Intellectual Ventures Lending Its Patents To Members To Sue Others
from the win-win? dept
We've certainly written plenty about Intellectual Ventures, the giant, incredibly secretive, patent hoarding operation that has convinced a bunch of companies to pay hundreds of millions of dollars in a sort of pyramid scheme protection racket, to avoid getting sued on any of the patents that it holds. But now it's taken things a step further. Last year, we saw how at least one IV patent had shown up in a patent lawsuit, and now Zusha Elinson is reporting that Intellectual Ventures has effectively loaned out one of its patents to member company Verizon, with which it can sue TiVo, in response to a lawsuit TiVo filed against it.Yes, effectively, Intellectual Ventures is becoming an arms dealer in patent nuclear war.
Think about this for a second. TiVo sued Verizon over patents. Traditionally in patent lawsuits between two big tech companies, the sued party then finds some of its own patents that the other company is infringing on and then counter-sues. But, in this case, apparently Verizon couldn't find anything good, and IV dug through its own portfolio and transferred the rights over to Verizon so Verizon could pound back on TiVo. This must be what Verizon paid Intellectual Ventures $350 million for. The right to get handed patents that it has no intention of using or implementing, but over which it can sue others. I don't think this is what Thomas Jefferson envisioned when he set up the patent system.
Amusingly, Intellectual Ventures tries to position this all as a good thing:
Don Merino, vice president of licensing at IV, said it's an example of IV taking "a much more customer-centric approach."Well, sure. Unless you're TiVo. Or the general public who would prefer that these hundreds of millions of dollars getting tossed around went towards actual innovation instead of lawsuits.
"We want to figure out how to get out of the, 'I win, you lose' to a much more collaborative, 'We both win,'" said Merino.
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Filed Under: lawsuits, lending, patents
Companies: intellectual ventures, tivo, verizon
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Jefferson
Actually he may have had that in mind, which is why he was dubious about such a system from the beginning.
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GREAT NEWS!!! Lawyers are finding new and innovative ways to create litigation. See, patents do lead to innovation after all. This new innovation is a novel way of enriching the pockets of lawyers.
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Re:
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Regarding the movie picture assoc.
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Is he anything like Don Corleone?
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It's all nuts
Whatever deal w/ the devil TiVo made to win their DISH lawsuit, at least they are making & selling an actual product that relies on their patents. The Verizon countersuit is pure inanity. Also, it's clearly not the case that the $350 million was invested just for these patents-- TiVo would have gladly settled for that amount with Verizon. More likely, Verizon bought themselves protection & gained rights to borrow patents as needed to sue.
So fucked up.
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Patent Nuclear War
Apple Responds with iNuke
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Re:
http://www.nbc.com/The_Office/video/clips/conflict-resolution/116196/
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So Ridiculous, it just might work
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Nice way to prevent competition
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Re:
I've been plenty harsh on TiVo for its patent lawsuits (see http://www.techdirt.com/articles/20090625/2343205367.shtml) for example, and I also wrote about TiVo's initial lawsuit against Verizon (http://www.techdirt.com/articles/20090826/1945196009.shtml). So I disagree with the claim that I've "largely ignored" it. I'm still troubled by the process of giving patents out for lawsuits like this.
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The general public could give a crap...
The "general public," whoever or whatever that may be, does not get a voice with respect to where privately owned companies spend their money. While the "general public" may prefer that the money went to "actual innovation," the company could just as well have decided to spend the money on a new executive bathroom, bonuses, or whatever. Not spending money on lawsuits does not automatically translate into spending money on innovation. Indeed, since in the vast majority of cases the actual dollars spent are relatively small, the money was likely shifted from some other optional category. Innovation tends to be a protected category and the budget for innovation is rarely affected in medium and larger companies by intellectual property lawsuits.
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Re:
For example, Company A could sue Company B for infringing on PVR technology patents with a new whole-house PVR, server based solution. Company B is at risk of losing, so seeks something with which to sue back. Not finding anything in their patent portfolio, they search IV's patent portfolio and find a patent on, say, audio encoding in MPEG2 video (just making this up). They counter-sue on those patents.
You see they are not countersuing saying "No we didn't infringe." They countersue saying "Oh, yeah? Well you infringe on our separate patent!"
Then both settle to avoid wasting more time and money in court.
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Re: The general public could give a crap...
However, the "General Public" does get a say in who represents us in government, and, ostensibly, the laws of the land. In this case, we have laws that support Intellectual Property in ways that deliver the outcomes seen in this case. Maybe the "General Public" would prefer different laws that produce different outcomes.
Outside of government, the "General Public" comprises many of the consumers which, in aggregate, make up the economic concept of "Demand". I have found that successful companies should and DO, in fact, pay attention to demand.
Contrary to your assertion, the opinion of the "General Public" should and does matter. It does affect where privately owned companies spend their money.
"Innovation tends to be a protected category" Please!! When budgets are tight, it's often the first to go.
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Re: The general public could give a crap...
No, but the patent system is designed to promote the progress -- and thus increase the overall welfare of "the general public."
If that's not happening, then it's a pretty good demonstration that the patent system is broken.
You would be absolutely right if you were talking about actual private property. But when you're talking about gov't granted monopolies, designed for the purpose of promoting the progress of society, the fact that it's a waste to the general public is very, very relevant.
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Re: Champerty
On the contrary, it seems to be admired in the US, where it is seen as just another form of free market capitalism and the courts practically give those who practice it standing ovations. There are companies that support other companies financially in bringing lawsuits (even bogus ones) against their competitors (e.g. Microsoft supporting SCO) and some litigants are even beginning to openly sell shares in their cases wherein the profits from the litigation are to be "shared" with the case "investors".
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I agree with you that patents suck and we would be better off without the entire system. But the reality of the situation is that we're currently stuck with it and companies like Verizon are forced to take whatever defensive measures they can against aggressors. And as is so often the case with patents, the fight fire with fire approach is sadly the most effective defense, despite being a costly exercise.
Why shouldn't Verizon and IV in this case do whatever they can to work together to defend against TiVo's attack? By saying that IV shouldn't have stepped in to help Verizon out with a patent to counter sue TiVo, then you're basically saying that Verizon should have been left suffer the consequenses while TiVo - the real evil party - gets a nice payout.
At least this way, TiVo gets a taste of their own medicine, and I hope TiVo suffers big time for their initial aggression, and learns not to be so aggressive in the future.
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I think it should be clear by now that they want to create a cartel and then force competitors shut down their businesses, so that cartel partners can run by sharing monopolies.
There must be some agreement between partners to settle internal disputes, and the intention is obviously not to make every company a partner of them.
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