The mobile app economy is estimated to have created nearly 466,000 jobs in the United States alone as of the beginning of 2012, up from zero jobs in 2007. See New ‘App Economy’ Creates Nearly 500,000 Jobs. Further, mobile app downloads are expected to hit 76.9 billion in 2014. This growing technology based industry, like so many other similar growing industries, is facing increased threat of patent infringement claims, which are hampering the process of bringing new mobile innovations to market.
In order to attempt to combat the use of dubious patents against mobile app developers, Article One Partners (AOP), the world’s largest patent research community, today announced the formation of a partnership with the Appsterdam Legal Foundation, a global trade organization for mobile software developers.
Typically I am not one to say that patent infringement lawsuits are responsible for stunning the growth of an industry, but with respect to mobile app developers there is something quite different than what we have witnessed in the past. Many mobile app developers are individuals or truly small businesses. When faced with threats of patent litigation or demands to pay licensing fees, many of these mobile app developers leave the market. Still more are simply not entering the marketplace out of fear.
While I have absolutely no problem with innovators obtaining patents and enforcing them to the fullest extent possible, there is at least some reason for concern when small enterprises are targeted with infringement. Like many others, I have seen many complaints that merely satisfy the Federal Rules of Civil Procedure, but which we all know to be woefully inadequate. They say that someone owns a patent and the defendant(s) are doing something similar to the title of the patent and therefore infringing. Never mind that you cannot infringe a patent and instead only infringe patent claims. These types of dime-a-dozen lawsuits filed for harassment purposes have caught the attention of some courts that have labeled complaints filed without due diligence “extortion-like.” See Indicia of Extortion.
“Some developers are so intimidated by patent infringement claims, especially from non-practicing entities (NPEs), that they are contemplating moving offshore and no longer releasing their products in the United States,” said Michael McCoy, Chief Legal Officer of Appsterdam. “For some developers, it’s a better business decision to stop releasing apps in the United States than to face potentially massive patent infringement liability. That’s a real shame, especially for the development culture, which is driven by sharing and innovation. It is time to educate and empower developers — and keep the app economy going strong in the process.”
As a result of this announcement today, AOP will help Appsterdam accomplish the organizations mandate of supporting ongoing innovation and business success in the mobile app development community through research projects sent to its global, diverse and highly educated community. The Appsterdam Foundation attorneys and developers will work with AOP to conduct patent research, harnessing the global reach of the AOP community, which has been used by many Fortune 500 companies to locate prior art that can be used against patents asserted against them. While note every search conducted by Article One results in prior art that can be used to invalidate patent claims, many searches have found prior art that is then used in both federal court and at the United States Patent and Trademark Office during reexamination proceedings.
Through this partnership with AOP, developers will have the ability to easily secure the patent research they need in order to stop frivolous patent infringement lawsuits from undermining their innovations and forcing them to make difficult decisions about engaging in the U.S. marketplace. The Appsterdam Legal Foundation, which has attorneys on staff, will help the mobile app developers accomplish the goal of continuing to innovate and bring apps to market in what can be a complex legal environment.
But is this announcement all about patent busting in the mobile app space? Not so fast. In an interview back in March of 2011, I spoke with Marshall Phelps, a Member of the Article One Board of Directors and former high ranking attorney with both IBM and Microsoft. During our discussion he explained the AOP “manifesto,” saying:
We started out with a manifesto on that exact point, that we were agnostic. We didn’t care what the result was as long as it was an adequate result. It could be thumbs up, or thumbs down, or thumbs sideways. That is not our concern. Our concern is running the human network, if you will. Our job is to be ruthlessly agnostic because once we are not agnostic then the value proposition is gone.
Somehow I dot think the AOP Community will come up empty handed when pushed to research the dime-a-dozen no due diligence patent complaints brought by some of the more nefarious actors. It is the frivolous complaints that have become the nemesis of mobile app developers. Frivolous complaints give the industry a black eye, particularly those non-practicing entities that have fairly engaged in the research and development necessary to innovate only to have their innovations serially copied and patent rights infringed. Indeed, AOP can and should be the great equalizer and go a long way to pointing out who the nefarious actors are (with dubious patent claims) and who the true innovators are (with valid patent claims).
“Appsterdam members now have the same ability to access patent data as our Fortune 100 clients,” said Cheryl Milone, founder and CEO of Article One Partners. “AOP is leveling the playing field for entrepreneurs and small businesses that comprise a significant portion of the mobile app development community. Developers can participate as AOP community members as well and can receive compensation for correcting the problem with which they are faced. In this situation, AOP brings our clients and our communities together to improve our patent system.”
Indeed, over the years Milone has told me that even in the situations where nothing is found that is useful information because it would tend to support the validity of the patent claims in question, which is important information for those being sued to have. She is, of course, correct. If patent searches don’t uncover relevant prior art and the AOP Community cannot uncover relevant prior art then the changes are quite good that the claims are valid.
“Our partnership with AOP is a huge win for the developer community,” said McCoy. “Through AOP, developers can easily secure the information they need in order to move their products to market. In turn, those developers can use their own knowledge and unique resources to contribute to the AOP community. Just like the development community, AOP is a community-based network where the sum is greater than its component parts.”