RIM Pays Out Again Over Patents

from the how-dare-you-try-to-do-wireless-email dept

Fri, Jul 17th 2009 3:23pm — Mike Masnick

The patent battle between RIM and NTP is considered something of landmark in alerting politicians and the general public to just how ridiculous the patent situation is these days. There was, however, an interesting sidenote on this. As part of its attempt to show that its own patents were valid, NTP convinced a couple other companies to "license" the patents -- except the details showed that NTP "invested" in each of these companies at the same time. That certainly looks like NTP paying a company to license its patents, just to make it looks like there were some legitimate licensees. Two of the companies that NTP did this with were Visto and Good Technology. Having licensed NTP's patents, Visto, at least, took a lesson from NTP and became an aggressive player in the patent lawsuit game, trying to mimic NTP's success by suing RIM as well.

There is no way to describe this other than sour grapes. Visto tried to play in the market and was a pretty big (and massively expensive) failure. RIM, on the other hand, was able to create a product that people wanted and build a good business on it. This wasn't by copying Visto's (or NTP's) ideas, but better understanding the actual market and creating a good product itself. Visto failed to do that. So, in turn, it just sued and demanded cash from the company that was able to innovate. Recently, Visto also purchased Good Technology (another NTP licensee) from Motorola (who had purchased it earlier), likely adding more patents to the portfolio.

Either way, it looks like RIM has finally grown tired of the game and has agreed to pay Visto $267.5 million. It's less than the amount NTP got, but it's still a hefty chunk of change. And, for what? For being the loser in the market place. This is a tax on innovation. The loser in the marketplace forces the winner to hand over a nice chunk of profits. It's bad for everyone (except some lawyers and Visto shareholders).

Thank you for reading this Techdirt post. With so many things competing for everyone’s attention these days, we really appreciate you giving us your time. We work hard every day to put quality content out there for our community.

Techdirt is one of the few remaining truly independent media outlets. We do not have a giant corporation behind us, and we rely heavily on our community to support us, in an age when advertisers are increasingly uninterested in sponsoring small, independent sites — especially a site like ours that is unwilling to pull punches in its reporting and analysis.

While other websites have resorted to paywalls, registration requirements, and increasingly annoying/intrusive advertising, we have always kept Techdirt open and available to anyone. But in order to continue doing so, we need your support. We offer a variety of ways for our readers to support us, from direct donations to special subscriptions and cool merchandise — and every little bit helps. Thank you.

–The Techdirt Team

Filed Under: innovation, patents, wireless email
Companies: good technology, rim, visto

31 Comments

If you liked this post, you may also be interested in...

Reader Comments

Subscribe: RSS

View by: Time | Thread

Richard, 17 Jul 2009 @ 3:52pm

WHHAAT!!!
That's UNREAL why the hell would they do that? It's going to lead packs of trolls to their doorstep??
[ link to this | view in chronology ]
- lance_, 17 Jul 2009 @ 4:03pm
  
  Re: WHHAAT!!!
  Cheaper than fighting it. And the patents are on their way to being invalidated, so the other trolls would have to act quickly.
  [ link to this | view in chronology ]
OldGeek, 17 Jul 2009 @ 4:13pm

Always knew it
I've always known Canadians weren't too bright but this just takes the cake!!
[ link to this | view in chronology ]
- Anonymous Coward, 17 Jul 2009 @ 5:46pm
  
  Re: Always knew it
  bite me.
  [ link to this | view in chronology ]
- Richard, 17 Jul 2009 @ 8:18pm
  
  Re: Always knew it
  That's the other thing didn't Canada toss out idea patents a few weeks ago?
  [ link to this | view in chronology ]
PRMan, 17 Jul 2009 @ 4:13pm

Inventors Marketers
Shouldn't inventors get paid, too.

Marketers can't invent (they're generally not smart enough), but they can get paid by "stealing" someone else's invention.

Inventors can't market (they're generally too smart and marketing pitches repulse them), but they cannot get paid at all no matter what.

Nice world, Mike. I suppose you are a marketer, not an inventor.
[ link to this | view in chronology ]
- Anonymous Coward, 17 Jul 2009 @ 4:23pm
  
  Re: Inventors Marketers
  Mike still pretty much seems to think that taking something and slapping a new coat of paint on it (or remixing a song) is some major new innovation and accomplishment.
  
  After a while, you can spot the direction of his posts from a mile back.
  [ link to this | view in chronology ]
- Mike Masnick (profile), 17 Jul 2009 @ 5:18pm
  
  Re: Inventors Marketers
  Shouldn't inventors get paid, too.
  
  Sure they can. If they build a product that the market wants. We should not be rewarding failure.
  
  Marketers can't invent (they're generally not smart enough), but they can get paid by "stealing" someone else's invention.
  
  Ok. Let's be 100% clear: NO ONE here thinks that RIM "stole" anyone else's invention. Everyone admits that RIM came up with its ideas independently.
  
  And, it's wrong that "marketers can't invent." I'm not sure why you'd say that.
  
  Inventors can't market
  
  I'd argue that's not even close to true either.
  
  but they cannot get paid at all no matter what.
  
  Generalize much?
  
  Are you honestly suggesting that the world is better off when companies that fail in the marketplace get to take cash from those that succeed? This is not about "inventors or marketers." RIM and Visto had plenty of both types of people.
  
  But Visto failed. So why do they get paid for failing?
  [ link to this | view in chronology ]
  - Anonymous Coward, 17 Jul 2009 @ 6:28pm
    
    Re: Re: Inventors Marketers
    Hey Mike, I think you are confusing patents with products. A patent/process/technology may be part of a product rather than being the product itself.
    
    For example, the iPod from Apple and the Zune from Microsoft both play MP3 music files. The iPod is more successful in the market place than the Zune. The process/technology of decoding MP3 files has the same value in both products.
    
    There are MP3 player products that have failed. It is perfectly reasonable that a great technology still has value after having been in a product that failed.
    
    Having said that I think RIM really did develop its technology independently and should not have to 'license' anything. Settling is probably the best choice for them at this point, they need to focus on their business not their legal problems.
    [ link to this | view in chronology ]
  - Anonymous Coward, 17 Jul 2009 @ 6:28pm
    
    Re: Re: Inventors Marketers
    "Are you honestly suggesting that the world is better off when companies that fail in the marketplace get to take cash from those that succeed?"
    
    According the the current Administration in DC, the answer is a resounding "yes".
    [ link to this | view in chronology ]
  - Anonymous Coward, 18 Jul 2009 @ 9:44am
    
    Re: Re: Inventors Marketers
    "But Visto failed."
    
    I do not understand this. Visto is a software company engaged in creating and selling software for mobile phones. RIM is a hardware company that uses software to enable functionality on its mobile phones.
    
    Has Visto somehow failed in serving its customer base?
    [ link to this | view in chronology ]
  - Anonymous Coward, 18 Jul 2009 @ 10:52am
    
    Re: Re: Inventors Marketers
    They aren't getting paid for failing, they are getting paid as being the ones with the idea first. Succeed or fail, they climbed that mountain first and stuck their flag on it.
    
    As the other poster mentions, you are confusing product (what was retailed) with the patent (the ideas used to make that product). RIM may make a good product, but their willingness to settle suggests that they know that the patents used to make the product just aren't theirs to start with.
    
    I can't imagine someone with such a passion for copyright and patent laws not knowing and understanding the basic differences between patent and product.
    [ link to this | view in chronology ]
    - Derek Kerton (profile), 18 Jul 2009 @ 4:16pm
      
      Re: Re: Re: Inventors Marketers
      And I can't imagine someone following this story not knowing that RIM invented their technology (hardware, software, server solution) AND their handset products independently.
      
      So there we are.
      
      You "protect the inventor" people are fighting the wrong side on this one. RIM are the inventors, and the marketers, and the makers of a great, successful product. The other guys are parasites who were lucky to get granted some bad, overly broad patents which they used to attack the winners.
      [ link to this | view in chronology ]
      - Anonymous Coward, 19 Jul 2009 @ 9:51am
        
        Re: Re: Re: Re: Inventors Marketers
        It doesn't matter if they invented it independantly, if they came to the same solution that was already out there, they are in violation of patents.
        
        Yes, there are many overtly broad patents out there, but when they were granted, they seemed okay and non-obvious, it is hard to judge standing today what was and was not obvious at the time, what was and was not overbroad at the time.
        
        200 million buys a lot of lawyering. I think RIM's move shows that they know the truth, and it's cheaper to pay now than it is to fight and pay later.
        [ link to this | view in chronology ]
- angry dude, 20 Jul 2009 @ 7:55am
  
  Re: Inventors Marketers
  Mikeu is a honest PR dude on RIM payroll
  
  (yes, I believe Mikey took some money from RIM in the past, right, Mikey ?)
  
  So much for "independent" journalism...
  [ link to this | view in chronology ]
  - Mike Masnick (profile), 20 Jul 2009 @ 1:57pm
    
    Re: Re: Inventors Marketers
    Mikeu is a honest PR dude on RIM payroll
    
    (yes, I believe Mikey took some money from RIM in the past, right, Mikey ?)
    
    So much for "independent" journalism...
    
    Nope. We've never taken any money in any way from RIM. In fact, I've criticized them quite a bit for their own patent practices.
    
    Angry dude, I'm not sure why you feel so compelled to lie, but it's really unbecoming.
    [ link to this | view in chronology ]
Anonymous Coward, 17 Jul 2009 @ 6:09pm

re: A C
take you whiney ass and go home
[ link to this | view in chronology ]
Scott Seiter, 17 Jul 2009 @ 11:20pm

All ideas are similar in nature and many are simply a slight variation of another. Just look at the advances in telecommunications. Is everyone required to pay Bell a royalty for his invention?
[ link to this | view in chronology ]
- pdigit, 19 Jul 2009 @ 6:33pm
  
  Re:
  Actually should be Meucci, the real inventor of telephone (http://en.wikipedia.org/wiki/Meucci)!
  [ link to this | view in chronology ]
staff1, 18 Jul 2009 @ 7:17am

trash
"Either way, it looks like RIM has finally grown tired of the game and has agreed to pay Visto $267.5 million. It's less than the amount NTP got, but it's still a hefty chunk of change. And, for what? For being the loser in the market place. This is a tax on innovation. The loser in the marketplace forces the winner to hand over a nice chunk of profits. It's bad for everyone (except some lawyers and Visto shareholders)."

Patents are awarded to the first to invent. If we did not do so no one in their right mind would risk perhaps all their capital and often years of development work to innovate. As they say when you are on the cutting edge you bleed. RIM paid because they were using someone else's technology. Either don't use it, or invent it yourself. Enough with your sour grapes. Who pays you to write this trash?
[ link to this | view in chronology ]
- Anonymous Coward, 18 Jul 2009 @ 8:36am
  
  Re: trash
  First to 'invent', no first to write down. There is a real question of obviousness. It is too easy to get a patent on something obvious. There is also a place for developing something independently.
  [ link to this | view in chronology ]
- Derek Kerton (profile), 18 Jul 2009 @ 4:25pm
  
  Re: trash
  "Either don't use it, or invent it yourself. "
  
  Gawd. Buy a clue! RIM DID invent it themself.
  
  And do you not know what "sour grapes" means? It's a terrible metaphor for what you are trying to say. Are you saying Mike wanted something, but couldn't get it, so doesn't want it anymore?
  [ link to this | view in chronology ]
  - Anonymous Coward, 19 Jul 2009 @ 9:54am
    
    Re: Re: trash
    Mike's sour grapes is because RIM paying this money is against his personal agenda. He is so agressive about this stuff, that you would think that one or more of the anti-patent lobby groups was paying him to write it.
    [ link to this | view in chronology ]
    - Anonymous Coward, 19 Jul 2009 @ 11:11am
      
      Re: Re: Re: trash
      Name a successful anti patent lobby group and tell me how much money it makes and who funds it.
      [ link to this | view in chronology ]
      - Anonymous Coward, 19 Jul 2009 @ 2:10pm
        
        Re: Re: Re: Re: trash
        successful? None.
        [ link to this | view in chronology ]
        
        Anonymous Coward, 19 Jul 2009 @ 5:47pm
        
        Re: Re: Re: Re: Re: trash
        I rest my case. Where are these anti-patent lobby groups you keep screaming about and where is the success they have achieved in advancing their agenda? "one or more of the anti-patent lobby groups" you act like there are very many influential anti patent lobby groups but they have no success whatsoever (whoever they are).
        [ link to this | view in chronology ]
Ronald J Riley (profile), 18 Jul 2009 @ 8:18am

Mike builds arguments on false assumptions.
I have watched RIM for sometime and do not buy their media hype that they invented these things on their own.

What RIM lacks in an ability to invent the things they need to succeed in their market they make up for in leaving no propaganda stone unturned.

RIM is repeatedly accused of infringement. Some people see this as evidence of RIM being a victim. I see it as evidence of RIM victimizing real inventors, corporate greed and arrogance.

Considering their history we can all assume that they do not settle cases based on their moral compass. I think that they did learn a teeny bit from the mistakes they made with inventor Thomas Campana Jr. (http://en.wikipedia.org/wiki/Thomas_J._Campana,_Jr.) and his partner and patent attorney Don Stout and they are now settling cases when they know that they are likely to lose and that the owner of the invention has the resources to get their day in court.

Ronald J. Riley,

Speaking only on my own behalf.
President - www.PIAUSA.org - RJR at PIAUSA.org
Executive Director - www.InventorEd.org - RJR at InvEd.org
Senior Fellow - www.PatentPolicy.org
President - Alliance for American Innovation
Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
Washington, DC
Direct (810) 597-0194 - (202) 318-1595 - 9 am to 8 pm EST.
[ link to this | view in chronology ]
- Derek Kerton (profile), 18 Jul 2009 @ 4:31pm
  
  Re: Mike builds arguments on false assumptions.
  Way to cite poor old (deceased) Campana and his loyal sidekick Stout, and their epic battle against the RIM Goliath. It's useful for you to position it as two lone men fighting the power.
  
  Also...nice job not mentioning that Campana's related patents are all getting thrown out upon review. That would have weakened your argument.
  
  "False assumptions", indeed. You seem to assume Campana's inventions were unique and significant. The USPTO review process indicates that assumption to be false.
  [ link to this | view in chronology ]
Anonymous Coward, 18 Jul 2009 @ 5:16pm

The business model of tomorrow; If you can't compete in the free marketplace, lobby the government and sue people.

Look at all the success that has come from this business model. Lawyers get paid a fortune, the RIAA has achieved tremendous success through lobbying the government and suing people, telco and cable companies are very successful because they lobby the government to restrict competition, patent trolls are a success because of their suing efforts. Just look at the success pharmaceutical corporations have incurred. Bayer has gotten away with selling Aids tainted blood, and the FDA allowed it, and no one (in the U.S) has faced any consequences whatsoever. Not to mention the fact that the lobbying efforts of newspapers are likely to win them laws that benefit them and no one else. Someone should write a book entitled; A successful business model - How to get rich by lobbying the government and suing people. Lets all get rich by lobbying the government and suing people, after all, those that do it are very successful so why shouldn't we benefit from this successful business model?
[ link to this | view in chronology ]
Stephan Kinsella (profile), 19 Jul 2009 @ 9:32am

Why NTP Licensed to Visto
Mike, you wrote, "That certainly looks like NTP paying a company to license its patents, just to make it looks like there were some legitimate licensees."

This may be right, but as I explain in "Impact of Patent Licensing on Patent Litigation and Patent Office Proceedings" (available on my legal site), "a license under the patent may be
offered as persuasive evidence in rebutting a prima
facie case for obviousness." In other words, one reason patentees seek to license their patents is to build up the case that the patent is not obvious--to use it in litigation later to help defend the patent.
[ link to this | view in chronology ]
JoeEsq, 20 Jul 2009 @ 10:34am

Not buying it
Sorry, but I'm not buying that RIM is spending $267.5M to settle a case they feel has no merit. Attorney fees are high, but c'mon...
[ link to this | view in chronology ]