Sunday, June 14, 2009

Big company abuse of the patent system?

An IAM blog post titled ACT calls on CAFC to rein in big company abuse of the patent system begins

Patent litigation is expensive.

then goes to

Strangely enough, while many big companies rail against patent trolls and the harm they are doing, very few seem to be as concerned about how litigation favours them in so many ways

then gets to the title text:

With all that in mind, I was very interested to receive an email late yesterday afternoon from the Association for Competitive Technology [ACT] about an amicus brief it has filed in the TiVo v EchoStar case.

and then

That said, I do not actually blame big companies for using the patent system to maximum effect any more than I blame trolls/NPEs for doing exactly the same thing. It's the sanctimonious hypocrisy I often hear that I can do without. Why are trolls evil and a drain on innovation, while gaming patent litigation to the detriment of smaller competitors that lack your resources is perfectly legitimate?

[IPBiz infers an SME is a small manufacturing entity:

If they are small companies or lone inventors with limited reserves this puts a huge strain on their ongoing viability. As we have seen, in the US this is something that trolls leverage so as to extract settlements from businesses. But globally, it is also something that big companies understand. Armed with this knowledge, they infringe patents owned by SMEs. They know that in many cases, SMEs may actually ignore the infringement, or they may be so daunted they immediately agree to settle a case on big company terms. Alternatively, some SMEs may grit their teeth and go to court. Then the big companies seek to extend the litigation for as long as possible. They use the very best lawyers to game the system to ensure that the dispute becomes punitively expensive. In doing this, their experience tells them that there comes a stage when the SME can no longer fight and has to find a way to make the dispute go away. At that stage, the chances are that it will grant a licence for use that does not reflect the value of the patent(s) in question. In the worst case scenarios, the expense involved drags the SME under and there is nothing left to fight about.]

Separately, see Intel's take on statutes in foreign countries (eg Japan. Germany) to protect employee-inventors which appears in a comment on deferred examination.

Separately, on outsourcing to India:

When Indian IT outsourcer Satyam's fraud news broke earlier this year, there were definite winners and losers. Satyam is, of course, the loser. The winners were international behemoths Accenture (NYSE: ACN) and IBM (NYSE: IBM).
While other Indian outsourcers such as Wipro and Infosys (Nasdaq: INFY) benefit from the weakening of a direct competitor, they will likely suffer from the bad press and a lack of confidence in all Indian outsourcers. After all, in the business-to-business world, a sterling reputation and the unquestioned ability to deliver on long-term contracts are prerequisites to winning clients.

IBM's published patent application 20090083107 on outsourcing


Blogger Erin-Michael Gill said...


Despite most normal abbreviation conventions, SME stands for "Small and Medium-Sized Enterprises (SMEs)"

Erin-Michael Gill

11:24 AM  

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