Stupid Patent Of The Month: Phoenix Licensing Trolls Marketers With 'Personalized Communications' Patent

from the that's-not-patentable-subject-matter dept

Mon, Feb 29th 2016 11:23pm — Daniel Nazer, EFF

This month, we feature yet another patent that takes an ordinary business practice and does it on a computer. Our winner is US Patent No. 8,738,435, titled "Method and apparatus for presenting personalized content relating to offered products and services." As you might guess from its title, the patent claims the idea of sending a personalized marketing message using a computer.

Claim 1 of the patent is representative (the claims are supposed to describe the boundaries of the invention). It claims a "method of generating a set of personalized communications … with a computer system." The steps are described at an extremely high level of abstraction, including things such as "accessing a computer-accessible storage medium" using "identifying content to distinguish each person from other persons." The patent plainly proposes using ordinary computers to achieve this task. In fact, the "preferred embodiment of the apparatus" is illustrated in Figure 1 and includes fascinating, non-obvious details like a "display," a "keyboard," and a "mouse or pointing device."

Attentive readers have probably already concluded that the claims of US Patent No. 8,738,435 are almost surely invalid under Alice v. CLS Bank, the 2014 Supreme Court decision which held that abstract ideas implemented on a generic computer are not patent eligible. We agree. But this has not stopped a company called Phoenix Licensing, LLC, from suing more than 100 targets with this and other highly questionable patents from the same family (a patent family is the group of issued patents that come from the same application).

Phoenix Licensing has filed at least a dozen lawsuits just this month against companies ranging from CVS to Credo Mobile. Unsurprisingly, given that its patents are so vulnerable to challenge under the Alice standard, it has filed all of these lawsuits in the Eastern District of Texas. Recent data shows that the Eastern District of Texas is much less likely than other federal courts to invalidate patent claims under Alice. This helps explain why a dispute between Phoenix Licensing (principle place of business in Scottsdale, Arizona) and Credo Mobile (headquartered in San Francisco) would end up way out in East Texas.

In its complaint against Credo Mobile, Phoenix Licensing boasts that its original 1996 patent application has grown into a patent family of 19 patents with more than 1,500 issued claims. But this is not evidence of inventiveness. Rather, it simply shows that the Patent Office is asleep at the wheel. The Patent Office has allowed Phoenix Licensing's mundane idea -- using a computer to send personalized marketing messages -- to grow like a Chia pet into a thicket of patent claims.

We have seen similar strategies from other patent trolls who exploit the permissiveness of the Patent Office to get an absurd number of nearly-identical claims, which can then be used to force defendants to play an expensive game of whack-a-mole in court. This creates enormous settlement pressure. Indeed, most of Phoenix Licensing's cases settle quickly after filing. The Phoenix Licensing story shows that we still need reform both in the courts and at the Patent Office -- to stop abusive patent litigation and to stop these stupid patents from issuing in the first place.

Reposted from the EFF Deeplinks Blog

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Filed Under: customization, marketing, patents, stupid patent of the month
Companies: phoenix licensing

16 Comments

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Anonymous Coward, 1 Mar 2016 @ 12:20am

I don't know who to cheer for
I don't know who to cheer for: The troll for making the marketeer pay up or the marketeer for fighting the troll.

I'd rather see both gone from my net.
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klaus (profile), 1 Mar 2016 @ 12:22am

A High Level of Abstraction Indeed
This patent is 99.5% business rules liberally sprinkled with computer keywords, such as RAM, pointing device, storage...

It mentions the word "invention" many times, but it reads like "these are our processes for marketing insurance policies". There's nothing at all inventive about that.

Notwithstanding the obviousness of it all, I'm trying to get my head around how "this is how we do business" could possibly be patentable. It's almost as though the patent process is being used to stifle, or at least control, competition.
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That One Guy (profile), 1 Mar 2016 @ 12:39am

Stopgap measure
Though it certainly wouldn't eliminate the problem entirely, a good way to seriously damage patent trolling would be much stricter rules with regards to what court the lawsuit is held in. When neither company is headquartered in Texas, east or not, the idea that the lawsuit can be filed there is ridiculous.

Simply removing the trolls' ability to pick the most advantageous court to file in would strike a huge blow to their willingness to do so I'm sure, as without a clearly biased court in their favor they'd actually be forced to defend their claims in court, and given how weak so many of them are that could be difficult if not impossible.
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- Aussie Geoff (profile), 1 Mar 2016 @ 4:01am
  
  Re: Stopgap measure
  I would go further. The plaintiff must file in a court in the jurisdiction where the defendant has its headquarters and court costs are strictly on a loser pays system. If the plaintiff withdraws from or loses the case the defendant is compensated 150% of the total costs incurred to defend the case, of course this should be in addition to the reimbursement of their costs incurred in defending the case.
  
  I think this will slow down the trolls and their trivial "patents".
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- Anonymous Coward, 1 Mar 2016 @ 8:17am
  
  Re: Stopgap measure
  As a sidebar to court shopping, is there any (legal) way to completely eliminate the territory encompassing the Eastern District of Texas from one's sales market, thus negating the 'doing material business' requirement? Refusal to ship items to the area, web traffic redirect from area to page explaining why EDT is a douchebag area to do business in? Are we compelled to do business in high-legal-risk areas?
  
  Hey, I smell a patent! "Method To Exclude Geographical Area From Corporeal Presence, Using A Computer"
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  - That One Guy (profile), 1 Mar 2016 @ 9:14am
    
    Re: Re: Stopgap measure
    As far as I know the usual trick they use to file in the area is to rent an 'office' and claim that that means they're doing business there, and therefore can file there. That the 'office' may be the size of a broom closet, have absolutely no-one there, and may be shared with multiple other companies/groups is completely beside the point of course.
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    - Anonymous Coward, 1 Mar 2016 @ 9:57am
      
      Re: Re: Re: Stopgap measure
      Are they actually renting a space that big, or are they renting the space on a door or wall for their company plaque?
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- Anonymous Coward, 1 Mar 2016 @ 10:21am
  
  Re: Stopgap measure
  This actually already exists. Both parties being in different jurisdictions then the one filed, is a valid reason for it to be dismissed.
  
  It's called Personal Jurisdiction, and an objection based on it will probably be the first filing for the defence.
  
  https://www.law.cornell.edu/wex/personal_jurisdiction
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Anonymous Coward, 1 Mar 2016 @ 2:07am

"The Republic of Texas"...
...has a really nice ring to it. Given their copyright wackiness, their suppression of science and history in textbooks, and the repression of female reproductive rights, I think many of us could be convinced to allow, nay encourage, secession.
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- Richard (profile), 1 Mar 2016 @ 7:50am
  
  Re: "The Republic of Texas"...
  Why not just expel them ?
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Capt ICE Enforcer, 1 Mar 2016 @ 4:07am

Need legal help
OMFG, I need legal help, I been doing this for years and now that I realized I have violated someones intellectual property I feel bad. I need a lawyer to protect me for when they sue. What if they won't give me a licensing deal. My business is over.
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Anonymous Coward, 1 Mar 2016 @ 4:56am

Dear business tycoons and captains of industry,

On behalf of myself and many others, there is no interest in your advertisements. If I have interest in your product(s), I will be contacting you. Do not bother wasting your time and money sending me ads because they will be ignored. If you persist, I will go out of my way to avoid your product(s).
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Quiet Lurcker, 1 Mar 2016 @ 5:03am

Wonder if they're going to go after Microsoft. Seems the mail-merge feature of MS Word - my copy of which is dated to 2007 - would be covered by the patent.

Or, maybe not. Seems the patent was filed only about three years ago. I expect if they go after a company for having that technology long before their patent even came into existence, any court (with the probable exception of east Texas) they file in would likely invalidate the patent so fast it would make their heads swim.
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Jay Fude (profile), 1 Mar 2016 @ 5:45am

Prior Art
Would not a "form letter" be prior art?
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Ed (profile), 1 Mar 2016 @ 6:29am

Can't we get rid of the trolls who sit on the bench of the East Texas court? They seem to be in the mix of every ridiculous patent claim.
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John Mitchell (profile), 1 Mar 2016 @ 7:55am

Patent for disposing of junk mail
Wow! When I went from disposing of the personalized junk mail delivered by the U.S. Postal Service to disposing of personalized junk mail delivered by my Internet Service Provider, it never occurred to me that I could patent the use of a computer to dispose of it. Even a small fraction of a penny for every licensed press of the "delete" key all over the U.S. would make me richer than Trump. But if the USPTO gives a patent for preparing incoming personalized spam using a computer, it must be duty-bound to issue my patent for getting rid of it using a computer.
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