Posts Tagged: "Unified Patents"

Why in the world would the federal government want to be an active participant in invalidating patents that the USPTO grants? Does the federal government believe that an insufficient number of patents are challenged through inter partes reviews, that there is insufficient gang tackling (which occurs when another petitioner requests joinder using a near-photocopy of the original petition), or that there are insufficient serial attacks on the same patents? To put the last issue in other words, does the federal government really believe that nine attacks against some patents are needed?

The Alliance of U.S. Startups and Inventors for Jobs (USIJ) recently released a report detailing the organization’s research into serial attacks on high quality patents at the Patent Trial and Appeal Board (PTAB). The USIJ’s research shows that, far from being a cheaper alternative venue for small businesses to challenge the validity of weak patents being asserted against them as was originally intended, the administrative tribunal has instead become a tool for rich, sophisticated companies who are able to harass owners of valuable patents with duplicative petitions filed either by themselves or by profiteering entities which weren’t envisioned when the Leahy-Smith America Invents Act (AIA) of 2011 was passed into law.

Why is it that innovators such as Universities and independent inventors are caricatured as patent trolls while entities such as Unified Patents and RPX, who exist for the sole purpose of destroying property, are somehow let off the hook or even celebrated? In a different era, about 100 years ago, those large corporations and their allies who ganged up on smaller companies and individuals were characterized as ‘robber barons’ and caricatured as ‘fat cats’… The AIA makes clear that patent owners should not have to endure repeated attacks on their patent claims at the PTAB.

Last week the Patent Trial and Appeal Board (PTAB) entered a final written decision terminating an inter partes review (IPR) proceeding that had challenged a patent owned by technology licensing company Kamatani Cloud. According to the PTAB, petitioner Unified Patents failed to show by a preponderance of evidence that any of the challenged claims of the patent were invalid on obviousness ground under 35 U.S.C. § 103. “We are delighted with the PTAB’s decision in this matter,” Shanahan said. “The Kamatani Cloud patent survived the validity challenge presented by Unified Patents and its beneficiary members with all 41 claims emerging intact.”

As Jaime Siegel, OIN’s Global Director of Licensing, notes, OIN is able to grant free membership to companies joining the consortium thanks to the efforts of eight full-funding member companies which have each funded $20 million to support OIN’s operations through an endowment. These companies include the first six companies to form OIN: Sony, Phillips, IBM, Red Hat, NEC and SUSE; joining those companies are Google and Toyota. OIN’s board consists of representatives from each of these full funding members. Every new member of OIN signs the same licensing agreement as the full-funding members, giving all members in the organization equal standing in terms of the cross-license agreement.

On August 1st, the non-profit inventor advocacy group US Inventor filed an amicus brief with the Court of Appeals for the Federal Circuit asking the court to grant a petition for en banc rehearing in American Vehicular Sciences LLC v. Unified Patents Inc. The case, which stems from the Patent Trial and Appeal Board (PTAB), involves issues regarding obviousness which US Inventor argues that the Federal Circuit should resolve through the en banc rehearing of this case… This uncertainty in determining the validity of an invention disincentivizes small inventors from taking risks and experimenting to create an invention at a time when the United States is facing an innovation crisis. US Inventor notes that China has been outpacing the U.S. in terms of startup funding for artificial intelligence developers and that patent applications filed in China has been outpacing U.S. patent applications at a rate of about 2-to-1.

Often, a PTAB proceeding is threatened by an accused infringer to successfully settle the dispute with the patent owner. Often, no PTAB petition is ever filed. When the patent is asserted in two or more district court suits, often only one PTAB proceeding is filed. Many valuable and infringed patents are not asserted because of the threat of PTAB challenge. Everyone knows the extreme threat of a PTAB challenge and the costly, time-consuming, uphill battle to win faced by the patent owner.

I was dismayed recently when I received my invitation from Unified Patents to their conference where the keynote speaker was David Ruschke, Chief Judge for the Patent Trial and Appeal Board. In what world would a Chief Judge be so blinkered that he’d think it a good idea to speak at such a conference? Judge Ruschke surely should have realized that Unified Patents makes money exclusively by arguing in front of Judge Ruschke’s team. Unlike other conference hosts, Unified Patents operates exclusively in front of the PTAB and solicits members on that basis.

The next several weeks will see much wringing of hands and gnashing of teeth about Allergan’s transaction with the Saint Regis Mohawk Tribe. Our point is not to engage in futile “what about-ism…” but rather to illustrate how the PTAB is inherently subject to gamesmanship — from all directions — that destroys systemic credibility, which is undeniably bad for all parties, not just the one whose ox got gored today. As an administrative tribunal, the PTAB isn’t limited to resolving actual “cases or controversies” between parties like Article III courts are. The gates are open to all comers, and so are the unintended consequences.

Based on this Unified Patents definition of an NPE, any patent owner that seeks to enforce a patent, whether through licensing or litigation, is a patent troll. Therefore, according to Unified Patents and Shawn Ambwani, any patent owner that seeks a licensing fee, seeks to resolve ongoing infringement, or resorts to the judicial process to seek redress for those who are violating rights granted by the federal government are patent trolls. In other words, all patent owners are patent trolls in the view of Unified Patents and Shawn Ambwani. Only those patent owners that go through the extraordinary time and expense of inventing and obtaining a patent and then do absolutely nothing are legitimate patent owners — everyone else is a patent troll. Talk about completely and utterly asinine! But I suppose that is how they come up with the ridiculous and obviously phony “statistics” about more than 95% of patent infringement cases being filed by patent trolls. The only way that is possible is because to Unified Patents all patent owners are patent trolls!

Unified Patents is a relatively new form of patent troll that works as a “Troll of Trolls” or “ToT.” They file IPRs (inter-partes reexamination requests) to kill patents. While they purport to only attack “bad patents,” their definition of a “bad patent” is simply any patent asserted against their clients. So who are their clients? Good question – that is a large part of the problem. They keep most of their clients’ identities secret. Unified does identify a handful of their members on their website such as Adobe, Google, NetApp, Roku, and Salesforce… But China is different. Here, a mercenary third party attacking innovation via patents is problematic. China, unlike America, has made innovation a top priority. China’s government has also, over the last few years, created the best patent enforcement environment in the world.