Monday, June 12, 2006

San Diego Union-Trib on eBay v. MercExchange: dumb and dumber?

The Union-Tribune wrote on 12 June 06: In a unanimous decision, the high court said that eBay could continue using its “Buy It Now” button while a U.S. District Court judge figures out whether the consignment sales technology violates a patent held by MercExchange LLC, a tiny firm that sues companies for a living. IPBiz notes that statement is incorrect. eBay does violate (infringe) claims of MercExchange's patent. That's already established. The question is: are money damages enough for MercExchange? In addition to missing the legal issue sent back to the District Court, the Union-Tribune neglected to mention that the US Supreme Court all but killed the District Court's previous reasons for NOT granting MercExchange a permanent injunction. In contrast, the Supreme Court made it easy for the Court of Appeals for the Federal Circuit to reach its earlier conclusion that MercExchange should be granted a permanent injunction. At least the Union-Tribune, which did not mention the 1908 Continental Paper case, did not mangle its interpretation of eBay v. MercExchange as badly as the Los Angeles Times did.

The Union-Tribune wrote: Instead, the Supreme Court said judges should first weigh the public interest and explore licensing deals. The Supreme Court said district court judges should use the traditional four-factor test for permanent injunctions. The Supreme Court NEVER said judges should explore licensing deals.

The Union-Tribune wrote: At the same time, Kennedy's opinion may herald a crackdown on patents for “business methods,” which improperly cover ideas instead of specific innovations. Business-method patents cover methods, not ideas. Referring to the Metabolite case, the Union-Tribune wrote: the Supreme Court now is considering whether a firm can patent its observation that a disease correlates to the presence of a naturally occurring substance in the human body. The Metabolite case does NOT involve a business method, but it does involve a method claim. The Union-Tribune neglected to mention that it was three professors (two at Colorado University, one at Columbia) who obtained the correlation patent, not "a firm."

The Union-Tribune concluded: Behind the legal wrangling are twin worrying trends: An explosion in the number of patents and sharply declining quality from an overwhelmed U.S. Patent Office. Buffetted by competing business interests, Congress seems likely to make matters worse.

This balancing act is best left to the Supreme Court. It's a good sign that the justices are moving cautiously.

IPBiz notes that the US Constitution at Article I, Section 8, Clause 8 gives Congress the power over patents and copyrights. As CJ Rehnquist noted at oral argument in the Lessig-argued copyright case, the Constitution gives Congress (not the Supreme Court) the ball to run with. Contrary to what the Union-Tribune seems to think, the balancing act is left with Congress by the terms of the Constitution.

All in all, the June 12 piece was extremely sloppy writing by the Union-Tribune.

[IPBiz post 1657]


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