Red Hat's Secret Patent Deal

Bruce Perens writes "When patent troll Acacia sued Red Hat in 2007, it ended with a bang: Acacia's patents were invalidated by the court, and all software developers, open-source or not, had one less legal risk to cope with. So, why is the outcome of Red Hat's next tangle with Acacia being kept secret, and how is a Texas court helping to keep it that way? Could the outcome have placed Red Hat in violation of the open-source licenses on its own product?"

Comments

Not necessarily a licensing deal

[Grond]

The settlement did not necessarily include a license. It probably did, but it's possible it did not.

Anyway, if the settlement agreement violates the LGPL then that will become apparent if Acacia sues another JBoss developer. In the event of such a suit it is likely that the terms of the settlement would be open to discovery. If the settlement doesn't contain a license, then no problem. If the settlement contains a broad license to all users and developers of JBoss, then the infringement suit will get tossed. If the settlement only offered a license to RedHat, in violation of the LGPL, then RedHat will suffer the consequences.

And of course Perens invokes the non-existent threat of the Open Source Patent Apocalypse:

Perhaps this will come as a wake-up call to an open-source community that has been historically complacent about the elephant in its living room: Patent holders can shut down open source at any time, simply by bringing claims against individual developers and small companies that can not afford to defend themselves.

Except, of course, that patent holders have never actually done so (certainly not in any significant way), despite 15 years or more of opportunity. Litigation is expensive even if the other side doesn't defend itself, and organizations like the FSF, the EFF, law clinics, and individual charity-minded patent attorneys would likely defend individual developers or small companies for a reduced fee or no fee. If the defendants put up even a modest defense, the expense to the patent holder would almost certainly outweigh the remotest possible benefit.

Perens brings up Jacobsen v. Katzer, but it's important to note that that it was the open source developer that sued for a declaration of patent invalidity as a (successful) way of getting leverage in the case. He was not sued for patent infringement, only copyright infringement. Not only that, the developer received a $100,000 settlement fee (net $68,357.62 after paying the defendant's attorney's fees because of a failed special motion to strike) and set some important precedents. Further, the other party was not a large corporation but an individual and the small company he owned. There was no particular need for legal aid in that case.

There is just no point in trying to sue individual open source developers or companies that don't have significant assets. Patentees can't use the courts to eliminate infringing open source software. New developers will step in, hosting will move to another country, and the multi-million dollar game of whack-a-mole will continue, all the while generating enormous negative PR. Non-practicing entities, which some call patent trolls, are even less likely to sue individuals or small companies. They don't make money from litigation, they make money from licensing, and you can't squeeze blood from a turnip.

So the patentees aren't going to get licensing fees from suing individual developers and small companies. What are they going to get? Customers to pay for their software instead of the open source version? I highly doubt that the open source community of developers and users would turn around and pay for software from the company that just sued them.

Patent infringement suits may be a problem for larger companies like RedHat, but such companies have the means to defend themselves.

Wrong on so many levels

[Anonymous Coward]

IAAL (in fact, IAAPL, I Am A Patent Litigator).

1) Bruce Perens knows nothing of the law. The case was not sealed. You know that because you can use PACER to go on the EDTX docket and look at the case (Civil Action No. 6:09-cv-00097-LED-JDL). If the case itself was sealed, you could not do that. Only really exceptional cases get sealed (i.e. national security cases, some mafia cases). Whether or not the case was sealed has nothing to do with whether the settlement will be publicly available. Nearly all patent cases end with a confidential settlement agreement. Generally, with limited exceptions (e.g. class action cases), there is no requirement to put a settlement of any civil case before the Court or to make it public. The parties simply file a stipulation to dismiss, as was done in this case. Furthermore, Mr. Perens confuses a protective order (which is often a permanant order by the Court not to disclose or use confidential material produced during discovery) with a confidential settlement agreement (which is a contract between the parties, typically enforced by a subsequent breach of contract lawsuit, rather than contempt).

2) The LGPL provision at issue (presumably LGPL 2.1 Paragraph 11) is HORRIBLY DRAFTED. In fact, it is not clear what at all it is meant to do. What does it mean that a judgment or "allegation of patent infringement" "contradict[s] the conditions of this License"? Whether or not RedHat takes a license, a patentee could sue another JBoss user for infringement. Just because the patentee could not sue RedHat again or sue RedHat's paying customers again does not seem to necessarily contradict the conditions of the license. RedHat could not guarantee before or after that 3rd parties would not be sued by the patentee. RedHat is not the one that is impinging on the downstream use of the LGPLed software, the patentee is, so how could RedHat be in breach of the license? The whole section is non-nonsensically meaningless and demonstrate a complete misunderstanding of how patent litigation and licenses work. Sure, if a patent license required Redhat to not distribute the source code to LGPL licensed materials, that would be a clear breach. But that's not how the license works. The license simply would not guarantee that the patentee wouldn't sue individuals who then took that source code and sold a product based on it. No "contradict[ion]" because RedHat is doing nothing to impinge the downstream re-sellers (the patentee is) and the downstream re-sellers are in no worse condition than before the agreement that RedHat entered into.

3) It does not appear from the JBoss documentation that JBoss mentions any particular version of the LGPL. Therefore, under the LGPL, you can choose any verison. LGPL v3 does not have the equivalent non-nonsensical provision.

No, it's well-reasoned because of a precedent

[FlorianMueller]

Seriously, this is the best opinion piece on open source and patents that I've read in a long long time. And as the founder and former director of the NoSoftwarePatents campaign and author of the FOSS Patents blog, I read (and write) a lot about that subject.

There's a precedent to this settlement in which Red Hat definitely paid royalties: when it settled the FireStar case. It published a misleading FAQ on its website trying desperately to divert attention from what really happened. The non-confidential part of that settlement was published and leaves no doubt that Red Hat entered into an obligation to pay (even Groklie arrived at that conclusion, a website that I very rarely agree with). That payment was probably not on a per-unit basis. They might have made a one-off payment, or a royalty on revenues/profits, or some combination of both.

Concerning Moglen's discouraging anti-software-patent lobbying, it's interesting that he gets away with it (other than Bruce Perens criticizing him for it now) while I get bashed all the time for calling on people to be pragmatic. The first time I met Eben Moglen (back in 2004 together with a MySQL VP), he told us not to lobby against software patents. Instead he wanted money for his patent-busting efforts, which failed miserably (Microsoft's FAT patents are still in force).

I tried very hard to fight against software patents (in the EU) at the legislative level. I said on my new blog several times that at some point (more than four years ago, in fact) I couldn't help but arrive at the conclusion that it's impossible. It won't happen simply because the collateral damage caused to other industries is huge (you either have to do away with the largest part of the patent system, or you have to live with software patents) and there simply isn't any serious, meaningful support for the anti-software-patent cause by businesses. On LWN I gave an example by quoting what a staffer of the conservative group in the European Parliament once said: unless you bring in those middle-aged closed-source entrepreneurs with beards, bellies and glasses talking about how they suffer from software patents and how they may have to lay off employees because of software patents, there's no way that a political majority will do what the FOSS community asks for.

While my focus is on how to deal with the most important threat (exclusionary strategic use of software patents), Moglen never talks about that because he's been loyal to IBM throughout his professional life and gets funded by them. Instead, he always talks about IBM's (and consequently, his) favorite bogeyman, which is the wrong focus.

Re:Dear Slashdot,

[Zero__Kelvin]

"Copying the first paragraph of TFA, verbatim, does not make a helpful summary."

It does if the person writing the article knows how to write. Indeed, a summary of the article is exactly what the first paragraph in a properly written article is supposed to be. The rest of the article should elaborate on the ideas, concepts, and assertions made in the first paragraph. This is basic article writing 101.