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It's been barely two months since Netflix added its long-awaited download feature, and the online streaming company has already been sued over it. The plaintiff is a company few have heard of: Blackbird Technologies, a company with no products or assets other than patents. Blackbird's business is to buy up patent rights and file lawsuits over them, a business known colloquially as "patent trolling."
Blackbird was founded by two former big-firm patent attorneys, Wendy Verlander and Chris Freeman. The organization owns US Patent No. 7,174,362, which it hopes will result in payouts from internet video companies with offline-viewing features. On Wednesday, Blackbird (who tells potential clients about being "able to litigate at reduced costs and achieve results") filed lawsuits against Netflix (PDF), Soundcloud (PDF), Vimeo, Starz, Mubi, and Studio 3 Partners, which owns the Epix TV channel. All of the companies have some type of app that allows for downloading content and watching it offline.
The patent-holding company, which filed the lawsuits in Delaware federal court, has good reason to hope for success. The '362 patent already has a track record of squeezing settlement cash out of big companies. The patent was originally issued in 2000 to Sungil Lee, a San Jose entrepreneur and business instructor. In 2011, Lee sold his patent to Innovative Automation LLC, a patent troll that filed dozens of lawsuits in East Texas and California. Innovative Automation said that the '362 patent covered various "methods and systems of digital data duplication" and used it to sue services like "Target Ticket" and "DirecTV Everywhere." Court records suggest most of those cases settled within months.
Source:
https://arstechnica.com/tech-policy/2017/02/patent-troll-sues-netflix-over-offline-downloads/
(Score: 5, Interesting) by Runaway1956 on Tuesday February 07 2017, @03:14AM
Again, I say, destroy them. The court needs to examine this company, and determine that they give NOTHING back to society. The whole business model sucks. Parasites need to be removed and destroyed. The company needs to disappear, their property needs to be confiscated, and turned over to the public. Their patents need to be revoked, or, in the case of patents that have some validity, put into the public domain. If they own any other property, it needs to be confiscated, and used for the public good. Office furniture is all they really own? Donate it to a charity - any charity. Or, give it to a school nearby.
FFS, we kill fleas and ticks, routinely. Let's start killing off patent trolls.
(Score: 2) by fido_dogstoyevsky on Tuesday February 07 2017, @03:30AM
Office furniture is all they really own?
Probably not even that- most likely leased. Time to reinstitute workhouses for these parasites.
It's NOT a conspiracy... it's a plot.
(Score: 2) by gidds on Wednesday February 08 2017, @02:04PM
Always worth trying to see things from the other side, so let me play Devil's Advocate for a minute…
First, let's assume (for the sake of argument) that the patent system (in some form) has value. (Otherwise there's nothing to discuss!)
Now consider these two cases: 1: MakerCo makes stuff, holds patents on it, and sues people infringing them. 2: MakerCo makes stuff, then sells the patent on to TrollCo which sues people infringing them.
What's the overall difference between the cases? TrollCo alone might seem to have no value, but taken in combination with MakerCo, isn't the overall effect pretty similar?
Don't forget that TrollCo paid MakerCo for the patent. So that's given some value to MakerCo, and provided an incentive for taking out the patent (which should benefit everyone in the long term). And of course TrollCo wouldn't have bought the patent if it didn't expect to make some money from lawsuits. So saying that TrollCo has no benefit to society ignores the fact that they've already generated that benefit by buying the patent in the first place.
So, if you see the patent system as worthwhile, then I can't see how you can consider a patent troll suing as any worse than any other company suing over a patent. It might feel more unfair, but I can't see how that feeling is justified, when the overall effect is the same.
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(Score: 2) by tibman on Wednesday February 08 2017, @02:53PM
I think it's the point of the patent that is being violated. It's supposed to protect your invention long enough that you can recoup the costs of inventing it. It's supposed to give you exclusive rights to make your invention for a limited time. A patent that exists for the purpose of preventing "the Progress of Science and useful Arts" is acting against it's purpose for existing. What TrollCo is doing might be legal (for now) but it certainly isn't right.
The biggest issue i think is that a lot of these patents are so vague and/or worthless that nobody would want to license them anyways. If Netflix wanted to create an offline video service then this patent on an automated CD duplicating service is totally useless.
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(Score: 2) by Runaway1956 on Wednesday February 08 2017, @02:59PM
"It's supposed to give you exclusive rights to make your invention for a limited time."
That's not quite right. You have the exclusive right to decide who can produce your invention. That is, you may charge a fee to license someone to use your idea. Copyright and patents are quite different, in so many ways, but both operate from a presumption that "if anyone can make a dollar from an original work, then the creator should get some of the profit".
(Score: 2) by tibman on Wednesday February 08 2017, @04:07PM
Yeah, you're right. I don't see anything wrong with that either. If someone only wants to invent and then sell the patent, that should be cool. But if they just take the patent and use it to sue other people and not actually produce anything then that is going against the point of the thing.
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(Score: 2) by gidds on Wednesday February 08 2017, @03:10PM
Indeed. But what's the difference between protecting your invention by you suing infringers, and protecting your invention by another company sue infringers? Surely the protection is the same, either way: potential infringers have the same potential losses, and the same incentive not to infringe.
And if the protection is the same, then 'the progress of science and useful arts' (or equivalent in other countries) is being promoted the same.
So I can't see any rational justification for banning patent trolls without abolishing the whole patent system.
(Which, of course, leads neatly on to your final paragraph. The current implementation of patents in many places leaves much to be desired: issues of precedence, publication, validation, and the legal costs on both sides of patent cases all leave much to be desired. There's certainly a very strong case for patent reform. But that's a separate question from whether patents are a good idea in principle.)
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(Score: 2) by tibman on Wednesday February 08 2017, @04:06PM
Recouping the costs by producing the invention. Not sitting on the patent and suing other people to recoup the research costs : ) If the other company, TrollCo, is actually producing the invention then i don't think anyone would have a complaint?
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