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Newegg Defeats Alcatel-Lucent in Third Patent Win This Year

Newegg's policy of not backing down from patent trolls, even ones as large as Alcatel-Lucent, continues to result in victory. Earlier this year, Overstock and Newegg successfully defended themselves with a jury invalidating Alcatel-Lucent's main patent used to force companies as large as Amazon to settle. Naturally, Alcatel-Lucent appealed, but the appeals court quickly ruled in favor of Newegg and Overstock.com. From Ars: "Federal Circuit judges typically take months, and occasionally years, to review the patent appeals that come before them. Briefs in this case were submitted last year, and oral arguments were held last Friday, May 10. The three-judge panel upheld Newegg's win (PDF), without comment — in just three days. ... Alcatel-Lucent dropped the case over its other two patents, desperate to get back the '131 patent that Newegg and Overstock had killed at trial. 'If they had been able to revive this patent, the litigation machine would have continued on,' Reines told Reuters after the win."

28 of 143 comments (clear)

  1. A simple summary... by PortHaven · · Score: 4, Insightful

    Of the patent(s) at hand would have been nice...

    1. Re:A simple summary... by idontgno · · Score: 4, Informative

      I know this is not appropriate to Orthdox Slashdotism, but if you had read TFA, you'd have found this link to the actual patent in play.

      --
      Welcome to the Panopticon. Used to be a prison, now it's your home.
    2. Re:A simple summary... by EmagGeek · · Score: 4, Insightful

      Yeah I'm an idiot and didn't see that there :p

    3. Re:A simple summary... by UnknowingFool · · Score: 5, Interesting

      Am I the only one that read the patent and thought it was extremely vague and so general that it describes almost every client-server relationship since the beginning of the computing?

      --
      Well, there's spam egg sausage and spam, that's not got much spam in it.
    4. Re:A simple summary... by Impy+the+Impiuos+Imp · · Score: 4, Informative

      I read it -- it took me 4 minutes to figure it out.

      Old way: Server sends, say, menu of 5 items with indicator to highlight first.

      User arrows down two, client sends two down arrows. Server notes this that it is on 3rd item, but only in theory.

      User hits enter. Server receives enter and decides 3rd item is selected.

      Patent: Send IDs for all that shit and client reports ID-based activities.

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    5. Re:A simple summary... by Paul+Slocum · · Score: 4, Informative

      "Evidence at trial showed Alcatel's patent application to the U.S. Patent Office (USPTO) that resulted in the issuance of the '131 patent was faulty because the claimed invention was both anticipated and rendered obvious by technologies from the 1980's that preceded Alcatel's patent application by years." source

    6. Re:A simple summary... by schlick · · Score: 5, Interesting
      heh the lawyer for Alcatel didn't even know which patent it was!

      "Successful defendants have their litigation managed by people who care," said Cheng. "For me, it's easy. I believe in Newegg, I care about Newegg. Alcatel Lucent, meanwhile, they drag out some random VP—who happens to be a decorated Navy veteran, who happens to be handsome and has a beautiful wife and kids—but the guy didn't know what patents were being asserted. What a joke.

      --
      "It's because they're stupid, that's why. That's why everybody does everything." -Homer Simpson
    7. Re:A simple summary... by Theaetetus · · Score: 3, Interesting

      Only 1980's? I'd be surprised if substantial part of that, at the least, didn't go back to Doug Engelbart's On-Line System demo in 1968. :-) That was a veritable treasure trove, that one.

      Generally, when invalidating a patent, you go for the most recent prior art that's still "prior" to the priority date of the patent - there's less wiggle room when you say "this was done 6 months earlier by X" as opposed to "this was done 20 years previously by Y", because with the latter, they can respond "if so, how come no one exploited it for 20 years?"

  2. Fuck Yeah! by idontgno · · Score: 5, Informative

    Give 'em hell, Newegg!

    Another big PC build order comin' your way! Keep on winning

    BTW, on a sad note, does anyone remember when Lucent actually innovated stuff? The legitimate heir of Western Electric and Bell Labs has fallen very far.

    --
    Welcome to the Panopticon. Used to be a prison, now it's your home.
    1. Re:Fuck Yeah! by wiggles · · Score: 3, Insightful

      Yep. I was a contractor there during the dot-com bust. Watched their stock drop like a stone overnight. For the company that essentially invented cellular service, the company that managed to build a global telecommunications infrastructure, and invent Unix and C on the side - it was truly sad to see what the corporate raiders did to them.

    2. Re:Fuck Yeah! by Grizzley9 · · Score: 5, Informative

      BTW, on a sad note, does anyone remember when Lucent actually innovated stuff? The legitimate heir of Western Electric and Bell Labs has fallen very far.

      Do you mean like this? Light Radio, a programmable cell tower the size of your palm?

      While true it has been a while since the hey day of Bell Labs coming out with new tech every few years, they don't seem dead just yet. I blame their current state on chasing quarterly or yearly profits and having a somewhat unfair playing field with companies like Huawei and ZTE instead of investing in the long term tech.

      Per wikipedia

      On August 28, 2008, Alcatel-Lucent announced it was pulling out of basic science, material physics, and semiconductor research, and it will instead focus on more immediately marketable areas, including networking, high-speed electronics, wireless networks, nanotechnology and software.

      That and their merger with Alcatel hasn't been very smooth. Though too, perhaps the wireless tech is maturing so there is not the low hanging fruit anymore?

      Also for clarification Bell Labs is still around in at least some form, it is the research arm of Alcatel-Lucent. Lucent merged with Alcatel back in 2006.

  3. Re:Missing info from the articles by alen · · Score: 4, Interesting

    at the trial the alacatel VP who was sent to testify had no idea which patent newegg was violating or how they were violating it. alcatel just said you must be violating one of our 27,000 patents

  4. Good show, NewEgg! by sstamps · · Score: 4, Interesting

    THIS is why I give my business to companies like NewEgg, and have and will NEVER buy a single damn thing from ones like Amazon.

    Amazon settled because it is also a patent troll. Blood runs thicker than water, especially between patent trolls.

    --
    -SS "Teach the ignorant, care for the dumb, and punish the stupid."
    1. Re:Good show, NewEgg! by Jonner · · Score: 4, Informative

      THIS is why I give my business to companies like NewEgg, and have and will NEVER buy a single damn thing from ones like Amazon.

      Amazon settled because it is also a patent troll. Blood runs thicker than water, especially between patent trolls.

      Amazon are not pure patent trolls or they would not have been sued. They actually use their technologies. I'm not saying they are squeaky clean, I certainly didn't like their 1 click patent, but they are not a complete troll.

      Indeed, the genius of the pure patent troll company is that I can never be attacked in the same way it attacks. Since the troll company doesn't produce any useful products or services, there's no activity it does which could be considered for patent infringement, at least until one of them is granted a patent on enforcing patents as a business method.

      Big corporations wield large portfolios of patents as weapons all the time, suing and countersuing each other when it looks like that action will help profits. While this is a very damaging abuse of the patent system, it's quite different from the type of trolling described in TFA. Also, the fact that Amazon chose to settle has little to do with how that company may have abused their patents in the past. They made a decision calculated to be best for their bottom line, whether that was a correct decision or not.

      As a customer, I think it's a mistake to make broad buying decisions based solely on one aspect such as the suits described in TFA. I've been a customer of NewEgg for years because they have good prices and service and now I have yet another reason to use and recommend them. I've also been a customer of Amazon, especially of their music store which has long provided downloads unencumbered by DRM, proprietary formats or requirements to use specific client software. OTOH, I'd never use Amazon's Kindle system with its very restrictive DRM and other lock-in mechanisms.

  5. Patent office should have to pay legal fees by RichMan · · Score: 4, Insightful

    The patent office should have to pay the legal fees of the winning side every time a patent is defeated in court.

    The patent office are the gate keepers. They are currently enabling all the patent shakedowns.

    For proper control every system needs proper negative feedback. If the patent office gets money for granting patents and does not lose money for granting bogus patents they are going to grant everything under the sun to encourage more applications and more incoming money.
    Only by penalizing the patent office for improper patent granting will there be a proper measure of control.

    1. Re:Patent office should have to pay legal fees by dutchwhizzman · · Score: 3, Insightful

      Maybe not only the patent office, but both the company that filed or bought the patent should get to pay. Not just the legal fees, but a penalty on top. That should make people consider more carefully when they buy or file a patent.

      --
      I was promised a flying car. Where is my flying car?
    2. Re:Patent office should have to pay legal fees by Jah-Wren+Ryel · · Score: 4, Insightful

      Maybe not only the patent office, but both the company that filed or bought the patent should get to pay. Not just the legal fees, but a penalty on top. That should make people consider more carefully when they buy or file a patent.

      Forget fining the patent office -- all that will do is reduce the funding available for patent examiners to do their jobs causing the reverse effect of letting more bad patents slip through. But a fine on the patent holder for certain kinds of invalidations sounds good to me. It is my understanding that it is the patent filer's responsibility to seek out prior art as part of the application process. If a patent is invalidated for what is essentially failure to follow the filing process correctly then I think a big fine is appropriate.

      What we do not want is to turn the system into one where a big company can simply out-lawyer a small patent holder and then add insult to injury by forcing them to pay a fine too. That increased risk would discourage little guys with validly patentable inventions from filing in the first place (or force them to settle out of the court on poor terms).

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      When information is power, privacy is freedom.
  6. Lesson from primary school by dkleinsc · · Score: 5, Insightful

    The best way to deal with a playground bully is to punch him in the face. Even if he has his buddies with him. Even if you'll get disciplined by the school. You do that a few times, and no one will mess with you.

    The same principle applies to patent trolls: Always fight if you can at all manage it.

    --
    I am officially gone from /. Long live http://www.soylentnews.com/
  7. Newegg is no mom 'n' pop. by MickyTheIdiot · · Score: 5, Insightful

    Newegg might be smaller than Lucent, but they are still not a Mon 'n' Pop. I know that in the corporate mind anything under a thousand employees is "small business" but, face it, Newegg is not small business.

    The real tragedy with patent trolls is that the *real* small business can not fight them. They can shut down a business writing innovative software with 2-3 employees just like that.

    Good for Newegg, but treating it like a David vs. Goliath win is not too smart.

  8. Re:too bad its not precedential by Shotgun · · Score: 3, Insightful

    Maybe not a 'legal' precedent, but most certainly a 'social' precedent.

    It tells everyone that the trolls can be taken down. Notice how the trolls are backing off of Newegg. The trolls know Newegg will fight back. The trolls know that Newegg will take out their best moneymakers. Better to go pick on somebody that won't put up a fight. Well, when the rest of the playground sees that the bully will back down if you punch him in the nose, the bully's control is greatly curtailed.

    --
    Aah, change is good. -- Rafiki
    Yeah, but it ain't easy. -- Simba
  9. Re:Force by plover · · Score: 5, Informative

    Force is a euphemism for blackmail, and it's not inaccurate when applied here. "Nice web site you got here, it'd be a shame if we had a court order you to take it down. Give us $100,000 and nothing bad will happen to it, or you risk losing a $100,000,000 in court if we win." That's force to a company that doesn't have $100,000,000 in their bank account.

    Newegg's made a corporate decision that said "we don't care if it's a thousand times cheaper to settle than to risk losing a lawsuit. We have a very large pile of money, and we have promised to call every single bluff presented to us. We will never fold our hand."

    Go, Newegg!

    --
    John
  10. Re:too bad its not precedential by Lloyd_Bryant · · Score: 4, Insightful

    i wanted to scan the opinion, but there is none. and the decision says nonprecedential.

    not a lawyer but it seems this decision cannot set a legal precedent for future cases

    There was no precedent to be set here. Basically, the appeal was Alcatel trying to get its favorite patent un-invalidated, and the the judges looked at the case and are basically telling Alcatel "There's nothing wrong with the lower court's decisions - it stays invalidated. Now go away and quit bothering us".

    --
    Don't tell me to get a life. I had one once. It sucked.
  11. Re:Seriously? by Lumpy · · Score: 4, Insightful

    A patent should require a physical object. Yes that means method and software patents die instantly, which is a very good thing.

    --
    Do not look at laser with remaining good eye.
  12. Consequences? by ggpauly · · Score: 5, Interesting

    What happens with the settlements that Amazon and others made over this patent? Can that money be clawed back?

     

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    Verbum caro factum est
    1. Re:Consequences? by Solandri · · Score: 4, Interesting

      Amazon gets nothing back. They entered an agreement to license the patent, irrespective of whether or not the patent was valid. That's why patent trolling works - no risk of a negative outcome (a zero outcome is still possible).

      Same thing happened to Research in Motion. They were sued by NTP for patent infringement. After RIM lost the court cases and the SCotUS turned down their appeal, they were backed into a corner and forced to settle with NTP for $600+ million. Then the USPTO decided to review the patents and invalidated some of them. (They're still in the process of being reviewed AFAIK. The courts have put NTP's lawsuits against other wireless companies on hold until the review is completed. Fat lot of good that does RIM. We'll always wonder if they would have fallen as badly as they did if they had had $600 million extra to put into R&D back in 2006.)

  13. Re:Force by Anonymous Coward · · Score: 5, Insightful

    Actually, their view is somewhat more long-sighted than that. "We know settling this one patent would be cheaper than fighting, but settling would encourage a flood of other patent trolls to try and that would be more expensive."

  14. Re:Seriously? by gstoddart · · Score: 3, Insightful

    If it wasn't for the graft and greed or incompetence of the employees of the patent office, they never would have.

    And since the US has set themselves up to be an economy highly dependent on patents and copyright, I seriously doubt you'll see these patents repealed.

    The people lobbying for expanded IP rights don't want patents lessened, and they're not going to allow the politicians to take away their meal ticket.

    When Microsoft makes more revenue from Android licenses (for patents I'm not convinced they've ever disclosed) than they do on their own OS, nobody is going to allow patents to stop being so widespread.

    At this point, all of the "too big to fail" companies are so dependent on this as to make it inseparable from their core business.

    --
    Lost at C:>. Found at C.
  15. Re:Seriously? by greenbird · · Score: 4, Interesting

    The patentability of software only applies when it is run on a computer.

    Software isn't being patented in "software" patents. Vague ideas and idioms are patented. Pinching the screen to zoom isn't a software patent. If it was a software patent the patent should be on exactly how the software accomplishes the effect, on the implementation. If my implementation accomplishes the effect differently it wouldn't infringe your patent. The implementation is the code. The code is copyrighted. A real software patent would be redundant. The way it works now is the equivalent of inventing a special kind of drill bit and getting a patent on anything that makes holes. That's how software patents work now.

    --
    Who is John Galt?