5 ms·

The tacit assumption upon which this argument rests is that the trolls are guaranteed to lose in court (at least after an appeal). While that might be a fair a

by splat 15y ago

The tacit assumption upon which this argument rests is that the trolls are guaranteed to lose in court (at least after an appeal). While that might be a fair assumption in the most egregious cases, in many circumstances the lower court will not be particularly skilled in patent law and an appeal to a specialized appeals court is by no means certain. A rational businessman might well chose to settle a case even if the probability of losing is just 5% simply because the penalties for patent infringement are so high in comparison to the settlement costs.

probablyrobots 15y ago
The OP also argues that the patent could be defeated by a patent review. "Virtually none of the patents that patent trolls buy would be issued today. The vast majority of these patents would not survive a U.S. Patent & Trademark Office patent review. Most were issued during the 1990s when the standards for business process patents were very low." The OP goes on to say that the victims of patent trolls band together to finance the review to make it cheaper than settling.
- splat 15y ago
  > The OP also argues that the patent could be defeated by a patent review. Yes, but the OP ignores the probability of failure. I'm claiming that even a small probability of failure would be sufficient to deter most businesses from pursuing the OP's advice because the costs of a defeat are so much greater than the costs of a settlement. > The OP goes on to say that the victims of patent trolls band together to finance the review to make it cheaper than settling. I'm not disputing that. The problem I'm pointing out does not have to do with financing the review, but with the fines that are due if you lose the case. Even if you band together to finance the review, if you lose, you have to pay the fines individually.
- alanthonyc 15y ago
  The MacroSolve patent[1][2] was requested in 2003 and granted in 2010: forms on devices that transmit data to web servers. The USPTO is broken. [1]http://fosspatents.blogspot.com/2011/05/worse-than-lodsys-macrosolves-sues.html http://fosspatents.blogspot.com/2011/05/worse-than-lodsys-ma... [2]http://patft.uspto.gov/netacgi/nph-Parser?Sect1=PTO1&Sect2=HITOFF&d=PALL&p=1&u=%2Fnetahtml%2FPTO%2Fsrchnum.htm&r=1&f=G&l=50&s1=7,822,816.PN.&OS=PN/7,822,816&RS=PN/7,822,816 http://patft.uspto.gov/netacgi/nph-Parser?Sect1=PTO1&Sec...
  - brlewis 15y ago
    It is impossible to expect the USPTO to determine novelty and non-obviousness for software patents. Imagine how difficult it would be to examine mechanical engineering patents if millions of people carried machine shops around in their backpacks.
kwantam 15y ago
This is a situation where the locally optimal solution is globally suboptimal. You're doomed to a death of a thousand cuts if you play along with patent trolls, even if each cut is comparatively small. Clearly "let's cooperate and put trolls out of business" isn't happening right now, and other than the possibility that no one has thought of it before now (doubtful) there are two obvious reasons: - For a given case where a troll sues multiple parties, each party is relying on the other defendants to cooperate, but the lowest risk alternative is to settle early and be done with it. The patent troll knows this, and will try to cut down the number of cooperators until all are forced to settle. - Since most cases don't offer much resistance and often settle, patent trolls are able to fund an expansion of their operations, and they simultaneously gain credibility ("you'd better settle, Microsoft already did"). So the historical practice of settling with trolls works against companies who would think not to do so, and any group of companies that tries to band together in defense is in a situation where defection ruins the defense, and the incentive to defect starts high and increases with each additional defection. As Mr. Crutchfield says, it's a shakedown that exploits a peculiarity of the patent system (namely, the combination of the ability to sell patents with the ability for NPEs to bring infringement suits). This is an emergent property of the legal system. The right approach is to change the system. I doubt I'll have to convince many here that nothing of value would be lost if NPEs were no longer allowed to bring infringement suits for dormant patents.
- amalcon 15y ago
  So it's a straightforward defect-weighted prisoner's dilemma. The best option for any one party is to settle (regardless of what others do), but the best overall result would be for nobody to settle. One solution to the prisoner's dilemma is for everyone to get together and give up the ability to defect, say by incorporating it into corporate bylaws. Another is to drastically change the cost structure, such as by insurance or a mutual contract that holds anyone who settles liable for a large amount. If not done carefully, either of these could tie a party's hands against legitimate suits, but they are alternatives (after a fashion). Game theory has analyzed the prisoner's dilemma to death. If there's any hope for a grassroots solution, it's there.
  - 15y ago

by splat 15y ago

probablyrobots 15y ago

The OP also argues that the patent could be defeated by a patent review. "Virtually none of the patents that patent trolls buy would be issued today. The vast majority of these patents would not survive a U.S. Patent & Trademark Office patent review. Most were issued during the 1990s when the standards for business process patents were very low." The OP goes on to say that the victims of patent trolls band together to finance the review to make it cheaper than settling.

splat 15y ago
> The OP also argues that the patent could be defeated by a patent review. Yes, but the OP ignores the probability of failure. I'm claiming that even a small probability of failure would be sufficient to deter most businesses from pursuing the OP's advice because the costs of a defeat are so much greater than the costs of a settlement. > The OP goes on to say that the victims of patent trolls band together to finance the review to make it cheaper than settling. I'm not disputing that. The problem I'm pointing out does not have to do with financing the review, but with the fines that are due if you lose the case. Even if you band together to finance the review, if you lose, you have to pay the fines individually.
alanthonyc 15y ago
The MacroSolve patent[1][2] was requested in 2003 and granted in 2010: forms on devices that transmit data to web servers. The USPTO is broken. [1]http://fosspatents.blogspot.com/2011/05/worse-than-lodsys-macrosolves-sues.html http://fosspatents.blogspot.com/2011/05/worse-than-lodsys-ma... [2]http://patft.uspto.gov/netacgi/nph-Parser?Sect1=PTO1&Sect2=HITOFF&d=PALL&p=1&u=%2Fnetahtml%2FPTO%2Fsrchnum.htm&r=1&f=G&l=50&s1=7,822,816.PN.&OS=PN/7,822,816&RS=PN/7,822,816 http://patft.uspto.gov/netacgi/nph-Parser?Sect1=PTO1&Sec...
- brlewis 15y ago
  It is impossible to expect the USPTO to determine novelty and non-obviousness for software patents. Imagine how difficult it would be to examine mechanical engineering patents if millions of people carried machine shops around in their backpacks.

kwantam 15y ago

This is a situation where the locally optimal solution is globally suboptimal. You're doomed to a death of a thousand cuts if you play along with patent trolls, even if each cut is comparatively small. Clearly "let's cooperate and put trolls out of business" isn't happening right now, and other than the possibility that no one has thought of it before now (doubtful) there are two obvious reasons: - For a given case where a troll sues multiple parties, each party is relying on the other defendants to cooperate, but the lowest risk alternative is to settle early and be done with it. The patent troll knows this, and will try to cut down the number of cooperators until all are forced to settle. - Since most cases don't offer much resistance and often settle, patent trolls are able to fund an expansion of their operations, and they simultaneously gain credibility ("you'd better settle, Microsoft already did"). So the historical practice of settling with trolls works against companies who would think not to do so, and any group of companies that tries to band together in defense is in a situation where defection ruins the defense, and the incentive to defect starts high and increases with each additional defection. As Mr. Crutchfield says, it's a shakedown that exploits a peculiarity of the patent system (namely, the combination of the ability to sell patents with the ability for NPEs to bring infringement suits). This is an emergent property of the legal system. The right approach is to change the system. I doubt I'll have to convince many here that nothing of value would be lost if NPEs were no longer allowed to bring infringement suits for dormant patents.

amalcon 15y ago
So it's a straightforward defect-weighted prisoner's dilemma. The best option for any one party is to settle (regardless of what others do), but the best overall result would be for nobody to settle. One solution to the prisoner's dilemma is for everyone to get together and give up the ability to defect, say by incorporating it into corporate bylaws. Another is to drastically change the cost structure, such as by insurance or a mutual contract that holds anyone who settles liable for a large amount. If not done carefully, either of these could tie a party's hands against legitimate suits, but they are alternatives (after a fashion). Game theory has analyzed the prisoner's dilemma to death. If there's any hope for a grassroots solution, it's there.
- 15y ago