8 ms·

University wins $1.17 billion hard disk patent verdict against Marvell

76 points by bitcartel 14y ago

aaronbrethorst 14y ago
Hmm, I was wondering if there was a good stock buying opportunity here, and then I started reading employee reviews on Glassdoor (http://www.glassdoor.com/Reviews/Marvell-Technology-Reviews-E11761.htm http://www.glassdoor.com/Reviews/Marvell-Technology-Reviews-...). So much for that :-\
rwmj 14y ago
Considering everything that goes into making a hard drive, the two patents[1][2] describe such a tiny detail (a tiny incremental improvement on distinguishing magnetic domains), how can $1.17bn be a just award? [1] http://www.google.com/patents/US6201839 http://www.google.com/patents/US6201839 [2] http://www.google.com/patents/US6438180 http://www.google.com/patents/US6438180
- aaronbrethorst 14y ago
  Since the jury found the infringement by Marvell had been “willful,” meaning the company knew it was using the patented technology, the judge can award up to three times the verdict amount, according to a statement by K&L Gates, the law firm representing Carnegie Mellon. http://www.nytimes.com/2012/12/27/technology/marvell-ordered-to-pay-1-17-billion-in-patent-case.html?_r=0 http://www.nytimes.com/2012/12/27/technology/marvell-ordered...
- tzs 14y ago
  One thing to keep in mind is that the alleged infringement has been ongoing for nearly 10 years. Over that time, they sold over 2 billion of the infringing chips. A billion dollars sounds huge, but $0.50 per chip doesn't necessarily sound huge. I believe that the current standard for figuring out what damages should be is based on trying to figure out what deal the parties would have made had their been a negotiated license deal under the constraint that both parties feel that they MUST come to an agreement. This should take into account royalties that the defendant has paid to license similar patents before, and the importance of the patents to the defendants business. There is a whole big list of factors used to guide this hypothetical negotiation. They were established in a case involving Georgia Pacific, so googling for that along with patent damages will get more information if you are curious. To find out exactly what happened in this case, you'd need to get records from the trial. Both sides would have had hired experts prepare damage reports that look at the Georgia Pacific factors and argue for what royalty should result. It sounds like the jury decided to go with the plaintiffs estimate.
  - btian 14y ago
    $0.50 per chip is HUGE. This is not the ultra-expensive Intel Core i7. ARM makes only $.10 per licensed chip[1] [1] http://www.quora.com/ARM-Processor-Architecture/How-much-does-an-ARM-processor-design-cost http://www.quora.com/ARM-Processor-Architecture/How-much-doe...
  - wallflower 14y ago
    > $0.50 per chip doesn't necessarily sound huge. One of my relative's husbands is a hard drive engineer. He used to talk about how if they could eliminate one single bolt from the HDD assembly (3 cent cost) - it could end up saving millions over the total life of the production run. $0.50 is huge
- kansface 14y ago
  This was a Pittsburgh jury that decided in favor of a Pittsburgh institution against a Silicon Valley company. I'd imagine the results would be a bit different if the trial took place in San Francisco.
xmanifesto 14y ago
Marvell's stock just took a massive hit, 10% down in under 2 hours[1] and will probably sink a bit more tomorrow. Meanwhile, Carnegie Mellon just doubled their annual revenue from $909m to ~$2bn[2]. --- [1]http://www.google.com/finance?cid=664838 http://www.google.com/finance?cid=664838 [2]http://www.cmu.edu/finance/reporting-and-incoming-funds/financial-reporting/files/2011-annual-report.pdf http://www.cmu.edu/finance/reporting-and-incoming-funds/fina...
btipling 14y ago
I think patents may sometimes have the opposite effect than the one intended. Instead of encouraging innovation and stimulating the economy through entrepreneurship and business, it may have a chilling effect. Who knows what patents are out there that may lead you to also face a steep penalty that could ruin your entire business?
- shrughes 14y ago
  This has not been mentioned on all the other patent threads.
  - praxeologist 14y ago
    It needs repeating because it is it is up there as one of the most widely believed and repeated falsehoods. >Marvell lawyers said CMU's closing statement was "rife with misrepresentations," including suggestions that Marvell "broke the chain of innovation by not paying the royalties that they now owe," and noting those payments would be used "to fund further research, to lead to further innovation." That resulted in a short conference at the side bar, in which the judge warned "you can't dig deep into all of CMU's contributions to society and mankind." There are tons of studies showing that IP law hampers innovation and not a single one showing it aids it.
    - cobrausn 14y ago
      There are tons of studies showing that IP law hampers innovation and not a single one showing it aids it. What about pharmaceuticals? 'Tech' (as we use the term) isn't the only industry in existence.
      - praxeologist 14y ago
        What about it? Find a study to support your belief if you think patents aid innovation in pharmaceuticals. I can refer you to my comments the last time I challenged people to show a study in support of this idea. The paper attempted to measure innovation in the number of patents issued. Hopefully the problem with doing that is blatantly obvious. http://news.ycombinator.com/item?id=4901756 http://news.ycombinator.com/item?id=4901756
jennichen 14y ago
Looks like the real winners are Douglas B. Greenswag and Patrick J. McElhinny of K&L Gates ... Carnegie Mellon's lawyers.
- monochromatic 14y ago
  Why does the winning litigant not count as a real winner?
  - accountswu 14y ago
    Perhaps jennichen was suggesting that since the appeal has already been filed and the verdict might be overturned, the lawyers win either way. In the end CMU may get nothing out of it after having spent millions on the lawyers. Quoting from the article shared: "As Brian Love, a professor of patent law at Santa Clara University, pointed out, most universities end up net losers (http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2019190 http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2019190) in the game of "patent roulette," with their patents costing them more money than they make."
  - uvdiv 14y ago
    Another commenter wrote an interesting reply to you. It got censored by friendly robot overlord, so I'll reproduce it: «Perhaps jennichen was suggesting that since the appeal has already been filed and the verdict might be overturned, the lawyers win either way. In the end CMU may get nothing out of it after having spent millions on the lawyers.» «Quoting from the article shared:» «"As Brian Love, a professor of patent law at Santa Clara University, pointed out, most universities end up net losers (http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2019190 http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2019190) in the game of "patent roulette," with their patents costing them more money than they make."» (Thank you 'accountswu', that is an interesting find.)
deleted 14y ago
[deleted]
jeswin 14y ago
If the US technology sector ever falls behind other countries, one could look back and see that a fundamentally broken patent system played a significant role. Pitting companies against each other in courtroom battles with no net productive output.
- monochromatic 14y ago
  By that standard, every court case has "no net productive output." Should we disband the legal system?
  - theklub 14y ago
    Yes, it needs a reboot at least.
    - monochromatic 14y ago
      Why do you say?
      - snowwindwaves 14y ago
        Lawmakers don't refactor the laws like programmers refactor their programs. Laws get more and more complex with more and more bolt on patches. Times change but they don't get updated. There Are so many laws it is impossible to know if you are breaking one or not. http://unclibertarians.com/are-you-breaking-the-law/ http://unclibertarians.com/are-you-breaking-the-law/ Laws are designed by committee. We know how that works out for programming projects. I think the volume of laws could be significantly reduced and laws could be simplified, but the law making process doesn't allow it. Ianal.
        rayiner 14y ago
        The law is "refactored" all the time. That's one of the tremendous virtues of the common law process. And while the law is designed by committee, it is applied in any given case by a single judge which has insight into the actual issues in play. Again, a tremendous virtue of the common law process.
pi18n 14y ago
If you read the claims they are apparently infringing upon, it's all math with a thin veneer of "on a magnetic storage medium". It's literally mathematical signal processing. I would bet a few dozen bucks that it is obvious to anyone studying signal processing, since it seems like an advancement on a Kalman filter.
- monochromatic 14y ago
  Yeah, we're probably doing a better analysis glancing at the claims than the team of patent attorneys defending against a billon dollar lawsuit did.
- wmf 14y ago
  Yeah, it's so obvious that it was published in IEEE Transactions on Information Theory and the author got a PhD from CMU for it.
  - Brashman 14y ago
    I agree. Since this is coming out of research out of a university, I would be more inclined to guess that (at the time at least) this was actually innovative and new work. The fastest way for a paper to be rejected is for it to have been done already, or even for it to be "obvious to anyone" with basic knowledge in the field. Also, I don't see why the fact that it's advancing existing techniques or that it's just math somehow makes it less important. There are whole fields that are just math, such as computer science originally.
    - pi18n 14y ago
      I don't want to make math and computer science sound unimportant -- it's an important distinction because pure math is not supposed to be patentable. But for whatever reason if you include a hypothetical machine it is suddenly patentable.
  - pi18n 14y ago
    So I lose the bet, but it's still mathematics that shouldn't be patentable in the first place.
rutigers 14y ago
Taiwan University sues Apple over SIRI[1]. Columbia University sues Illumina[2]. University of California sues Facebook[3]. And now, CMU sues Marvell. --- [1]http://www.reuters.com/article/2012/07/30/us-apple-patent-taiwan-idUSBRE86T0A920120730 http://www.reuters.com/article/2012/07/30/us-apple-patent-ta... [2]http://www.reuters.com/article/2012/03/26/us-illumina-columbia-idUSBRE82P0VK20120326 http://www.reuters.com/article/2012/03/26/us-illumina-columb... [3]http://www.reuters.com/article/2012/09/13/us-patents-facebook-university-californi-idUSBRE88C00N20120913 http://www.reuters.com/article/2012/09/13/us-patents-faceboo...
linuxhansl 14y ago
Universities should teach, research, and publish. What the heck are they doing in patent litigation?! Also, is CMU partially tax funded? If so, do they really own these patents to begin with? Should they?
- tingletech 14y ago
  In the process of research, professors and graduate students (and sometimes non-academic appointment staff) make discoveries and inventions that can be patented. The University owns part of every patent, because the University often provides the infrastructure yadda yadda, but usually the academics are the ones who start companies to exploit the patent. Technology transfer officers who manage the University patent portfolios will negotiate licenses if you call them up, but these offices are often dealing with grant compliance issues as well and are dealing with so much data it seems like they can hardly keep track of all the research going on in the academy, let alone look for patent violators. I don't think a University ever owns 100% of a patent, so I have to believe it is the inventor's company that is really going after people; and the university is just a co-plantif because they own part of the patent are are legally compelled to take part in the patent defense / plus they want to get their slice of the pie.
  - Brashman 14y ago
    If the professors and graduate students involved in this didn't start a company to exploit the company, then I'm guessing the university still owns 100% of the patent (I don't know if that's the case in this situation or not). I think this is similar to in industry when employees may have their name on patents but the company they're working for will own the patent. This case gets me thinking a bit because they are probably involved in this in part so that they can get money to do more research. It's not like they're doing this as a power play to grab more market share.
    - tingletech 14y ago
      > If the professors and graduate students involved in this didn't start a company to exploit the company, then I'm guessing the university still owns 100% of the patent That is not consistent with how I personally interpret http://www.cmu.edu/policies/documents/IntellProp.html http://www.cmu.edu/policies/documents/IntellProp.html but I am not a patent lawyer > so that they can get money to do more research. Some research requires massive public and private investment, and the rational for the technology transfer function of a university is to recoup the costs of R&D from commercial products that are legitimately derivative from these investments, so as to reinvest in the facilities and create more original knowledge that can lead to more commercial products.

76 points by bitcartel 14y ago

Hmm, I was wondering if there was a good stock buying opportunity here, and then I started reading employee reviews on Glassdoor (http://www.glassdoor.com/Reviews/Marvell-Technology-Reviews-E11761.htm http://www.glassdoor.com/Reviews/Marvell-Technology-Reviews-...). So much for that :-\

rwmj 14y ago

Considering everything that goes into making a hard drive, the two patents[1][2] describe such a tiny detail (a tiny incremental improvement on distinguishing magnetic domains), how can $1.17bn be a just award? [1] http://www.google.com/patents/US6201839 http://www.google.com/patents/US6201839 [2] http://www.google.com/patents/US6438180 http://www.google.com/patents/US6438180

aaronbrethorst 14y ago
Since the jury found the infringement by Marvell had been “willful,” meaning the company knew it was using the patented technology, the judge can award up to three times the verdict amount, according to a statement by K&L Gates, the law firm representing Carnegie Mellon. http://www.nytimes.com/2012/12/27/technology/marvell-ordered-to-pay-1-17-billion-in-patent-case.html?_r=0 http://www.nytimes.com/2012/12/27/technology/marvell-ordered...
tzs 14y ago
One thing to keep in mind is that the alleged infringement has been ongoing for nearly 10 years. Over that time, they sold over 2 billion of the infringing chips. A billion dollars sounds huge, but $0.50 per chip doesn't necessarily sound huge. I believe that the current standard for figuring out what damages should be is based on trying to figure out what deal the parties would have made had their been a negotiated license deal under the constraint that both parties feel that they MUST come to an agreement. This should take into account royalties that the defendant has paid to license similar patents before, and the importance of the patents to the defendants business. There is a whole big list of factors used to guide this hypothetical negotiation. They were established in a case involving Georgia Pacific, so googling for that along with patent damages will get more information if you are curious. To find out exactly what happened in this case, you'd need to get records from the trial. Both sides would have had hired experts prepare damage reports that look at the Georgia Pacific factors and argue for what royalty should result. It sounds like the jury decided to go with the plaintiffs estimate.
- btian 14y ago
  $0.50 per chip is HUGE. This is not the ultra-expensive Intel Core i7. ARM makes only $.10 per licensed chip[1] [1] http://www.quora.com/ARM-Processor-Architecture/How-much-does-an-ARM-processor-design-cost http://www.quora.com/ARM-Processor-Architecture/How-much-doe...
- wallflower 14y ago
  > $0.50 per chip doesn't necessarily sound huge. One of my relative's husbands is a hard drive engineer. He used to talk about how if they could eliminate one single bolt from the HDD assembly (3 cent cost) - it could end up saving millions over the total life of the production run. $0.50 is huge
kansface 14y ago
This was a Pittsburgh jury that decided in favor of a Pittsburgh institution against a Silicon Valley company. I'd imagine the results would be a bit different if the trial took place in San Francisco.

xmanifesto 14y ago

Marvell's stock just took a massive hit, 10% down in under 2 hours[1] and will probably sink a bit more tomorrow. Meanwhile, Carnegie Mellon just doubled their annual revenue from $909m to ~$2bn[2]. --- [1]http://www.google.com/finance?cid=664838 http://www.google.com/finance?cid=664838 [2]http://www.cmu.edu/finance/reporting-and-incoming-funds/financial-reporting/files/2011-annual-report.pdf http://www.cmu.edu/finance/reporting-and-incoming-funds/fina...

btipling 14y ago

I think patents may sometimes have the opposite effect than the one intended. Instead of encouraging innovation and stimulating the economy through entrepreneurship and business, it may have a chilling effect. Who knows what patents are out there that may lead you to also face a steep penalty that could ruin your entire business?

shrughes 14y ago
This has not been mentioned on all the other patent threads.
- praxeologist 14y ago
  It needs repeating because it is it is up there as one of the most widely believed and repeated falsehoods. >Marvell lawyers said CMU's closing statement was "rife with misrepresentations," including suggestions that Marvell "broke the chain of innovation by not paying the royalties that they now owe," and noting those payments would be used "to fund further research, to lead to further innovation." That resulted in a short conference at the side bar, in which the judge warned "you can't dig deep into all of CMU's contributions to society and mankind." There are tons of studies showing that IP law hampers innovation and not a single one showing it aids it.
  - cobrausn 14y ago
    There are tons of studies showing that IP law hampers innovation and not a single one showing it aids it. What about pharmaceuticals? 'Tech' (as we use the term) isn't the only industry in existence.
    - praxeologist 14y ago
      What about it? Find a study to support your belief if you think patents aid innovation in pharmaceuticals. I can refer you to my comments the last time I challenged people to show a study in support of this idea. The paper attempted to measure innovation in the number of patents issued. Hopefully the problem with doing that is blatantly obvious. http://news.ycombinator.com/item?id=4901756 http://news.ycombinator.com/item?id=4901756

jennichen 14y ago

Looks like the real winners are Douglas B. Greenswag and Patrick J. McElhinny of K&L Gates ... Carnegie Mellon's lawyers.

monochromatic 14y ago
Why does the winning litigant not count as a real winner?
- accountswu 14y ago
  Perhaps jennichen was suggesting that since the appeal has already been filed and the verdict might be overturned, the lawyers win either way. In the end CMU may get nothing out of it after having spent millions on the lawyers. Quoting from the article shared: "As Brian Love, a professor of patent law at Santa Clara University, pointed out, most universities end up net losers (http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2019190 http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2019190) in the game of "patent roulette," with their patents costing them more money than they make."
- uvdiv 14y ago
  Another commenter wrote an interesting reply to you. It got censored by friendly robot overlord, so I'll reproduce it: «Perhaps jennichen was suggesting that since the appeal has already been filed and the verdict might be overturned, the lawyers win either way. In the end CMU may get nothing out of it after having spent millions on the lawyers.» «Quoting from the article shared:» «"As Brian Love, a professor of patent law at Santa Clara University, pointed out, most universities end up net losers (http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2019190 http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2019190) in the game of "patent roulette," with their patents costing them more money than they make."» (Thank you 'accountswu', that is an interesting find.)

deleted 14y ago

[deleted]

jeswin 14y ago

If the US technology sector ever falls behind other countries, one could look back and see that a fundamentally broken patent system played a significant role. Pitting companies against each other in courtroom battles with no net productive output.

monochromatic 14y ago
By that standard, every court case has "no net productive output." Should we disband the legal system?
- theklub 14y ago
  Yes, it needs a reboot at least.
  - monochromatic 14y ago
    Why do you say?
    - snowwindwaves 14y ago
      Lawmakers don't refactor the laws like programmers refactor their programs. Laws get more and more complex with more and more bolt on patches. Times change but they don't get updated. There Are so many laws it is impossible to know if you are breaking one or not. http://unclibertarians.com/are-you-breaking-the-law/ http://unclibertarians.com/are-you-breaking-the-law/ Laws are designed by committee. We know how that works out for programming projects. I think the volume of laws could be significantly reduced and laws could be simplified, but the law making process doesn't allow it. Ianal.
      - rayiner 14y ago
        The law is "refactored" all the time. That's one of the tremendous virtues of the common law process. And while the law is designed by committee, it is applied in any given case by a single judge which has insight into the actual issues in play. Again, a tremendous virtue of the common law process.

pi18n 14y ago

If you read the claims they are apparently infringing upon, it's all math with a thin veneer of "on a magnetic storage medium". It's literally mathematical signal processing. I would bet a few dozen bucks that it is obvious to anyone studying signal processing, since it seems like an advancement on a Kalman filter.

monochromatic 14y ago
Yeah, we're probably doing a better analysis glancing at the claims than the team of patent attorneys defending against a billon dollar lawsuit did.
wmf 14y ago
Yeah, it's so obvious that it was published in IEEE Transactions on Information Theory and the author got a PhD from CMU for it.
- Brashman 14y ago
  I agree. Since this is coming out of research out of a university, I would be more inclined to guess that (at the time at least) this was actually innovative and new work. The fastest way for a paper to be rejected is for it to have been done already, or even for it to be "obvious to anyone" with basic knowledge in the field. Also, I don't see why the fact that it's advancing existing techniques or that it's just math somehow makes it less important. There are whole fields that are just math, such as computer science originally.
  - pi18n 14y ago
    I don't want to make math and computer science sound unimportant -- it's an important distinction because pure math is not supposed to be patentable. But for whatever reason if you include a hypothetical machine it is suddenly patentable.
- pi18n 14y ago
  So I lose the bet, but it's still mathematics that shouldn't be patentable in the first place.

rutigers 14y ago

Taiwan University sues Apple over SIRI[1]. Columbia University sues Illumina[2]. University of California sues Facebook[3]. And now, CMU sues Marvell. --- [1]http://www.reuters.com/article/2012/07/30/us-apple-patent-taiwan-idUSBRE86T0A920120730 http://www.reuters.com/article/2012/07/30/us-apple-patent-ta... [2]http://www.reuters.com/article/2012/03/26/us-illumina-columbia-idUSBRE82P0VK20120326 http://www.reuters.com/article/2012/03/26/us-illumina-columb... [3]http://www.reuters.com/article/2012/09/13/us-patents-facebook-university-californi-idUSBRE88C00N20120913 http://www.reuters.com/article/2012/09/13/us-patents-faceboo...

linuxhansl 14y ago

Universities should teach, research, and publish. What the heck are they doing in patent litigation?! Also, is CMU partially tax funded? If so, do they really own these patents to begin with? Should they?

tingletech 14y ago
In the process of research, professors and graduate students (and sometimes non-academic appointment staff) make discoveries and inventions that can be patented. The University owns part of every patent, because the University often provides the infrastructure yadda yadda, but usually the academics are the ones who start companies to exploit the patent. Technology transfer officers who manage the University patent portfolios will negotiate licenses if you call them up, but these offices are often dealing with grant compliance issues as well and are dealing with so much data it seems like they can hardly keep track of all the research going on in the academy, let alone look for patent violators. I don't think a University ever owns 100% of a patent, so I have to believe it is the inventor's company that is really going after people; and the university is just a co-plantif because they own part of the patent are are legally compelled to take part in the patent defense / plus they want to get their slice of the pie.
- Brashman 14y ago
  If the professors and graduate students involved in this didn't start a company to exploit the company, then I'm guessing the university still owns 100% of the patent (I don't know if that's the case in this situation or not). I think this is similar to in industry when employees may have their name on patents but the company they're working for will own the patent. This case gets me thinking a bit because they are probably involved in this in part so that they can get money to do more research. It's not like they're doing this as a power play to grab more market share.
  - tingletech 14y ago
    > If the professors and graduate students involved in this didn't start a company to exploit the company, then I'm guessing the university still owns 100% of the patent That is not consistent with how I personally interpret http://www.cmu.edu/policies/documents/IntellProp.html http://www.cmu.edu/policies/documents/IntellProp.html but I am not a patent lawyer > so that they can get money to do more research. Some research requires massive public and private investment, and the rational for the technology transfer function of a university is to recoup the costs of R&D from commercial products that are legitimately derivative from these investments, so as to reinvest in the facilities and create more original knowledge that can lead to more commercial products.