or nay.

Which means we either need more examiners... or fewer patent applications. What's really bad is that the current state is a vicious cycle. If any patent application is likely to be approved, then people will submit more applications, which increases the workload on patent examiners, reducing the time they have to look at a patent, and increasing the likelihood that any patent application that appears on its surface to be novel and to have referenced the appropriate prior art will be approved.

Further exacerbating the problem is the fact that patent portfolios so often do battle by "weight". If company A has 10,000 patents and company B only has 5,000 patents, it's much easier for B to pay A some money and both to enter a cross-licensing agreement than to actually determine which of the 15,000 patents has value and is relevant. So, companies incent their technical people to patent all sorts of silly crap. More applications, more applications per examiner, less time per application, lather, rinse, repeat.

IMO, we need to take a big step back and re-examine the whole system. I've been arguing for a long time that there's a very simple test we should be using to evaluate the effectiveness of the patent system which is supposed to be encouraging progress (not paying inventors, note. If that happens, well and good, but it's not the goal). The way patents are supposed to promote progress is by publishing details of the inventions so that other inventors can use the ideas and build upon them. The licensing fees patent owners can receive as a result are their incentive to publish, rather than keeping their ideas as trade secrets.

So, to see if the system is working well, we just need to look at how often the patent database is used by inventors as a resource when they're looking for solutions to problems they have. If the patent system were working, we'd see the database being mined for ideas, and companies happy to pay licensing fees for useful inventions that help them build their products more cheaply than if they'd had to invent it all themselves.

Re:Sounds awesome except.... (1)

phorm (591458) | about 1 month ago | (#47147063)

So it's not "not enough examiners" but rather "not enough time to examine" and probably "too many patent applications."

Why too many patent applications? Because companies have decided that's it's a potential goldmine (or landmine depending on which side of the patent suit you're on). If you reduce the b.s. patent cases or approved B.S. patents (or add a penalty for filing truly B.S. patents), then you reduce the attraction to filing tons of crap patents, which results in less work on the shoulders of the examiners.

Re:Sounds awesome except.... (3, Interesting)

sjames (1099) | about 1 month ago | (#47146513)

Change that to their boss is fired and it might work.

Re:Sounds awesome except.... (4, Insightful)

StripedCow (776465) | about 1 month ago | (#47146111)

The problem is that USPTO is getting paid *more* for every approved patent than for every rejected patent application.

Like it was said before here, this is like paying fishermen for the fish they *didn't* catch.

Re:Sounds awesome except.... (4, Insightful)

ConfusedVorlon (657247) | about 1 month ago | (#47146589)

Whilst I agree that a lot of bad patents are certainly granted, I actually think the systemic problem here is actually the review process after the initial grant.

Even if USPO was a lot better, then it is safe to assume that some crappy patents would get through when an examiner was having a bad day.

It's ok to have errors like that if you have a decent fast review process to fix mistakes.

This might be something that a judge could request before a case went to trial.
The patent would be re-reviewed by a senior patent examiner who would make an new judgement:

1) this probably should not have passed. (Inventor can appeal, but legal process assumes that patent is invalid until the appeal).
2) this is a solid patent that probably should have passed. (the infringer can appeal, but legal process assumes the patent is valid until the appeal).

given that only a tiny fraction of patents will ever get taken to court, this isn't adding a huge amount of re-work to the USPO, so they can handle this stream as a high priority.

This does somewhat reduce the certainty of the initial patent grant, but that is no bad thing.

Re:Sounds awesome except.... (1)

Duhavid (677874) | about 1 month ago | (#47146883)

Another problem. If the patent troll has already threatened litigation against others, and those others caved & paid, there is ( in my opinion ) undeserved income.
If it is shown in a subsequent court case that the patent troll's claim was unsupportable, it was unsupportable to begin with, any monies paid should be reimbursed.

Sounds awesome except.... (0)

Anonymous Coward | about 1 month ago | (#47146937)

How about the tech companies sue the USPTO to recover damages ? That way, the USPTO will be more diligent in their duties. I understand they are understaffed and all, but that is no excuse for granting bogus patents. The best way to stop this scam is to hit USPTO where it hurts - their pocketbook. The USPTO is not a neutral third-party in this dispute.

Re:Sounds awesome except.... (3, Insightful)

jythie (914043) | about 1 month ago | (#47145839)

That is part of the reason that these 'looser pays' rules make me nervous. Truly bad actors like patent trolls have lots of ways around actually paying out, but small shops or inventors generally do not, so all it does is increase the risk associated with taking on companies with more resources.

When filing a lawsuit you generally only have to consider spending what you can afford, but having to consider what the other party can afford changes the equation dramatically.

Re:Sounds awesome except.... (4, Funny)

fuzznutz (789413) | about 1 month ago | (#47145925)

That is part of the reason that these 'looser pays' rules make me nervous..

Would you feel better if it was 'tighter pays'?

Re:Sounds awesome except.... (1)

Anonymous Coward | about 1 month ago | (#47146139)

Well, if they're so tight then it's about time they paid!

Re:Sounds awesome except.... (2)

present_arms (848116) | about 1 month ago | (#47146437)

Now that sounds just slack :P

Re:Sounds awesome except.... (0)

Anonymous Coward | about 1 month ago | (#47145935)

That is part of the reason that these 'looser pays' rules make me nervous.

Well, the one who is more loose is bound to have more money, eh?

Re:Sounds awesome except.... (1)

Anne Thwacks (531696) | about 1 month ago | (#47146187)

I want the moose to pay!

Re:Sounds awesome except.... (1)

ruir (2709173) | about 1 month ago | (#47145973)

For sure, and when you have very well known companies that are more than happy to "negotiate" with trolls for them to make more difficult to small players doing their business, you really dont have any ideia how much "the other party" can afford.

Re:Sounds awesome except.... (1)

ruir (2709173) | about 1 month ago | (#47145987)

How that plays with off-shored companies? Here small, family owned, incorporated companies play that game all the time, specially in the construction and textiles sector, and often both the IRS and their suppliers do not see a dime.

Re:Sounds awesome except.... (0)

Anonymous Coward | about 1 month ago | (#47146591)

How that plays with off-shored companies? Here small, family owned, incorporated companies play that game all the time, specially in the construction and textiles sector, and often both the IRS and their suppliers do not see a dime.

It's a completely different situation when dealing with patent trolls. In your example, the company has no real assets to take. The patent troll has NOTHING except assets - patents - and those assets are grants from the Federal government. As a creditor in the bankruptcy, you'll just have the patents assigned to you to satisfy the judgment. And then you can go out and become a troll.

Re:Sounds awesome except.... (1)

bobbied (2522392) | about 1 month ago | (#47146673)

That is part of the reason that these 'looser pays' rules make me nervous. Truly bad actors like patent trolls have lots of ways around actually paying out, but small shops or inventors generally do not, so all it does is increase the risk associated with taking on companies with more resources. When filing a lawsuit you generally only have to consider spending what you can afford, but having to consider what the other party can afford changes the equation dramatically.

Good point. But looser pays has good aspects too. How about we modify it by requiring an escrow account where the filer is required to either put up a percentage of expected legal fees, or allow leans on the personal property of the principles of any corporation that files? Claims on personal property would require court action to prove who the person or persons who made the decision to sue was, but this would put a huge damper on marginal lawsuits.

They do this kind of thing in other countries, so Looser Pays is not without it's good points too.

Re:Sounds awesome except.... (4, Insightful)

Anonymous Coward | about 1 month ago | (#47145863)

The Patent troll will probably just declare bankruptcy and reform under a new name, all in the same day.

Not even looking at how it is structured I'd blindly wager that they are held by no fewer than two shell companies. So the problem is that the people pulling the strings never suffer any real repercussions.

What's more important than whether or not this particular company actually pays, is that the precedent is being set and the tides are shifting, hopefully making others think twice before filing frivolous lawsuits.

Re:Sounds awesome except.... (4, Informative)

Attila Dimedici (1036002) | about 1 month ago | (#47145891)

If FindTheBest is willing to spend the money on lawyers and court costs, that will not protect the patent troll. There exists a legal basis for "piercing the corporate veil". Dissolving the corporation and forming a new corporation with the same assets(in this case, patents) is a classic example of where that can happen and what that very concept was created for.

Re:Sounds awesome except.... (4, Interesting)

rapturizer (733607) | about 1 month ago | (#47146047)

FindTheBest probaby will spend the money. The good part of this ruling is that there are law firms that will seek out small businesses to defend them from deep pocketed patent trolls. They will develop the methods to aggressively pursue the money, and will even be happier if they find trolls that send out nearly identical letters to multiple companies and can achieve class action status. In my opinion, this may be one of the few good reasons for these law firms to exist.

Re:Sounds awesome except.... (0)

StormReaver (59959) | about 1 month ago | (#47146169)

Dissolving the corporation and forming a new corporation with the same assets(in this case, patents) is a classic example of where that can happen and what that very concept was created for.

Which is VERY easy to skirt:

1) Form a new corporation, issue stock (tada, new ownership free of liability).
2) Declare bankruptcy on the old corporation (triple point score if it's incorporated in Delaware).
3) Liquidate the assets of the old corporation to the new corporation for a pittance.
4) Shutter the old corporation.
5a) Next victim, please.
5b) Thumb your nose at the judge, who is now powerless.

Re:Sounds awesome except.... (1)

Attila Dimedici (1036002) | about 1 month ago | (#47146267)

Actually, no it is NOT that easy. If a company purchases all of the assets of a bankrupt corporation (or the majority) it becomes liable for the bankrupt corporation's debts.

Re: Sounds awesome except.... (-1)

Anonymous Coward | about 1 month ago | (#47146337)

Ding ding, oh wait wrong, most civil suits can be discharged in bankruptcy.

Re: Sounds awesome except.... (3, Informative)

UnknowingFool (672806) | about 1 month ago | (#47146655)

"Can be" and "will be" are two different terms. When going into bankruptcy, not all suits and judgements are automatically negated when a company files for bankruptcy. A court still has to determine if the suit can proceed and which debts are still valid. The main thing that bankruptcy does is to stop the suit until a court rules on it.

Re:Sounds awesome except.... (0)

Anonymous Coward | about 1 month ago | (#47146357)

If a company purchases all of the assets of a bankrupt corporation (or the majority) it becomes liable for the bankrupt corporation's debts.

That's *so* close to being right. the only part wrong is....the whole fucking thing.

Re:Sounds awesome except.... (1)

Paradise Pete (33184) | about 1 month ago | (#47146377)

The court also found the patent to be invalid, which just might be slight hinderance to that plan.

Can work. Can also fail. (1)

mmell (832646) | about 1 month ago | (#47146599)

I knew some guys who had done that three times previously. The fourth time they went for it, the court noticed it and seized everything. Their company went into receivership until the court was able to sell it - patents, inventory and all. The guys pulling this scam lost (after winning huge three times in succession).

Re:Sounds awesome except.... (3, Insightful)

alen (225700) | about 1 month ago | (#47146035)

you need money to litigate a patent suit. if you had cash in the bank to pay the bills and it vanishes the day before you file chapter 11, the court is going to start asking questions and auditing your books

Re:Sounds awesome except.... (1)

Anonymous Coward | about 1 month ago | (#47146039)

In that case the so called "patents" held by the company should be treated as assets and used to pay off its debts. Starting with the judgement for court costs.

Re:Sounds awesome except.... (4, Interesting)

Greyfox (87712) | about 1 month ago | (#47146141)

If you have a claim to their assets, you could probably still go after all the patents that company owns and presumably any of the licensing fees they had managed to collect. Denying the people pulling those strings as much money as possible still has some value. Now that the precedent has been set, more companies might elect to pursue this course of action, which could put a serious dent in the patent troll business plan. And if you suspect a corporation has just been formed to serve as an alias, you can still go after the assets of the individuals holding that corporation.

It's a bigger problem (0)

Anonymous Coward | about 1 month ago | (#47146381)

Eliminate "limited liability" for corporations and expect business owners to buy liability insurance instead. There's no limit to the damage they impose on the rest of society, so there should be no limits to our restitution. Take their mansions, their sports cars, and send their kids to public school.

Re:Sounds awesome except.... (1)

aurizon (122550) | about 1 month ago | (#47146891)

At first this will happen, but then judges will request a fee bond from these numbered companies, which will pay the fees to the winner if the troll loses.

Re:Sounds awesome except.... (0)

Anonymous Coward | about 1 month ago | (#47147115)

Not really. Patents are assets, and as such the creditors in a bankruptcy proceeding can force their sale on the open market for reimbursement. So no, they won't be hanging a new shingle tomorrow, at least not with that patent arsenal.

Ummmm (0)

Anonymous Coward | about 1 month ago | (#47145885)

'prototypical exceptional case'

Well which one is it? Prototypical? Or exceptional?

Re:Ummmm (2)

r1348 (2567295) | about 1 month ago | (#47145927)

Exceptionally prototypical.

Re:Ummmm (2)

Immerman (2627577) | about 1 month ago | (#47146633)

Parsing error detected, should be: prototypical "exceptional case"
The anti-patent-troll loser-pays law applies to "exceptional cases" (presumably from context that's a step beyond just bad faith), and this is a prototypical example.

Patient Troll 2: The Revenge (0)

Anonymous Coward | about 1 month ago | (#47145965)

(Like a bad movie) This time it's personal!

My favourite sentence (5, Interesting)

Anonymous Coward | about 1 month ago | (#47146023)

My favourite sentence from the summary in the first link:

The patent troll's attorney also made the claim that calling someone a 'patent troll' was actually a 'hate crime' under 'Ninth Circuit precedent' and threatened to file criminal charges — unless they settled the civil case immediately, apologized, and gave financial compensation to the troll.

Re:My favourite sentence (5, Insightful)

Anonymous Coward | about 1 month ago | (#47146175)

My favourite sentence from the summary in the first link:

The patent troll's attorney also made the claim that calling someone a 'patent troll' was actually a 'hate crime' under 'Ninth Circuit precedent' and threatened to file criminal charges — unless they settled the civil case immediately, apologized, and gave financial compensation to the troll.

That is the worst thing I've ever read!!! It's the kind of thing a lawyer should be disbarred for. The kind of thing that would make me willing to bankrupt myself and my company just to punish the company and attorney. Ugh that's the worst!!!

Re:My favourite sentence (2)

TheDarkMaster (1292526) | about 1 month ago | (#47146207)

Here you simply kill this type of lawyer.

trolls (1)

Tim Leath (3514895) | about 1 month ago | (#47146073)

and what is the latest news in the prenda soap series ? or has that all quietly been dealt with and they forgot to tell anybody,not heard a whisper in months...

What this means (1)

slashmydots (2189826) | about 1 month ago | (#47146075)

Oh good! So now if some Chinese copycat company with no morals rips off my company's technology and I sue them then they spend 10 million on lawyers and beat my small company, I have to pay that bill for them. Fantastic!

Re:What this means (1)

Registered Coward v2 (447531) | about 1 month ago | (#47146143)

Oh good! So now if some Chinese copycat company with no morals rips off my company's technology and I sue them then they spend 10 million on lawyers and beat my small company, I have to pay that bill for them. Fantastic!

Not really. If you have legitimate claim and litigate in good faith then you are unlikely to get hit with paying the winner's expenses; while adding significant financial risk to the "they'll settle because it's cheaper to than fight even a bogus claim" business model.

Re:What this means (1)

yacc143 (975862) | about 1 month ago | (#47146145)

LOL, considering that the *US* courts are really known for finding for foreign companies.

Re:What this means (1)

gnupun (752725) | about 1 month ago | (#47146779)

Okay, what if MS or Oracle were the big company in this scenario? Lawyers charge between $250 and $500 per hour. So imagine the small company loses and has to pay these lawyer costs.

This law is partially stupid. Why was a troll patent issued in the first place? It was because the USPTO has few resources. But before going to trial, can't the USPTO do a 2nd detailed review and eliminate any troll patent based on complaints from the defendants? Note troll patents are those patents that are trivial changes to prior art. So it should not take much effort to invalidate it if the defendant has some evidence of prior art.

I thought the bill that made losers pay was recently rejected. So how did the judge make this ruling?

Re:What this means (1)

ewieling (90662) | about 1 month ago | (#47147079)

If the small company loses then paying the patent trolls legal costs is the least of their worries.

Re:What this means (1)

UnknowingFool (672806) | about 1 month ago | (#47146713)

Um no. Read carefully. In this case and in the Octane Fitness [wikipedia.org] , the courts have ruled that defendants in patent troll cases can be awarded attorney's fees as these cases are "exceptional". In your case, if you have valid IP and a valid case, then at worst you lose the case and have your own attorney's fees to pay.

Re:What this means (0)

Anonymous Coward | about 1 month ago | (#47146729)

Not likely, but an american copycat with no morals might. Are you some kind of FUD spreading racist?

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