OPTi Shows: When You Can't Compete In The Market, You Sue For Patent Infringement

from the troll-or-not,-you're-not-creating-value dept

Reader BakaYaro points us to this article about OPTi, the company that recently won a $21.7 million patent ruling against Apple, where the company's CEO insists it's not a patent troll because it's only suing over patents that it got itself. It seems that Bernie Marren is trying to redefine what a "patent troll" is to mean just someone who buys patents and sues. But the real story shows that OPTi is yet another example of patents harming, not helping, innovation. The company used to produce products, but other companies eventually caught up, and OPTi couldn't compete. Now, in a true capitalistic society, the companies that can't compete, go out of business. And that's a good thing. Failure is important for free markets to work. But, thanks to the very un-capitalistic concept of government granted monopolies, known as patents, tech companies never need to fail and go out of business. They can just sue over patent infringement. So, OPTi went from a 235-person company producing products and adding value to the market, to a 3-person company that just sues and extracts money from the companies who actually provide value on the market. So OPTi went from providing value to sucking value out of the market. It might not be a troll, but it's difficult to see how it's good for the economy or for innovation.

Filed Under: lawsuits, patents
Companies: apple, opti

North Face Lawsuit Against South Butt Going Viral With Facebook App

from the can-you-tell-a-butt-from-a-face dept

Following North Face's incredibly short-sighted decision to sue parody clothing maker, South Butt, it seems that the story is going viral in a variety of ways. Not only is the press and various blogs talking about it, but Paul Alan Levy alerts us to the news that South Butt has released a Facebook app that helps you "sharpen your skills" to see if you can "tell a butt from a face." As Levy notes, this sort of application and attention gaining effort shows why these types of lawsuits are likely to bite you in the butt. Even if there's a legal basis here (and that's questionable), the backlash against such a lawsuit is clear (and was widely predicted when North Face first made its threat). Anyone filing lawsuits these days needs to realize how the court of public opinion can weigh in quite loudly on such things.

Filed Under: backlash, facebook app, lawsuits, trademark, viral
Companies: facebook, north face, south butt

No, Shareholders Don't Get To Sue Heartland Just Because It Leaked More Data Than Anyone Else

from the that's-not-how-it-works dept

Last year, Heartland Payment Systems, leapt into the lead as being the company with the largest data breach of all time (well, that we know of), when it potentially leaked the personal info on somewhere over 100 million people. As typically happens in these sorts of things, a shareholder lawsuit was quickly filed from bummed out shareholders pissed off that the stock dropped (like off a cliff) following the announcement. But, of course, for there to be liability it takes a lot more than just the stock to drop, so it comes as little surprise that the lawsuit has been tossed, as the court said there was no evidence that Heartland execs knew their data was exposed. Friendly reminder to litigious shareholders: just because the company screws something up, it doesn't mean you get to sue.

Filed Under: data leak, lawsuits
Companies: heartland

Private Equity Firm That Bought EMI Sues Citigroup For Misleading It Into Deal

from the oh-come-on dept

You had to be pretty clueless in 2007 not to recognize that the major record labels were seriously struggling. Still, we thought that the decision by private equity firm Terra Firma to buy EMI in 2007 might actually be an opportunity for a major record label to change, since the new bosses did not come from the recording industry, and weren't saddled with silly preconceived notions about how a major record label had to do business. And, early on, things actually looked positive. New boss Guy Hands was quick to embrace Radiohead's experiment and let everyone at EMI know that they needed to learn from it, rather than deny it or freak out about it. He also threatened to leave both the IFPI and the RIAA if they didn't stop suing fans (eventually he stuck with both, but cut their allowance). On top of that, he hired some smart outsiders to help.

Since then, however, everything has pretty much collapsed. While they weren't saddled with preconceived notions, they were saddled with dreadful contracts, and every attempt to change them resulted in charges from EMI's biggest artists that the company was trying to screw them over. On top of that, the company started giving really mixed messages. At times it seemed to be embracing the new, and at other times, it would try to personally bankrupt the CEOs of innovative startups. It didn't take long for the tech experts EMI brought in to quit. Then, there were stories of infighting at Terra Firma, with arguments over what to do with EMI altogether, which could explain some of the contradictory strategy decisions.

Either way, Terra Firma has now decided to sue Citigroup for misleading it into the deal. Again, given the state of the recording industry, it's hard to see how they thought it was going to be a good deal in the first place, but Terra Firma claims that Citigroup lied to Terra Firma about other bidders to get the firm to pay more and pay now -- noting that Citi had a major conflict of interest in acting both as an advisor and a financier of the deal. Of course, that's how investment banks make their money anyway. They want deal flow, so they have a neat little script that always encourages more deal flow. At times, they talk about synergies, and why companies need to buy each other, and then once they get big, they talk about spinning off parts to "unlock shareholder value." You can't trust those guys for an honest assessment of such a deal, and if Terra Firma did so, it seems like it should be the firm's own fault.

Filed Under: lawsuits, music industry
Companies: citigroup, emi, terra firma

Apple Fighting Macpro In Australia, Despite Is Using That Name For 26 Years

from the just-discovered-it,-eh? dept

Reader mick alerts us to a legal fight in Australia with Apple working hard to stop computer firm Macpro from being able to keep its name. The company has been in business since 1983, prior to Apple introducing the Macintosh (which happened in early 1984). In other words, Macpro should have priority on the name. When Apple tried to register a trademark on Mac Pro, Macpro opposed it and won, but Apple keeps fighting, and Macrpo's boss thinks the company is just trying to force them into bankruptcy with legal bills (he's already spent $200,000). He says he's offered reasonable settlements to Apple, but gets no response. Again, given Apple's early trademark fight with the Beatle's Apple Corp., you might think that it would be sensitive to bullying other companies over trademark issues... but apparently Apple thinks different(ly).

Filed Under: australia, lawsuits, macpro, trademark
Companies: apple, macpro

There's An Apology For That: AT&T Dismisses Its Pointless Lawsuit Against Verizon Over Ads

from the nice-work dept

We still don't understand why AT&T called so much more attention to Verizon's ads that highlight AT&T's weak 3G network coverage by suing over the ads. Things were made worse when a judge refused to block the ads from airing. Perhaps finally realizing that all this was doing was creating free advertising for Verizon -- and more attention on the quality of AT&T's network -- the company has decided to drop the lawsuit. Apparently, instead, it's going to focus on its own misleading ad campaign.

Filed Under: 3g, advertisements, commercials, lawsuits, maps
Companies: at&t, verizon

What Kind Of Mickey Mouse (And Donald Duck) Lawsuits Are These?

from the what's-going-on-now? dept

Donald Duck is apparently pretty busy on the trademark law front. On the same day, I heard about two separate legal incidents involving Donald Duck, which is just the sort of coincidence that can't be ignored. The first story, admittedly, is more bizarre than the second. It involves Mickey Mouse suing Donald Duck. Literally. It's got to be some sort of prank, but the lawsuit has actually been filed. The complaint is rather basic, with Mickey Mouse's lawyer Juan Abogado ("Abagado" apparently is the word for "lawyer" in Spanish.) stating simply:

COMES NOW Plaintiff, by and through undersigned counsel, and states:
1. This is an action arising under the Trademark Protection Act, 15 USC 78.
2. The Plaintiff is the owner of the trademark no. 0134148349208, (Walt Disney World patent).
3. The Defendant is a duck.

Donald Duck, represented by his lawyer, Pluto the Dog, Esq., quickly shot back:

1. Admitted.
2. Denied.
3. Admitted.

A quick search fails to turn up the trademark in question, though, I'll admit to not putting much effort into it.

The other case involving the same Donald Duck is a bit more bizarre. Reader Kevin Brody lets us know that the University Oregon has a stylized version of Donald Duck as its mascot, on license from Disney. Some students and fans of the University football team put together a song about how much they love the team. Great, right? Well, except that in the video they made, the Donald Duck-alike mascot makes a few appearances, and the school's marketing director flipped out and ordered them to edit out the duck, supposedly because Disney either was, or could get, upset about the usage. As the author of the column notes, this is ridiculous. It's just a few guys having fun and does no damage to the trademark at all. It's unclear if Disney actually got involved here, and my guess is that this is more the university stepping up before Disney said anything to protect itself. Given Disney's aggressive enforcement of its copyrights and trademarks in the past, perhaps this isn't a huge surprise.

Still, with Donald Duck being summoned by court clerk "Goofy" to the Florida courtroom where Mickey is suing, you have to wonder if he'll be able to make it back in time for the the Oregon Ducks game...

Filed Under: donald duck, lawsuits, mickey mouse, trademark, university of oregon
Companies: disney

Entertainment Industry Wants More People To Know About OpenBitTorrent Tracker

from the for-what-reason? dept

The definition of insanity, the saying goes, is doing the same thing over and over again and expecting different results. For the past decade, the entertainment industry has sued one site or service after another that was used for unauthorized file sharing at some time. In every single case, the act of suing that site or service ended up only serving to massively increase attention and usage of those services. Suing Napster made Napster into the service to use. Ditto with Kazaa and Grokster. The Pirate Bay wasn't that big until Hollywood got Swedish authorities to raid the operations and confiscate the servers.

So, here we go again -- except this time it's even more ridiculous. Entertainment industry representatives have filed a lawsuit against the OpenBitTorrent tracker's hosting company (Update: noting that the lawsuit is against the hosting company), which is not a file sharing site or service at all. It's just an open tracker. Now, I recognize that folks in the entertainment industry aren't particularly knowledgeable about how technology works, but at some point, aren't they supposed to at least understand the basics? The tracker alone is not responsible for anything here -- and even more ridiculous is that the OpenBitTorrent guys (despite not being in the US) set up a DMCA-like process for taking down any info_hash if they want (which, by the way, was the reason the industry claimed it didn't sue Google -- because it took down links on request -- but now that OpenBitTorrent does the same thing, it's a problem?). Either way, with the rise of trackerless solutions means that even taking this site down won't much matter. Still, it makes you wonder what they're thinking over in the entertainment industry other than ways to increase their legal bills.

Filed Under: bittorrent, lawsuits, trackers
Companies: openbittorrent

The More Innovative You Are, The More You Get Sued; Yet Another Patent Lawsuit Over Shazam

from the aren't-patents-great? dept

Earlier this year, we noted that Apple and AT&T had been sued for patent infringement concerning Shazam, the popular service for identifying music. At the time, we noted how this was a clear demonstration of the difference between just the idea and the actual innovation. Shazam has been around for ages, and despite having a good idea (ability to identify music just by hearing it), it struggled for many, many years until the iPhone came along, and there was a platform on which its concept made sense. During that time Shazam kept trying out new things and improving its service. The basic concept behind Shazam (identifying music) isn't that interesting. It was all the work that Shazam kept doing over the years to find the right mix of things that consumers wanted that made it worthwhile.

But, of course, patent holders continue to insist that it's the original idea only that's important.

So, once again, Shazam's service is involved in a patent lawsuit, this time from Digimarc, who has sued Shazam directly, claiming infringement. Now, Digimarc claims that Shazam is infringing on its patents, even though Digimarc does not offer a similar service at all. In fact, Digimarc is in an entirely different business: it's really a DRM company who wants to try to stop people from sharing or appreciating content, by locking it down. More recently, Digimarc has been focused on patenting its watermarking concept (despite plenty of prior art), and going the lawsuit route.

So, we have the tales of two companies who have been around for quite some time. One is focused on providing unique and compelling solutions that make consumers' lives better. And the other is focused on locking things down and talking about its intellectual property. Guess which one's getting sued by the other? So, please, explain again how patents encourage innovation? Once more, it looks like patents are being used to prevent actual innovating by those who prefer to lock up ideas.

Filed Under: drm, innovation, lawsuits, music recognition, patents
Companies: digimarc, shazam

IFPI: If Lawsuits Aren't Working In Denmark, We'll Seize Computers To Get Evidence

from the um,-wow dept

We just wrote about how the Danish anti-piracy group was dropping its lawsuits against individual file sharers after realizing that Danish law made it almost impossible for the industry to win those cases. However, as pointed out by brokep, the international wing of the recording industry, the IFPI, wasted little time in trying to spin the news in its favor (Google translation of the original). The IFPI insists that the lawsuits won't stop, but just that the anti-piracy organization was realizing it needed more detailed evidence -- and this means that it will now start seizing computers to get evidence. Now, the Google translation trips up over the word "beslagslaeggelse," but multiple Danish speakers have confirmed that the word means "seize" or "confiscate." Of course, that raises some questions about why a private organization representing record labels has any right to seize computers of individuals. I think they were better off when they just admitted they were going to give up on the counterproductive legal strategy.

Filed Under: antipiracy, computers, denmark, lawsuits, piracy
Companies: ifpi