Are Patent Wars Worth the Price Tag?

ericjones12398 writes "It's beginning to feel like a TV series, a weekly patent war drama. Apple and Samsung have consistently been going back and forth with claims of IP infringement, to the point where who is accusing who of what is exhausting to follow. The question I would like to ask and try to answer is what the opportunity costs are of pursuing litigation versus just toughing it out? Would it be more economic for both companies to live and let live, or is there value to be captured in legal finger pointing? My best guess would be that this isn't about stopping sales this quarter or next, nor is it about defending the small-scale tech features that merely mildly differentiate. It's instead about momentum and branding. Winning these cases is PR that says, we are the leaders in smartphone technology, we are the innovators."

Comments

Shoot a lawyer...

[Gription]

This is more about the legal department making decisions. Are they going to decide "Let's not do any litigation!"? Of course not. They will always pick a choice that keeps them employed.

Re:Shoot a lawyer...

[reebmmm]

This is more about the legal department making decisions

This is usually very much NOT the case. Legal departments in major corporations don't usually make these sorts of decisions. Or, when they do make the decisions, they're usually very conscious of the fact that lawsuits (and legal fees generally) are not viewed as revenue centers, but cost centers. Wins in any litigation are usually windfalls, not strategic investments.

There are exceptions, of course. Companies do exist with litigation as their business model. However, you might be surprised about how much strategic planning goes into that as well.

Are they going to decide "Let's not do any litigation!"? Of course not. They will always pick a choice that keeps them employed.

In-house lawyers don't view litigation as job security. Few companies staff litigation lawyers. That work is almost always moved to outside counsel. Those with litigators on staff don't usually do patent litigation. Litigation tends to detract from scarce corporate resources for legal services that are usually necessary to keep a business running.

For most companies, in-house counsel are concerned more about avoiding litigation and the expense of that litigation than they are with prolonging that litigation.

All of that said, it may come as a surprise to you that BUSINESS teams are usually more litigation happy than the lawyers especially if they see a competitive reason. In fact, at Apple, Steve Jobs famously said that he's willing to go "to thermonuclear war" with Google over Android: http://www.insidecounsel.com/2012/06/04/steve-jobs-quotes-allowed-in-apple-google-patent-t

In addition, business teams tend to be less calculating about their litigation risks than the lawyers they have on staff.

Are Patent Wars Worth the Price Tag?

[WilliamGeorge]

To the community at large: no. End of line.

I despise patents

[A nonymous Coward]

I am convinced that at least 99% of patents are useless. They are trivial expansions on previous patents, maybe changing the temperature of an annealing, maybe adding .01% more chromium, or changing the angle of a gear surface by a degree. Software patents are far worse them mechanical patents, and I have not heard of a single one that is not obvious to someone skilled in the arts.

If those companies spent half on research what they spend on patent lawyers, they'd beat the competition in products and build up their internal skills to keep their edge.

Patents are the first refuge of the unskilled.

Re:I despise patents

[A nonymous Coward]

Yes I do. Intellectual property is no more property than vibrations in air.

The idea that someone can write a song and retire and the grandkids can probably retire at birth too is disgusting. Whereas I write a program and have a job. Did K&R retire from writing C? No, it just gave them the reputation to get further work. That's all anyone should get.

I have a neighbor whose father wrote some famous songs, and now he spends half his time ferreting out bands who don't pay the proper respect. Nice for him, does nothing for productivity or creating new works or making anyone, including him, any happier.

Re:I despise patents

[Yvanhoe]

There, there. I agree that intellectual property ha been completely subverted. I agree that software patents should be outlawed, that the copyrightableness of code should be carefully examined, and the copyrightableness of binaries also. However, there are indeed domains where a period of exclusive commercial exploitation makes sense. Drug research, movie production.

I like the position of the pirate party : copyrights should be a lot shorter (~10 years) and non-commercial sharing should be allowed. It is, however, productive to propose a period of commercial exclusivity.

Re:I despise patents

[Dunbal]

he idea that someone can write a song and retire and the grandkids can probably retire at birth too is disgusting. Whereas I write a program and have a job. Did K&R retire from writing C? No, it just gave them the reputation to get further work. That's all anyone should get.

I agree. For example, I recently went to an Elton John concert here in Costa Rica. Sir Elton is what, 60-odd now? We had a great time and he played his all time hits. I went home and looked at his concert schedule. The man is working in Vegas every weeknight, and flies internationally on his private jet on the weekends. What this means is he is working his ASS off. Therefore he well deserves all the fabulous riches that he has.

Now look at some of those "one hit wonders" from the same time period that go around complaining and suing people at the drop of a hat. Yeah, fuck em. They don't deserve any more than they got. If they didn't manage their money and decided they could retire at 20, well, they are reaping the rewards life gives such people.

Yes, because only the BIG guys can play the game

[thomasdz]

After a few years of these patent wars, all the Googles, Apples, Microsofts, Samsungs, etc have big war chests that they can win some battles and lose some battles. unfortunately, battles will kill the smaller companies and keep the existing big companies in place.
Status quo all the way baby...it's a new world.

Maybe it's not about the IP at all

[EliSowash]

A little part of me wonders if the lawsuits are as much a strategic business plan to foil the competition. Y'know, like throwing around some bad press will dissuade investors, and a court ordered delay for a product's entrance to market in a particular region will cost the opponent so much in revenue, and allow the plaintiff time to get a foothold in the marketplace. Sort of 'gaming' the legal system to get a competitive edge, without so much concern for the outcome of the suit.

Are they worth it?

[the eric conspiracy]

A patent is a contract between the inventor and the government. The exchange is:

1. The government grants an right to the inventor to prevent others from practicing the invention for some period of time, currently 20 years.

2. The inventor publishes in the patent the details of the invention which would give others the ability to practice the invention.

So it's worth it if having the details of the invention published outweighs the costs associated with the restriction on practicing the invention.

Your mileage will vary depending on the nature of the invention. The less obvious it is the more likely you will come out ahead.

For the vast majority of the inventions that Samsung and Apple are quibbling about the answer is pretty simple to see. It's not worth it.

These patents should have never issued.