San Diego Company Owns E-Commerce

Kernel Panic writes "Looks like you can now be sued for using graphical and textural content on your e-commerce site. As everyone who has an e-commerce site does. A company in San Diego was granted one patent for using graphics and text to sell things on the web and another for accepting information to conduct automatic financial transactions via a telephone line & video screen. They have started their crusade with smaller companies that do not have the financial resources to fight back so as to build a "war chest" to take on larger companies like Ebay and Amazon. One site has taken the offense after becoming one of the first defendants of 50 companies so far. Curiously it appears the company was formed in March of 2002, less than a month before filing for the first lawsuit."

Comments

And we wonder

[circusnews]

why our founding fathers had such a dim view of IP rights.

Re:And we wonder

[grimmfarmer]

To read the patent claims, it sounds as though Lockwood has patented a) the principle of RDBMS, b) the microcomputer, and c) the World-Wide Web. It also sounds as though certain aspects of the patent could be circumnavigated by using a monolithic binary to handle everything, and by storing the info on DVD (the only optical medium mentioned in the older patent is CD-ROM), but that's my uninformed opinion.

My more informed opinion is that we should assemble a group (like www.youmaybenext.com?) to sue the Patent and Trademark Office for issuing stupid patents, the recommended remedy being to shorten the life of technology- and pharmaceutical-related patents to six months. =P

Patent Abuse

[Anonymous Coward]

Something must be done... this is wholesale abuse
of the patent system. Patents and copyrights are
necessary to further innovation, but if this sort
of filthy lawyer abuse continues we may lose these
rights. Abuse a right, and lose it.

Re:Patent Abuse

[Fembot]

Actualy I think this is a good thing.. the more ludicrous patents like this the more general public are likely to realise how plain wrong the patent system as it stands is (eg: swinging sideways on swings, genes etc..)

Without things like this there is no way Joe Public will ever realise anything is wrong

Ridiculous

[shadowj]

What sort of imbeciles is the patent office hiring these days?

I'll bet that if they had tried really, really hard, they just might have been able to come up with a teensy weensy little bit of prior art.

Re:Ridiculous

[zanerock]

The patent office itself is not wholly to blame. Examiners make around 30,000, typically, and because of the spate of patents lately are *way* overworked. They are under pressure to get things out the door, are typically not nearly as well educated or have near as much time as people writing patents, and even more rarely have much specialized knowledeg in the fields they are asked to look over. If they did, they'd have another job. It's not the examiners fault, it's the system that hires them.

moderated -1 - redundant

[kraksmoka]

yes, panIP sucks. no, it won't hold in court. yes, ip laws are awful. next . . . .

It's a fraud

[NetDanzr]

One patent has been filed on November 1996, the other on September 2001. As the hyperlink patent controversy showed, all you need to do is to prove that the concept that's been patented preceeds the date the patent has been filled. I became an Amazon.com customer in August 1995 - more that a year before the initial patent has been filled. As such, the patents will be overturned as soon as a single entity challenges them.

How would the founding fathers feel about this?

[User 956]

This patent nonsense is getting way out of hand. When Thomas Jefferson put the idea of intellectual property into the Constitution of the United States, he did so because he realized that information leaks; once people learn something, they can reuse that knowledge. Jefferson believed that if there was no protection to intellectual property, people would not be encouraged to share knowledge with others. He believed writers would not write, inventors would not invent, artists would not create art. So in the US Constitution, it says:

Congress shall have the 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;

The reason why this is important is spelled out in Jefferson's own writings:

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.

How far are we going to let this patent nonsense go? We need to remind people that patent law, like most IP laws in the US, is a balance between two forces, and the scale should not be tipped too far to one side.

Bigger companies

[TheRealFixer]

If some of the larger companies, such as Amazon and eBay, were smart, and thinking ahead, they'd help fund some of these smaller companies defense funds, and back them up in court. Cut these idiots in San Diego off before they can build their "war chest".

Re:Bigger companies

[Anonymous Coward]

If some of the larger companies, such as Amazon and eBay, were smart, and thinking ahead, they'd help fund some of these smaller companies defense funds, and back them up in court. Cut these idiots in San Diego off before they can build their "war chest".

Because the cost to license his "technology" is pennies for someone like Amazon, not to mention a real benefit to their customers... Look at it this way:

Amazon sells just about anything they can get ahold of: Books, Kitchenware, Electronics, Video Games, Music... Crap, i've even seen riding lawn mowers on Amazon. In essence, they compete with *everyone* selling something on the web, right?

PanIP, last i heard, was asking for a small settlement amount, like $5000 or the like. Definatly a 'spoiler' for small mom-n-pop shops, but this is chump-change for the likes of Amazon. Even if the licensing grew, it would still be more cost beneficial to pay it than fight it, even discounting all the additional revinue created from competitors being eliminated.

Even with an impressive "War Chest" built up, PanIP's capital and legal fund will NEVER match that of Amazon's. Never. Sure, they might have to pay him royalties, but Amazon can *easily* put him out of commision before paying PanIP a red-cent.

Ready for my theory?? I propose that Amazon (or likeminded company) is actually funding or somehow paying this guy to do this. Why not just hold the patent yourself like Amazon does with "One-Click"? because how would it look if you extinguish your competitors thru shoddy Patent and IP claims? If someone doesn't wanna pay for "One-Click", fine; don't use it... Now a general "e-commerce" patent is a different story, and Amazon doesn't wanna look like a bully, right?

Anyway, thats my theory why the big-wigs don't hop into the arena now, or possibly ever.

-ab2650

Re:System needs remodeling?

[Sajarak]

For a start you could prevent people taking out patents on things like business practices and software algorithms. Allowing patents on these sorts of things does little to promote innovation (most of the world outside the USA does quite nicely without software patents) and works vastly in the favour of big companies who can use their warchests of patents to hold small companies' ideas to ransom.

Re:Comment from Pan IP

[Daniel Dvorkin]

The "a senior executive at Pan IP" bit is almost surely bullshit, but the post is worth answering, because it represents some common misconceptions about both what IP law is for and about the "average /.'ers" feelings on the matter.

A tiny minority of people, on /. or anywhere else, feel that IP laws (patent, copyright, trademark) are fundamentally wrong and broken and should be done away with. I'm not one of them. The Constitution spells out the purpose of IP law very nicely; "to promote ... progress" and "limited time" are the key phrases. Good grants of IP protection serve this purpose, by rewarding the genuinely innovative thinkers who keep our world moving forward. Bad grants of IP protection, such as those used by PanIP, do precisely the reverse.

Not everything should be patented, copyrighted, or trademarked. There are some ideas (e.g. "buying and selling things over the Web") that are a) not the invention of any one person or group of people, b) immediately obvious to anyone with a brain, and c) so widespread that any attempt to enforce IP law on them would have crippling economic effects. Generally speaking, I think falling into any two of those three categories ought to be enough to remove something from IP protection. I'm particularly concerned about (c) because it seems to be something that a lot of IP vultures Just Don't Get: when a bunch of people are doing something and nobody's bothered to file an IP grant application on it, just because you did file the application does not give you the right to deprive a whole bunch of other people of their livelihood.

And, oh yeah, on the off chance that you actually are "a senior executive at Pan IP": you and others like you are scum who contribute nothing to the world in which you live. You create no value of any kind, and would be of more service to humanity shoveling shit.

Tell the Patent office how you feel

[Anonymous Coward]

Tell 'em directly.

usptoinfo@uspto.gov

800-786-9199 (U.S. and Canada)
703-308-4357

Re:Comment from Pan IP

[TheRealFixer]

If you really are an "executive" of Pan IP...

Patents can provide a valuable service. I work for a non-profit research company who takes out patents on medical treatments to insure they are available for everyone to benefit from. To specifically prevent some hoser like you from keeping people from benefiting from innovations just to pad your pocketbook.

How the heck are your patents "protecting people who create value from those who would steal it"? You freely admit you didn't even do any of the inventing! You just pick up patents from others, and exploit them for your own profit!

How is this "protecting" anything? The only thing it's protecting is your greedy, greasy little hands.

Little guys can't afford to fight back

[xenoc_1]

They know it won't stand up. That's why they're going after real small "mom and pop" businesses. Somebody who doesn't have lawyers on retainer, who can't afford the time away from running their business to fight it.

Think they'd try this with walmart.com or Amazon? The article implies they are considering it, but you know that's just bluster.

These sleazeballs aren't stupid enough to pick on sombody who could fight back.

Typical abuse of our legal system.

PanIP doesn't give adequate notice

[kaltkalt]

If you read PanIP's initial complaint setting forth the "grounds" for its lawsuit, it is pretty clear that all the allegations are mere conclusory statements. "Defendant is infringing on our patent #whatever and continues to do so." ... stuff like that does not give adequate notice per Federal Rules of Civil Procedure Rule 8(a)(2). Just saying "you're infringing my patent #1234567" isn't enough. Gotta give some minimal explanation as to how they are infringing your patent. Check out Gen-Probe, Inc. v. Amoco Corp., Inc., 926 F.Supp. 948 S.D.Cal., 1996 for a good description on this vis a vis patent infringement suits. California federal court, no less. Keep in mind that the patent office is the second most profitable government organization, right behind the IRS. They are in the business of selling patents. For them to say "no, we're not gonna grant you a patent for that because that's a load of bullshit" is like Walmart kicking out customers because they aren't well-dressed enough to shop there.

Re:Two words: Prior art

[Anonymous Coward]

Have you contacted the people that run the prostest web site?