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FTC Defends Ethernet From Patent Troll
I Don't Believe in Imaginary Property writes "The FTC has put a stop to Negotiated Data Solutions, a patent troll that bought a patent on an important part of the Ethernet networking standard and tried to jack up the royalties for licensing it. In a consent decree (pdf), N-Data agreed to continue licensing the patent at the formerly promised rates. 'Whatever the merits of the decision, it shows that the FTC sees the value of standards and will be on the lookout for any behavior that could undermine these standards-setting process. That alone could keep companies honest when they enter the standards process. Standards-setting bodies have also become more sophisticated over the years (after being burned in several high-profile cases), and now do a better job at forcing involved companies to disclose and license patents.' The IEEE voted back in 2002 to make patent letters irrevocable, which could have prevented this, but neglected to make that clause retroactive."
I already have a patent pending on using eletrical signals for any kind of communication!! How dare he steal my thunder!
So basically, -1 troll/offtopic is really slashdots way of saying "I hate that you thought of something before me."
Nice to see the FTC moving in a sensible direction. Of course the only reason they did it, was because we are talking Ethernet. If it was some less known standard that a troll way trying to attack, they would let it slide.
Sorry, this was a no contest situation.
With 100M worth of capital you do not go against an industry with turnover in excess of 100s of Billions per year. Most networking gear all the way to 10G is Ethernet now and that industry as the chairman of FTC noted can fend for itself. In fact, based on the FTC decision it surely did.
Baker's Law: Misery no longer loves company. Nowadays it insists on it
http://www.sigsegv.cx/
Why wasnt this patent written so that in X number of years in became extinct and the contents of it went out under the GPL? This is done with other things such as prescription drugs, for so long after the drug is discovered only one company can make it, but then the patent expires so to say and other companies can produce generic versions of the drug. Why hasnt this been the case with ethernet?
Why not limit the number of times patent rights can be reassigned?
As set forth in the US Constitution, the purpose of patents is twofold:
1: The temporary monopoly on the invention gives the inventor recompense for the investment made in the invention. In other words, it keeps him/her inventing instead of waiting tables.
2: The limited term of the patent brings the invention into the public domain, to be used as fodder for future inventions.
The whole idea of assignment of your invention rights is simply another way of getting recompense. It's a good idea, because it means you don't have to be a manufacturer and marketer, as well as an inventor. Assignment of rights lets you focus on inventing and not on those other things, if that's your bent.
And maybe reassignment by the first assignee might make sense, too. But by the time patent rights have been sold multiple times, the link back to one of the original functions - to keep the inventors inventing - is so diffuse that it has been lost, IMHO.
The Constitution never intended the patent as a revenue source beyond spurring invention. (Same with copyrights)
The living have better things to do than to continue hating the dead.
Did they derive great LULZ from watching people get annoyed at them? If they bought the patent, it's their choice how they license their intellectual property. The patent system is flawed, not the companies which treat it as an investment opportunity.
Watch this Heartland Institute video
"Why wasnt this patent written so that in X number of years in became extinct and the contents of it went out under the GPL? "
All I can say Wow...
1 A patent is not a software license or a copyright. A patent does have a limited life span.
2. When a patent expires then it becomes totally free. Not free as beer, speech, or the GPL. Free as in public domain free. You can do anything you want with it after it expires.
So all I can say is WOW.....
See my blog http://ilovecookes.blogspot.com/ for light hearted technical information.
Not necessarily a good thing
First, the GP is only a troll is the poster doesn't believe the content of the post, but rather posts just to go against the prevailing sentiment and arouse a reaction.
Second, a phrase like "exploiting the flaws of the system" is quite loaded. Like if someone you like is charged with a crime but not convicted, you might say that person is not guilty. If someone you don't like is in the same situation, you might say, they only got off on a technicality.
I'm not guilty of murder, but only on a technicality. Of course, that technicality is the fact that I haven't killed anyone, or caused the death of anyone, or done anything else covered by the laws that define murder. But that's only a technicality.
If you think the right of a patent holder to charge licensing fees is a "flaw of the system" then yes, in this case the company was trying to exploit that flaw. Of course I could say the requirement to release source code is a flaw of the GPL, and anyone trying to get me to release the source of an application based on GPL code I am selling is just a troll exploiting the flaws of the system.
I may hear replies that the requirement to release source code is not a flaw of the GPL, but rather is an intentional aspect of how the GPL works. On the same tip, some might say the right of a patent holder to charge licensing fees for use of works covered by the patent, and the right to increase those fees should the patented works prove to be popular, is not a flaw in the system, but part of how patents are intended to work.
This isn't a submarine patent. In that case, the patent holder sneaks into the marketplace with a hidden patent and then springs it full-fledged upon businesses using the patented technology.
This case is a bit different. The patent was licensed to the current users of the patented technology--the "bad guy" ship wasn't a submarine sneaking into the middle of a convoy, it was one of the ships already part of the convoy. But then the ship is taken over by another entity... say, a crew of pirates... and they took advantage of their position in the convoy and the fact their intended victims were already under their guns to try to extort more.
Yeah, this isn't a submarine patent, this is patent piracy.
Yaaar!
The only real problem with this analogy is that it doesn't involve cars....
Welcome to the Panopticon. Used to be a prison, now it's your home.
Sure. And why not limit the number of times rights can be reassigned on something like music files? Why not have the number be 1, for the original sale? I'm sure the RIAA would like that. And why not apply the same standard to software? Or anything else?
You're right in the dual purposes of patents, but allowing the holder of a patent to sell rights does not counter the letter or spirit of either purpose.
Comment removed based on user account deletion
My inner cynic is thinking, "I wonder what official they forgot to pay off at the FTC."
Surely the existence of the original letter would allow a defence of promissory estoppel against the patent troll?
http://en.wikipedia.org/wiki/Estoppel#Promissory_estoppel
I wonder if that's why the troll caved so easily? (badum tish!)
A pizza of radius z and thickness a has a volume of pi z z a
Why wasnt this patent written so that in X number of years in became extinct
ALL patents and in fact all the temporary monopolies known in layman's terms as "intellectual property" are already term-limited. The problem is that the terms have been progressively extended over the decades since they were introduced so that, for all practical purposes, they might as well be permanent.
That is, "year X" just plain takes too long to get here.
A secondary issue that is closer to what you're thinking of is the terms of the licenses for the patents. These should have been made permanent and irrevocable. Another possibility is that the IEEE could have been granted a permanent and irrevocable right to sublicense the technology under the original terms for the purpose of fulfilling IEEE standards.
Are you referring to 802.10g ?? Thats not Ethernet - thats WiFi (well, one of them anyway) ...
... and it only applies one sort of standard ... theres also Token Ring (802.5) ...
802.3 is Ethernet
Been there, Done that, Sold the t-shirt to the next idiot in line
Instead of making uninformed guesses about what this is all about you should read NData Response. NData was part of a company that National provided VC funds to create. When the company's products were sold, the patents stayed behind so that the VCs and common share holders (employees of the company) could get some value out of the IP they were given by National as part of the VC funding process. The patent enfocement process started when the company still was making products - so it was not a "patent troll", it was a normal product producing company enforcing it's IP (normal everyday occurance) - the fact that the products were later sold should not affect the enforcment actions that have taken years to prosecute. For the cynical, you are probably closer to the truth in that the comissioners voting to take action against the chair's beliefs and the fact that 2 seperate dissents were written indicates to me that something fishy is going on here. The companies that borught this to the FTC are located in Texas and make computers, not consumers who would be affected. The amounts involved are pennies on a computer system purchase, not outrageous amounts as some would lead you to believe. http://www.negotiateddata.com/files/N-Data%20Statement%20012308pm.pdf
Slap em' Danno! Then put the cuffs on them.
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