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Patent Legislation Gives FTC Power to Regulate Demand Letters

Posted: Monday, Mar 31, 2014 @ 8:46 am | Written by Andrew Baluch | 18 comments
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Posted in: Congress, Federal Trade Commission, Guest Contributors, IP News, IPWatchdog.com Articles, Patent Reform, Patents

Senator Claire McCaskill (D-MO).

On Thursday, March 27, 2014, the Senate Judiciary Committee held another meeting on patent reform legislation.  A markup of Senator Leahy’s bill (S. 1720, “Patent Transparency and Improvements Act”) may happen as early as this week.  During Thursday’s meeting Senator Leahy, who Chairs the Committee, indicated a willingness to incorporate in his bill other provisions from Senator Cornyn’s and Senator Hatch’s bills.

Momentum is clearly building for more patent legislation, but the myriad bills and provisions make it difficult even for folks close to Capitol Hill to keep track of them all.  To fill that need, today’s post is part of a series of articles based on the white paper, Patent Reform 2014.  IPWatchdog.com has already published articles on Joinder of Interested Parties and Loser-Pays Fee-Shifting. Today’s focus is on the proposed FTC enforcement provisions found in several pending bills.

In September 2013, Senator Klobuchar’s staff circulated draft language that would require the FTC to initiate a rulemaking proceeding, in accordance with 5 U.S.C. §553, to prohibit the assertion or enforcement of patents in a manner that is an unfair method of competition, or unfair or deceptive act or practice, under section 5 of the Federal Trade Commission Act (15 U.S.C. 45).





Prelude to SCOTUS Oral Arguments in Alice v. CLS Bank, Part 3

Posted: Sunday, Mar 30, 2014 @ 3:50 pm | Written by Gene Quinn | 27 comments
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Posted in: Computers, Gene Quinn, IP News, IPWatchdog.com Articles, Patents, Software, Technology & Innovation, US Supreme Court

Eric Gould Bear

This is the third and final installment of my conversation about software, patents and software patents with expert and inventor Eric Gould Bear. To begin reading our conversation from the beginning please see A Software Conversation with Eric Gould Bear.

BEAR: In Judge Michel’s brief, he writes about not confusing §101 with §102 and §103. I’m also looking at this and thinking that patentability questions regarding “abstract ideas” may, perhaps, be better handled under §112 on specificity grounds.  What do you think about that?

QUINN: I totally agree.  And I think that that was the way that Director Kappos meant it when he was at the Patent Office and the Bilski case came out.  That was what he was urging the examiners to do. Do not to make this a §101 issue but instead get the §112 issue. I think that’s the exact right approach because the real question I think they’re struggling with is whether there is an invention there.  You can’t know whether there is an invention there until you ask what does somebody of skill in the art understand by reading the disclosure.  And what some want to do is make it a §101 question so that they don’t have to do any analysis or heavy lifting.





Patent Business: Litigation, Deals, Licenses & Settlements

Posted: Sunday, Mar 30, 2014 @ 8:00 am | Written by Gene Quinn | No Comments »
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Posted in: Companies We Follow, Gene Quinn, IBM, IP News, IPWatchdog.com Articles, Microsoft, Patent Business & Deals, Patent Litigation, Patents, Qualcomm

Periodically I stumble across a number of items that catch my attention, so I have occasionally published a monthly column that incorporates various items of possible interest. As I was reviewing the wire I noticed that this past week was particularly busy. Obviously, this is not intended to be an exhaustive summary, but rather interesting items that might be worth knowing about in order to keep your finger on the pulse of the industry.

Without further ado, here are some interesting patent business items from the past week.





Prelude to SCOTUS Oral Arguments in Alice v. CLS Bank, Part 2

Posted: Saturday, Mar 29, 2014 @ 1:38 pm | Written by Gene Quinn | 10 comments
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Posted in: Computers, Gene Quinn, Interviews & Conversations, IP News, IPWatchdog.com Articles, Patentability, Patents, Software, US Supreme Court

Eric Gould Bear

Eric Gould Bear knows software. He is a successful inventor, has spent over 25 years working with numerous Fortune 500 corporations and he is also a testifying expert witness for patent infringement cases. With the oral argument in Alice v. CLS Bank scheduled for Monday, March 31, 2014, we recently sat down to talk about the briefs filed and issues in the case. In part 1 of our conversation we discussed the false distinction that is erroneously made between hardware and software, as well as the ACLU amicus brief, which he called “embarrassing.”

In part 2, which follows below, we discuss why software start-up companies need patents. Bear also further analyzes the briefs filed, including the one filed by LinkedIn, Netflix, Twitter, Yelp and Rackspace, which he characterizes as taking “a fairly radical stance.”

Without further ado, here is part 2.

QUINN: I was hoping you might be able to give us an idea of how a software startup company uses patents as an asset to leverage building, growing, and further innovating?

BEAR: Sure.  Startups have to move with velocity and with a high level of excellence simultaneously.  And they’re fiscally challenged for the most part, so have to operate very lean.  There’s a challenge with regards to patent filing because the costs are hard to justify as having any immediate benefit.  And when you weigh your weekly or daily burn, it’s really hard to swallow the costs of investing in patents. That’s certainly the case for startups like the ones I advise at the Capital Factory incubator in Austin.  Most don’t know with certainty if they’re even going to survive to the next year.





Alice at Court: Stepping Through the Looking Glass – Part II

Posted: Saturday, Mar 29, 2014 @ 8:00 am | Written by Robert Sachs | 2 comments
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Posted in: Computers, Guest Contributors, IP News, IPWatchdog.com Articles, Patentability, Patents, Software, US Supreme Court

An illustration of Alice by Lewis Carroll circa 1887.

In Part I, I addressed many of the issues that are being considered by the Supreme Court in the Alice v. CLS oral arguments, and continue the analysis here, looking at particular issues and what various amicus briefs argue, and whether those arguments hold up or not.

The Equivalence of Software and Hardware

There is a further gulf between those who view In re Alappat as sound logic and engineering (ABL, AIPLA, Alice, Mr. Ronald Benrey, BSA, CCIA, Mr. Dale Cook, Prof. of Computer Science Lee A. Hollaar, IEEE-USA, Microsoft) and those who it as mistaken (Electronic Frontier Foundation, Prof. Robin Feldman, Red Hat) and primarily responsible for an increase in such patents (Electronic Frontier Foundation, Google, “Law, Business and Economics Scholars”). The IEEE-USA provides an excellent analysis of the relationship between software and hardware, pointing out the incontrovertible principle of equivalency, that “special-purpose programming of general-purpose hardware” is “equivalent to special-purpose hardware,” though IEEE-USA fails to mention that this is a fundamental principle of computer science, as established by Alan Turing in the 1930s. To assert, as does the EFF, that the Federal Circuit “concocted” the equivalency of hardware and software goes beyond denying the foundational work of Turing and others.  The equivalency of software and hardware is what makes it possible for Java to run on any type of computer using the Java Virtual Machine, as well the electronic design automation industry, which enables complex electronic circuits to be entirely designed in software before being implemented in hardware.





Prelude to SCOTUS Oral Arguments in Alice v. CLS Bank: A Software Conversation with Eric Gould Bear

Posted: Friday, Mar 28, 2014 @ 12:44 pm | Written by Gene Quinn | 27 comments
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Posted in: Computers, Gene Quinn, Interviews & Conversations, IP News, IPWatchdog.com Articles, Patentability, Patents, Software, US Supreme Court

Eric Gould Bear

Eric Gould Bear is an inventor on over 100 patents and patent applications in the software space. He has spent over 25 years working with numerous Fortune 500 corporations with respect to assisting them in the creation of new user experiences. He is also a founder of the design studio MONKEYmedia, who signed onto the Trading Technologies amici brief filed in Alice v. CLS Bank at the Supreme Court. Bear is also a testifying expert witness for patent infringement cases. He is an expert in the software/patent space, and has seen the industry from multiple different angles over the years.

With the oral argument in Alice v. CLS Bank scheduled for Monday, March 31, 2014, I reached out to Bear to see if he would go on the record to discuss the issues he saw in the various briefs filed, what was good, what was problematic, and how he as a software expert would try and convey the issues to a layperson, or scientifically untrained jurist such as the Justices on the Supreme Court. He agreed and we spoke on the record about the issues, using as our focal point several of the high profile amici briefs filed.

What appears below is part 1 of my 3 part substantive software converation with Bear. In part 1 we discuss the false distinction between hardware and software, and Bear goes into deal with examples, saying at one point that most of the innovation today relates to software. He also takes issue with the ACLU amicus brief, calling it “embarrassing.”





Alice at Court: Stepping Through the Looking Glass of the Merits Briefs in Alice v. CLS Bank – Part I

Posted: Friday, Mar 28, 2014 @ 8:00 am | Written by Robert Sachs | 6 comments
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Posted in: Computers, Guest Contributors, IP News, IPWatchdog.com Articles, Patentability, Patents, Software, US Supreme Court

Alice with Lion and Unicorn from “Through the Looking Glass,” published 1871.

Reading the merits briefs of Alice Corp., CLS Bank and many amici induces the strange feeling that there are multiple, parallel universes operating, and it is hard to know which one you are in. Are you in a universe in which Alice’s claims are for a software invention or a business method? Where software has always been patent eligible or has never patent eligible? Where the Supreme Court’s jurisprudence is absolutely clear and consistent over the past 150 years or entirely murky and at odds with itself? Of course, it would be foolish to expect universal agreement on a topic that is controversial, and we expect nothing less than zealous advocacy from lawyers. Instead of summarizing the briefs individually, I’ve organized my analysis by topics, looking at particular issues and what various briefs argue, and whether those arguments hold up or not.

Framing the Debate: The Question Presented

The fractured views of the world begin with the question presented, and reflect how different parties frame the debate in very different terms. Alice’s merits brief presents the question before the Court as “whether claims to computer implemented inventions…are patent-eligible.” Putting the question this way allows Alice to place its inventions and claims in the larger context of all computer-implemented inventions, the subtext being that if the Supreme Court holds that computer-implemented inventions are patent eligible—which is a fair bet—then Alice’s patents should be valid. Further, phrasing it this way allows Alice to distance itself from pure business method claims from the invalid claims in Bilski v. Kappos.





Dissecting the Software Patent Amici in Support of CLS Bank

Posted: Thursday, Mar 27, 2014 @ 12:13 pm | Written by Gene Quinn | 16 comments
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Posted in: Companies We Follow, Computers, Facebook, Gene Quinn, Google, IP News, IPWatchdog.com Articles, Patentability, Patents, Software, US Supreme Court

There are numerous briefs listed on the ABA’s brief publication webpage for Alice Corp. v. CLS Bank that are filed in support of the respondent, most of which make specious claims about software patents blocking innovation, or which make arguments that claims that specifically recite computers, data storage units, devices and more are somehow abstract and imaginary. These arguments should be easy enough to dispose of as ridiculous on their face, but who knows how the Supreme Court will respond. Still, one would hope that the Supreme Court would notice that neither patents generally or software patents specifically have done anything to block innovation in the smartphone industry.

Whereas the Alice supporters feel that the U.S. Patent and Trademark Office’s issuance of software patents are important for protecting and spurring innovation in many fields, the supporters of CLS Bank have largely responded that software patents hurt innovation. But that can’t be! One of the areas critics always say has been allegedly hamstrung by patents, the smartphones industry, is barely over 6 years old.  Have patents stopped innovation of smartphones? Hardly. In fact, with every new version companies tout just how much more the phones do and how they are so far superior to the previous model. Thus, it is easy to see that those claiming that software patents block innovation simply ignore market reality and how the functionality of current devices (which is thanks to software) match up with previous generations of devices over the last 6 years. Corporate critics must also ignore their own marketing of new smartphones, which directly contradicts the ridiculous claim that software patents are preventing innovation. Still they make these and other specious arguments as if they are true.