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Netflix Sued Over Fradulently Obtained Patents
An anonymous reader writes "Techdirt has a story about a new class action lawsuit against Netflix, claiming that the patents the company is using to sue Blockbuster were obtained fraudulently. Specifically, the lawsuit claims that Netflix was well aware of prior art, but did not include it in its patent filing, as required by law. The lawsuit also claims that Netflix then used these fraudulently obtained patents to scare others out of the market, in violation of antitrust law. 'Certainly, it makes for an interesting argument. Patents grant a government-backed monopoly -- which should get you around any antitrust violations. However, if that patent is obtained fraudulently, then I can see a pretty compelling claim that you've abused antitrust law. It would be interesting if other such cases start popping up (and, indeed, the lawyer who sent it to us said his firm is looking for additional patents to go after in this manner).'"
that someone found a way to sue the bejesus out of patent trolls and their BS patents...
Plenty of video games featured in-game stores with one click shopping. That should constitute prior art. Amazon knew about these but discounted them because the transactions were virtual.
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patent troll troll?
It would be nice to see this force reasonable patent reform.
Support NYCountryLawyer RIAA vs People
I don't care about suing people or companies, what I care about is the ambulance chacing all these friggin' vampire lawyers do.
Without lawyers I am quite certain the world be a better place.
(Before anyone starts, yes I know there are good decent lawyers who do their jobs really well who practice criminal law, not this corporate bullshit)
liqbase
"and, indeed, the lawyer who sent it to us said his firm is looking for additional patents to go after in this manner"
Forget IT, go to law school.
1) Help company get patents
2) Profit
3) Help company threaten to sue infringers
4) Profit
5) Defend company against other lawyers representing other patents
6) Profit
7) Sue other companies for bogus patents
8) Profit
Heck, even if the company they represent gets burned and goes under, they still walk away with no penalty. It's like all the financial benefits of inventing something, with out the work or risk!
-Rick
"Most people in the U.S. wouldn't know they live in a tyrannical state if it walked up and grabbed their junk." - MyFirs
While successful lawsuits of this type could result in patent reform, since having a weak patent (with clear prior art) could end up costing company's money instead of being used as corporate weapons, an instantanious problem arises.
You need to be able to prove that the company ignored prior art and if a case comes down to two people saying different things the courts will generally find in favor of the defendant.
I can see it now:
Lawyer 1: "You knew about the prior art before you filed for the patent because your secretary told me so!"
Defendant: "No I didn't!"
Judge: "Case dismissed"
In order for this cases to be sucessful, hard evidence needs to found (i.e. an e-mail saying "Lets ignore the prior art"). Otherwise the only ones who will win are the lawyers (as always).
Technology is most abused by the very people it was created to help
Someone would sue the patent office, charging negligence. Maybe get an injunction against them from issuing any patents until they can issue them properly.
now that's an amusing thought.
I have patented several products and have a patent pending (in manufacturing, not in software, so please no-one try to dissolve me in acid) for products and techniques I think are at least fairly innovative. That said, it's no use blaming the lawyers for the state of affair in the US and Canada. The fact that they're needed at every step of the process -- truly and absolutely needed -- is a testament not to lawyers greed but to legislative bloat.
Now, you can argue that lawyers and lawmakers form a recursive loop, but I'll leave that for people smarter than I.
What is is all that is. Isn't that obvious?
If netflix did in fact obtain those patents fraduently then they deserve to pay for it. I know if this class action lawsuit results in a loss for netflix that the lawyers will get the lions share of the money which sucks, but at least netflix will have to pay for their wrong doing and other companies may think twice before doing something similar.
I guess since the entity that I want to "pay up" isn't Microsoft, the RIAA, or the MPAA the mods decided to mod me offtopic. Whatever...
Hey, there is only one Return and it's not of the King, it's of the Jedi.
Even as a person who has used Netflix for years now and absolutely love their service, I can say that if this is true they should be nailed to the wall over it. This is the sort of Patent System BS that must not be allowed to stand if we are to maintain our technology superiority as a country.
It's said that no great idea ever comes out of nowhere. All of the greats stood of the shoulders of giants. However, if people get it into their head to abuse the patent system like this, then there will be no shoulders to stand on and in the end no great achievements.
I read the internet for the articles.
Probably because the lawyer filing the case is going to claim a wide range of potential victims constituting a valid "class" through the antitrust allegations.
No, when people band together, you get a big direct action suit with lots of plaintiffs (like the one depicted in Erin Brockovich). A class action suit is when a lawyer and a small number of plaintiffs allege the existence of a vast number of victims that are similarly situated, and seek to claim the right to represent all of them.
Its related to the patent issues in Blockbuster v. Netflix, but separate.
I can see Blockbuster suing them, or some other company whom Netflix threatened. But I can't imagine that there are enough of those companies to form a "class".
The article is pretty vague on exactly what the evidence is. The actual lawsuit is more informative, but harder to read.
The class (as I finally figured out on page 17 of the lawsuit) is Netflix customers, of whom Dennis Dilbeck is the representative sample. They're suing based on the idea that Netflix's prices are higher than they should be, because competition by Blockbuster should have brought prices down. I just can't see a judge buying it; these people all paid for Netflix's service at the asking price voluntarily.
From what I've read so far, I'm just not buying their claim. They are citing one patent in particular, which is about delivery of resources based on people making requests on a computer, but that's considerably different from Netflix's rental queue.
(I'm assuming that patents are not a completely stupid idea. Please, if you're in the "all patents are inherently evil" category, can you just assume that I agree with you and go preach to the choir in some other thread?)
I don't consider Netflix's idea at all obvious. I thought it was pretty neat when I came up with it: the idea of a rental service which doesn't have a due date is pretty cool and I'd never heard of it.
I know we hate patents, but I hate idiot class-action lawsuits even more. I've been involved in dozens of them; I literally throw them away unopened when they arrive in the mail. The lawyers always make money and I always get a coupon for 30 cents off my next bag of Chex Mix.
Sometimes, I'm even suing myself. Some of those lawsuits were shareholders suing the company. Well, I'm still a shareholder, so I'm suing myself.
All the lawyers need to find is one fool member of the class to make a claim, and the company will often settle rather than fight. It's free money for class-action lawyers.
this comes as no surprise to any big corporation, I think. There's a reason why, at Microsoft (for instance), you are told to *not* investigate whether something is patented or not. Just do it. That way, should it go to court, they can honestly claim that they had no idea about prior art and thus be in line with law.
:)
Slightly ironic.
What company HASN'T done this?
This isn't fraud, this is standard operating procedure.
Instead of invalidating software patents, we could shorten their term to a reasonable period (two or three years generally ensures obsolescence for most software products), and drastically expand the criteria against which a particular software patent is judged invalid. Would that not be at least a workable compromise?
What is is all that is. Isn't that obvious?
Leeches feeding on leeches.
Deleted
IANAL, but...
Isn't there a positive obligation to investigate prior art before filing. Just like you have a positive obligation to keep your walkway free of ice, protect children from attracive nuiscences and pay your taxes?
Wait, I have a car analogy too! If you're driving your car, and you close your eyes and speed through every stop sign, then shouldn't you still be ticketed (AFAIK, not seeing a stop sign is a legitimite, although difficult to prove, defense. But I'm not very sure as I made up the fact for my car analogy as required by Slashdot bylaw 22.45.b)
Your ad here. Ask me how!
So I imagine then that you would want the number of patent examiners increased even further, or the criteria for rejection broadened?
What is is all that is. Isn't that obvious?
Actually it's "knew or should reasonably have known". That second part is the kicker. When applying for a patent an applicant's required by law to do certain due-diligence research (including the prior-art search) first and include the results in the application. If a reasonable person doing the research required by law would've discovered the prior art, then whether Netflix actually knew about it doesn't matter.
Or that's the theory, anyway. In practice you get into extended argument about what's reasonable, and things go downhill from there.
That has got to be the weakest attempt to extort money I've ever read. If you read the claims in the complaint, essentially the amblance-chasers are trying to attack Netflix not by invalidating the patents, but by arguing that the patents are invalid and therefore Netflix is guilty of abusing monopoly power given to it (by the existence of patents that the complaint contends are invalid).
That's pretty weeak. Looks like they're going for extortion and to certify a class all in one shot. Amazing. Only in the 9th Circuit could something like this be perpetrated.
Friends help you move. Real friends help you move bodies.
Never forget: 2 + 2 = 5 for extremely large values of 2.
Change the way patents are granted and prosecuted.
1) Make the bar of being granted a patent much higher. The applicant should have to demonstrate significant effort to make the invention. It should take far more effort to invent something than to patent the results.
2) For each patent, give adequate notice to the public to give them a chance to protest the patent. Hold as many hearings as necessary before the patent is granted.
3) Require a demonstration of the patent if there is any doubt over whether or not the applicant has ever actually built one.
4) Make patents non-exclusive. Any inventor should be able to use, sell, and market his own inventions, even if someone invented the same thing first. If he went to substantial effort to invent the item with no knowledge of products containing the same invention or of the patent, either permit him his own patent or add him to the previously existing patent. Reserve licensing of the patent to other parties for the first inventor only.
5) Before a patent lawsuit may be initiated, require the patentee to notify the infringer and give him adequate notice of his patents and ample opportunity to stop using the invention. Enable the infringer the ability to request a hearing over the question of whether or not the patent was rightfully granted.
6) Permit the patent owner to recover damages only from willing infringers. That would be someone who either knew about the patent before using it or who continued to use it more than a year after being given notice of his infringement.
7) Base the damages awarded on the greater value of the invention to the patent owner and to the infringer. That is, if the patent owner and the infringer is only making minor use of the patent internally, than the patent is not worth much and damages would be minimal. If one of them is actively selling devices for which the patent is a major portion of the device, then the value of the patent would be greater.
8) Require the patentee to actually use the patent in order to recover damages.
Yes. I have a cousin who is a patent officer in Canada (and we have some stimulating discussions on patent-related subjects when we see eachother), which I imagine is at least somewhat similar to being a patent examiner in the US. I also have a close friend who is a patent lawyer, though we don't talk about that stuff much because it bums out all our other friends.
But still, there are so many things being patented, in such esoteric fields, that even smart people with training in related fields or tangential field or whatever don't have the technical knowledge to grasp the subject at hand, or -- and this is pretty important -- don't have a way to access the information that would give them a better grasp of it.
I mean, you're probably not a dumb guy, but imagine yourself presented with a sheaf of materials that you only vaguely know about from college five years ago. It's written in technical language that, even though broken down as much as it can be, is still pretty arcane. How are you going to judge if that patent application represents something truly innovative, something truly worth granting a patent for?
We can all say, "Well, they should know," but that's much harder said than done. Another problem is that the people truly qualified to judge the patent's worthiness are often very expensive people. While the patent office may pay a lot of money to their examiners, they still don't, as far as I am aware, pay as well as private industry.
What is is all that is. Isn't that obvious?
But did they ever find Waldo?
Give me Classic Slashdot or give me death!
A method of placing an order for an item comprising: under control of a client system, displaying information identifying the item; and in response to only a single action being performed, sending a request to order the item along with an identifier of a purchaser of the item to a server system; under control of a single-action ordering component of the server system, receiving the request; retrieving additional information previously stored for the purchaser identified by the identifier in the received request; and generating an order to purchase the requested item for the purchaser identified by the identifier in the received request using the retrieved additional information; and fulfilling the generated order to complete purchase of the item whereby the item is ordered without using a shopping cart ordering model.
The way you described the game doesn't teach how to do the client-server part of the claims and proving that it's obvious an engineer skilled in the art could just throw together a system like that from seeing what you descibed is a LOT harder.
A good example: say I invent a warp drive or a phaser or what have you. The fact that it's been shown on Star Trek for the last 40 years doesn't count as prior art because from watching the show it's not obvious how to construct one. But if I tried to patent say a LCARS-style layout of buttons, then you might have a good argument for unpatentability since those layouts are shown all the time.
The sending of this message pretty much inconveniences everyone involved.
Have you considered running for Congress? Because you are ready to make laws!
What is is all that is. Isn't that obvious?
However, if that patent is obtained fraudulently, then I can see a pretty compelling claim that you've abused antitrust law.
I continue to be amazed at how technology people are so astonishly bad with understanding Anti-trust law.
Patents grant you a type of monopoly over the technology you are using, but they do not automatically grant you a monopoly over the marketspace you are in. Therefore you are not in violation of anti-trust laws if you lose a patent. You simply lose the ability to sue someone if they come along and copy your technology. How can you be abusing power you no longer have?
Is netflix in hot water over abusing patent laws? You betcha, but anti-trust laws are not their problem.
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Life is Reality
No, I don't prefer Blockbuster. I am actually a happy Netflix user myself. If they did obtain the patent fraduently though I believe they deserve to pay the price. Just because I like them wouldn't make this ok.
Hey, there is only one Return and it's not of the King, it's of the Jedi.