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Patent Cases Hurting Small Businesses
smudge writes "An Information Week article states that multiple small businesses with Web presence are being sued by PanIP LLC. The claims in these patents being asserted in the lawsuits refer to 'a
computerized system for selecting and ordering a variety of information, goods and services' and 'an automatic data-processing system for processing business and financial transactions between entities from remote sites.'"
Can you imagine if this lawyering tactic and blatant abuse of an overburdened patent office had taken place 150 years ago. I could patent things like "a way to use electricity for an artificial light source" and then I could have sued Edison or perhaps I could have patented "a method of towing freight along metal rails" and the railroad and locomotives would have been sued into non-existence. Its insane.
It boggles the mind to think about what kind of qualification process would keep letting through all sorts of patents that any semi-competent engineer would recognize as obvious and/or prior art. Maybe it is just easier to rubber stamp the applications so they can get to the bar early.
This Lockwood guy sounds like a real pro. He's been at it for at least 10 years. He sniffs out broad new technological trends in business - the kind of thing you might read about in a Forbes article - and then cynically abuses the weakness of US Patent Law by patenting a vague expression of that trend. He never intends to produce anything with his "ideas"... he just slinks into his hole and waits for the real innovators to come along so he can extort money from them.
He's going to lose any court case--that's almost a given--but in the meantime he's hoping that enough of his small, carefully picked victims cave in and throw him $30k, or at least a few grand to make him disappear.
The key to wiping the smirk off his face is to make sure no more of his victims cave. Sure, lawyers aren't cheap, but the 30 companies have to realize that there is no way they can lose this disgusting and frivolous lawsuit, especially if they work together.
Sorry. The same guy patented computerized vending machines too, back in 1986...
This sig intentionally left justified.
Actually, there are many patents out there which extend their claims this way. And having come across several patent lawyers myself, it looks like its standard procedure. All patents end with phrases like "experts well versed in this field would know that this invention is not limited to (whatever the patent mentions) but also to related fields". I am forced to believe it now :(
I have a list of such patents here
"Do something man. Right now."
I've got a friend who has a friend that works in the USPO and he was telling me how ridiculous it is to work there. Basically, you're supposed to nail predatory patents like these obviously are, but this guy who works there gets creamed by his boss whenever he tries to deny a patent. His boss is involved in all sorts of payoffs and dirt - I literally couldn't believe the stories he was telling. He later got put on a committee that was trying to track fraud and they figured out that some really high percentage (don't remember exactly, but it was over half) of the patents are frivolous and completely bunk. One tactic lots of patent filers like to use is to send in a 25 page document, and the first 24 pages are garbage designed to lull the reviewer to sleep, then they slip in a couple of paragraphs that involve what they're really trying to patent at the end. So to sum things up, its his opinion that the whole system is completely out of control, which is too bad, and he also thinks its so broken it can't be fixed, which is where things REALLY begin to suck.
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businesses were doing web sales for a few years before these yokels said "hey that sales system is not patented..."
Even the article states:
DeBrand, literally a mom-and-pop shop in Fort Wayne, Ind., has been selling its homemade chocolates over the Web "practically from the beginning, probably seven, maybe eight years...
and several paragraphs later:
The patents PanIP bases its lawsuits on were granted-the first in 1996...
This makes no sense. The shop has been selling stuff online since 1994-95. USPTO, with its head buried in the dumpster, approves and hands the patent to PanIP in 1996 on the obvious prior art stuff that had been going on by thousands of companies/individuals for years before. PanIP turns around and sues small companies that can't afford to defend against patent infringement and would probably rather pay $5k.
Note the following:
1. To PanIP: the company that you are suing has prior art to your patent if your accusation is correct that they are infringing in the first place. They have been in business longer and actually *doing* what you patented couple of years later.
2. I hope the judge sees (a) the obviousness and numerous prior art of the patents, (b) the ill intent of PanIP, LLC, (c) the frivolous and wrongful lawsuit brought by PanIP, and dismisses the lawsuit, awards legal expenses plus punitive damanges to the defendants, and orders to close down PanIP, LLC, put all its patents in public domain, and orders its founders/owners and laywers to spend 3 months in community service and 9 months living with GNU/RMS at their own expense!
3. USPTO will approve any patent claim that contains the word "apparatus". It seems like this is one of the qualifying criteria for approval. I can probably get an approval for a patent for an "apparatus that hammers the nails in the wood", or an "apparatus that can roll in a circular motion on any surface". Hey! why not - check out the infamous method of swinging on a swing granted on April9, 2002?
4. This has got to stop! Write to your local corporate representatives in DC and tell them this is devastating for local small and medium size business!
5. USPTO database and website should be turned into a comedy and satire website and public entertainment source (Ok... done already), but remove most of their entries' legal implications. On a side note, when you are bored and have nothing to do try searching patents on your favorite activity. How about a tub for bathing granted on June 25, 2002 solely from the drawings?
Biotech companies have been submitting patents of 140,000 pages in length. These may take some time to examine thoroughly.
I was implementing EDI 15-17 years ago.
I wouldn't be surprised - our (very small) company has been fighting a huge company over the violation of one of our patents, and they're using the strategy of delaying the reviews of our patent so that we can't go to court (and they are hoping that our little company will eventually die).
We've fought off their challenges to our patent FOUR times (now going on a fifth reexamination), taking over 4 years now. Each time, the primary examiner has revalidated our patent - and then his boss overrides his conclusion & throws our patent out (the same boss each time), usually without a reason.
Needless to say, we've got some questions about the motivations of the patent examiner's supervisor - but there isn't anything we can prove, and due to the rules of the Patent Office, we can't get anyone else to look at the case.
For prior art see the Internet Shopping Network (now part of HSN) which was operating in '94, Also the UK Prestel system which operated in the early 80s.
I don't doubt that we could have got a patent for HTTP, but it is only a more efficient transport than ftp. There used to be quite a few sites that used ftp to serve HTML.
This type of extortion should be punished. In the UK you would be hit with a crippling legal bill for the defendant's costs if you lost so there is little point in filing vexatious patents. Also prior review means that the probability of getting a vexatious patent is much lower.
The problem with the USPTO is that it speaks with a forked tongue. When it is justifying its racket it claims that a patent has to be 'novel', when justifying the actions of its franchisees it claims that their legal definition of 'novel' is 'anything at all, even something completely obvious'.
Actually cases like these are the ones that might lead to reform. A corrupt senator bought by USPTO franchisees can ignore the complaints from the likes of Microsoft or slashdotters, but it is harder to ignore small business owners. And no, the judgemet against Microsoft on the disk compression patent was not any more justified than the present scam. What was being claimed there was not LZW but the idea of a compressed disk.
Don't you think Amazon would be well served to help these little guys squash this thing in the first round before it gets any momentum.
They have their own problems in this area, there are something like 2000 odd patent extortion scams going on and Amazon have their fair share.
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