If Your Business Strategy Relies On Suing Others, You're Not A Business, You're A Leech On The System

from the face-facts dept

Canadian patent troll Wi-LAN has a long history as trying to tax any and all wireless innovation with patent threats. With the news that it's suing a bunch more companies -- including Apple, HTC, HP, Dell, Sierra Wireless and others, the company is merely cementing its reputation as a taxer of innovation, rather than a builder of anything useful. The company doesn't seem shy about this. As the link above notes, the company seems to brag about this "business" strategy:

What's more, Skippen said he believes "that our past investment in litigation could generate a significant return in the future. Our record revenues and earnings in the first quarter signal the beginning of that return to WiLAN and its shareholders."

It's hard to read such a comment and not feel sickened by the pure net loss on the economy and innovation from such leeches. Any company whose business model focuses on litigation is not contributing positively to society and innovation. There are times to file a lawsuit, but when that becomes central to your business model, something is broken.

The very core of a functioning capitalist system is that companies make transactions in which there's a buyer and a seller, and both sides come away from the transaction feeling better off. The buyer values the product or service more than the money paid, and the seller values the money more. That's good business. Any time you involve a lawsuit to force someone to pay, you're doing exactly the opposite of that and you're setting up a system that is not working to benefit everyone, but is actively using the force of the courts to try to force a company to "buy" something it has no interest in buying. It's not good for the economy and it's not good for innovation.

Filed Under: business, economics, patents, strategy
Companies: wi-lan

Wi-Lan Just Keeps On Suing; Says Cable Modems Infringe Its Patents Too

from the does-any-networking-equipment-not-infringe? dept

Wi-Lan really is the patent troll that just keeps on suing. You may recall that the company -- which once was an operating company that totally failed in the market, because it was unable to execute -- has since become one of the nastier patent trolls out there, suing everyone it possibly can. Years back, it claimed that it had patents that covered the basics behind WiFi. After that, it claimed patents on mobile broadband offerings, like WiMax. It's also sued over patents on mobile devices and near-field Bluetooth technology.

And it's not stopping there. Its latest move is to sue a bunch of cable firms for violating patents with their cable modems. Basically, if you offer any kind of networking, expect to have to pay some sort of tax to this company that couldn't hack it in the marketplace. Is that how the patent system was supposed to work?

Filed Under: cable modems, networking, patents
Companies: wi-lan

Now Wi-Lan Sues Everyone Over Bluetooth Patents

from the what's-next? dept

Remember Wi-Lan? The failed Canadian company reinvented itself as a patent nuisance, claiming that WiFi violated its patents, leading to it suing a bunch of companies all at once. That strategy seems to be working, so now its claiming that Bluetooth also violates Wi-Lan patents and has sued another 19 companies for infringement. The list includes Apple, Dell, Intel, HP and others. And, of course, the lawsuit was filed in East Texas -- and Wi-Lan is claiming willful infringement, demanding treble damages. Same story, different day.

Filed Under: east texas, patents, wifi
Companies: wi-lan

RIM Sued Yet Again For Patent Infringement

from the maybe-you-shouldn't-have-kicked-up-all-that-dust dept

While most people think of just the NTP lawsuit when they hear about RIM and patent infringement troubles, what's often left out of the discussion is that prior to the NTP suit, RIM was one of the more aggressive companies in filing patent infringement lawsuits against everyone else. In fact, it was news articles about RIM's aggressive patent enforcement strategy that convinced the guys behind NTP to file their lawsuit in the first place. Since paying $612.5 million to NTP to settle that battle, other patent holders have been lining up to sue RIM as well.

Earlier this year, we wrote about another aggressive patent enforcer, Wi-LAN, which sued RIM for infringement. RIM, once again, settled -- indicating a bit of an open season. If you happen to have a patent that RIM might sorta possibly infringe on, why not sue?

The latest to step up to bat is Mformation, who has sued RIM for two separate patents which are both about remote management of a wireless device (Patent 1 and Patent 2). Whatever the merits of the case, all of this has to make you wonder if RIM regrets its decision to kick off the process of suing lots of companies for patent infringement. It seems that the blowback was a lot worse than any benefit.

Filed Under: lawsuits, patents, stockpiling
Companies: mformation, ntp, rim, wi-lan

RIM Pays Off Wi-LAN To Get Rid Of Another Patent Suit

from the losers-litigate dept

Wi-LAN is a Canadian company that did some early work in the wireless field, but was unable to actually make much of a business out of its work, so it took the loser's route: it started suing lots of companies for patent infringement. It's the same old story: winners innovate, losers litigate -- and litigate seems to be about all that Wi-LAN does these days. Recently, Wi-LAN targeted RIM, another Canadian company, who famously was pressured to cough up hundreds of millions in another patent battle to NTP a few years ago. These days, RIM seems to have learned an unfortunate lesson: it's easier to just pay up whoever sues you for patent infringement, no matter how legit (or not) their claim is.

So, it should come as no surprise that RIM has agreed to pay off Wi-LAN to make the lawsuit go away. No details were released, but given that Wi-LAN put out a separate press release saying that its "earnings" (a misnomer if there ever were one) for the quarter should be between $24.5 million and $25.5 million from the previous guidance of $15 million to $20 million you can take a guess how much this cost RIM. Definitely cheaper than a lawsuit, though this will only encourage two bad results: Wi-LAN will keep suing companies that actually do something, and more companies with questionable patents on wireless technologies will line up to get some cash from RIM. This isn't encouraging innovation. It's encouraging extortion.

Filed Under: patents
Companies: rim, wi-lan

Wi-LAN Sues RIM: Two Canadian Firms Duke Out Patent Fight... In East Texas, Of Course

from the ah,-east-texas dept

Turns out that Canadian patent holders love East Texas just as much as American companies. The news today covers how Canadian wireless patent holder Wi-LAN has now sued RIM in East Texas, concerning patents on mobile handheld devices. RIM is also a Canadian company (and also heavily involved in patent disputes). Isn't it great to see two Canadian firms choosing East Texas as the best place to fight over patents?

Wi-LAN is a company that we've discussed in the past. It worked on some technologies for wireless networks, but was unable to successfully market products commercially. In other words, it failed in the market. So, instead, it started focusing on aggressively enforcing its patent portfolio, suing a ton of companies who did anything wirelessly. As with so many public companies that turn into patent hoarders these days, it also has a very vocal and active set of day traders who will defend it to no end (see the comments on that link above).

RIM, of course, is also a well known company that we've written about many times. The maker of the super popular Blackberry wireless device, it became an aggressive filer of patent infringement lawsuits. That, in turn, led some patent holders from a non-practicing entity called NTP to sue RIM over some other patents -- eventually leading to a $612.5 million payout by RIM (despite the fact that NTP's patents were found to be invalid).

This latest case seems like it ties together so many different stories. You've got a failed business trying to use its patents to hold back the company that won; it's got Wi-LAN who has been aggressively trying to tax just about every wireless innovation with its patents; it's got RIM, who has been on both sides of a ton of questionable patent lawsuits; and it all takes place in East Texas. Who could ask for anything more?

Filed Under: canada, east texas, patents
Companies: rim, wi-lan

The Meaningless WiMax Patent Pool

from the somebody's-missing.... dept

There are some folks who believe that the solution to patent problems is to just have everyone who claims to have a patent on a certain technology throw it into a "patent pool" and then those who use the technology pay up a fee that gets divided up among pool members. It sounds nice, but in practice, it almost never works. Setting up a patent pool actually encourages the wrong behavior: it encourages plenty of other patent holders to claim they deserve to be a part of the pool, and if they're not included, they start suing like crazy. Also, it encourages companies to try to get any kind of patent that might get them included in a pool, leading to all sorts of crazy claims. It's the exact opposite of the type of behavior that should be encouraged.

So, don't read too much into the fact that a bunch of companies in the WiMax space have agreed to put together a patent pool under the amusingly inaccurately named "Open Patent Alliance." The companies involved, Cisco, Intel, Samsung, Sprint, Alcatel-Lucent, and Clearwire are all betting big on WiMax deployments, so they know it's in their best interest to get the licensing out of the way. But you'll notice that there are a lot of companies missing -- including Wi-LAN who has been claiming that it owns all the key patents over WiMax technology for years. The patent pool sounds nice, but it's certainly not going to diminish the number of patent lawsuits that arise over WiMax technology. If anything, it's just going to make all those other companies even angrier.

Filed Under: patent pools, wimax
Companies: alcatel-lucent, cisco, clearwire, intel, samsung, sprint, wi-lan

Wi-LAN Follows New Patent Hoarder Strategy: Sue Everyone All At Once

from the this-is-innovation? dept

Three and a half years ago, I wrote an article about the coming WiFi patent problem, focusing on the Canadian company Wi-LAN who claimed a bunch of patents related to WiFi technology. The company started off by suing Cisco. That lawsuit was eventually settled, but Wi-LAN clearly wasn't done yet. The company has now sued 22 different companies for violating its patents. This strategy seems to be the new strategy of patent holders: sue a ton of high profile companies all at once. It's what Sandisk did for example. Why is it becoming more popular? Because these patent holders are afraid that one of the potential targets might sue them first, seeking a declaratory judgment saying they don't infringe, and do so in a court other than the patent friendly court in Marshall, Texas. Oh yeah, Wi-LAN also notes that it's more economical to sue everyone at once. How nice of them.

Of course, Wi-LAN is hardly the only company that claims patents having to do with WiFi. It's a true patent thicket. If all these patents were actually valid and needed to be licensed no one could afford WiFi and it would be worthless. It's also worth noting that Wi-LAN's target list is somewhat ridiculous as well. It appears to be suing up and down the supply chain from chip suppliers like Broadcom and Intel to computer makers like Apple, Dell, Lenovo and Sony all the way to retailers like Best Buy and Circuit City. Assuming that all are somehow responsible for paying Wi-LAN the company could conceivably get license fees three or four times for the same computer. It's not hard to start adding up the questionable things going on here: (1) broad patents that are claimed to be important for a standard long after that standard has become widespread (2) these patents are one of many, many patents that claim to cover WiFi technology (3) filing the lawsuit against many companies at once (4) filing the lawsuit in east Texas and (5) filing the patents up and down the supply chain. This isn't what the patent system was designed to do and patent attorneys know it.

Filed Under: patents, wifi
Companies: acer, apple, best buy, broadcom, circuit city, dell, intel, lenovo, sony, texas instruments, wi-lan