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December 14, 2005

Visto Licenses NTP Patents

Wireless email provider Visto signed a licensing agreement with NTP, joining the licensee ranks of Research in Motion (RIM) rivals Good Technology and Nokia, as RIM's Blackberry withers on the vine of infringement.

Having failed in getting a licensing settlement with NTP from March talks somewhere in the neighborhood of $450 million, the whispered settlement number now reaches towards $1 billion for RIM to pull its Blackberry wireless email out of the infringement patch. RIM tried to get presiding district court judge Spencer in the NTP v. RIM case to enforce the $450m deal, but that drew a raspberry from the judge for the unconsummated talks. Next stop is a ruling on an injunction to forcibly stop RIM from further infringement.

The NTP v. RIM case has stirred controversy regarding injunctive relief for patent infringement. But the informed consensus understands the essential nature of the patent right as that of exclusivity. “It’s like owning a piece of land,” explained Philip Johnson, chief patent counsel of Johnson & Johnson, “and having somebody on your land.” If you win your trespass case, “the person on the land is supposed to get off it.”

RIM's reputation is getting battered, as customers are worried and potential customers shy away from the uncertainty emanating from RIM's hard-nosed refusal to put this behind them.

Here's the Economist viewpoint on the NTP v. RIM case.

Posted by Patent Hawk at December 14, 2005 9:09 PM | Patents In Business

Comments

“It’s like owning a piece of land,” explained Philip Johnson, chief patent counsel of Johnson & Johnson, “and having somebody on your land.” If you win your trespass case, “the person on the land is supposed to get off it.”

This is delusional. Having a patent isn't like owning a piece of land. How is physical property different from patent monopolies? Let me count the ways:

1. Exclusivity: by the laws of nature, physical property is exclusive; it can only be used by a limited number of individuals at the same time. Ideas, on the other hand, can be used by an unlimited number of people at the same time. Furthermore, the fact that a second (or third, or fourth, etc) person uses an idea that you 'possess' does not diminish your own ability to use that idea.

2. Transferrence costs: for physical property to change hands, there are necessary transaction costs. For an idea to spread, there is no transaction cost. In many cases, in fact, you don't even need to communicate an idea for it to spread; others will hit upon it naturally and independently.

3. Natural Law: posession of physical property occurs without government intervention. Posession of patents can only occur with the heavy hand of government grant and regulation.

4. "Private" ownership. We all understand the term 'private property.' But have you ever heard the term 'private intellectual property?' No. And why not? Because the idea is absurd. The only thing that comes close is what we call a 'secret,' yet even that elludes private ownership, since others can independently discover the secret or invent it independently.


The analogy between physical property and patents is not only poor, it is outright deceptive. It is a lie. But that doesn't seem to stop lawyers and IP-maximalists from propogating it.

Posted by: joey5 at December 15, 2005 7:39 AM