Recently I had the opportunity to interview Jay Walker, the founder of Priceline.com. Walker, with over 700 patents and pending patent applications, is one of the most prolific living inventors in the world. He is embarking on the monumental task to commoditize patent licenses in a way that streamlines the process, keeps costs down, maximizes the number of licenses and charges a low flat fee. A daunting task no doubt, but his methodology is unique and seems to me to be more likely to succeed than any other efforts, which really bear no resemblance to the Patent Properties model. Still, to call the task difficult is an understatement, but if anyone has the ability to pull it off it would be Jay Walker.
WALKER: Let’s switch to the other side before we go to the theory. On the other side are users of patented technology, most of whom don’t know which patents they are using. They have no way to run the kind of sophisticated outlook to say, well, if I’m using patented technology how do I know what it is? I can’t read claim lines, which takes a federal judge to interpret whether I’m actually am infringing or not. It takes a whole Markman Hearing to figure that out. And on top of that when I try to look through the patents that are already issued as a way to learn they’re not written up in a user-friendly language, and I’m often advised by counsels not to do that.
Patent licensing company Conversant Intellectual Property Management today launched an educational campaign against the use of extortionist demand letters that are victimizing thousands of small and medium-sized businesses. The goal of Conversant’s Stand Up to the Demand campaign is to help small businesses spot unscrupulous demand letters sent by patent trolls. Conversant’s Stand Up to the Demand campaign follows the company’s November 2013 release of a set of ethical patent licensing principles, which built upon the belief that patent licensing companies should take the lead in curbing patent abuses within their own industry.
Bad demand letters are a big problem for U.S. small businesses, costing them millions of dollars in settlement fees and legal costs annually. Patent trolls often operate through shell companies and these bad acting companies send form demand letters to hundreds or even thousands of small businesses at a time, claiming with little or no evidence that they are infringing on patents. These mass demand letters are often misleading and sometimes outright false. This type of activity has been characterized as “extortion-like” by the federal courts, and gives hard working innovators a bad name. See also Extortion Patent Style.
Earlier this year New York Attorney General Eric T. Schneiderman announced a groundbreaking settlement that sanctioned a patent troll that was engaged in abusive pre-litigation tactics by sending letters with the intent to deceive those receiving the demand letters, scaring them into settling. Additionally, recognizing the stakes involved, a dozen U.S. states have already enacted laws to curb extortionist demand letters, and 14 other states are actively considering such laws.
A friend who handles large numbers of software patent applications for some of the most elite technology companies sent me an e-mail late last week about what he has already started seeing coming from patent examiners. He says he has seen the below form paragraph twice within a week. Most alarming, in one case the form paragraph came in the form of a supplemental office action, but the outstanding original office action didn’t have any patent eligibility rejections under 35 U.S.C. 101.
Claims… are rejected under 35 U.S.C. 101 because the claimed invention is directed to non statutory subject matter. In the instant invention, the claims are directed towards the concept of… [This] is considered a method of organizing human activities, therefore the claims are drawn to an abstract idea. The claims do not recite limitations that are “significantly more” than the abstract idea because the claims do not recite an improvement to another technology or technical field, an improvement to the functioning of the computer itself, or meaningful limitations beyond generally linking the use of an abstract idea to a particular technological environment. It should be noted the limitations of the current claims are performed by the generically recited processor. The limitations are merely instructions to implement the abstract idea on a computer and require no more than a generic computer to perform generic computer functions that are well-understood, routine and conventional activities previously known to the industry. Therefore, claims… are directed to non-statutory subject matter.
Did you notice the circular logic? The claims are abstract because the claims do not recite limitations significantly more than an abstract idea. Truthfully, this rather ridiculous logical construct can’t be blamed on patent examiners when the Supreme Court refuses to provide a definition for what is an abstract idea.
Earlier this morning Wayne Sobon, President of the American Intellectual Property Lawyers Association, sent an e-mail to members announcing that Todd Dickinson will step down as Executive Director of the AIPLA. The announcement suggest this will be effective immediately, and provides no reason for Dickinson’s departure, although the announcement says Dickinson will remain engaged within the IP community.
Dickinson has been rumored to be on various short lists for appointments throughout the Obama Administration. Perhaps Dickinson is stepping down because he is being vetted for an appointment, or perhaps he just needs a break. In any event, for what it is worth, I think Dickinson appointment to the United States Court of Appeals for the Federal Circuit to replace the now retired Judge Randall would be extremely well received within the industry.
Last month, I co-authored an article on IPWatchdog.comabout the legal, technical and academic communities’ over-a-decade long debate about the boundaries, legality and wisdom of software patents. Now, on June 19, 2014, the U.S. Supreme Court has issued a decision in its review of the U.S. Court of Appeals for the Federal Circuit’s en banc May 10, 2013, decision in CLS Bank v. Alice. Unfortunately, the clarity that many had hope for has not come to fruition!
What we do know for sure — for at least a 150 years now — is that U.S. Patent Law recognizes four broad categories of inventions eligible for patent protection: processes; machines; article of manufacture; and compositions of matter. 35 U.S.C. Section 101. We also know for sure, despite the oft-quoted recognition that the patent laws were made to cover “anything under the sun that is made by man,” Diamond v. Chakrabarty, 447 U.S. 303, 309 (1980) (quoting S. Rep. No. 1979, 82d Cong. 2d. Sess., 5 (1952)), the U.S. Supreme Court has long recognized that there are three exceptions to these four broad patent-eligibility categories: laws of nature; physical phenomena; and abstract ideas. Id. This is where the certainty ends.
The Supreme Court’s Alice decision has again left the IP bar without a clear, repeatable test to determine when exactly a software (or computer-implemented) claim is patentable versus being simply an abstract idea “free to all men and reserved exclusively to none,” Funk Brothers Seed Co. v. Kalo Inoculant Co., 333 U.S. 127, 130 (1948). This is perhaps not surprising as Alice is a case more about so-called “business method” patents than software patents! (In fact, three justices in a succinct, 116-word concurring opinion indicated that they would impose a per se ban on patenting business methods!) With respect to software patents, however, we still find ourselves with a myriad of USPTO Section 101 guidelines, flowcharts and presentation slides – the latest of which is a March 4, 2014, 19-pager which may very well get fatter after Alice!
Simply stated, Jay Walker is one of America’s best-known business inventors and entrepreneurs. Walker has founded multiple successful start-up companies across various industries, although he is best known to members of the public as the founder of Priceline.com.
Walker has had a incredibly successful career, and with well over 700 issued and pending U.S. and international patents he is the world’s 11th most patented living inventor. TIME magazine has twice named Walker as one of the “50 most influential business leaders in the digital age,” and he was selected by Businessweek as one of its 25 Internet pioneers “most responsible for changing the competitive landscape of almost every industry in the world.” Newsweek has cited Walker as one of three executives at the forefront of the Internet commerce revolution. He is an icon within the patent world and one of the visionary leaders of the Internet business revolution.
Walker currently serves as executive chairman and lead inventor of Patent Properties, a successor in interest to Walker Digital, which has developed a new no-fault patent licensing system.
Recently I had the opportunity to interview Walker, along with the CEO of Patent Properties Jon Ellenthal. While nothing was ruled out of bounds for the interview we spent much of our time discussing his attempt to create a no-fault patent licensing system that will help innovators monetize patents through a uniform licensing regime that offers a variety of peripheral benefits to those who take licenses. In a broad sense there have been some who have tried to commoditize the monetization of patent licensing in the past, but as yet have largely been unsuccessfully. Initially I was skeptical, but listened. Over the Winter and Spring as I learned more about Walker’s plan I became intrigued because this effort and have come to believe that his plan has a real chance of succeeding. Of course, if anyone is going to be able to figure out the myriad issues involved Walker can.
In order to obtain exclusive rights on an invention the law requires that the patent applicant particularly point out and distinctly claim the subject matter which the inventor regards as his or her invention. Any patent, or patent application, contains a variety of different sections that contain different information. Generally speaking, a patent is divided into a specification, drawings and patent claims. Only the patent claims define the exclusive right granted to the patent applicant; the rest of the patent is there to facilitate understanding of the claimed invention. Therefore, patent claims are in many respects the most important part of the patent application because it is the claims that define the invention for which the Patent Office has granted protection.
35 USC 112 requires that the applicant shall particularly point out and distinctly claim the subject matter which he or she regards as his or her invention. The portion of the application in which he or she does this forms the claim or claims. The claims are in many respects the most important part of the application because it is the claims that define the invention for which protection is granted.
Like most statutes, Title 35 is not very specific with respect to the details regarding implementation of its directives. Notice that 35 USC 112 only states that a claim is necessary, but does not provide any information on the structure or format of the claim or claims. It is, therefore, necessary to turn to Title 37 of the CFR to expand upon what is actually required. The basic section that deals with claim requirements is 37 CFR 1.75.
Qualcomm’s strong research and development activities in chipsets and other wireless telecommunications products are regularly featured in IPWatchdog’s Companies We Follow series. Today, we’ve scoured the recently issued patents and published patent applications from the U.S. Patent and Trademark Office to find the most intriguing inventions assigned to Qualcomm. Our search rendered up a variety of technologies designed to improve wireless communications networks that may interest our readers.
Our featured application in today’s column discusses one Qualcomm technology designed to establish a call session across a network for the real time transmission of text messages. This data system could also be used to aid data transmission for mobile banking and other applications. We also discuss a couple of intriguing systems for detecting physical movement of a device owner, including one invention which provides a navigational guide for indoor environments.