As a former patent examiner, I was struck by how low the payout for Project Jengo was. $125,000 for all people submitting prior art? (There were hundreds of submissions, so it's split among many people.) I would like to help out with such things and I think I have the experience to do it well, but even being a GS-7 patent examiner making $75,000 per year is a better deal! That's especially true given that Cloudflare's not only expecting people to find prior art, but to also write the legal arguments about why it reads on Sable's claims.
If they're serious about their prior art bounty program, they're going to need to increase the bounties. Actual patent search firms charge a lot more money, and even lowly paid bureaucrats make a lot more.
Having talked with several of them, most of the people who submit the prior art as part of Project Jengo would do so even if there were no payout. Several winners have actually asked that the payout be donated back to other organizations fighting patent trolls. This isn't intended to be anyone's full time job. It is intended to reward technical people with industry knowledge who may be able to help surface prior art and are as sick of patent trolls as we are.
That’s cool and all but don’t lowball people. This was the first thing Cloudflare has done in years that I didn’t associate with something shitty until I saw this.
Just for once do the right thing rather than what you think you can get away with because overall this is a genuinely something to be celebrated.
It seems like it worked out quite well for Cloudflare. You typically only increase bounties if you aren't seeing the results you want.
While I don’t disagree with any of your points, it seems like they are using a “platform/UGC/crowd” model to change the economics of the business model.
In the same way that TV networks find/vet/pay for the supply of shows and take on the risk per-show, YouTube (at its core) doesn’t do any of that and all of the content creators do those things with the hope it will take off and a share of the ad revenue, while YouTube’s risks are related to the opex cost of the incoming supply/demand.
Instead of cloudflare paying per examiner, they give a non-guaranteed slice to a bigger group of people.
Gene Quinn (in 2015) estimated that patent search with the attorney's opinion on patentability for software costs around $2500 to $3000 [1]. Obviously the cost is going to be higher now. Compare that alone against the $1000 ("at least") per winner that Cloudflare's offering.
But Cloudflare isn't asking for an opinion on a particular invention. A patent searcher could come back and say there is no prior art that reads on the invention in that case and still be paid. Instead, Cloudflare's asking for invalidating prior art, which I think sets the bar even higher and should increase the payout to account for the fact that much of the time there won't be invalidating prior art and thus won't be a payout.
If the platform is not taking on as much risk, the payouts should be higher.
[1] https://ipwatchdog.com/2015/04/04/the-cost-of-obtaining-a-pa...
I doubt the program’s aimed at patent lawyers. They’re probably casting a wide net hoping to reach people who happen to be close to invalidating prior art to begin with, skipping the search. Or maybe people who’s sued by the same patent troll, in which case the program serves to pool findings. If I can write up something I already know in less than an hour and possibly win $1k, why not.
But is there any potential disproportionate upside for any of the group of people who are searching? The sued company avoids paying $100 million in damages, and my upside as a searcher is $1000? Correct? Like, I don't have a potential super high upside like a YouTube content creator.
Strangely, this sounds like a great use case for LLMs? To just grind through entire datasets attempting to surface prior art.
Edit: Found this with a search, so it can be done: https://xlscout.ai/novelty-checker-llm/
(also, thanks Cloudflare! Keep on grinding patent trolls!)
Then you need to go over each item with just as much care as you would any probably-irrelevant item pulled from a keyword search, because the LLM is incapable of evaluating it in any way other than correlation.
Also, you don't necessarily have a real dataset to begin with: prior art doesn't need to be patented, it just needs to be published/public/invented sufficiently before the patent. Searching the existing patent database is insufficient.
Going over a better curated list is a significant upgrade and time saver.
Let’s not pretend that “correlation” isn’t very powerful
After I quit the USPTO, I tried using ChatGPT 3.5 for some basic patent examining activity out of curiosity, and I can say that it did an absolutely horrendous job. This wasn't prior art search, just analyzing the text to do a rejection based on the text alone (35 USC 112).
And the AI search technologies I used tended to not be particularly good. They typically find "background" documents that are related but can't be used in a rejection.
I don't anticipate LLMs being able to examine patents in general well. Many times a detailed understanding of things not in the text is necessary to examine. For the technologies I examined, often search was basically flipping through drawings. I'd love to see an AI search technology focus specifically on patent drawings. This can be quite difficult. Often I'd have to understand the topology of a circuit (electrical or flow) and find a specific combination of elements. Of course, each drawing could be laid out differently but be topologically equivalent... this surely can be handled with computers in some way, but it's going to require a big effort right now.
The patent office is also horrendous at evaluating novelty, so I suppose ChatGPT has already reached human level performance on this task!
Cloudflare is shrewdly calculating that there is a lot of latent, unexpressed hate toward patent trolls but that most people don't want to make a career out of it, but might very well make a little hobby out of it, and so they get to take advantage of people who are motivated by something other than money.
More deeply, the very idea of a "patent examiner" has never made sense to me. It requires being expert in all things, which is impossible. It makes more sense to take someone who is an expert in a field, and put a "patent examiner" hat on them for a little while. Ideally the patent system is not so complex that it itself requires as much or more study to be expert in than the actual subjects of the patents -- this would be a very bad sign.
Patent Examiners do specialize in their fields. It isn't something that is just a common pool subject to any patent that comes into the pipe.
From the USPTO[1]
What kind of degree do I need to apply, and which vacancy do I need to apply to? The minimum degree required to be a utility patent examiner is a bachelor’s degree. There are dozens of STEM-related bachelor’s degree types that qualify, even if they are not the exact discipline listed in the title of the job vacancy.
For example, professionals with bachelor’s degrees ranging from engineering, mathematics, astronomy, space science, geophysics, oceanography, or hydrology could all apply to the "Patent Examiner (Physics)" vacancy when it is open. To see more details about which degrees best fit with which patent examiner vacancies, view this chart[1]. You can also attend one of our upcoming webinars or office hours to chat with a current patent examiner, or email us at JoinUSPTO@uspto.gov with your specific question.
[1] https://www.uspto.gov/jobs/become-patent-examiner [2] https://www.uspto.gov/sites/default/files/documents/patent-e...
> Cloudflare is shrewdly calculating that there is a lot of latent, unexpressed hate toward patent trolls but that most people don't want to make a career out of it, but might very well make a little hobby out of it, and so they get to take advantage of people who are motivated by something other than money.
I don't think this is a good strategy. These folks tend to have a poor understanding of patent law in my experience, and you need to understand the basics to do this right. (You fortunately don't need to know too much law to handle 90% of cases.) And these folks probably aren't very effective at patent searching even if they understand the legal parts. I think most people overestimate their own search abilities. I certainly did. Examining patents didn't level me up as much as humble me in that regard.
> More deeply, the very idea of a "patent examiner" has never made sense to me. It require being expert in all things, which is impossible. [...]
As saratogacx pointed out, at the USPTO, the vast majority of examiners have a specific technology they are assigned to. While the matching of examiners to their "art unit" is often pretty bad (I could go on a rant...), the situation is not as bad as you described. There are some generalist examiners, but as I understand it, they are in (basically) QA roles and don't need to know the technologies as much. Unfortunately, USPTO upper management seems to want to make examiners into generalists, which I doubt will work out as they want.
I agree that periodic rotations of industry folks into patent examiner positions is a great idea. It would help the patent system and give the industry folks some appreciation for what examiners do.
If you're worried about lack of expertise, you should be more worried about the courts. Judges and juries almost never have a background in the technology of the case they are working on.
Proof is in the pudding, as they say. I've been astonished by the quality of the submissions we've received the times we've fired up Project Jengo. And it's helped us successfully beat — and literally put out of business — the two patent trolls that have come after us.
>It would help the patent system and give the industry folks some appreciation for what examiners do.
The examiners regularly approve absolute bullshit patents in my field that either obviously have prior work, and shouldn't be patentable anyway such as game mechanics. They clearly don't understand the work they're meant to be doing. Either patent law is horribly designed and needs to be razed to the ground, or it's being horribly applied.
If you go to a hospital that lacks the resources to provide proper treatment, should you be surprised to receive poor treatment even if your doctor was highly competent? That's basically the situation the USPTO is in. Examiners are on a quota system and they don't get enough time to do a good quality job.
With that being said, the majority of the time, the examiner made the right decision. You should check whether a patent was actually granted, for instance. Often when people are complaining about a dumb patent they're actually complaining about a dumb patent application that the USPTO rightly rejected. You should be complaining about the people writing such applications, not the USPTO.
Further, the USPTO is funded purely by fees, not taxes. Applicants want patents. That creates a perverse incentive to reduce patent quality to make it easier to get patents.
I've elaborated on these issues at length on HN before: https://news.ycombinator.com/item?id=36563611
> Ideally the patent system is not so complex that it itself requires as much or more study to be expert in than the actual subjects of the patents
Unfortunately, "patent law" is a complex body of laws, legal decisions, and specialized procedures large enough to be its own distinct specialization for lawyers. While it's not impossible to become an expert in it without years of study, it is definitely not possible to be excellent at it.
Just to put it in perspective, the Manual of Patent Examining Procedure alone weighs in at over 4K pages of text.
These patent trolls are greedy, extractive, and contribute nothing to society while wasting vast public and private legal resources.
Fuck. Them. Excellent work to the entire litigation team at Cloudflare.
Heard an interesting counterpoint to this from a patent attorney. In the IP ecosystem patent trolls serve as a sort of check on the big companies - the apex predators - to stop them from willfully infringing on your patents and then bankrupting you in litigation.
While you as a startup may not have the resources to go after them in court; your IP assets in the hands of a competent and aggressive patent troll could be a very big problem for Big Co.
So in that sense they are also kind of like a parasite that infects the apex predators who eat tainted meat.
Are these patent trolls doing anything that normal companies with patents that try to monetize them don't do?
it's what they don't do. a troll doesn't play any role in developing the tech they hold patents for, they just extract rent when someone stumbles into a similar solution
if a company doesn't develop products, but they actively license their patents to those that do, that's still patents working as intended, and not trolling. they're still helping to get the tech developed, rather than stifling it
(i think there are a lot of problems with software patents even when used as intended by real companies. mainly, they last too long)
I dunno, this line of reasoning doesn’t feel right to me. A company making products did develop the technology. They were awarded a patent. That patent was an asset. That asset was sold presumably for the benefit of the people behind the original company. That the resulting asset owner wasn’t the originator doesn’t feel like it should make any difference here?
Software patents are a scourge, I’m just not sure the reasoning there holds.
> Software patents are a scourge,
The reason is because they aren't being used as they were intended: patents are _supposed_ to be a way to give inventors/entrepreneurs a window to build a market with their idea. Let's say that you have some truly amazing invention that frobnicates foos 50x faster than anyone else, and you plan to take it to market. What would prevent the likes of Amazon from copying your idea with all the resources at their disposal? Patents.
Patents as an asset is exactly the problem. Your entire first paragraph is built on this faulted perspective - the assumption that how we actually use patents is aligned with how they were designed to be used. They are supposed to foster small businesses, not destroy them.
Software patents are a scourge only because patents as a whole have become a scourge.
from a strict logic perspective, you're right.
The issue is widespread bad behavior from patent trolls, given that the cost of mass filing patent infringement claims that barely apply is so much lower than the expected settlement, and the cost of a successful defense is likely higher than the request settlement. The incentive is to get a portfolio of overly broad patents and then shake down almost entirely unrelated companies.
For sure, the whole thing sucks
> That patent was an asset.
That line of thinking is the problem. A patent is intended as a protection to spur development, not an asset to be traded.
The spirit of a patent is to protect a novel solution while a company develops and monetizes their innovation. It keeps bigger fish with deeper pockets from quickly copying your invention and monetizing it before you.
What's happened however is that Large companies with deep pockets are filing patents for anything and everything they can. These patents generally come from their R&D efforts but are not necessarily linked to any product specifically. They're also usually unenforceable junk that wouldn't hold up in court.
The value of these junk patents isn't in the viability to be developed into a product, rather their value is that it will take time and money to invalidate them in court.
When these companies are hit with a lawsuit for violating someone else's patent, their defense is to counter sue with as many junk patents as possible. The purpose of the counter suit is to make a settlement preferable to the protracted legal fight necessary to invalidate all of the junk patents. It's the path of least expense. You could argue this allows large companies to steal innovations from smaller players by forcing cross licensing agreements.
Often these patent portfolios are transferred to companies with no interest in developing products or protecting their business. These companies sole purpose are to weaponize the patents, they're Patent Trolls.
Using the same strategy as companies with defensive patent portfolios, Patent Trolls seek to extract settlements (extort money) from companies by suing them with all the junk patents they can. The patent trolls are immune to counter suit because they produce nothing. Thus companies must either invalidate each junk patent or settle. Often settling is the path of least expense.
The two normal arguments are:
1. Patent trolls don't actually produce anything. They just extract rent from other companies.
2. The patents they choose tend to be extremely bad -- overly broad, should never have been granted, had prior art, the tech never existed, .... They use the fact that they're able to sue cheaply to bully people into settling on bogus claims.
Point (1) doesn't seem bad to me. It's kind of like how truck driving is separate from truck insurance. Having specialists capable of monetizing patents allows, in theory, inventors to invent and immediately sell for estimated lifetime patent value, minus a discount associated with the troll's costs and desired profits. Without trolls, in theory, you'd have fewer inventors because they'd also need to be/hire experts in marketing, litigation, ....
Point (2) is the one that bothers me the most, and my impression is that it's a very common problem.
Oh, and to your question, most companies use patents for mutually assured destruction and as a form of signalling that important people should want to work there, not to directly monetize. Monetizing patents is less common.
No, but the argument would be that normal companies are doing something that patent trolls are: selling a product besides patents
You would hope companies have patents based on something actually innovative. For software this is never the case. I think all software patents are bs.
yes
Good on ya!
> the Western District of Texas against patent trolls
That means they had really good lawyers.
I had a friend that lived in that area, many moons ago.
He showed me a few of their local newspapers. They were filled with stories about "plucky innovators," fighting against "corporate vested interests."
It seems they have a fairly well-prepped jury pool, thereabouts.
This is great. I do worry that a future more sinister malicious patent troll could read all the wonderful strategy Cloudflare used and work around them. Hopefully Cloudflare legal team got stronger!
Kudos to the likes of Cloudflare and (yesteryears’) Newegg that fought these trolls.
I shudder at the thought of how many of the existing legacy industries outside the computer space are still riddled with these patent portfolio companies :(
> I do worry that a future more sinister malicious patent troll could read all the wonderful strategy
The "good" news is that patent trolling is, more or less by definition, a get-rich-quick scheme - they want to make a lot of money by sending a few dozen letters every year. It does not attract people who are interested in anything approaching due diligence.
But also, the whole point of all of this is to get the trolls to leave Cloudflare alone, right? This is a very deliberate strategy; this announcement says "don't try that stuff here ... but feel free to try Cisco or Juniper instead."
Hopefully the powers that be will look at it from a national security perspective, in that other countries do not respect US copyright law and may be pulling ahead
copyrights are different from patents.
Copyright, patents, it doesn't matter. It's all IP and our enemies do not respect it. We need to move forward with that reality.
The US used to ignore IP laws when we were an underdog.
Patents are explicitly open for anyone to see. I don't know that we need more help there: you can get a product banned from import if someone uses your patent without recompense.
As someone in a place without pure software patents (algorithms can't be patented, but software/hardware combination systems can be), I'm willing to let US users use an overseas hosted instance instead of locally running it.
Though keeping US entities from importing copies against US patents isn't really something I could stop.
Why should they respect it? Software patents are and have always been a bad idea, blatant parasitism. They should never have been established, must never be taken seriously, and ought to be abolished.
I've read the article but I'm not sure I understand :
1. Why / how did sable give up its patent portfolio? It's handwaved as "lots of post trial stuff" but what's the nutshell of it? Is it because they're marked invalid? Is it punitive ruling? Something else?
2. There were 4 patents brought up against cloud flare, but sable gave up "its entire portfolio". Does that mean these 4 were their entire portfolio? Or did they have to give up patents outside of suit itself? If so, how and why? Did sable hang up the hat as a business?
Reading between the lines, my uneducated guess is that Sable knew they were going out of business either way and had to chose between paying ALL of Cloudflare's legal fees (possibly in the millions) or paying a token amount and giving up their (now or soon-to-be worthless) patents. The latter results in fewer financial loses for Sable and makes for excellent Cloudflare PR.
Edit: Also, it's entirely likely that Sable still made a tidy profit overall when it settled with the other big networking companies and decided to quit while they were ahead.
There's a picture of the "Dedication to the Public and Royalty Free License Agreement between Sable and Cloudflare" at the end of the article. [1]
Not a lawyer, but it seems to be part of the court ruling. Maybe CF didn't see a chance to get their costs back and made a deal so Sable needed to only pay a part, but also release the patents?
[1] https://cf-assets.www.cloudflare.com/slt3lc6tev37/4rpPZkNJBZ...
Sable's patents are from a company that stopped operations in 2006, so most patents are probably from well before then, and likely either expired or will very soon.
Could it be that the Cloudflare victory would basically give anyone in the future a very strong case to fight Sable with?
And so this portfolio of patents has lost most of its value because of that?
Maybe Cloudflare agreed to reduced damages in exchange for this?
I agree it's unclear.
Take a look at the legal doctrine of collateral estoppel. Once a party gets its day in court on a specific issue of fact, it can't keep relitigating that issue in later legal actions. It's possible that Cloudflare was the first to take Sable's claims all the way to a verdict (versus settling early), so Sable might have finally gotten its day in court.
Did Sable give up ALL its patents, or only the patents involved in the Cloudflare case? The picture of the document refers to the "Sable Patents", which I would suspect are defined in the context of the court case and therefore are only the ones relevant to that case?
Why are patent trolls allowed to exist? A company that only holds patents and does no productive job with them (research, production, ...) should not be allowed to exist. It stifles development and innovation for the short-lived monetary gain of a few people.
The naive explanation is that it helps inventors, because speculative investors (the trolls!) buy up patents.
One analogy is pharma research. Rights for a promising candidate molecule are purchased by "big pharma" and they will do the grunt work to validate it and extract the big money from its therapeutic value.
Substitute "FDA market authorization after successful clinical trials" with "that infamous East Texas court district and picking the right targets" (picking a too big target might backfire, picking a too small doesn't really worth the costs, etc.)
Of course the questions are: does this really help inventors? do inventors need help? is it good for society that inventors get help? is the cost of helping inventors this way not unreasonable to the economy? and even if the cost is "low", how fucking fair is it that a lot of businesses are using a given invention but only a lucky few get dragged to court? can we do better? what kind of people patent trolls are? what do they do with the money?
Yeah, I think pharma is the really tricky case.
I worked at a small biotech company whose business model was (in part) to do early stage drug discovery research and then sell promising leads to bigger companies, who would take the leads through the FDA approval process. Actually taking a drug through to approval is a $1 billion+ endeavor (with a high probability that it just won't work; e.g. stage 3 trials just fail). Small companies cannot do this.
So a naive solution like "don't allow patents to be sold" actually restricts a bunch of reasonable businesses.
Its a pure failure of the Patent office issuing dubious patents.
The patent office is financially encouraged to keep issuing patents no matter the quality because it keeps the patent fees and those are payed by the applicants. The patent office seems to be protected financially from issuing bad patents as well (I can't find any record of them being sued by companies that have licensed patents that have been invalidated).
Its gotten a little better with the Alice ruling.
https://en.wikipedia.org/wiki/Alice_Corp._v._CLS_Bank_Intern...
The patent laws does not require such thing. If it were, there may be some unforseen consequences.
For example, during the late 1800s, a number of companies bandied together to pool their patents together for a commercially viable sewing machine. No single company had been able to develop and file patents that resulted in a working sewing machine. As such, they pooled the patents and negotiated a portion of royalties for everyone who contributed. That would probably have been set up as its own legal entity. With a requirement to be an operating company, such a legal vehicle would not have worked.
You could argue that such an entity is considered “productive”, but then you would have to define what that means and write it into the law. Any lawsuit involving patents would require demonstrating that.
Another example is trademarks. In order to have a registered trademark, you must show that it is in active use, and it is distinct. That means that in order to keep a registered trademark, you must sue anyone who is infringing upon it.
There is an indie author who came up on a litrpg genre concept combining it with a post-apocalypse setting. His book exploded upon the niche, progressive fantasy scene. People loved the idea and other authors wrote books for it. The original author tried to brand it and protect it with a registered trademark. Because the term had rapidly genericized, that author started sending cease & desist letters to other authors, because he was required to in order to keep the registered trademark.
I don’t know if he knew he had do that when he registered it, but doing so drained the goodwill he had in the community. Progressive fantasy is a small indie community, and the authors who can, gather at Dragoncon to talk, exchange ideas. This is similar to sending cease and desist to your neighbors. You will quickly find yourself locked out of the community.
I am thinking of the inventor of the bear suit. Making something to protect yourself from a grizzly bear seems like it has low value for society. It is also this off the wall perspective that allowed him to invent a gel that can absorb heat (probably a non-Newtonian fluid). If we’re trying to protect the livelihood of an indie inventor like that, would a requirement to demonstrate productivity help the Bear Suit inventor? Or would it have a chilling effect?
It’s an unfortunate byproduct of allowing patents to be bought and sold. Let’s say you had a patent: you worked hard on your invention and you deserve to reap the financial benefits of it. But you do not have the legal resources to protect your right as the inventor. It feels fair and reasonable to me that you can sell your patent to a third party to license and protect as they see fit, so you can reap some financial reward.
Now, how do you make sure that these companies buying patents don’t become trolls? I don’t think it’s fair to require them to use the patent, because that limits who the inventor can sell to. Personally I think the way IP lawsuits are filed and considered needs significant reform.
We could require someone to use it - get rid of submarine patents.
Submarine patents is a different issue, effectively ended by changes in 2000 that require (most) patent applications to be published, and changes in 1995 that changed the term of patents to start from date of filing rather than date of issuance. There could possibly be a few unpublished patent applications from before 1995 that are still in the examination process; but case law from 2005 [1][2] makes it difficult to enforce patents if there has been 'unreasonable and unjustified' delay in the claims, and I'd suspect it would be hard to justify a delay of 30 years.
[1] http://cafc.uscourts.gov/opinions-orders/04-1451.pdf
[2] https://www.pinsentmasons.com/out-law/news/appeals-court-con...
Then you get will into issues of what use actually is. What is a reasonable timeline for filing a patent, and getting it to market? What is a slow and methodical development program vs. footdragging? What if the market for your product doesn't support profitable operation for your company, but someone else claims they can do it?
IMO patents should not be transferable. And maybe they shouldn't be assignable to corporate entities, only to people. Multiple people at once if they all contributed to the invention.
This would massively disenfranchise small inventors, and force all inventive work into large companies. There is no reason that the person who does the inventing should also be the person developing and selling a product.
It is weird and unfortunate that the longstanding deficiencies with patent law (chiefly: issuing patents for things that are too obvious or numerous) are being blamed on transferability of property rights. It’s the same broken intuition as over regulating housing construction and then blaming high housing costs on ownership by Chinese nationals.
In a perfect world this is arbitrage. Arbitrage helps making markets more efficient. However we don't live in a perfect world. Judgment is too expensive and risky. If it were quick, cheap and safe then patent trolls won't have the chance to do extortion. They would be limited to ... um... arbitrage!
Good news! There should be a rule that you have to use a patent in X years (much less than the lifetime) so its harder to do this behavior of hoarding a patent.
I really wish this settlement included disclosing what the other trolled parties ("including Cisco, Fortinet, Check Point, SonicWall, and Juniper Networks") paid.
Could someone explain to me why it was decided that Sable will release the patents to the public?
With the verdict in-hand, Sable was probably voluntold by Cloudflare.
If Cloudflare thought they had a shot at recovering costs, $225k and a patent-portfolio could be substantially less than whatever Cloudflare (or their insurance) had paid in defense-costs.
They had those patents only to sue other companies and get money, now some of those patents were invalidated by prior art and to Sable are essentially toilet paper. The action is unlikely to be goodwill, more likely admitting defeat and closing the patent troll company.
Could a part of the motivation perhaps be quick, clean liquidation, before any of the companies who settled before cloudflare chose resistance might try to claw back some of the settlement?
As I read this, all but one of Sable's patent claims got invalidated in an IPR (a patent proceeding), and the last one got invalidated by a jury at trial. When your patents have no claims left, you aren't doing anything by releasing the patents to the public. It's been defanged anyway.
So they can't use them to sue anyone else ever again. Basically they're hosed.
I consider this a victory for creativity, freedom and technological progress. Let the entrepreneurs innovate and execute without fear of legal suffocation!
In a sane law system, the existence of a company as a mere "box of patents" without any real product currently or previously on the market would be illegal, and these patent trolls won't exist...
Where would you draw a line for "any real product" ? ARM for example doesn't actually produce any "real" (physical) product, but they certainly do research and produce technology for other companies to build products on.
There's a lot of "on paper" companies around the world who actually do produce novel technologies even if they don't themselves create the end product, but instead sell their inventions to other parties.
I don't think they should be illegal... companies that don't "produce" anything are useful for lots of different legitimate reasons. But the bar for suing for damages should be a lot higher than just, "we happen to own the patents."
So Cisco, Fortinet, Check Point, SonicWall, and Juniper Networks paid millions to Sable. Sable paid $225k to Cloudflare, and won't use them again against anyone.
Sounds like they don't need to. Well played Sable. Enjoy your money.
I really wish we could publicly shame the people behind these abuses or provide some other incentive to correct bad behavior other than speeding-ticket sized fines.
In other news, as an investor, this tells me Cloudflare is technologically ahead of the other older companies who apparently were not sure they could defend against the claims.
> I really wish we could publicly shame the people behind these abuses or provide some other incentive to correct bad behavior other than speeding-ticket sized fines.
Right? This seems like out-and-out fraud to me.
>In other news, as an investor, this tells me Cloudflare is technologically ahead of the other older companies who apparently were not sure they could defend against the claims.
That feels like a highly specious takeaway from this court case. Companies settle against trolls because litigation isn't free to fight. It can make very good financial sense (and even be encouraged by investors who don't want to see a company in the courts for years, as Cloudflare was.)
I would be highly interested to see the breakdown of what it cost in manhours, fees, prizes to Project Jengo, etc. versus the payout from Sable to fight this particular case for Cloudflare, and whether they even came close to breaking even just on this case alone. Likely their decision somewhat hinged on an estimate of what it might cost to settle all other patent disputes in the future, and the belief that fighting this case is actually saving them much more money down the line (but how much?).
On the flip side, there's some napkin math to be done about the costs saved by any future patent trolls who are averted by going all scorched earth this time around...
> I really wish we could publicly shame the people behind these abuses or provide some other incentive to correct bad behavior other than speeding-ticket sized fines.
They are beyond shame, believe me. There have already been TV news segments about how their "place of business" in West Texas is just a PO Box.
Someone messed with the wrong guy.
If you don't mind the language, the first minute of https://www.youtube.com/watch?v=rLLt9bnRdlE comes to mind for how to deal with incompetent trolls. Comedy gold.
Cloudflare's redeemed themselves, bigtime.
A lot of patent trolls have no assets, and don't own anything except the patents they're currently milking. Then they go out of business, and there's nothing to sue. Sable apparently made the mistake of building up a portfolio and living on.
> Proving invalidity to a jury is hard. The burden on the defendant is high: Cloudflare needed to prove by clear and convincing evidence that claim 25 is invalid. And, proving it by describing how the claim is obvious in light of the prior art is complicated.
You're not kidding.
> Sable’s damages expert, Stephen Dell, told the jury that Sable was owed somewhere between $25 million and $94.2 million in damages.
"damages experts" == nice work if you can get it. The damage expert in the Apple v. Samsung trial that I went to was paid $2 million. "How much are you getting paid?" is always one of the first things they get asked on cross-examination.
> Sable has agreed to dedicate its entire patent portfolio to the public. This means that Sable will tell the U.S. Patent and Trademark Office that it gives up all of its legal rights to its patent portfolio
Left unsaid is whether this includes anything other than the patents that they already lost on.
Anyhow: great work, Cloudflare.
Has Cloudflare stated anywhere how much their defense cost them (or their insurance)?
Thank you Cloudflare (there, I said it for you)
What does "to the public" mean in this instance? Are they going to an open source patent pool or something?
From TFA: "Sable has agreed to dedicate its entire patent portfolio to the public. This means that Sable will tell the U.S. Patent and Trademark Office that it gives up all of its legal rights to its patent portfolio. Sable can never again use these patents to sue for infringement; they can never again use these patents to try to make a quick buck."
> Are they going to an open source patent pool or something?
All patents are "open for public access" [1]. And once they age past their "expiration date" (currently twenty years from earliest date of filing) they become "public property".
What Sable is doing is giving up the ability to restrict others based on the patents content's before those patents would normally have expired anyway. So in effect they are having the patents "expire early" -- which makes the contents of each become "public property".
Are there useful patents (i.e. worth using) in the Sable portfolio, or is it all trivial bullshit and obsolete hardware?
patent trolls have a special place in hell, next to the boiler room
Hum... Doesn't clouldfare have patents of their own? Don't they enforce them? Did they turn them to the public domain? You have to love hypocrites.
I don't know, do they?
There's an important difference between patenting something that you've invented and built, and a patent troll which has done neither.
Well, it's nice to know that Sable's entire portfolio is going into the public domain, it's a shame that the likely 50-100 other shell companies owned by this troll still have an arsenal of useless, but incredibly complicated, patents to use to extort money.
A just world would involve piercing the corporate veil and imposing personal consequences on the owner of this company.
Patents should have a triviality clause in them, so if you can prove that they're trivial to create and implement and be thus invalid if they are.
On one hand, you have patents where someone needed to do thousands of experiments, often costly, years of research to invent some kind of procedure to do X and thus should have some protections from others just taking the implementation and doing it cheaper, because they don't have the development costs. On the other, you can patent "Page down button on the keyboard moves the screen down one full page (A4) instead of one screen size"
> Patents should have a triviality clause in them, so if you can prove that they're trivial to create and implement and be thus invalid if they are.
That's already there (https://www.law.cornell.edu/uscode/text/35/103)
> A patent for a claimed invention may not be obtained, notwithstanding that the claimed invention is not identically disclosed as set forth in section 102, if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date of the claimed invention to a person having ordinary skill in the art to which the claimed invention pertains.
The problem is that unless the USPTO can find the requisite publications to prove the "obvious" part above from the statute, that then knocking down the resulting issued patent in a court case can be a very expensive effort.
> On the other, you can patent "Page down button on the keyboard moves the screen down one full page (A4) instead of one screen size"
Applicant's get patents because the USPTO can't find the publications necessary to prove they do not deserve to get the patent (there's also lack of time problems that I'm ignoring at the moment).
For your premise, often the reason why "Page Down moves by 'printed page'" might get patented is the lack of any findable publication of anything stating such. The USPTO examiner's don't have the ability to just say "but this is the way it works....", they have to find some publication, somewhere, that said "this is the way it works...".
For things like "how much movement 'PageDown' means", finding publications that state "how much" is extremely difficult.
> For things like "how much movement 'PageDown' means", finding publications that state "how much" is extremely difficult.
Yes .. because it's too trivial to write down.
Exactly. But to "prove" it in the USPTO process, they need that "written down" item. And if it is never "written down" because it is too trivial to write down, then the USPTO' examiner's hand are very much tied.
It is really sad to see kost companies refused to fight. Congrats on that one Cloudflare, may that serve as an example to destroy those grifters.
You can see why, though. Even in this case where they thoroughly won, and got damages, the damages were just $225K, and they probably spent millions on legal fees, employee/founder time, etc.
Ultimately, the American legal system is pretty broken. If someone brings a frivolous lawsuit against you, and you defend yourself in court, nearly 100% of the time you’ll be losing money, often a lot of money. This is the core reason why patent trolls exist, why companies normally settle out of court - it’s cheaper to do so.
I couldn't tell from the article but it seems the $225k was a settlement, and the release of all patents was additionally part of the settlement - I doubt the court could have awarded that directly. So they took $225k + the release of the patents, and I assume that the trolls would only have agreed to that if they felt the court awarded cash value would have been significantly higher.
A few states have passed laws to ban abusers from the legal system:
https://en.wikipedia.org/wiki/Vexatious_litigation#United_St...
Usually a "vexatious litigant" is not one of these patent trolls, but some nut job who spends his days at the courthouse.
If more companies let patent trolls go to court their repeated losses would fall under the first part of California's definition, but since they settle, trolls are technically not even litigants.
How much does it cost to argue in court that a particular entity is an abuser though? Someone has to be willing to cover those costs up front, otherwise people will just keep settling if they don't want to go through that process.
It's not just cost, it's cost x uncertainty of outcome. A settlement is very tempting from cost x uncertainty alone. But it also has other merits: when the rich, powerful incumbent gives in and settles, the fragile thrifty upstart won't see the slightest chance of winning and either beg the troll for an affordable licence (but they won't get a good offer) or look for a completely different line of business. To the incumbent, the settlement is a fee paid for moat-as-a-service provided by the troll.
But if we'd given in to one of these trolls, others would have targetted us.
Agreed, it’s a lose-lose situation really. But the reason most companies just settle is that going to trial is so expensive, and the American legal system allows these frivolous lawsuits while generally awarding either no compensatory damages, or damages far below the cost of the defence.
At Google I did a piece of research, along with a statistician, of whether it's better to settle or fight.
"Better" would mean you don't get sued as much in the future, because you're a hard target and not easy money.
They haven't released this study, AFAIK.
your definition of "better" implies the results of the study, although you did not specifically say it.
