Techdirt Podcast Episode 194: Ninja Future, With Gary Shapiro

from the moving-forward dept

Today, Mike is at the opening of the Consumer Technology Association's CES 2019 show — which means we'll have one of our CES post-mortem podcasts coming up soon! But before that, for this first episode of 2019, we've got a discussion with CTA CEO Gary Shapiro, whose new book Ninja Future takes a look at how people and businesses are dealing with innovation and rapid technological change.

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Filed Under: ces, gary shapiro, innovation, podcast
Companies: cta

FCC Shuttered, Ajit Pai Forced To Cancel CES Trip Because The US Government Is a Hot Mess

from the dumpster-fire dept

As you've probably noticed, the bickering over a dumb fence most attentive folks realize will never be fully funded or built has resulted in the government partially shutting down, leaving roughly 800,000 government employees furloughed without pay. As garbage and human waste begin to pile up at our under-staffed park system, the FCC this week also announced it would be suspending all but the most essential operations as of last Thursday, with 1,197 of the FCC’s 1,442 employees now left unpaid.

According to the FCC, all investigations into fraud (admittedly few and far between with this FCC), merger review, management of spectrum, and approval and testing of new electronics will grind to a halt. And while the agency's 911 and network outage complaint systems will remain operational, there will be nobody staffing the agency to respond to consumer or company complaints. The agency did note that things like its ongoing spectrum auction would continue, since the auction is funded by spectrum sale proceeds:

"However, work required for the protection of life and property will continue, as will any work related to spectrum auctions, which is funded by auction proceeds. In addition, the Office of the Inspector General will continue operations until further notice."

While he'll obviously be hamstrung by a lack of resources, Ajit Pai will continue to work, though the shutdown forced him to cancel a scheduled appearance at CES in Las Vegas. It's technically the second year in a row the FCC boss has had to cancel his planned CES appearance, since last year's visit was also scuttled after Pai began receiving death threats due to his historically-unpopular attacks on consumer protections like net neutrality.

Worry not though! Pai took to Twitter to joke that he'll still be around to thwart the use of naughty words on television:

While many will likely (and quite correctly) joke that a shuttered Pai FCC isn't likely to be much different from an operational Pai FCC given his apathy toward actually doing anything to help consumers or small businesses, the 1,197 FCC employees currently not getting paid over an idiotic fight over metal slats likely aren't finding this all that funny. And while a shutdown of a few days probably won't be all that big of a deal, a longer shutdown is going to spell trouble not just for Pai's unpopular agenda, but also for the oodles of notably less controversial, frequently mundane but essential tasks the FCC engage in on a daily basis.

Filed Under: ajit pai, ces, fcc, government shutdown, indecency

Picking Up Where We Left Off: A 2018 Policy To-Do List For Washington

from the innovation-and-policy dept

From January 9-12, thousands of tech experts, innovators, media professionals, politicians and business leaders from around the world pour into Las Vegas for CES 2018. It’s an incredibly exciting time: Attendees get to see the most innovative technologies and trends that will change the face of industries across the globe, from health care and entertainment to automobiles and home appliances.

I’m always proud of CES – proud of the innovators who have traveled a long road to get to the floor; proud of all my behind-the-scenes colleagues who dedicate months to putting the show together; and proud the show inspires thoughtful conversations and partnerships that lead to life changing products, new businesses and jobs.

But CES also makes me proud to be an American. Our nation’s tech industry is the envy of the world. When you combine induced, indirect and direct impact, the U.S. tech sector accounts for over ten percent of our GDP and 15.3 million jobs. It has produced brands and companies that are known and needed all over the world. And nowhere is that more obvious than at CES.

The reason our country can host a show like CES is because we have a legal and policy framework designed to allow our tech industry to flourish. From our education system that encourages originality and ingenuity, to our openness to immigrants and their innovative ideas, to a pro-business regulatory framework that lowers barriers to entry for entrepreneurs, to the First Amendment and its protection of ideas, no matter how controversial, our system rewards those who have the creativity to solve a problem and the courage to make their idea a reality.

If policymakers want to preserve our global leadership and support this vital industry, they must act at this crucial moment. With the start of the new year comes the start of a new legislative session, and the opportunity to prioritize policies that can strengthen the framework that has allowed the tech industry to flourish. As Washington gets down to business in 2018, here are some ways they can do this:

• Promote fair and free trade. We can’t mistake American ingenuity for isolationism. For instance, threats to impose tariffs on Chinese goods or hinder trade with China – a crucial trade partner of the U.S. tech industry – would harm, not help, tech innovation. Our supply chain is global and must be kept open.
• Protect innovative tech companies from crushing liability costs. One of the cornerstones of internet freedom are the “safe harbor” and “fair use” principles in domestic law. These laws allow users and entrepreneurs to innovate, free from ruinous nuisance lawsuits and should be added to the North American Free Trade Agreement (NAFTA). But Congress is questioning these principles and considering changes that would seriously compromise the free, open flow of information these companies now help to sustain. This in turn would hurt small businesses across the country, many of whom rely on the internet to market their products internationally. By upholding these safe harbor laws and other copyright protections, federal leaders can maintain a strong economy and secure a stable internet for future innovators. Not only should these principles be enshrined and protected in domestic law, they should become a template for our trade agreements. We have a chance to do so now with a digital chapter in NAFTA that embodies these principles.
• Pursue immigration reform that opens our borders to the world’s best and brightest. Right now the future of immigration policy is unclear, but it is obvious that we need to attract the best and brightest if we want to maintain our global lead in innovation. More than 50 percent of our country’s billion-dollar startups were created by immigrants according to the National Foundation for American Policy. While we are closing our borders, other countries are copying our strategy of attracting the best and brightest.
• Invest in infrastructure. The rise of the Internet of Things, smart cities and self-driving vehicles means that the world as we know it will change significantly over the course of the next several decades. By getting a head start on infrastructure investments, including 5G broadband and highway construction, federal leaders can help smooth this transition and pave the way for new levels of connectivity. Simply allowing utility companies to lay broadband in every federally funded roads project is an easy bipartisan start.
• Focus in on patent reform. Many of the startups at CES have horror stories about patent trolls – companies that threaten patent lawsuits in hopes of collecting money out of court. Patent trolls are undermining the strength of our patent system and bleeding $80 billion annually from our economy. Too many businesses are dragged down by their lawsuits and threats. Congress must act to protect innovators and ensure we maintain the best intellectual property protection system in the world.
• Pursue a business-friendly regulatory framework. President Trump has taken the lead on this, spearheading major reform soon after his inauguration. Congress must continue his efforts, creating policies that encourage innovation and lower barriers to entrepreneurship.
• Protecting freedom of speech across the board. We’ve seen many attacks on freedom of speech this year from all across the political spectrum. Financial freedom is important for innovators, but low taxes and limited regulatory interference mean nothing if innovators don’t have the intellectual freedom to try out new ideas without fear of legal repercussions. It’s high time we act to protect this first and most vital of our freedoms.

There’s no denying it’s been a challenging year politically, no matter your perspective. But with the new year comes a renewal of opportunity. Washington must put aside petty partisan arguments and work together to protect the framework that has led to our flourishing. And by doing this, we can protect the creativity and ingenuity of American innovation for generations to come.

Gary Shapiro is president and CEO of the Consumer Technology Association (CTA), the U.S. trade association representing more than 2,200 consumer technology companies, and author of the New York Times best-selling books, Ninja Innovation: The Ten Killer Strategies of the World's Most Successful Businesses and The Comeback: How Innovation Will Restore the American Dream. His views are his own. Connect with him on Twitter: @GaryShapiro

Filed Under: ces, dc, fair use, free speech, free trade, immigration, innovation, intermediary liability, patents, policy

Remember How US Marshals Seized All Those 'Hoverboards' At CES In A Patent Dispute? The Company Has Now Dropped The Case

from the wait,-what? dept

Back in January, we wrote with some concern over the news that US Marshals had seized a bunch of one wheel scooters that everyone wants to call hoverboards, even though they don't hover. The case involved a US company, Future Motion, that had gotten a lot of attention (and a utility patent and a design patent) on such single-wheel balancing scooters. Future Motion then sued a Chinese firm, Changzhou First International Trade Co., that was making a product that certainly looked similar. Changzhou was demonstrating its product at CES in Las Vegas, only to have the US Marshals raid its booth and seize all its products based on a 7 minute hearing in front a judge where Changzhou didn't even get to present its side.

And now that Changzhou has attempted to present its side... Future Motion turned tail and ran, ran away. It flat out dropped the case once it was clear that Changzhou was going to challenge the lawsuit. In fact, Changzhou is so up in arms over this that it's not accepting the case being closed and has asked the court to reopen the case so that it can seek attorney fees from Future Motion.

The filing by Changzhou is well worth reading. It accuses Future Motion of misleading the US Patent Office and the court, claiming that the lawsuit and the seizure were a combination attempt to stifle a competitor and get publicity for itself, and that this all helped Future Motion raise more money. It also says that Changzhou's product, the Trotter, does not infringe on Future Motion's patents. From the filing:

CES is the world's largest electronics and technology show, and was a major opportunity for Changzhou to promote sales of its Trotter product. Instead, Future Motion orchestrated an effort to obtain a baseless TRO and to effect seizure of Changzhou's products from CES. These acts caused Changzhou to lose sales and suffer public embarrassment at a critical juncture in marketing its new Trotter product. Indeed, Future Motion engaged in a significant media campaign to gain freee publicity from the fact that it wrongfully prevented Changzhou's sales....

Moreover, Future Motion directly relied upon its baseless TRO to obtain additional financial backing for itself. On February 3, 2016, Future Motion announced that it had obtained $3.2 million in additional funding for its business.... One of the stated bases for obtaining that funding was that Future Motion "vigorously protects its Intellectual Property as it protects safety and a ride experience that cannot be replicated by knock-offs."... Interestingly, Future Motion dropped this lawsuit against Changzhou on February 4, 2016 the next day after announcing it obtained the new funding.

It is now apparent that Future Motion's actions were conducted with full knowledge that that the asserted patents... were non-infringed and invalid.... Future Motion undoubtedly sought the TRO and preliminary injunction with the expectation that Changzhou would not fight back in this litigation, and therefore would not discover the fatal flaws in Future Motion's case. Unfortunately for Future Motion, Changzhou did fight back.

Changzhou filed an opposition to the preliminary injunction motion on January 29, 2016, explaining in detail that the two patents in suit were both noninfringed by Changzhou's Trotter product and invalid in light of Future Motion's own prior art (as well as the prior art of others), most of which was never disclosed to the United States Patent Office.... For example, with respect to Future Motion's design patent, its "proof" of infringement consisted of a single sentence by the inventor, coupled with a few of the figures in the patent.... This was insufficient on its face, as a design patent must be construed and infringement evaluated based on all of the figures.... Further, with respect to Future Motion's utility patent, the "proof" of infringement provided no claim construction analysis (which is required under Federal Circuit law) and relied on a conclusory claim chart.... Moreover, Future Motion baldly stated that it was aware of no anticipatory prior art to either patent, but it neglected to tell the Court about prior art disclosures of Future Motion's own product and other similar products....

Upon reviewing Changzhou's opposition and supporting declarations, Future Motion simply gave up, filing a voluntary notice of dismissal. Even then, Future Motion only offered to dismiss without prejudice despite the uncontroverted evidence that the patents in suit were non-infringed and invalid.

And this is why we're supposed to have an adversarial process in court, folks. Whichever side you come down on, it's ridiculous (1) that without even hearing the other side, the court simply ordered that the CES booth be raided and all products and other supplies be seized and (2) that the US Marshals got involved and seized the product.

Future Motion is claiming that it's dropping the lawsuit because "it had been outgunned" and that following through on the court case would cost too much. But that's ridiculous since it was Future Motion who filed the lawsuit in the first place. Those claims really do suggest that it filed the case for one reason only, which was to shut down a competitor, and then it also got a bunch of free publicity out of it. Maybe the company has a case, but if it wants to argue infringement it should have to make its case in court, not simply use the filing as an excuse to shut down and embarrass a competitor with no repercussions at all if the original claims were exaggerated or simply false.

Filed Under: ces, competition, hoverboard, lawsuits, patents, restraining orders, seizure, us marshals