Magnet Patent Suits

toybuilder writes: "Magnequench holds a key patent on high-power neodymium-iron-boron (Nd-Fe-B) magnets that they claim is worth almost 1/2 of the world's permanent magnet market. These magnets are in use everywhere including motors in CD/DVD drives and in actuators in camcorders. They are suing a whole lotta companies including Compaq and HP. You can see the AP newswire at Yahoo or read the company's press release."

Comments

Re:The New New Economy

[Anonymous Coward]

*Sigh* Don't people have the slightest idea of the subject they are commenting on. I have a little idea and it seems to be far above what you know (this is UK centric).

1) Trademark - Has to be applied for, has to be defended to continue existing. Never expires.
2) Copyright - Automatically granted, can be defended at anytime. Lasts life of author+70 years.
3) Patent - Has to be applied for. You can defend it at any time. last 25 years.

Maybe there should be a freqently asked questions section for slashdot?

Some suggestions are - How long do copyrights last? how long to patents last? Do you have to defend copyright to keep it? Do you have to defend patents to keep them? Should I post on Slashdot if I have no idea in the slightest of what I am talking about? If I put IANAL does that mean I can talk crap?

How long has Compaq been making magnets?

[Redwire]

I really don't see why Compaq, Sony and every other tech manufacturer you can name should be sued because they're using the 'illegal' magnets in their products, unless they are actually manufacturing them. How much responsibility should a company have to audit their supplier? How can anyone be expected to make something if they have to keep going over their suppliers books?

Why stop here? What happens if I work for Compaq's Magnet Supplier, and I get sexually harassed while on the job. Shouldn't I be able to sue Compaq? Aren't they somehow responsible for... well, something?

If it's a valid case, sue the magnet manufacturers, not the 'end users' such as Compaq and Sony.

Re:I hope they don't make fridge magnets

[kzinti]

Those little magnets are just awesome. I've been salvaging magnets from failed and obsolete disk drives for years, and have a nice collection of these insanely strong critters. My best acquisition was a set of four that came out of a nine-platter SCSI drive.

I love handing a pair of these little magnets to an unsuspecting guest, and ask them to separate them for me. One guy actually told me they were glued together, until I showed him how to slide the magnets apart to separate them.

Another good trick to do with an old (but functional) drive, before you take its guts out: take the cover off, hook the drive up, and run fsck on its contents while you mess with its guts. Touch the center of the platter stack to slow them down. Use a marker to write on the spinning platters. Put your finger on the center of rotation of the arms the R/W heads are mounted on. See how much abuse the drive will take and still function (I was kind of surprised).

I also like to salvage the disk-platter assemblies and set them out as objets d'art. They're really quite pretty!

--Jim

The Redifinition of the American Dream

[FreeUser]

What we are witnessing, and living through, is the decline of our civilization. This country was founded on high ideals and moral principles. Sadly, the ultimate goal today is to ruthlessly make as much money as possible. The current rampant abuse of the patent system is just the tip of the iceberg.

At one time the "American Dream" had little to do with money directly. It used to be the notion that one could go to a free country and achieve everything they were capable of, without governmental hinderence. For some people this was the practice of their non-mainstream religion, for others it was the persuit of philosophies or studies suppressed elsewhere, for other the chance to explore the unknown, and, yes, for some it was the opportunity to persue wealth.

Now, the media have all come together and redefined the "American Dream" solely in terms of the persuit of wealth, even going so far as to equate it with winning the lottery (as if, prior to the 20th century, there had ever even been such an absurd notion).

At one time laws were intended to benefit society, and the production of wealth was but one component in an entire series of concepts which together were required to benefit society (others included free education, libraries, fire department and water services, land grants, etc.) This is not to say society was ideal, as at the same time there were horrific things going on (the enslavement of black Americans, the wholesale theft of land from native Americans, etc.), but only to point out that, at one time, laws and politicians were expected to serve the voting population of the country, and to a fair degree did so.

Now there isn't even the pretense of laws in the United States serving the American public, much less society as a whole. Is it any wonder, with our willingness as individuals (by and large) to sell every ideal down the river in the name of profit and income, that our government, as our representatives, behaves any differently?

Disgusting, yes, Reprehensible, yes. Self defeating and ultimately destructive (particularly with respect to government granted monopolies such as patents, copyrights, and other forms of IP), yes. But, given the direction the majority of the American people chose to go in 1980 and have continued toward since, hardly surprising. Fortunately for us, and the world, these sorts of things are self correcting, even if it means the US economy stagnating and even going third world before people become aware enough to start demanding the kinds of reforms which are necessary.

Exporting Patent Infringement

[Detritus]

I think the point of the lawsuit is that you can't dodge claims of patent infringement by outsourcing the production of the patented item to an overseas supplier who has figured out how to avoid paying royalties.

And no, this isn't patenting magnetism, breathing or any of the other tired clichés that get posted every time slashdot runs a story on patents. It takes real money and scientific research to invent improved permanent magnets.

Analyzing the combined picture

[Badgerman]

Let's take a look at this - having read the statements and the articles here, I think this illustrates more than "oh, darn those patents are so stupid."

1. The magnets are everywhere. This is a pretty lousy time to start suing people. I'd definitely say they haven't effectively defended their patent.
   
2. This illustrates that defense of patents is highly relative. If an idea becomes widespread quick enough, you can't possibly sue everyone.
   
3. From what I've read here, there's overseas investment involved in the company, specifically China. In the highly interconnected global economy, patents certainly seem like a potential weapon to me - a way to foul up other countries economies. We're too connected to be this stupid.
   
4. They've taken on some pretty heavy hitters, though in an awfully random way (Best Buy?). There's no guarantee they'll win - and this really shows that patents these days are not about principle, but about getting the court victory.
   
5. This legal action can probably be used by smart lawyers to undermine the current overdone patent/copyright legislation.
   

This is more than the usual stupid patent/copyright cases here. It illustrates a lot of the issues that need to be considered about patents, copyright, and intellectual property.

And I strongly reccomend people write Assistant Majority Whip Mike Pence (Republican, Indiana) on his statement. Let him know the above points, let him know the issues.

Re:Analyzing the combined picture

[pjrc]

Years ago, I worked on a pump design project which used some of these Nd-Fe-B magnets for a non-contact coupling mechanism. They are really quite amazing, and at the time they were relatively new. In the course of the project, I did quite a bit of reading about permanent magnets. Before these rare earth magnets were discovered, it was widely believed that Al-Ni-Co magnets were the strongest possible permanent magnet. The discovery that permanent magnets could be made with 3X to 8X the "strength" from rare earth materials, first Sm-Co and then Nd-Fe-B really was quite revolutionary, or at least "novel". It was also quite clearly "non-obvious".

Just because these magnets are now so widely used doesn't means that whomever did the R&D and ultimately "invented" them doesn't deserve a patent. There's a lot of bogus patents in the world, and IMHO, this probably isn't one of them.

Re:The New New Economy

[mindstrm]

No. There is no blanked law covering Intellectual Property Rights.

Patents do not have to be defended. You can selectively enforce them however you want.

Trademark is what you are thinking of; trademark must be enforced, or it no longer has meaning.

However.. I'm puzzled by Past Damages. I was under the impression that with Patent, you cannot claim past damages, only future dealings. You can't say 'We just discovered this company has been using our patented technology for the last 20 years'. Unless you can prove the company knowingly violated your patent (ie: you asked them before and they ignored you) you're probably out of luck.

Re:Does anyone bother reading the articles any mor

[BeanThere]

And incidentally, in 1995 the whole shebang was acquired by a Chinese holding company. Yes, a Chinese company suddenly has the potential to drastically affect a large portion of the American computer-manufacturing market. Does anyone think *that* might have interesting repurcussions worth discussing?

Gosh, you mean this might be an ATTACK on the GOOD GUYS from the EVIL CHINESE!?!? Uhm, lets see now ... the list of defendants includes Sony, Philips, Toshiba and Samsumg, none of which are American companies. It is truly amazing (and sad) how Americans simply cannot seem to see the anti-China propaganda for what it is.

-----

Re:I hope they don't make fridge magnets

[victim]

You would probably not want one as a fridge magnet. It would probably bend the front of your fridge as you pry it off.

If you ever have a hard drive go bad, you should get yourself a set of tiny torx drivers and disassemble it. You will find a pair of insanely strong magnets around the head positioning coil.

Watch your fingers, when those magnets take a notion to slam together they will pinch through your flesh.

note: the preceding should not be construed as instructions to bang your office mates computer up and down while operating in order to acquire a bad hard drive.

The decline

[Crusadio]

If nature has made any one thing less susceptible than all others of exclusive property, it is the action of the thinking power called an idea, which an individual may exclusively possess as long as he keeps it to himself; but the moment it is divulged, it forces itself into the possession of everyone, and the receiver cannot dispossess himself of it...He who receives an idea from me, receives instructions himself without lessening mine; as he who lights his taper at mine, receives light without darkening me. That ideas should be spread from one to another over the globe, for the moral and mutual instruction of man, and improvement of his condition, seems to have been peculiarly and benevolently designed by nature...Inventions then cannot, in nature, be a subject of property. --Thomas Jefferson

It was never the object of those laws to grant a monopoly for every trifling device, every shadow of a shade of an idea, which would naturally and spontaneously occur to any skilled mechanic or operator in the ordinary progress of manufactures. Such an indiscriminate creation of exclusive privileges tends rather to obstruct than to stimulate invention. It creates a class of speculative schemers who make it their business to watch the advancing wave of improvement, and gather its foam in the form of patented monopolies, which enable them to lay a heavy tax upon the industry of the country, without contributing anything to the real advancement of the arts. It embarrasses the honest pursuit of business with fears and apprehensions of concealed liens and unknown liabilities lawsuits and vexatious accountings for profits made in good faith. (Atlantic Works v. Brady, 1017 U.S. 192, 200 (1882)).

What we are witnessing, and living through, is the decline of our civilization. This country was founded on high ideals and moral principles. Sadly, the ultimate goal today is to ruthlessly make as much money as possible. The current rampant abuse of the patent system is just the tip of the iceberg.

A modest proposal for patent reform

[dublin]

I didn't say innovation wouldn't happen, just that without the ability to exclusively profit from innovations (real ones, not the MS kind), the pace of innovation *will* slow to a crawl.

The only problem with the US patent system (which is far and away the best in the world, and a primary driver behind American technological leadership over the past couple of centuries) is that it is blind to the huge differences in economic timescales across disciplines. I think 17 years should be enough for anything (if it can't be capitalized on in that timeframe, it's not *ready* for a patent!) Areas where innovation is more rapid should have shorter terms. I'm all for software patents, but I don't think they should be valid for more than five years.

So here I present Dublin's simple but excellent patent reform proposal:
The length of patent terms can and should be self-regulating: Make the length of term for new patents in each patent category (mechanical device, electronic hardware, software, etc.) inversely proportional to the average number of patents issued in the previous two quarters. (Note: that's "issued", NOT "applied for" - this discourages artificial manipulation.) This would automatically produce shorter terms as patent activity heats up (with a quick response time), and then lengthen them again once the pace of innovation slows, matching the growth patterns of the associated industries. Also, it ensures that the IP behind innovations is more quickly available freely in fast-moving areas. This tends to prevent the formation of long-term dynasties unless there is real and continual innovation to back it. (We might expect to see more innovation like that of Dyson in the UK and other companies *really* pushing the state of the art under such a plan.) Interestingly, this could make patents (especialy early and really innovative ones, which will have longer terms) *more* valuable than they are today, while still making technologies more rapidly and readily available for society at large.

Reasonable upper and lower limits should apply to the patent terms: I'd argue for 17 years upper and 5 years lower (although I could perhaps be persuaded to consider 3 or 4 years as a lower bound in extraordinary circumstances - nothing shorter makes any economic sense.)

This relatively simple and straightforward change would fix the aspect of the patent system that most vexes its foes, while still retaining all the best features of a system that has proven its inestimable value over the past two centuries. In other words, it only fixes what's broken, which is a very good thing. I can envision no alternative type of patent reform that has such advantages for the inventors, for the creation of vibrant markets, and can ensure that a proper balance is struck between protecting the innovator and freeing the innovation for the use of all in a reasonable timeframe.

Indemnity is not immunity

[werdna]

I don't understand the logic here. Compaq and HP have contracts with their suppliers that specify that the suplier must comply with any and all applicable patents. Why does the fact that Compaq and HP have money make them liable for the actions of others?

If they made, used, sold, offered for sale or imported an infringing apparatus, they are liable to the plaintiff. Their contracts with other persons might give them a cause of action for indemnity or contribution (if collectible, of course), but that doesn't get them off the hook -- they still owe the plaintiff the dough, and if their indemnitors go under, they are stuck holding the bag.

Yes, this means an indemnification and hold harmless provision from an uncollectible poor guy is virtually meaningless in practice -- at best it may give the poor guy some deterrence.

Them's the breaks.

Re:What I would like...

[1010011010]

Lots of countries don't give a fried fart about U.S. patents -- outside the U.S. However, they cannot participate in our economy unless they do 'respect' them here.

Interestingly, the U.S. was the "China" of its day when the country was first founded (with a little more freedom for its citizens, of course). Cheap manufacturing, a lack of regard for copyrights and patents from other countries. Plus, the U.S. defaulted on its debts quie a bit.

Slightly hypocritical of us to complain about people doing that to us, now...

Some other people have noted that Magnequench is a Chinese company -- but their World Headquarters is in Anderson, Indiana. So they look like a U.S. firm. They have a "Technology Center" in the RTP area, just up the road from me. They make their materials in China. The Chairman of their Board is Chinese.

However, according to their "timeline," General Motors, Sumitomo Metals and the Chinese Academy of Sciences all discovered neodymium-iron-boron magnets in 1982. Magnequench was created as a "business unit" of GM in 1986. Then, in 1995,

Beijing San Huan New Material High-tech, Inc., China National Non-Ferrous Metals Import & Export Corporation, and an investment group led by Sextant Group, Inc. acquire Magnequench and establish Magnequench International, Inc

So, yes, they appear to be a Chinese company now.

Apparently Sumitomo Special Metals Co. licensed the magnet technology to San Huan New Material High-Tech Inc., which sells the stuff through Beijing San Huan International Trading Co. Sumitomo has this notice on their website:

"Notice : In the United States of America and Canada, you may use Sintered Neodymium-Iron-Boron Permanet Magnets, as the piece part magnet or as it's assembly, manufactured by the [above] licensees ONLY. Use of Sintered Neodymium-Iron-Boron Permanent Magnets made by non-licensee is prohibited by the Patent Law of the United States of America and Canada."

Sumitomo is a Japanese company that got its start in 1918 as Sumitomo Steel Works, Ltd. So it appears that, even though GM invented the stuff here, they sold it to the Chinese who now license it from the Japanese.

Ninbo Konit Industries Inc. is the only Chinese licensee of Magnequench and Sumitomo. They are also the largest manufacturer of NdFeB magnets in China. They are located in the "Ningbo Economic and Technical Development Zone" in Xiaogang, China. I.e., one of the pseudo-capitalist (mercantilist, really) enclaves in otherwise Communist China. Konit is actually owned by San Huan High-Tech New Materials. Apparently Tridus of Rancho Domingo, California founded San Huab New Materials in a joint venture with the Chinese Academy of Science. They claim to be "the only legitimate importing and marketing company for Chinese Sintered Neodymium Iron-Boron permanent magnets in North America."

Apparently these infringement suits have been going on for a while. In 1995, a suit was originated in the PRC and Hong Kong by Crucible Materials Corporation against San Huan New Materials, Tridus and Ningbo Konit, among others. Violation of patent #4,588,439 ("Oxygen containing permanent magnet alloy") was found and a Cease and Desist issued.



- - - - -

Does anyone bother reading the articles any more?

[BobGregg]

You know, aside from the obvious "yet-another-patent"-ness of this, there actually are some interesting points to be made, that if anyone (!) had bothered to read the actual article(s), they might have picked up on.

For instance, "Magnequench" is not some Johnny-come-lately. They started as a division of GE back in the mid-'80s. The magnet technology was originally discovered in 1982, and they've had a production plant in operation since 1986. They have physical plants in both the US and China. They actually produce the products that they are suing over, as opposed to a lot of the business-method parasites usually discussed in these forums.

And incidentally, in 1995 the whole shebang was acquired by a Chinese holding company. Yes, a Chinese company suddenly has the potential to drastically affect a large portion of the American computer-manufacturing market. Does anyone think *that* might have interesting repurcussions worth discussing?

And FYI, here is the link to Magnequench's patent guide, which actually lists all of their patents (see especially 5172751), including their so-called philosophy, in case anyone feels like doing more than just barking today.

Re:Analyzing that YANAL

[frankie]

You Are Not A Lawyer. And it shows, badly.

Neither am I, but I do know the difference between trademark law and patent law. A patent holder does not Not NOT need to defend it in order to maintain it. They can choose to enforce it selectively, at a late date, or otherwise, any time in the duration of the patent.

The parent post is a good candidate for -1: Misinformative moderation.

Re:The New New Economy

[Artagel]

The limit is 6 years. 35 USC 286

286. Time limitation on damages

Except as otherwise provided by law, no recovery shall be had for any infringement committed more than six years prior to the filing of the complaint or counterclaim for infringement in the action.

Re:Who should be sued...

[Artagel]

Well, er, technically, YES. 35 USCA 271.

271. Infringement of patent

(a) Except as otherwise provided in this title, 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.

Please note USES. In the case of the defendants in this case, SELLS and OFFERS TO SELL apply, and IMPORTS might also.

Companies don't go after consumers, it is just too big a pain in the ass. But they could. (Oh, they can't sue the company that sold to you and then sue you. When they get their damage award, the sold product gets an implied license -- no double dipping.)

The Patent King

[Kwelstr]

If you hate this little story, you will REALLY hate this other one.

http://www.fortune.com/indexw.jhtml?channel=artcol .jhtml&doc_id=202216

The Patent King. He has a staggering 558 patents, costing companies around the world some $1.5 billion in licensing fees. But what did Jerome Lemelson actually invent?

Re:please don't post

[iainl]

"Yes, I *would* rather have my head in the sand"

See how this story is helpfully filed in a section called 'Patents'? Now you know what to turn off in your preferences. I agree that this is the same old story with new names, but these names are pretty damn big ones. When someone announces they are trying to take Sony, Philips and Toshiba for all they can get then thats gutsy. Or stupid, I can't decide which.

Re:Stupid Companies..

[TomV]

Obviously they're not a very good or big company otherwise they wouldn't be sueing, and even more so I'm sure prior art on this can be found...

From the press release...

Magnequench, with headquarters in Anderson, Indiana, has annual revenues of more than $250 million. It has more than 1,500 employees in seven countries and nine production facilities. In addition to Indiana, the company has operations in North Carolina, New Jersey, Germany, Switzerland, England, Singapore, Japan and the People's Republic of China

...which would suggest they're both big and good.

They're a spun-off joint venture between General Motors, Sumitomo Special Metals and The Chinese Academy of Sciences.

What I found interesting was that their attorney is one Archibald Cox. Now if that's the Watergate Special Prosecutor, then they're not exactly skimping on the legal firepower, are they?

Based on the same broad ignorance as every other poster to this story, I'd say this looks like a pretty credible legal attack, as long as the patent's there. And since it's not on Magnets, but the use of certain Neodymium compounds to make high-powered magnets, it might well be.

TomV

Gone fishing...

[BadDoggie]

Did anyone actually read the news article? Did someone at AP copy edit the story?

"Our primary focus is to get these companies to go back to their suppliers - and in some cases their supplier's suppliers - to make sure they are using our materials," said Jeff Day, senior vice president of marketing and sales for Magnequench.

It looks like Magnequench is following Microsoft's lead and, rather than presenting proof that there is violation and suing based on that, demanding the company shows proof that it isn't violating the patents.

This is a bad thing, people, and when Virginia Beach caved in to Microsoft's demands based on assumed guilt rather proof of wrongdoing, it set a precedent because a government body accepted this sort of demand.

In Logic, you generally can't prove negatives, which is why courts say "Not guilty" [of the charges levelled] rather than "Innocent" [and didn't do a damned thing].

OK, so this is /. and here you can prove that MS on your system will have negative results, but some of you know what I mean.

Rather than bitching and moaning, Run for some branch of the government (legislative or executive) to become a part of the solution. It can only be changed from within. Run for office. Listen to some Jello Biafra mp3s or <gasp!> buy his spoken-word CDs (like I Blow Minds) for inspiration. Or go to law school and deal with the judicial side. Learn how to write an Amicus [hint: no l337 sP3LLiNg, no "dude", passable grammar, etc.]. Just quit whining!

Re:Recall?

[alarmo]

That'd be funny. The yahoo article did say "destruction of products owned by the defendants", though, so I wouldn't worry about your personal CDRW drive motor too much.

It does make you wonder how in the world everyone got to be using that magnet material without *realizing* it was under patent, though. There's gotta be a story there - maybe a "publish the method but forget to mention the patent" story a la LZW compression? Anyone have more info?

Karma whorin' for Jesus

[kyz]

Magnequench have a handy guide to their own patents. Bonus points awarded to those who post hyperlinks to US Patents 4496395, 4851058, 4802931, 5411608, 4902361, etc.
Magnequench! Leading innovation in Nd-Fe-B magnets, because only we own the license to innovate!

Leading Magnet Innovation

[daniel_isaacs]

I think the very fact that they use the word "innovation" is reason enough not to trust them.

Re:Does anyone bother reading the articles any mor

[mikethegeek]

"It is truly amazing (and sad) how Americans simply cannot seem to see the anti-China propaganda for what it is. "

Really? Then I guess those thousands of students protesting in favor of DEMOCRACY that were shown being rolled over by ChiCom tanks in 1989 deserved what they were getting, huh? Masterful fake camera work by all those American news media companies, NBC, CBS, CNN, ABC, who were SO always biased towards President George H.W. Bush they created that fakery so as to promote his "Anti Chinese Propoganda".

I guess it's a Big Lie that Mao caused the death of millions in the "Great Leap Forward", right?

I suppose it's also a Big Lie that China forces millions of women to have FORCED abortions, against their will. I suppose it's another Big Lie that China arrests and imprisons people who dare ever speak out against their tyrannical, autocratic, anti-freedom MURDEROUS government?

And, of course, China would NEVER opress people because of their religion. Why no, those Falun Gong who are being murdered by the hundreds deserved what they got.

I'm sorry, but The US Patent Office ought to out of hand thow out a patent held by a FOREIGN government hostile to American Citizens. No business of ANY substance or size is totally privately owned in China, one of the most opressive anti-property, anti-freedom governments. China already has comitted an act of WAR against this country by attacking and forcing down a military aircraft flying well outside their borders, then holding the crew hostage.

I hope they don't make fridge magnets

[oily pants]

Now I guess I'll have to pile all of my kid's art work on the floor next to the fridge.