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(Message started by: Isaac on Jan 10th, 2006, 9:58am)

Title: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Isaac on Jan 10th, 2006, 9:58am
USPTO PARTNERS WITH OPEN SOURCE COMMUNITY TO EXPAND
PATENT EXAMINER ACCESS TO SOFTWARE CODE

Alliance will focus on software-related patents


The Department of Commerce’s United States Patent and Trademark Office (USPTO) has created a partnership with the open source community to ensure that patent examiners have access to all available prior art relating to software code during the patent examination process.

more at...

http://www.uspto.gov/web/offices/com/speeches/06-02.htm

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by JSonnabend on Jan 11th, 2006, 8:10am
I saw a blurb on this in the New York Times, and of course, the Slashdot folks are frothing at the mouth, but I'm not sure what it really means.  Has anyone taken the time to actually figure any of this initiative out?  I'd love to hear.

- Jeff

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by JimIvey on Jan 16th, 2006, 2:35pm
I've been sort of following the indirect discussions re software and patents and open source.  I'll try to read between the lines in the notice....


Quote:
The group agreed to improve prior art resources available to the USPTO;

First, it's not clear whether "the group" is the entirety of the meeting attendees or just the representatives of the open source community.

I read this as providing better access to non-patent software prior art for use by examiners.  

This is one of the major concerns of the open source community.  The hope of OS is to create something and set it free to benefit the world generally.  Much of the focus on OS development is on independent creation, to avoid copyright infringement.  The licensing aspects of OS is to prevent the software from being corralled and privatized for exclusive business use (think of a corralled wild stallion -- that's the mental image of the software taken and privatized by a corporation).  Unfortunately, there is no independent creation defense to patent infringement (hence, the disdain for software patents, in my opinion).  The other problem is that prior public use of OS software generally doesn't prevent subsequent patenting of the same thing -- due largely to inadequate searching facilities (and to inadequate documentation of the OS software itself, from a patent examiner's likely perspective).  If such a patent issues, it has a strong presumption of validity and woe is the OS developing community.

This statement seeks to address at least the inadequacy of searching tools to cover a substantial portion of publicly used and/or distributed OS software, and may attempt to addressed the perceived inadequacy of OS software documentation (not how to use it, which is reasonably well documented, but how it does what it does and to some degree, what is does exactly).


Quote:
to develop a system to alert the public when USPTO publishes certain software-related applications so that interested parties can submit related prior art in accordance with relevant rules and law;

My guess here is that the OS community wants to know when there's a new software patent application for which to mobilize the troops.    I don't know who's going to build the tool, but I could probably do it myself (some script to perform a weekly search of published applications in a given group and at least a front page download).  In fact, I've already done something like that for other types of searches (downloads the front pages of all results on a patent search page).  I'd happily share that with the OS community (or any other community) under OS terms.

I think combining this tool (mine or another's) with inexpensive means for third-party IDS submission could go a long way to overcoming any limitations in searching tools for OS software.  This would allow the OS community to voluntarily provide search services for the PTO.


Quote:
to explore developing additional criteria for measuring the quality of software patents.

This one is scary to me.  For some in the OS community, they wouldn't know a quality patent (software or otherwise) if it came up and bit them on the behind.  There's no reason to single out software from all other sorts of technology within the patent system.  All criteria for a good software patent should be applicable to all other types of patents.  As much as I'm sympathetic to the OS community, asking them which software patents are good is like asking a canary which cats are good.  

Personally, I think that 70%-80% of the concerns of the OS community would be addressed by a good way to effectively consider publicly used OS software as prior art during patent examination.  The first two items quoted above would represent good progress in satisfying this need.  Hopefully, the last item just means the PTO and the OS community will keep an ongoing and open dialogue to facilitate providing high-quality examination of software patent applications.

Regards.

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by JSonnabend on Jan 17th, 2006, 8:40am

Quote:
I think combining this tool (mine or another's) with inexpensive means for third-party IDS submission could go a long way to overcoming any limitations in searching tools for OS software.

This, I believe, would help fix our broken system immeasurably.  Create an "opposition" system, of sorts, akin to the opposition mechanism for tm's.  Even third party IDS' would be a big step in the right direction.

- Jeff

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on Jan 17th, 2006, 11:53am
Of -->This one is scary to me.  For some in the OS community, they wouldn't know a quality patent (software or otherwise) if it came up and bit them on the behind.  There's no reason to single out software from all other sorts of technology within the patent system.  All criteria for a good software patent should be applicable to all other types of patents.  As much as I'm sympathetic to the OS community, asking them which software patents are good is like asking a canary which cats are good. <--

the work on the patent quality index is probably an outgrowth of the patent quality problem proposed by Quillen and Webster, wherein it was once alleged that the USPTO grants patents on 97% of all applications.  Although even Quillen and Webster dropped that, one notes that Professor Wagner cited the 97% number in a law review published in Nov. 2005, so he may be laboring under a false impression of how bad the "quality" problem is.  Separately, there seems to be a US patent very similar to the approach taken by Wagner (6,556,992).  Thus, ironically, the approach taken to alleviate problems caused by neglect of prior art seems to ignore prior art pertinent to the approach.  


Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by JimIvey on Jan 17th, 2006, 12:54pm

on 01/17/06 at 11:53:23, Cibola wrote:
... it was once alleged that the USPTO grants patents on 97% of all applications.

Of course, I'm not telling practitioners anything they don't already know, but this number is misleading.  My very unscientific estimate would be that more than half of those applications as issued have undergone significant modification and probably substantial narrowing during prosecution before issuing as any patent at all.  I've seen applications (prosecuted by others) with no less than 6 amendments before anything issues.  To suggest that the Patent Office is laying down and allowing anything with such a statistic is so misleading as to be intellectually dishonest (and, I understand Cibola was just quoting another).  

My unscientific guesstimate is that fewer than 25% of application are allowed without substantial narrowing during prosecution -- perhaps fewer than 15% or even 10%.  

The reality is that it's extremely rare that an applicant's specific implementation is so exactly duplicative of prior implementations that the applicant can't get some level of patent protection, albeit fairly narrow at times.  That "extremely rare" circumstance is probably at or below the 3% suggested by the statistic.  More often, I find applicants determine that, although they could get very narrow protection in view of circumstances revealed during prosecution, the narrowness of the available protection does not justify the expense and effort of continuing the application.  I would guess that such determinations make up the difference between the "extremely rare" case I mentioned and the quoted 3%.  The remainder accept the substantially narrowed protection to allow the case to issue.

In short, anyone who thinks that they can get any application issued should be in this business and doing it.  There would be much demand for someone with such talents.  And, the fact that talents are required belies the quoted statistic.

Regards.

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on Jan 17th, 2006, 7:21pm
Of Quillen and Webster's "97%" patent grant rate number, the important point to note is that it is not accurate, even though Professor Wagner may have cited it in 2005.  Some interesting discussion may be found at http://talkaboutbusinesses.com/group/misc.int-property/messages/65029.html.

Of Wagner's approach, which incorporates information from re-exams and litigations, one notes that the Eolas patent, which has survived litigation and re-exam, would probably ring out as a high quality patent, perhaps not the result expected by the open source folks.  Separately, the search for claim terms not defined in the specification as an indicator of "low" quality might be a bit deceptive; as one example, the term "melting point" might not be defined in the spec but would not be harmful to the validity of the patent.

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on Jan 17th, 2006, 9:17pm
Further discussion of the deficiencies of the method underlying the "97%" [and "85%"] patent grant rate allegations may be found in jip.kentlaw.edu/art/volume%204/ 4%20Chi-Kent%20J%20Intell%20Prop%20186.doc.

One notes that many academics, including not only Wagner but also Lemley and Moore bought into the Quillen/Webster approach without reviewing the compelling evidence against it.   In the present situation, with the patent quality index, one hopes that there will be a more serious analysis of a proposal to identify high and low quality patents.    Although there may be a lot of traction on the patent "quality" issue, one has to avoid being drawn into research that amounts to telling people what they want to hear, as happened vividly in the publication by the journal Science of two fraudulent papers on human embryonic stem cells by Hwang Woo Suk.

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by JimIvey on Jan 18th, 2006, 9:30am
Thanks for the link.  While I have the utmost respect for at least one of the pundits named in the article (the others I don't know), I have two major problems with the theory that a large percentage of applications allowed/issued equates to too many patents covering known things.

First, as I mentioned above, none of this takes into account that claims are allowed, not applications -- and that claims are often amended in significant ways (or broadest ones canceled while narrower ones issue).  I think a much more interesting statistic would be the percentage of claims are issued as filed (without modification).  And, to be a valid statistic, all claims depending from any modified claims are to be considered modified (even if the actual text of the dependent claim was not modified).  Of course, cancelation counts as modification unless an identical claim was later filed in a child application (continuation, divisional, CIP) or even added back to the same application (that happens).

My very rough guess would be 10% or less of all filed claims are allowed without modification of any kind.  Perhaps 15% are allowed without any substantive modification (I know, a subjective criteria that's hard to evaluate -- but that's the nature of the patent business).

So, the presumption that allowance of many applications means the Patent Office isn't a meaningful filter is just not valid from the quoted statistics.

My second problem is the logical leap from many applications issued to many applications improperly issued.  It's simply not a valid assumption.  

The closest thing to any kind of comprehensive study on this is a rumored quality assurance program within the USPTO in which they privately re-examine cases selected somewhat randomly to evaluate the performance of examiners.  I don't know the results (don't even know the program really exists), but I seem to remember hearing rumors of a confirming conclusion (positive evaluation) in at least two-thirds or three-quarters of all evaluated cases.

I don't think one can reasonably believe (without substantial doubt) that the quoted statistic is anything approaching conclusive proof of a patent system run amok.  I think significant corraboration is required before such a belief (as opposed to unfounded opinion) is reasonable.

Regards.

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on Jan 18th, 2006, 11:06am
In this discussion, we have at least two themes:  

-->first, what Quillen and Webster put forward in two papers (Q1 and Q2), with Wagner having adopted the 97% grant rate of Q1 and Lemley and Moore (and others) having adopted the 85% number of Q2.  

-->second, what Wagner is proposing to do with a quality index in the context of the cooperative venture among open source people, IBM (and others), and the USPTO.

Of the first issue, I agree with your points that the claims define the invention (which is missed in both Q1 and Q2) and that the number of unchanged claims in the prosecution of applications is less than 50%.  Discussion of this number came out in the Festo case, wherein the parties discussed the scope of the impact of the absolute bar.   Additionally, the presumption that the patent grant rate is an indicator of patent quality can be questioned.  Looking only at grant rate does not address the scope of the allowed claims, which can be distinct from the scope of the submitted claims.  In the final report by the National Academy of Sciences, the panel did not rely on the numbers of Quillen and Webster, but did rely on a perceived higher grant rate in the US relative to Japan and Europe to infer the presence of a patent quality issue in the United States.  The NAS panel did not contemplate the impact of different rules among the US, Japan and Europe.  
The patent quality issue served as common ground to involve many players dissatisfied with the patent system to get traction for patent reform, in the body of HR 2795.   However, disagreement over the injunction issue among major players killed off 2795.  Of course, 2795 was disconnected from the fee diversion issue, which also went nowhere.  In the end, the USPTO pretty much ended up where it started.

Enter the open source initiative.  Here, the PTO gets access to "free" resources to aid in the evaluation of a problematic area.  Not a problem.  But tacked on is a lingering vestige of the quality discussion, spearheaded by someone who thinks the PTO grants patents on 97% of all applications.   In one irony, using the proposed metrics (including re-exam and litigation success), the Eolas patent, a poster child of evil to many in open source, will look like a high quality patent.  [As an aside, note that the re-exam of the Eolas patent which has now concluded was initiated by the USPTO director (with a strong push by W3C), and not by Microsoft; we now apparently have a different re-exam.]  In another irony, the quality examination initiative proposed by Wagner appears to fall within the scope of an issued, in-force US patent.  If the open source folks use a patented approach to evaluate patents, doesn't that undercut their underlying claim to fame a bit?


Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by JimIvey on Jan 18th, 2006, 12:41pm

on 01/18/06 at 11:06:44, Cibola wrote:
... the Eolas patent, a poster child of evil to many in open source

Do any reasonable people consider Eolas the poster child for improperly allowed patents (claims)?  It withstood challenges in court (all the way up to the Supreme Court) and in the USPTO (and, as you note, undergoing a second challenge in the USPTO).  Not many patents withstand that sort of scrutiny.  While I haven't read the Eolas patent, it seems that it's of sufficient quality at the very least -- perhaps relatively high quality.  I certainly hope my patents fare as well.


on 01/18/06 at 11:06:44, Cibola wrote:
If the open source folks use a patented approach to evaluate patents, doesn't that undercut their underlying claim to fame a bit?

I'm not sure I follow here.  I don't think the OS community ever asserts that they can deftly avoid infringement of all patents (if any such assertions are made, it must be out of pure ignorance).  My understanding of their perspective is that it seems you can't do anything without running afoul of patent infringement liability.  I would think a patent on evaluating patents would support their claims, not contradict them.  Perhaps I misunderstood your point.

I think the biggest problem in this whole issue is the insistence in treating all patents like commodities.  Parent are, by definition, unique.  Each one must be considered on its unique merits.  

Of course, economists hate that.  I heard a joke at a recent IP CLE conference.  I'll shorten it considerably....  To improve efficiency of a dairy farm, a panel of expert economists are called in to study the operation.  As the collaboration begins, some assumptions are agreed upon.  First: "assume a spherical cow of uniform density...."

Like cows, patents are not spherical and do not have uniform density.  Assumptions to the contrary are ... "inefficient" (evil and an anathema to any economist).

Regards.

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on Jan 18th, 2006, 8:04pm
Of opinions on U.S Patent No. 5,838,906 (Eolas), the W3C's HTML Patent Advisory Group put together prior art which it claimed would establish that the Eolas patent is invalid and "should therefore be re-examined in order to eliminate this unjustified impediment to the operation of the Web."  The Group stated the object embedding technology being claimed by Eolas has been a part of the HTML standard since the early days of the Web.  The Group warned that changes enforced by the Eolas patent would have a "permanent impact on millions of historically important Web pages," including pages with non-commercial content or older material that is not generating revenue.  In a letter to the USPTO Director, Berners-Lee wrote:  "Removing the improperly disruptive effect of this invalid patent is important not only for the future of the Web, but also for the past.  The '906 patent is a substantial setback for global interoperability and the success of the open Web."  Karsten Schneider wrote:  -->To me the Eolas patent is the poster child for software patent abuse. This so called invention has been independently “discovered” by everybody who has implemented a modern browser. The patent has done absolutely nothing to advance the art (one of the primary reasons for patents). <-- See http://kas.felinity.net/ndate/2005/09/

Of the quality index, one question might be whether or not Wagner and others seek to license the patented technology or simply just use it.  So far, there has not been much discussion by Wagner of the existence of the patent.   Similarly, there has not been much discussion by Wagner of why he believes the 97% patent grant rate is correct, in view of the substantial attack on the approach by Quillen.





Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by JimIvey on Jan 18th, 2006, 11:25pm
Whether a particular patent advances technology isn't really the final determination of the quality of a patent.  I've seen many clients extoll the virtues of their technology only to have the VC community completely ignore it.  Of course, eventually some company that gets funded comes up with the similar solution.  And, the funded company, having independently created the same solution asserts that the patent added nothing to the technology.

I don't know how many presentations in front of VCs you've made, but many times it seems like you're casting pearls before swine.  If the swine don't appreciate the pearls, it doesn't mean the pearls weren't valuable.  Like a contract, contribution requires both offer and acceptance of the technical teachings.  The inventor has control over the offer only, not the acceptance.  If the acceptance comes later, it's no fault of the inventor's.

As for the spot-on prior art of the early HTML standard, are you suggesting that Microsoft, with half a billion dollars on the line, couldn't find something as basic and fundamental as an HTML standard?  Perhaps they couldn't afford good experts or didn't have access to qualified software engineers.  Perhaps they thought they could save 1% of a $3,000,000 litigation budget by avoiding having any experts look at HTML standards for patent on web browser technology.

The notion that the validity of the Eolas patent wasn't adequately challenged in court by Microsoft just seems absolutely ludicrous.  The only plausible explanation (for a lame defense) is that MSFT didn't care about the half-billion dollars given MSFT's size.  I find that very hard to imagine -- especially with all the other patentholders in line with hands extended, palms up.  To paraphrase a Senator whose name I can't remember, a half-billion here, a half-billion there... pretty soon you're talking about real money.

Lastly, I haven't read the articles, but just because someone has a by-line doesn't mean that they know what they're talking about.  That includes me, by the way.

Regards.

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Isaac on Jan 19th, 2006, 6:28am
There are various measurements of quality, but they boil down to an index related to patents that the statistician thinks should not be granted.   The PTO is likely to measure quality in terms of patents that an examiner reasonably allowed or rejected under the constraints faced by the examiner.   Someone else might measure quality based on whether granted patents meet the definitions of patentability under the law.

Poster Cibola is basically suggesting that the invention in the Eolas patent is obvious independently of whether the legal standard suggests otherwise.   He is suggesting that independent reinvention by a number of different implementers suggests that an invention is obvious.    

Inherent in his "definition" of obviousness is a fairly high standard for inventiveness that IMO has already been shown to be hostile to reaching the objectives of the patent system.   Unlike copyright law which requires creativity and not sweat of the brow, the patent system does reward hard work and being first; no flash of genius required just small improvements over the existing technology.  

The other issue is that a reimplementation test is highly subject to hindsight.   Once you know that someone has invented X, it becomes much easier for a motivated someone to invent X.  In hindsight everything is obvious.

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on Jan 19th, 2006, 8:35am
Isaac and JimIvey may have misinterpreted my earlier remarks.  I was responding to the statement  -->Do any reasonable people consider Eolas the poster child for improperly allowed patents (claims)? <-- by furnishing evidence of some (perhaps reasonable) people who do consider the Eolas patent a poster child for a low quality patent.  I did not say anything about what I thought, so extrapolations to  "my" view of obviousness (or anything else) are unjustified from the text presented.    

One notes that W3C employed Pennie & Edmonds to write a paper attacking the claims of the Eolas patent in the director-ordered re-exam under 102 (not 103) grounds.   The combination of the smart technical people of W3C and the smart legal people at P&E did not go far towards invalidating the claims.  The examiner made an initial rejection under 103 and then dropped the arguments made by W3C/P&E entirely.

Microsoft attempted to utilize Wei's Viola browser as prior art, but the district court (strangelyand wrongly) applied abandonment principles to 102(a) art.    Although the Viola browser is not an anticipation, the failure of Berkeley to cite the art to the PTO, after Wei asserted its relevance prior to Berkeley's filing, makes inequitable conduct loom large.

Could Microsoft have done a better job?  Could W3C have done a better job?  Probably yes.  These were big guys who maybe didn't get the job done.  Turn the fact pattern around to what has happened with the Kamil patent, wherein the patentee attacks small guys who can't put up much of a fight (or Smucker attacking Albie's over the peanut butter and jelly patent).  Do litigation victories really prove the quality of those patents?  No.  Wagner's approach in  "objectively" counting noses out of context does not bring much to the party of patent quality.

Returning to the background of Wagner's quality index, this is an attempt to look at the past, in terms of why other patents were/were not invalidated, to predict via identification of variables obtained through regression what will happen to other patents (or even applications).   This approach is covered in a US patent issued in 2003.    Wagner has announced that his algorithm will be made freely available.   Wagner also has adopted the "97% of all applications are granted" number of Quillen's first paper, even though Quillen himself dropped the 97% in a paper published one year later, and years before Wagner adopted the 97% number.  This is way more than a byline issue or nice guy issue.

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Isaac on Jan 19th, 2006, 10:53am

on 01/19/06 at 08:35:33, Cibola wrote:
Isaac and JimIvey may have misinterpreted my earlier remarks.  I was responding to the statement  -->Do any reasonable people consider Eolas the poster child for improperly allowed patents (claims)? <-- by furnishing evidence of some (perhaps reasonable) people who do consider the Eolas patent a poster child for a low quality patent.  I did not say anything about what I thought, so extrapolations to  "my" view of obviousness (or anything else) are unjustified from the text presented.


Actually it looks like I misattributed a quoted remark to you.  Sorry about that.

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by JimIvey on Jan 19th, 2006, 12:02pm
Like Isaac, you can substitute "the authors" for "you" in my last post.  When someone posts a quote, it's hard to tell if the quote is offered as representative of the poster's viewpoint or simply as a point of discussion.  My apologies.

For what it's worth, my view that patents can't be lumped together in one big pile but must each be considered on its merits is consistent with Mark Lemley's proposal in his "rational ignorance" paper (sorry, don't have a link).  His argument is essentially that, due to the very small percentage of patents enforced (through litigation and licensing, to the extent he could get numbers on licensing), it's best not to devote too many resources to evaluating them until enforced.  Ultimately, he suggested doing away with the presumption of validity -- allowing the first meaningful examination/evaluation to be in court.  In essence, his point is that limiting thorough examination to those patents people really care about is a more efficient use of examination resources.

My main problem with that was the harshness of Graver Tank.  He admitted to me that he overlooked that in his paper but had some complex civil procedure, collateral estoppel obscure hair-splitting stuff I couldn't understand to suggest that there's a possibility to enforce a claim after being held invalid despite Graver Tank.  I wouldn't hold my breath waiting for such a result in court any time soon, but it's possible in theory (according to Mark).

My solution would have been to perhaps weaken the presumption of validity vis-a-vis the USPTO and maintain the strong presumption with repect to prior judicial/jury evaluations of specific items of prior art and specific arguments for invalidity/unenforceability.  You might call it a reverse Graver Tank.  Mark didn't respond to that, so I don't know if he liked it.

Lastly, I think Mark's notion of what constitutes enforcement of a patent is lacking (and I think he admitted as much in a footnote or parenthetical).  A patent which is not litigated and not licensed might still be an effective barrier to entry into a particular market.  Quantifying that "value" and the percentage of such enforcement (i.e., impact on the marketplace) would seem to be extremely difficult.

Regards.

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on Jan 20th, 2006, 10:55am
Of Lemley, note that he has extended (modified) his position from the discussion in Northwestern LR to now propose a two-tier system, with a presumption of validity applied only to so-called gold-plated patents.  Lemley's "ignorance" paper was later criticized by Kesan, who argued for "optimal ignorance".  All of this discussion ignores most basically that the point of the patent system is to obtain disclosure (not innovation or commercialization).  Further, Lemley's arguments ignore that people affirmatively invest in things because of the presence of patents.  For example, people have invested in BlackLight's technology without having licensed or litigated it.   The Patent Office should not be a party to encouraging bad investments anymore than the journal Science should trick people about the current state of advance in embryonic stem cells.  Lemley misses the big picture (and he's still wrong about the patent grant rate business).

As an aside, I don't at all understand your Graver Tank point.  As a factual matter, the patentee got access, through equivalents to manganese silicate, even though a claim, literally covering manganese silicate, had been declared invalid.  What point are you making?

Going back to the earlier Microsoft, big companies don't make mistakes point,  recall the testimony, before Congress, of the Exxon executive who stated he evaluated the decision to buy Reliance Electric by reading his college EE textbook during commercials while watching television.  More money was involved in that decision than in the Eolas case.

Of software patents, note also 9 Marq. Intell. Prop. L. Rev. 249.


Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by JimIvey on Jan 20th, 2006, 12:01pm

on 01/20/06 at 10:55:53, Cibola wrote:
As an aside, I don't at all understand your Graver Tank point.

"Graver Tank" is shorthand for the Supreme Court case that you found and its oft-noted holding is that, once a claim is found invalid, it's invalid forever against all accused infringers.  It's a collateral estoppel holding.  To have absolutely no presumption of validity (in Mark's proposal, regardless of how he may have modified it since) would seem harsh in the face of full collateral estoppel if a claim is ever found invalid.  It would seem harsh to allow a claim unlimited de novo challenges to validity requiring no more than a preponderance of evidence to prove invalidity when any one successful challenge forever renders the claim invalid.  I've always seen Graver Tank (the collateral estoppel holding, not the particular fact pattern) as balancing the presumption of validity.  Remove one and the scale of equity tips dramatically.


on 01/20/06 at 10:55:53, Cibola wrote:
Going back to the earlier Microsoft, big companies don't make mistakes point,  recall the testimony, before Congress, of the Exxon executive who stated he evaluated the decision to buy Reliance Electric by reading his college EE textbook during commercials while watching television.  More money was involved in that decision than in the Eolas case.

I never said big companies don't make mistakes.  My point was that it's hard to imagine a more motivated and better funded challenge to a patent's validity than MSFT challenging browser technology reading on ActiveX.  To suggest that there's this obvious, spot-on prior art right in the HTML standard that MSFT somehow missed or didn't assert properly just doesn't smell right.  That's all.  If I didn't have to work, I could sit around and read through all the documents in the Eolas case and come up with an informed opinion as to why MSFT didn't use that prior art or why that prior art isn't invalidating.  And, in reality, I really wish I could do just that.  Unfortunately, I do have to work.

Regards.

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on Jan 20th, 2006, 5:55pm
When I think of the estoppel effect of a prior determination of invalidity, I think of Blonder-Tongue Labs., Inc. v. University of Ill. Foundation, 402 U.S.
313 (1971).  

The more familiar Graver Tank case, 339 U.S. 605, was limited to the question of infringement of the four valid flux claims and to the applicability of the doctrine of equivalents to findings of fact in this case.  It did not involve invalidity or collateral estoppel.

The less familiar Graver Tank case, 336 U.S. 271, did involve invalidity.  The district court had found invalidity of certain flux claims, which determination was reversed by the Seventh Circuit:  The Court of Appeals considered that because there was nothing in the
record to show that the applicants for the patent intended by these claims to assert a monopoly broader than nine metallic silicates named in the specifications.  The district court and the Supreme Court found that because the claim read on certain silicates, undislosed and inoperative, the claim was invalid.  There is no mention of estoppel in the case, nor is an estoppel issue presented.

Lemley, in  16 Berkeley Tech. L.J. 1045,
talked about the absence of collateral estoppel barring a defendant from asserting invalidity of a patent previously held valid:  Parklane Hosiery Co. v. Shore, 439 U.S. 322, 330 (1979) ("If a defendant
in the first action is sued for small or nominal damages, he may have little incentive to defend vigorously, particularly if future suits are not foreseeable.").



Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by eric stasik on Jan 21st, 2006, 3:27am
Great discussion.

Here is the link to Lemley's paper Rational Ignorance at the Patent Office (pdf file).

http://repositories.cdlib.org/cgi/viewcontent.cgi?article=1021&context=blewp

Mr. Ivey is spot on about the problem of lowering the presumption of validity in the face of the Graver Tank decision. As I see it Graver Tank tends to correct, rather than imbalance, the problem of "trash patents." A questionable patent issued by the USPTO only has to be found invalid once.

I'm not familiar with the Kesan paper, but Farrell and Merges give "the party line" rebuttal that more government is the solution. Here's a link to Farrell and Merges criticism: Incentives to Challenge and Defend Patents: Why Litigation Won't Reliably Fix Patent Office Errors and Why Administrative Patent Review Might Help

http://repositories.cdlib.org/cgi/viewcontent.cgi?article=1133&context=boaltwp

The notion that any government bureaucracy can be 100% accurate all the time is absurd. Some errors will always be made. As a licensing professional, it is clear to me that these errors are not nearly as sustainable in the commercial environment as one might believe.  

The presumption of validity is of course legal fiction. The presumption of the accused infringer is that the patent is invalid and/or not infringed. Great exertions - far beyond anything an administrative review might conduct - are made to prove this.

I am skeptical about the Open Source submission of prior art. I have said it before but it bears repeating here. For a patentee THE BEST USE OF PRIOR ART IS IN AN IDS.
If you are a patent applicant, YOU should perform the prior art searches and YOU alone should be responsible for the quality of your patent.

For a potential infringer, THE BEST USE OF PRIOR ART IS IN FRONT OF THE JURY. Full stop. It is better to let the patent office issue a dodgy patent without your help than to make a mistake with your help.

Too many American critics place unwarranted faith in an "administrative review." EPO style opposition is not the panacea that it appears.

As a final comment, the EOLAS patent is not a poster child: it is a statistical outlier. It is a mistake to re-design the entire patent system on the basis of exceedingly rare situations. To a large extent, the patent system works very well just as it is and continues to provide substantial benefit to society.

/Eric Stasik

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Isaac on Jan 21st, 2006, 8:11am
"All of this discussion ignores most basically that the point of the patent system is to obtain disclosure (not innovation or commercialization)."

The point of the patent system is to "promote the Progress of Science and useful Arts"   I don't see why that purpose would be limited to disclosure or why it would exclude innovation and commercialization.  



Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on Jan 21st, 2006, 11:32am
Of the reference to the US Constitution, the Constitution grants to Congress the power to secure to inventors exclusive rights to the invention for limited periods of time to promote the progress.  The "promote the progress" explains why Congress gets the power.   Congress decides how to use the power.  Congress has decided to grant the right to exclude in return for disclosure of inventions that meet the requirements of the patent law, including novelty, utility, and nonobviousness.  "Commercializability" and innovation are not requirements.  If Congress felt like it, they could make them requirements.
They have not.  

Of Graver Tank, I don't see any reference to collateral estoppel in either case.  Perhaps you could explain what text in Graver Tank suggests collateral estoppel to you (or to Lemley or to anyone else).  The law in Blonder-Tongue is a bit different than what you ascribe to Graver Tank.


Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by JimIvey on Jan 21st, 2006, 10:42pm

on 01/20/06 at 17:55:36, Cibola wrote:
When I think of the estoppel effect of a prior determination of invalidity, I think of Blonder-Tongue Labs., Inc. v. University of Ill. Foundation, 402 U.S.
313 (1971).  

The more familiar Graver Tank case, 339 U.S. 605, was limited to the question of infringement of the four valid flux claims and to the applicability of the doctrine of equivalents to findings of fact in this case.  It did not involve invalidity or collateral estoppel.

Duh!  :P

Sorry, yes of course, Blonder-Tongue.  

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Isaac on Jan 21st, 2006, 11:31pm

on 01/21/06 at 11:32:45, Cibola wrote:
Of the reference to the US Constitution, the Constitution grants to Congress the power to secure to inventors exclusive rights to the invention for limited periods of time to promote the progress.  The "promote the progress" explains why Congress gets the power.   Congress decides how to use the power.  Congress has decided to grant the right to exclude in return for disclosure of inventions that meet the requirements of the patent law, including novelty, utility, and nonobviousness.  "Commercializability" and innovation are not requirements.  If Congress felt like it, they could make them requirements.
They have not.  


Congress has not required commercialization, but certainly Congress might expect the result of granting a monopoly to be commercialization and increased innovation.  The fact that Congress did not require such activity does not mean that they do not desire or intend that it occur.

Analogously, the president and the legislature might expect reducing taxes to spur economic growth and might enact laws for the purpose of spurring growth even without requiring that the saved money be invested in any particular activity.


Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on Jan 24th, 2006, 11:06am
Of Eric's comments, a link to Lemley's gold-plating paper (as well as Kesan's "optimal ignorance" paper in the UHouston LR) may be found in Patently-O.  Some discussion of Lemley's approach to patent valuation may be found at IPBiz
(ipbiz.****/2005/12/valuation-of-patents.html ).

I agree as to the lack of value of a European style opposition for US practice.  Several US attorneys, including Joe Hosteny, have been attacking this proposal for some time.  It is quite ironic that Jaffe and Lerner, who complain about the involvement of lawyers in US patent practice, advocate the opposition procedure, which would introduce more lawyers.  This is one example of so-called patent reformers creating more problems, rather than introducing efficiency into the patent system.

Of the Microsoft "motivation" point, note the interference proceeding over the rights to the "Dolly patents" between two US companies, who separately had picked up rights from various entities (eg, Geron from Roslin Biotech).  This truly was a "bet the ranch" case, yet the effort was so bad that when the attorney for the junior party finished his presentation, the judges told the lawyer for the senior party not to bother with his case, because he had already won.

Of the Graver Tank discussion, I assume we agree that Graver Tank has nothing whatsoever to do with collateral estoppel.




Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on Jan 24th, 2006, 11:48am
The first Graver Tank case (on invalidity) has some relevance to the recent LizardTech case decided by the Federal Circuit, discussed for example on IPBiz
(http://ipbiz.****/2005/10/lizardtech-ucberkeley-lose-to-earth.html).

How much discussion of individual species is deemed to give written description support for a genus?  

Is this UC/Berkeley patent another poster child for a bad patent (as some say the UC/Berkeley Eolas patent is)?

I am not sure what Eric means by an outlier?  Does that mean the Eolas patent is valid, but nevertheless disruptive to innovation?  What?

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on Jan 28th, 2006, 11:07am
Of relevance to the patent "quality" algorithm of Wagner, note that footnote 76 of Gideon Parchomovsky and R. Polk Wagner, 154 U. Pa. L. Rev. 1 (Nov. 2005), complete with the assertion about the USPTO approving 97% of all patent applications made it all the way to eBay's brief to the US Supreme Court in eBay v. MercExchange:

Generally, when reexamination occurs, one recent article states that nearly 74% of the time finds the patent invalid or restricts its claims. (&#8230;) This result is unsurprising given that an overworked PTO can spend a mere 18 hours on average to review a patent application before initial issuance. [citing to Parchomovsky (but not mentioning co-author Polk Wagner), 154 U Penn L Rev 1 and then citing to Cecil Quillen (but not mentioning co-author Webster), specifically the FIRST Quillen/Webster paper, 11 Fed. Cir. B J 1 (estimating the rate of patent approvals by the PTO to be 97%).

The connection to Wagner in the brief is obscured by the failure of eBay's lawyers to cite second authors in multi-author papers or to even denote et al.  The 97% number, which was proposed only as an estimated bound for grant rate by Quillen and Webster, was modified by Quillen, Webster, and Eichmann the next year to 85%, but you would never know that from what eBay told the Supreme Court.  The method of Quillen and Webster, which subtracts the number of continuing applications from abandonments without showing that there is an antecedent abandonment to justify the subtraction, has been shown to be wrong, but you never know that from what eBay told the Supreme Court.

Of the remark in the eBay brief about re-examination of patents, about 75% of all reexamined patents incur SOME change to SOME claims, but only about 13% have all claims canceled.  One recalls in the director-ordered re-exam of the claims of the Eolas patent (of relevance to the litigation with Microsoft), NO CLAIMS WERE CHANGED, in spite of the assertion by many in the open source community of the invalidity of the claims of the Eolas patent.  [I am still not sure about the remark in this thread of the Eolas patent being an outlier.  I would agree that one cannot formulate patent policy based on a perceived problem about one patent.  I would also state one can't formulate patent policy (or write briefs to the Supreme Court) about a non-existent 97% grant rate at the Patent Office.]

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on Feb 4th, 2006, 9:36am
An interesting irony has developed in the brief of eBay in the now-pending Supreme Court case eBay v. MercExchange, reviewing  MercExchange v. eBay, 401 F.3d 1323, 74 USPQ2d 1225 (CAFC 2005).   The eBay brief noted, that subsequent to the district court decision, the PTO had found claims of US 5,845,265 invalid (actually rejected in a non-final Office Action), suggesting that eBay was being persecuted by a patent now known to be invalid.  

The eBay brief failed to note that

1.  The art relied on by the PTO in the re-exam (90/006,956) was the SAME ART (US 5,664,111) which was found not to invalidate the MercExchange patent by the district court and affirmed by the Federal Circuit.

2.  The art relied on by the PTO in the re-exam was 102(e) art which was not even publicly available at the time of filing of US US 5,845,265.

The irony is this.  While effectively criticizing MercExchange for the rejections claims of the '265 patent over art not available when the '265 was filed, the eBay brief also cited Cecil Quillen, 11 Fed. Cir. B. J. 1, 3 for "estimating rate of patent approvals by the PTO to be 97%."   Although not mentioned in the eBay brief, Quillen and Webster corrected their view of estimates of the Grant Rate number the following year (12 Fed. Cir. B. J. 35 (2002), discussed in 86 JPTOS 568 (2004)).   Thus, eBay criticizes MercExchange over something MercExchange could not have known at the time of filing, BUT eBay cites to a false number (97%), the correction for which eBay could have learned before filing its brief.

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Isaac on Feb 6th, 2006, 7:42am

on 02/04/06 at 09:36:31, Cibola wrote:
An interesting irony has developed in the brief of eBay in the now-pending Supreme Court case eBay v. MercExchange, reviewing  MercExchange v. eBay, 401 F.3d 1323, 74 USPQ2d 1225 (CAFC 2005).   The eBay brief noted, that subsequent to the district court decision, the PTO had found claims of US 5,845,265 invalid (actually rejected in a non-final Office Action), suggesting that eBay was being persecuted by a patent now known to be invalid.  

The eBay brief failed to note that

1.  The art relied on by the PTO in the re-exam (90/006,956) was the SAME ART (US 5,664,111) which was found not to invalidate the MercExchange patent by the district court and affirmed by the Federal Circuit.

2.  The art relied on by the PTO in the re-exam was 102(e) art which was not even publicly available at the time of filing of US US 5,845,265.


Unless ebay is implying inequitable conduct on the part of the patentee, I don't see anything wrong with pointing out the PTOs latest take on things.   In particular, argument 2 is just one of those things patentees and practitioners have to live with.   Not all prior art is even potentially findable prior to filing.   The relevant question is whether the application should have been taken into account at the time the infringement action was filed.


Quote:
The irony is this.  While effectively criticizing MercExchange for the rejections claims of the '265 patent over art not available when the '265 was filed, the eBay brief also cited Cecil Quillen, 11 Fed. Cir. B. J. 1, 3 for "estimating rate of patent approvals by the PTO to be 97%."   Although not mentioned in the eBay brief, Quillen and Webster corrected their view of estimates of the Grant Rate number the following year (12 Fed. Cir. B. J. 35 (2002), discussed in 86 JPTOS 568 (2004)).   Thus, eBay criticizes MercExchange over something MercExchange could not have known at the time of filing, BUT eBay cites to a false number (97%), the correction for which eBay could have learned before filing its brief.


Even the numbers in the second paper were panned in that JPTOS article.   I don't think it matters much whether the 97% or the 85% number is used.  I'd question either the integrity or the familiarity with patent practice of someone making an unqualified citation to either Q+W paper.


Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on Feb 6th, 2006, 1:10pm
Of the text:

Unless ebay is implying inequitable conduct on the part of the patentee, I don't see anything wrong with pointing out the PTOs latest take on things.   In particular, argument 2 is just one of those things patentees and practitioners have to live with.   Not all prior art is even potentially findable prior to filing.   The relevant question is whether the application should have been taken into account at the time the infringement action was filed.

eBay is not raising an inequitable conduct defense, which would be inappropriate in either a re-exam or in the Supreme Court action (it would be off-point to the question presented, which is about injunctions).  My point was two-fold:  

#1.  the IRONY that the only art found to invalidate the MercExchange patent was not publicly known at the time of filing of the MercExchange application (it is 102(e) art and it is available).  In all the discussion of "bad" business method patents and how the claims of same were well-known in the art, this shows that eBay could not muster relevant prior art that was known at the time the patent application.

#2.  relevant to the earlier discussion in this thread about collateral estoppel, the IRONY that, after MercExchange prevailed against the '111 patent in litigation at district court, eBay filed a re-exam on the SAME art (the '111 patent) and prevailed in an Office Action that was mailed AFTER the CAFC decision affirming that the '111 patent did NOT invalidate the claims of the MercExchange patent.  The same parties have "litigated" the same issue twice, and but
there is no estoppel against the USPTO.  Of your text "I don't see anything wrong with pointing out the PTOs latest take on things," I don't see anything wrong with mentioning the re-exam BUT I do see something wrong in failing to mention that a DIFFERENT outcome arose over the SAME prior art when considered by the courts.    In New Jersey at least it is a disciplinary rule violation to fail to mention publicly available material information to a tribunal (see In re Seelig).  

Of the citation by eBay to the FIRST Quillen paper, my main point is not that the FIRST Quillen paper is wrong (and it very definitely is wrong) but rather that eBay's statement to the Supreme Court is FALSE.  Quillen did NOT estimate the patent approval rate to be 97% in the first paper.  He (and Webster) placed the grant rate between 80 and 97%, and by virtue of his footnote 17, Quillen made clear (at least to those familiar with continuation practice) that the the 97% number was not accurate.

As a subsidiary point, in the first Quillen paper, we have concrete evidence that the chief patent counsel of a major corporation did not understand that a patent could issue on both a parent application and separately on a continuing application (including a continuation  application, but also including a divisional application) deriving from that parent.  Anyone who understood that patents can issue from both continuing applications and the associated parent would have understood that the 97% number was not correct, BEFORE reading any of the later papers on the issue.

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Isaac on Feb 6th, 2006, 3:31pm
It seems we agree about the citation of the Quillen paper.  

I fail to see any ironic significance to the use of previously unavailable art 102(e) art in the re-exam.   Even if the art was unavailable previously, that does not make Ebay any more of an infringer, or make their reliance on the newly found evidence in court any less appropriate.   I don't find it any more ironic than if the new reference was a master's thesis written in Swahili that the Examiner did not have the resources to find during prosecution.

Further, there is no doubt in my mind that the previous judgment was in front of the court, but while the court owes some deference to the PTO, it owes none to even its own previous decision.

I think I understand your point, I just don't find the issues with respect to the patent's validity very significant.

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on Feb 6th, 2006, 4:52pm
Of the text

-->I fail to see any ironic significance to the use of previously unavailable art 102(e) art in the re-exam.   Even if the art was unavailable previously, that does not make Ebay any more of an infringer, or make their reliance on the newly found evidence in court any less appropriate.   I don't find it any more ironic than if the new reference was a master's thesis written in Swahili that the Examiner did not have the resources to find during prosecution.

Further, there is no doubt in my mind that the previous judgment was in front of the court, but while the court owes some deference to the PTO, it owes none to even its own previous decision. <--

First, of the sequence, we have

#1.  Litigation before district court with '111 patent asserted in invalidity defense

#2.  eBay loses, MercExchange patent found valid over '111 AND, separately, eBay infringes

#3.  eBay files re-exam, asserting invalidity over '111 patent

#4.  CAFC affirms district court as to validity over '111

#5.  PTO mails Office Action finding 3 claims invalid under 102(e) and remaining over 103

#6.  eBay mentions result of re-exam in Supreme Court brief

The irony is NOT in the fact that the examiner in the initial exam didn't find the '111 patent (he could not have found it, so there is no "resource" issue).  

An irony is that for all the talk about how many business method patents are low quality and represent knowledge already in the art, the only reference against this MercExchange patent was a reference that was not part of the known art.  I am not saying that 102(e) art is not available, just that, for all the talk, one would have expected a wall of references.

A different irony is that the reference used in the re-exam (the '111 patent) had already been litigated and the appeal decision published (the '111 does NOT invalidate the claims) BEFORE the USPTO mailed its Office Action (the '111 does invalidate the claims).

One's view of the force of the eBay brief can depend on the omitted information.  Merely being told of the result of rejection in re-exam, one thinks:  hmmm, some new art led to rejection.  How on earth could the district court think about an injunction when this new art caused the PTO to reject the claims.  What a waste by the district court.  BUT, if one knows the "new" art is the same "old" art fully litigated in district court AND reviewed by the CAFC, one thinks "how could the PTO miss the deficiencies in the art already fully shown by the CAFC?"  What a waste by the PTO.  At the end of the day, invalidity in a re-exam will be reviewed by the CAFC.   Do you believe that the CAFC will find the MercExchange patent invalid over the '111 when it previously found the MercExchange valid over the '111?  

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Isaac on Feb 6th, 2006, 8:33pm
I understand the circumstances, I just don't agree with your assessment that those circumstances reflect badly on Ebay's behavior.  

And of course I'm frequently wrong.  I would not worry overly much about the fact that we disagree.


Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on Feb 7th, 2006, 6:15am
I guess that depends on what one means by "badly."  Enitities as MercExchange and NTP have been criticized as trolls who impede innovation through operating more by litigation than discovery of new things.  Here, eBay filed a re-exam asserting prior art that had already been analyzed in a litigation.  The prior art was not even publicly available at the time MercExchange filed its application.  MercExchange's patent was available to eBay at the time eBay infringed.  In its actions in the re-exam, eBay did nothing "illegal" but yet its actions did not bear out the contention that MercExchange's patent claims were well-known in the art.

Separately, in mis-stating the contents of the first paper by Quillen and Webster, I would say eBay did behave badly.  People may say just about anything in law reviews, but stating something to the Supreme Court is a different matter.  There is a duty to verify.  There are at least two levels of bad behavior.  First, the statement is not an accurate presentation of what Quillen and Webster said in 2001.  Second, shepardizing the paper would have revealed that a number of authors, including Quillen and Webster, had found the 97% number deficient.

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Isaac on Feb 7th, 2006, 6:35am

on 02/07/06 at 06:15:10, Cibola wrote:
I guess that depends on what one means by "badly."  Enitities as MercExchange and NTP have been criticized as trolls who impede innovation through operating more by litigation than discovery of new things.  Here, eBay filed a re-exam asserting prior art that had already been analyzed in a litigation.  The prior art was not even publicly available at the time MercExchange filed its application.  MercExchange's patent was available to eBay at the time eBay infringed.  In its actions in the re-exam, eBay did nothing "illegal" but yet its actions did not bear out the contention that MercExchange's patent claims were well-known in the art.


Your point that the art was not publicly available is one thing we disagree about the importance of.   A 102(e) reference is evidence that the legally required number of people knew about the art at the filing date of the reference.   That's as "well-known" as the law requires.


Quote:
Separately, in mis-stating the contents of the first paper by Quillen and Webster, I would say eBay did behave badly.  People may say just about anything in law reviews, but stating something to the Supreme Court is a different matter.  There is a duty to verify.  There are at least two levels of bad behavior.  First, the statement is not an accurate presentation of what Quillen and Webster said in 2001.  Second, shepardizing the paper would have revealed that a number of authors, including Quillen and Webster, had found the 97% number deficient.


We agree completely about the cite to the Q+W paper.   There is simply no excuse for citing 97% number.  In fact even citing the 85% number is inexcusable.   Further the line of argument implying that a high issue rate means that the patent at hand is suspect is bogus anyway given the successful defense in court.

I am also uncomfortable with the labeling of patent holders as trolls, and with attempts to change patent law to prevent these alleged trolls from meaningfully asserting their patents.   A troll appears to be a patent holder that cannot be made to cross license.



Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on Feb 7th, 2006, 11:50am
Both the reexam and Quillen 97% remarks appeared in the eBay brief section concerning the "public interest" test in the traditional injunction inquiry.  

A different "public interest" issue is that both eBay and RIM are presenting significant products to the public, while the patentees are not.  From the Philadelphia Inquirer about NTP and RIM:  

"What's the harm to NTP?" Yoches said. "They're not actually making the stuff. At best they're a weak competitor. What's the harm to the public? You've got a lot of these BlackBerrys out there. You've got a strong public interest in only having them stopped if the patents are valid."

This issue goes to the requested briefing on Continental Paper.

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by bvigorda on May 17th, 2006, 5:05am
Hi All,

I'm not an attorney or in the IP profession in any way, but I've been lurking through your posts on this subject and finding it fascinating.

Based on your apparent enthusiasm for you field, I'd want any one of you for my IP attorney.

Anyway - I just can't help making this comment regarding the following statement:

"Wagner also has adopted the "97% of all applications are granted" number of Quillen's first paper, even though Quillen himself dropped the 97% in a paper published one year later, and years before Wagner adopted the 97% number.  This is way more than a byline issue or nice guy issue."

I hope none of you are Bush fans because what I want to say is this reminds me of the way he handled his campaign to go to war with Iraq.

So - please excuse my intrusion and enjoy the rest of your discussion uninterrupted.

Gail



Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on May 20th, 2006, 12:47am
Two updates:

#1.  eBay won the case before the Supreme Court, illustrating that there is not a big risk in telling whoppers to the Supreme Court.

#2.  Professor Kimberly Moore, who has endorsed the 85% number of Quillen/Webster, has been nominated to fill a vacancy on the Court of Appeals for the Federal Circuit.  Professor Moore is separately the editor of the journal in which the 97% and 85% numbers are published.


Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by JimIvey on May 20th, 2006, 8:38am

on 05/20/06 at 00:47:04, Cibola wrote:
#1.  eBay won the case before the Supreme Court, illustrating that there is not a big risk in telling whoppers to the Supreme Court.

This statement, on its face, is ludicrous.  Either you don't fully understand what "risk" means or you've forgotten the most basic precepts of logic.  Drawing a generalized conclusion of probabilities (which is exactly what risk is) from a single trial is ... well, ludicrous.  

That's even under the presupposition that your premises are correct -- that eBay did in fact tell a whopper to the SCt and that the SCt relied on that whopper in its opinion.  I don't have confirmation of either of those, but the general nature of the statement itself renders the credibility of those premises rather dubious.

Regards.

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by eric stasik on May 22nd, 2006, 5:43am
Cibola wrote "eBay won the case before the Supreme Court, illustrating that there is not a big risk in telling whoppers to the Supreme Court."

It is too vague to say that "eBay won." The matter in front of the SCOTUS was very narrow - whether or not the CAFC's "general rule" of awarding a permanent injunction automatically absent "exceptional circumstances" was correct as a matter of law. The SCOTUS ruled that the CAFC erred as a matter of law and that the "general rule" should not replace the traditional four-factor test used by U.S. courts of equity.

Yeah, the decision helps eBay in settlement negotiations with MercExchange - for the moment. It seems to me (and to the SCOTUS) that the District Court was wrong in denying the injunction based in the first place. In all likelihood, the District court will reverse itself and award MercExchange the injunction it deserves.

But my guess is that eBay and MercExchange will settle for some fractional multiple of $25m before the District Court has a chance to take any action. After seeing what happened to the hardheads at RIM, eBay executives should be a little less emotional in their evaluation of business risk.

/Eric Stasik

P.S. (I wrote more about this in my news entry for May 16th www.patent08.com.)

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on May 22nd, 2006, 10:38pm
Of eBay's whopper, Isaac had already noted:

We agree completely about the cite to the Q+W paper.   There is simply no excuse for citing 97% number.  In fact even citing the 85% number is inexcusable.   Further the line of argument implying that a high issue rate means that the patent at hand is suspect is bogus anyway given the successful defense in court.

If JimIvey has any evidence to support what eBay said about patent grant rate, let him provide it.  Otherwise, let us agree it was an untrue statement, that could have been demonstrated untrue at the time made.  

Of --that eBay did in fact tell a whopper to the SCt and that the SCt relied on that whopper in its opinion-- I disagreeertion is that eBay did state something that was untrue.  I did not state the SCt relied on it.   As an aside, for a violation of RPC 3.3 there is no requirement that the tribunal rely on the misstatement, only that it be a false statement of material fact or law.  

Of  --Drawing a generalized conclusion of probabilities (which is exactly what risk is) from a single trial is ... well, ludicrous--, there is an issue of both the bad act itself and the scope of knowledge of the bad act.  For example, as a hypothetical, the state's failure to prosecute someone who murdered the DA on the court house steps and was immediately caught, all while being televised, would have dramatic impact, even if the event was one time, because it was publicized and was perceived to be bad. On the other side of the coin, in many states, about 19 out of 20 disciplinary actions against lawyers are not acted upon, and the complaint sealed from public inspection (or comment by the complainant).   One might get the idea, from the frequent dismissal of many cases, that everything was fine.   The mistake of eBay was fairly well-publicized, at least in blogs and things and a few other places, before the decision.

Of Eric's comment, if analysis of the 4-factor test generally leads to patentee getting an injunction (CJ Roberts, but disputed by the Kennedy group), how much leverage did eBay get?  Some dollars off in a settlement?  How does this impact future injunction cases?


Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Isaac on May 23rd, 2006, 8:47am
I'm not sure how it will affect future cases.  Quite frankly I find some of the language bandied about by the district court and the Supreme Court quite troubling.  The idea that there are disfavored patents and that the validity of a patent might be "suspect" even after litigation which almost certainly touched on validity seems particularly ominous.   Also some members of the court seemed to embrace the idea that some patentees might be trolls and that trolling should be taken into account.   Given Congress' inability to get agreement on that issue, it seems to me that at least one industry segment ought to be well pleased while the other segments are probably horrified.


Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on May 23rd, 2006, 10:25am
I agree with your comments.

The following text in the concurring opinion of Justice Kennedy should be noted:

In addition injunctive relief may have different consequences for the burgeoning number of patents over
business methods, which were not of much economic and legal significance in earlier times. The potential vagueness and suspect validity of some of these patents may
affect the calculus under the four-factor test.

The concurring opinion was one vote away from being a majority opinion.

Keep in mind, the issue of a permanent injunction comes up after there is a determination of validity.  To refer to a patent, determined to be valid, as possibly of "suspect validity" is interesting.

To return to a point JimIvey raised, I do think the "suspect validity" text in the concurring opinion does derive in part from reliance on comments about "patent grant rate" and reexamination which appeared in the eBay brief.  Argumentation is one thing, but a false statement of a material fact is something else.  

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Isaac on May 23rd, 2006, 11:34am

on 05/23/06 at 10:25:47, Cibola wrote:
To return to a point JimIvey raised, I do think the "suspect validity" text in the concurring opinion does derive in part from reliance on comments about "patent grant rate" and reexamination which appeared in the eBay brief.  Argumentation is one thing, but a false statement of a material fact is something else.  


I believe the suspect validity remark was made with respect to business method patents (whatever they are) and is not applicable to all patents.   If so, then it seems unlikely that the Q+W study is the source of the disdain.

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by eric stasik on May 24th, 2006, 3:29am

on 05/22/06 at 22:38:19, Cibola wrote:
Of Eric's comment, if analysis of the 4-factor test generally leads to patentee getting an injunction (CJ Roberts, but disputed by the Kennedy group), how much leverage did eBay get?  Some dollars off in a settlement?  How does this impact future injunction cases?


The District Court first argued that an injunction under the four factors was not an equitable remedy because as MerExchange did not practive the invention, it did not suffer "an irreparable injury": one of the four factors.

The SCOTUS put paid to this, so it seems that the District Court judge will find it more difficult to refuse a permanent injunction. There is some argument that the failure to award an injunction along with damages amounts to compulsory licensing - which is exceedingly rare.

In my view, eBay gained the leverage of time to work out a settlement. The decision by the SCOTUS was, as typical of many of the Roberts' Court - decided on a very narrow basis designed to create consensus. It doesn't really change the calculus IMHO.

Regards,

Eric Stasik

Title: Re: USPTO PARTNERS WITH OPEN SOURCE COMMUNITY
Post by Cibola on Jun 25th, 2006, 8:42am


The eBay district court stated:  The defendants next [after failing at noninfringement] argue that there was evidence adduced at trial proving that the plaintiff is willing to license or sell its patents. On this point, the defendants are correct.

The district court concluded on the irreparable harm presumption section:  In the case at bar, the evidence of the plaintiff's willingness to license its patents, its lack of commercial activity in practicing the patents, and its comments to the media as to its intent with respect to enforcement of its patent rights, are sufficient to rebut the presumption that it will suffer irreparable harm if an injunction does not issue.

Failure to practice the invention was not the prime factor listed by the district court in rebutting the presumption of irreparable harm.  Willingness to license was.

The eBay district court cited to ED Va case Odetics for the "four factors," which  in turn cited to the Weinberger case, which was NOT a permanent injunction case and which does NOT enumerate four factors for anything, including for a permanent injunction.  The eBay Supreme Court decision also cites to the Weinberger case for the four factors.  



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