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April 3, 2006
Patent Pain
Frank
Hayes of ComputerWorld
likes it when companies pay for patent licenses. "We
like it when vendors wave a big check at a problem and make it go away. Sure,
we'll foot the bill if it means the result is a clean, simple, effortless (for
us) solution." What irks Frank is when they pay, and get nothing for it, except
passing the pain on to consumers.
Frank's example of ongoing consumer patent pain is Microsoft working around infringement of the Eolas patent by patching Internet Explorer; a patch that inconveniences users, Frank thinks.
Frank is just scratching the surface. Where the real problem lies is corporate pig-headedness, like Blackberry maker RIM, like eBay, like Microsoft, who can't seem to read the writing on the wall and take a license without the court shoving them up against the wall. In litigations, most of the time, after the claims have been construed, the writing is on the wall - either you can invalidate the patents with prior art, or you don't infringe, or you ought to bite the bullet and take a license. Even odds means the patent holder is favored.
RIM didn't have to pay $612 million to NTP. Microsoft didn't have to pay $521 million to the University of California for the Eolas patent. They could have gotten a license much cheaper if they'd decided to settle when the odds on the tote board were first written. Not exactly the paragon of corporate intelligence, or integrity, even Gateway got it through their cow skull to settle and pay HP rather than pointlessly fight on. Microsoft doesn't always fight patent cases until they look stupid, but they do have a nasty arrogance that does tend to lead them down the wrong path.
Nearly two-thirds of the time, patent litigations settle. The noise in the press is about the ones that don't settle, especially ones like Microsoft, RIM or eBay, where the public likes the infringing product. RIM generated a nuclear reactor's worth of heat before generating a photon of light in a big bang settlement. eBay's likely to do the same.
Statistics show that the appeals court overturns a district court ruling in a patent case about one-third of the time, so appealing trial judgment isn't de facto denial.
When you read about these high profile cases, like eBay begging before the Supreme Court last week, keep in mind that you're reading about the obstinate few who don't seem to have a clue about paying for patents as part of business-as-usual. That's why they get no sympathy here: they should have known better, and are flouting desperate flatulence that the anti-patent crowd mistakes for perfume.
Posted by Patent Hawk at April 3, 2006 6:09 PM | Patents In Business