Appeals Court Throws Out Rambus Patent Ruling

angry tapir writes "A US appeals court has ruled on two patent lawsuits that pit Rambus against two competing DRAM makers, sending both cases back to district courts for reconsideration. The US Court of Appeals for the Federal Circuit vacated a lower court ruling requiring Hynix Semiconductor to pay Rambus damages and fees totaling US$397 million for the use of its patents in DRAM chips." Here's the issued opinion (PDF) in Hynix v. Rambus. The opinion in the other case (PDF), pitting Rambus against Micron, contains this juicy snippet: "On August 26, 1999, Rambus held the 'shredding party' it had planned as part of its third-quarter intellectual property litigation readiness goals. Rambus destroyed between 9,000 and 18,000 pounds of documents in 300 boxes."

Comments

Re:How many libraries of congress

[martin-boundary]

Depends if they were written on microfiche or stone tablets.

Good

[jheath314]

Senior Judge Ronald Whyte's ruling in the Hynix case was bizarre anyway... I'm glad it got overturned. (He had concluded that Rambus wasnâ(TM)t anticipating litigation when the shredding took place.) Under Whyte's ruling the bar for being convicted as a spoilator of evidence was set impossibly high.

Re:Good

[Compaqt]

Wait, so the penultimate ruling (the one before this one) was in favor of Rambus?

Also, I thought the courts were supposed to view a party as guilty by default if they destroy evidence.

Re:Good

[icebike]

Wait, so the penultimate ruling (the one before this one) was in favor of Rambus?

Also, I thought the courts were supposed to view a party as guilty by default if they destroy evidence.

Yes to your question.

No to your destruction statement. They are not "Guilty" by default unless they were required to retain the
documents. Rambus would be required to retain these documents and the 1200+ email backup tapes
if they were planning litigation, or where a reasonable person could forsee litigation.
Since they were clearly planning litigation as early as 1998, they can't come along in 2006
and say that litigation was unanticipated.

Still, you have to wonder why this company was in such a rush to flush.

Re:Good

[Rich0]

Well, it was around that time when my own company started pushing more on records retention. Probably one of those general management trends of the day - probably some companies got creamed in discovery (consider that this wasn't long after the whole Microsoft email fiasco).

Love all the conflicting management recommendations that this led to. Legal would send out emails like "meet in person, rather than using email" and finance would send out "use electronic tools like email instead of having expensive in-person meetings."

I think the way it ended up shaking out is that most bottom-line employees use email, and most high-level managers that make the kinds of decisions that get companies sued tend to do it all in meetings without minutes.

Legally it is best for a company to have a policy and stick to it - what gets you in trouble is when one division shreds on a perfect schedule, and another doesn't. Then if the first gets sued the second gets used as an example to suggest that the first was planning something nefarious. That may or may not be true.

I almost wonder if this is something that should be the subject of government guidelines. I know that in many industries particular types of documentation have a retention schedule mandated by law (almost always short compared to most litigation). When you think about technology - is there really any reason to ever throw out a document? You could probably build a machine that sits next to a photocopier and which coverts a document to PDF, does OCR, uploads it to a server, and then dumps into a shredder. The server could then do deduplication and index everything (where it originated, where it was tossed, etc). Your document management system would send clean electronic PDFs to the same server, so in the ideal case where the document was printed and then tossed the scanned version never gets retained unless it has writing on it.

Re:Good

[ControlsGeek]

Ironically Rambus had implemented such a policy recommended by an outside legal counsel at the time. It was 'sticking to this policy' that caused them to hold the shred day clean up / pizza party that got them into the trouble. One of the verdicts in Delaware which was overturned had previously resulted in forfeiture of their patent rights entirely.

Re:Good

[nomadic]

Outside counsel should be disbarred for what was described in the Micron v. Rambus opinion.

Re:Good

[MightyMartian]

Sadly this doesn't shut them down. It just basically sends it back to the lower court so the judge can find a new way to give everyone else in JEDEC the shaft.

Re:Good

[Anonymous Coward]

Remember people, if you buy a PS3 you're supporting Rambus!
The PS3 uses XDR memory, designed by Rambus.

Re:Good

[yuhong]

IMO a PR 2.0 compliant company (one that no longer control the message, etc...) should not need to cover up smoking guns.

Re:As Caruso would say...

[Alex Belits]

This brings up some...

bad memory.

YEEEAAAHHHHH!

Still going?

[SeaFox]

At some point you just have to wonder... Does it even matter anymore? These court cases drag on so long that the technology they're litigating about isn't even relevant when they're done.

Re:Still going?

[cdrudge]

I can count 397m ways why it still counts. While the technology may gave moved on, the effects of the lawsuit are still around.

Re:Still going?

[WNight]

Unfortunately that sum is only half the story. The dollar was worth more then and those companies could have been benefiting from its use for years. And they'd have been selling a cheaper unencumbered product.

The real damages in this case are immense, probably to the entire industry but certainly to these companies. Damages our court system will never address.

Patent law costs everyone, a lot.

The real reason for all the litigation

[Anonymous Coward]

Okay I have an Earth shattering new product. I have the backing to produce it but I can't aford the lawyers to defend against impossibly vague patents. Do I risk all my cash starting the company assuming some one will sue me and take it all away or do I invest in stable stocks. Hmmmm. Is there really a choice here? It's like the auto industry shutting out the independent car makers. Do you have any idea how hard it is for a small car company to get a VIN number? Corporate America can whine about regulations all they want but regulations really protect the major corporations from little companies with superior products.

Re:The real reason for all the litigation

[Sun]

This case is about hardware patents, not software ones. The economics controlling those are difference.

For one thing, the costs of producing chips is so high, that if you can afford those, you can afford to go to court over patents. The main problem with software patents is that it costs your own time for so many months in your mom's basement (which amounts to about $70K if you count lost wages, less if you just count the food and lodging you consume) to produce a decent, market worthy software product. Compare that with the ~$5 million it costs to defend against a patent suite, and you see how that is a problem. It costs $1 million just to create a tape-out for ASIC production, which is just one part of the production chain, and does not include the development and testing costs.

This particular case is not about "dummy" patents. It is about a party signing RAND and participating in a committee that develops new technology, while at the same time discreetly patenting that very same technology. This is a simple case of misdirection and theft. The patents in this case are just the tool with which this misdirection took place.

Shachar

Re:The real reason for all the litigation

[westlake]

The main problem with software patents is that it costs your own time for so many months in your mom's basement (which amounts to about $70K if you count lost wages, less if you just count the food and lodging you consume) to produce a decent, market worthy software product.

This is the fantasy, of course.

But how many real - marketable - patentable - software products come straight out of Mom's basement?

Re:The real reason for all the litigation

[Sun]

This is the fantasy, of course.

Someone should let Sergei Brin, Bill Gates, Gil Schwed and not so few others that. They all started with miniscule software companies paying their initial employees mostly with equity, while these companies are, today, worth billions.

But how many real - marketable - patentable - software products come straight out of Mom's basement?

That is the wrong question for this thread. The right question is how many real, marketable software products that come from Mom's basement (or equivalent funding strain on the individual) are in danger of never making it due to inability to protect themselves from junk patents held by trolls. This thread isn't about the chances of the "mom's basement" business model producing products (which is indisputably low). This is about the ratio between the amount of equity required to form a software company and the amount needed to defend against patent trolls.

Shachar

Re:The real reason for all the litigation

[MSG]

The main problem with software patents is that it costs your own time for so many months in your mom's basement ... to produce a decent, market worthy software product. Compare that with the ~$5 million it costs to defend against a patent suite, and you see how that is a problem.

I don't think that's the biggest problem with software patents. I know we don't all agree on why software patents are bad, but I think the single biggest problem with patents (especially software patents) is this:

The patent system is intended to be an exchange. Inventors describe fully how their invention works and in return they are granted a temporary monopoly on its production. In exchange for that monopoly, the public receives valuable information about how new inventions work so that the invention can be produced after the monopoly expires and potentially integrated into new products or improved.

The monopoly that the patent office grants is a cost to consumers, and should only be granted when the value of the information about the invention is at least as great as the cost imposed by the monopoly.

All too often, the patent office grants patents that are of no value to the public. In the case of software, we frequently see the case where a product infringes on a patent by doing something obvious. That is antithetical to the purpose of the patent system. The patent system does not exist to reward the first person to file a patent. The patent system exists to provide a system and an incentive for inventors to document new inventions that the public would otherwise not benefit from. If products infringe without prior knowledge of existing patents, then it is obvious that the public is not benefiting from the documentation provided. It makes no rational sense to impose a cost upon the public (a monopoly) without receiving anything in exchange.

Re:The real reason for all the litigation

[Sun]

I don't think that's the biggest problem with software patents.

I just love how discussions on /. veer off topic so quickly. I never said it was the biggest problem. I just said it was a problem, and in the context of the poster to which I was replying, the most relevant one.

Just for the record, I am not against all patents. I am against areas where patents don't make sense and don't work. I believe the principle behind patents (which you have, correctly, outlined) is sound in certain fields.

Software patents have practical implementation problems (such as people succeeding in securing patents on 20+ years old text book snippets), but most of its problems stem from the core idea, and not from the particulars of the implementation. Even some of the problems that appear to be implementation problems are actually due to design problems, such as the hugeness of the software field (which, today, encompasses just about any other field of business even remotely technological), making sound implementation impossibly expensive.

Shachar

Ahh Rambus

[zixxt]

Seeing as Rambus the old school patent troll is still in the news a decade later, puts a smile on my face. Time to dig up some 8 to10 year slashdot stories about Rambus suing any company that made ram back in the day.....

Re:Ahh Rambus

[Nikker]

Still have my Dell Dimension 8250 with 512MB that I will never upgrade @ 300 / GB. Here I was thinking in 2004 that I was going to be able to max it cheap in 4 years.

Re:Ahh Rambus

[snspdaarf]

Want to sell it?

Re:Ahh Rambus

[Repossessed]

If he doesn't, I have one too.

Re:Ahh Rambus

[Nikker]

Wouldn't be worth the shipping costs.

Re:Ahh Rambus

[snspdaarf]

As it turns out, the kid has been saving money (something I did not think possible) for a new machine, so I guess the 8250 will ride into the sunset.

Good

[Trogre]

Anything that shuts down those litigious Rambus bastards is likely a positive move.

Does it even matter anymore?

[overshoot]

If you had ever done any standards work in the past ten years, you wouldn't have to ask.

And, yes, I speak from painful experience -- I worked on the JEDEC committees that Rambus abused.

Re:Does it even matter anymore?

[Anonymous Coward]

I haven't done any standards work in the last ten years. So is that a yes or a no?

I was there.

[slashfoxi]

Rambus was my first job out of college in 1999. I remember the shredding party well. I was like, why are we doing this? The old timers assured me it was perfectly normal. Anyway there was free beer, so that was nice. I haven't seen anything like it in my subsequent career. And free beer is all too rare.

Rambus's Silver lining in this cloud...

[ControlsGeek]

1. The infringers claimed RMBS did not invent the technology. It is now law that they did.
2. The infringers claimed there was prior art. It is now law that there was not.
3. The infringers claimed there was fraud at JEDEC. It is now law that there was not (by RMBS).
4. The infringers claimed they did not infringe. It is now law that they did and continue to infringe.
5. Now the infringers are admitting 1-4 above but claim they should not have to pay for the use of the technology they have been stealing for over a decade because they claim RMBS destroyed documents but cant point to any prejudice they suffered or any evidence of bad faith.