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USPTO Declares Invalid Third of Three Critical Rambus Patents
slew writes "This is a followup to this earlier story about 2 of 3 of Rambus's 'critical' patents being invalidated. Apparently now it's a hat-trick."
There's something that seems unsavory and wasteful about a business environment in which a company's stock value "fluctuates sharply on its successes and failures in patent litigation and licensing." The linked article offers a brief but decent summary of the way Rambus has profited over the years from these now-invalidated patents.
Up with this we will not put!
So do Nvidia, Hewlett-Packard , et al have any chance of recovering any money they paid to Rambus, or are they simply out the entire amount, or has no actual money traded hands yet?
Sig Battery depleted. Reverting to safe mode.
And it ain't over, yet, because they can still appeal - considering the loss of revenue, you can bet they will.
Can't really call this a victory, because Rambus received a cut of memory sales for years, which every PC buyer ultimately paid.
A feeling of having made the same mistake before: Deja Foobar
There's something that seems unsavory and wasteful about a business environment in which a company's stock value "fluctuates sharply on its successes and failures in patent litigation and licensing."
If ARM holdings licensing came into question it would probably destroy the company's stock. I am loving the way the ARM architecture is handled, a lot more competition than x86, and it seems to be advancing quickly now that it has becoming popular.
I was trying to imagine today if ARM holdings could survive in a world without IP laws. I think yes it could. It seems that getting a hold of ARM holdings processor plans, from something like bittorrent, would not be super useful even to Texas Instruments, Samsung, or Nvidia engineers. ARM works with them to implement the design, so the payment agreement would probably just be altered slightly and ARM would have to protect its disclosure of ARM architecture details a little more closely. Perhaps ARM would morph more into a standards body and not be as profitable though? I am curious what someone with more info on the topic can share please!
It's not that a company's price fluctuates with the state of its patent portfolio. The problem is that 3 patents, which should have never been issued in the first place, terrorized inventors and suppressed innovation for multiple years. This is squarely an indictment of the USPTO and of the Congress.
Patents are a property; changes to the scope of existence of a property right change the value of the property governed by that right.
The market should estimate the possibility of a company's winning or losing a patent case; once the decision is made, the actual value of the company has changed because of the new determination of whether the company has the right.
The only alternative would be to split the patent right King-solomon style. But that only happens if both parties are willing to settle.
Parties are sometimes not willing to settle. They may know or mistakenly believe that they are in the right, or they may expect they can force the other side to settle for more later.
In addition, mucking up their estimation as to whether they will win--and thus whether it makes sense to settle--is the fact that empirical research demonstrates that lawyers are more attractive to clients when they project a higher chance of winning. Thus it is in the interest of the lawyers to artificially inflate the chance of winning by at least some margin--whether done subconsciously or deliberately--and this means parties have biased information when they decide whether to settle.
Finally, occasionally a court will do something nobody expected, either legitimately for reasons people did not anticipate would motivate them or out of stupidity.
-- IANAL, this isn't legal advice, and definitely isn't legal advice for you. Also, Squee!
Must we continually remind you that Rambus technology was never Rambus technology, but rather stolen technology?
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Perhaps there should be greater incentivization for companies that are directly involved in making products based on patents, or at least on companies that have a reasonably large interest in companies that do produce products based on patents. Since we've all decided that Intellectual Property is Real Property, we've essentially allowed companies to use patents like they would apartment buildings, if we're not going to redefine what constitutes property, then at least there should, say, tax incentives for companies that patent and then produce products, are take ownership stakes in companies that do produce products based on patents. Or, we could just simply set the tax rate extremely high on licensing income, and then if you can demonstrate that you are in any substantial way responsible for making products based on patents you hold, then you get a break on those taxes. So let's say a company that makes its money purely from acquiring and licensing patents has to pay 95% of said income in taxes, but where they actually are involved in production that uses said patents they get an increasingly greater cut up to what we would currently consider normal corporate rates, so that companies like Apple (though I have my own issues with their using patents to bludgeon, but at least they do actually manufacture products based on their portfolios) are not penalized. I think you could make it very fine-grained, based upon each patent, so that there is no incentive to patent lots of things and then strategically use patents that one has no intention of making products from to attack competitors.
It wouldn't be a perfect solution, and still leaves open questionable patent suits like Apples', but perhaps we might also look at rules to require that licensing fees plus some level of interest be returned to the licensees, thus making it far riskier for a company to use dubious patents slipped past overworked examiners to bludgeon or force licensing fees from competitors. How willing would Microsoft be to go after Android manufacturers if there was a law on the books that would require them to return those fees plus interest if the patents got overturned?
The world's burning. Moped Jesus spotted on I50. Details at 11.
USPTO: "Yeah, we approved these totally bogus patents that resulted in billions of dollars of litigation and now we're affirming our own malfeasance. What's your problem?" The USPTO needs to be sued into the stone age for this fraud.
1 and 2 were already invalidated.
The third of 3, i.e. the last one, has now also been invalidated.
You're welcome.
Nice view of the process.
Makes me wonder if the market is failing here due to the issue of patents (which are a privilege granted by the government to create artificial scarcity) being so profligate that we have some sort of patent boom fuelled by lawyers?
If so, it's due to head for bust any time soon - I wouldn't want to be holding stock in any company with that business model.
The way Rambus has profited over the years from these now-invalidated patents ...
In other words, Rambus is nothing but a scam
And the amazing part is that the America knowingly allows such a scam to exist for such a looooooooooonnng time !!
Muchas Gracias, Señor Edward Snowden !
3 down, many thousands to go.
Or, we could just simply set the tax rate extremely high on licensing income, and then if you can demonstrate that you are in any substantial way responsible for making products based on patents you hold, then you get a break on those taxes.
I like this idea, because the original intent of patents was to allow the inventor a certain period of exclusive use of his patent before it became available for others to use. Its not at all clear that licensing was ever contemplated.
The theory was that the inventor could make more money selling a product incorporating a new invention than a competitor could make without it. But the money came from the selling of the products, not the licensing of the patent.
If you do not want to use tax law, (and there is certainly reason enough not to do so), then you could use the term (duration) of the patent itself. If you make a product using your invention, you get a longer patent term, but if you license it you get a much shorter duration patent.
The theory being the total return on your patent was meant as a temporary monopoly as an incentive to invent. You can choose to achieve this total return in 5 years by licensing the patent to others, vs 15 years by using it yourself. In the first case you multiply your earning power, while assuming no costs and taking no risks, so your period of reward is lessened.
Sig Battery depleted. Reverting to safe mode.
I was given a very nice Compaq Deskpro series computer with about a 1.5G P4 (this was a while ago!)
The 1.5GHz P4 was never very nice, even a long while ago. A late model P3 of the same time frame would handily outrun it at half the power consumption.
Not to mention when they weren't patent trolls they were frankly shitty at business. RDRAM sucked, it cost too much to manufacture, needed dummy chips to fill empty slots, didn't scale well, it just wasn't a great design. Frankly after even Intel gave up on RDRAM patent trolling was pretty much all they had left. Good riddance Rambus, all of us will be glad when you are gone.
ACs don't waste your time replying, your posts are never seen by me.
Uhhh...you DO realize that most likely for the price you paid for that RDRAM you could have just shitcanned the board and put a MUCH nicer board in its place? I had a similar situation about a year and a half ago, I just Craigslisted the board under free stuff, slapped in a cheap socket 775 along with a $15 Pentium D and a gb of RAM and it was STILL cheaper than buying that POS RDRAM and i ended up with a much nicer system. hell if you don't want to go to that much effort you can buy those AMD E-350 system boards starting at like $80 and that has a dual core CPU and HD6310 GPU, just slap a $15 DDR 3 stick and you got a dual core that'll play 1080p and is small enough you can drop that sucker into even the SFF cases. I did that with some office boxes the customer didn't want to have to buy whole new systems to replace and it worked like a charm, quiet as a churchmouse and does any task your average SMB is using floor PCs for.
So trust me friend, as a born packrat i know how it hurts to shitcan functional gear but you gotta know when to hold and know when to fold and RDRAM is a fold situation. if you don't want it going to the dump offer the parts on freecycle or CL and let someone have it for spare parts, don't throw good money after bad friend.
ACs don't waste your time replying, your posts are never seen by me.
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I'm amazed. A Rambus astroturfer. The SCO checks bouncing now?
The world's burning. Moped Jesus spotted on I50. Details at 11.
I don't know. Maybe I did read the link you provided, which is why I was asking what you meant. Rambus's patent applications predated the JEDEC meetings. The sleazy behavior they engaged in was in their failure to disclose the patents and efforts to steer the emerging standard such that you couldn't implement it without running afoul of the RAMBUS patents. Definitely what they did was fraudulent and wrong, but "stolen" isn't the right word here.
This quote is too good not to bring up when it comes to mentioning Intel and Rambus.
October 2000
Craig Barrett, Intel's president and CEO, tells the Financial Times: "We made a big bet on Rambus, and it did not work out ... In retrospect, it was a mistake to be dependent on a third party for a technology that gates your performance."
Although RDRAM was good at providing high bandwidth, being serial and having more logic between row activation and the last data bit of the cache line propagated through the complicated deserialization logic on the way to the front side bus, it sucked at latency. Unfortunatly, what misses and evictions that dribbles out of the typical CPU cache are often pretty random, so although RDRAM generally had more banks than standard SDRAM of the time, for most use cases, the randomness of the access patterns cause it to have more average latency than DRAM.
This probably would NOT have gotten better over time even if intel had continued to invest in it as caches got bigger and the dribbles got even more random and regular DRAM grew more banks to catch up.
Even the i820 "camino" chipset from intel which used PC800 RDRAM, was slower than using the previous generation "BX" chipset which used PC133 SDRAM. Of course if you were working on a large data set with lots of cache misses, RDRAM was faster, but it would be a mistake to say that RDRAM was better for the average user in the average case.
Rambus's patent applications predated the JEDEC meetings.
Their amendments to their applications to match what they'd heard in the JEDEC meetings, on the other hand...
There's something that seems unsavory and wasteful about a business environment in which a company's stock value "fluctuates sharply on its successes and failures in patent litigation and licensing."
No, there's not. Do you see the bulk of silicon made in the USA? Thought so. Buy any consumer-grade electronics, and it will say Made in China. Made in Taiwan is already higher-end. I've been given some Christmas candy that was friggin' made in China. The only thing left is R&D. Research should lead to inventions, which should lead to patents.
In the end, if you are not doing your own manufacturing to some level you are in deep shit. To the extent that patents work as you described they are making the problem worse by putting of dealing with it. Innovation and R&D largely (though not completely) come from being inspired by practically involved in making, building, designing and manufacturing. For some time, people who used to be involved in those will be able to put out patents, but that is already slowing down (China is already starting to produce more patents than the US; within a few years they will start to produce better quality patents than the US). In the meantime, the "pure R&D" companies push the proper manufacturing companies out of the economy and mean that in the medium term, when those R&D companies begin to lose contact with real innovation, there will be a large collapse of the US.
This is an unhealthy environment, even for people in China, because the US still has the most massive military and the idiot politicians might start throwing that around more and more as a way of distracting from their serious problems at home. Serious wars have often been started by bad economic situations in countries with large armies.
=~ s,(.*),<sarcasm>$1</sarcasm>,g if any_point_you_wish();
You're taking away the ability for companies to specialize. Let those that are good at R&D do R&D, and let those that are good at production do the producing.
[Obligatory Car Analogy] If I invent an awesome new spark plug that gives 10% more power for 15% less fuel consumption I have to build a factory and run it (which I know very little about) to avoid your stupid tax? That'll delay it from reaching the market for years, when it could be out in months if I license it to Bosch or Champion. Who gains from that? Not the environment. Not drivers. Not me. Not the economy as a whole. Not you either, hopefully.[/OCA]
Would you tax an architect more because he doesn't pour the concrete himself on the buildings he designs?
So it's a dumb idea in principle, but I suppose it sounds good to those who think it's not real work if you don't get your hands dirty.
It's a dumb idea in practice too. What about joint ventures? What about dealings between semi-autonomous divisions within companies? Are they in scope or not? It'll keep plenty of lawyers busy, that's for sure.
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
First off, patents don't protect "products" per se. They protect inventive concepts, of which a given product is but one embodiment (usually). In any case, a patent can comfortably take 5 years from filing to grant, and if you want to decrease that you're going to have to accept a lower standard of examination. Secondly, most jurisdictions have a mechanism wherein the renewal fees on patents (because you have to keep paying every year to keep it in place) rise quite sharply for the latter half of the term of protection. The effect of this is that the average length of patent terms for the majority of cases is actually quite a bit less than the 20 years maximum possible term, because it becomes uneconomical for the proprietor to keep up the renewal fees when the patent's subject matter has ceased to be profitable for them. Also, 5 years might be plenty for technology products, but consider other fields; pharmaceutical products - for whom the "incentive to invent" justification for patents is perhaps strongest - will still be undergoing the regulatory approval process by the end of 5 years.
The "obvious" test isn't really there because of competitors, it's to stop trivial inventions being patentable. Your solution would remove that barrier, and also ignores the fact that there are many possible reasons why a good, solid patent idea may not yet have been filed. With your system, you could end up with trivial patents being granted due to no-one else wanting to work in that field, or extremely solid patents being refused simply because there were multiple people pouring huge amounts of effort and inventiveness into the same field.
Finally, your final criterion already exists. It's called "sufficiency of disclosure", and in most jurisdictions (patents being national rights and hence requirements varying from place to place), if the ordinary skilled person cannot work the invention described to the full extent of protection sought by the claims, then that is grounds for refusal or revocation of the patent.
Once upon a time I was in the thick of this, both working for a Rambus licensee on our implementation of their design, and later reading the patents, including the original 1990 submarine.
I don't see from your Wikipedia link where they say Rambus "stole" their IP from anyone.
As a fun aside, the original 1990 submarine patent application, was abandoned, but not before being continued, which I guess is part of what let it stay submerged for so long. I believe even the first continuation was abandoned as well, but not before it spawned the other patents that they actually used. That orginal patent actually described "Rambus-C", not "Rambus-D", the thing that they eventually brought to market with Intel.
It was an incredible job of mining the teachings to extract claims which just happened to match the JEDEC standards. I was also friends with several JEDEC members on that board, at the time.
The living have better things to do than to continue hating the dead.