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posted by janrinok on Friday November 18 2022, @02:28PM   Printer-friendly

Cascade Lake and Skylake prove even more expensive than expected:

VLSI Technology, a patent holding company affiliated with Softbank's Fortress Investment Group, has been awarded $948.8 million in a patent infringement claim against Intel Corporation.

On Tuesday, a federal jury in the Western District of Texas, a popular venue for patent claims, found that Intel's Cascade Lake and Skylake processors violated a VLSI data processing patent.

Intel in a statement emailed to The Register said it intends to appeal the decision.

"This case is just one example of many that shows the US patent system is in urgent need of reform," a company spokesperson said. "VLSI is a 'patent troll' created by Fortress, a hedge fund that is bankrolled by large investment groups for the sole purpose of filing lawsuits to extract billions from American innovators like Intel."

"This is the third time that Intel has been forced to defend itself against meritless patent infringement claims made by VLSI. Intel strongly disagrees with the jury's verdict and the excessive damages awarded. We intend to appeal and are confident in the strength of our case."

An attorney representing VLSI did not immediately respond to request for comment.

[...] A 2014 academic paper, "The Direct Costs from NPE Disputes," [PDF] found that in 2011, "the estimated direct, accrued costs of NPE [non-practicing entities] patent assertions totaled $29 billion."

Large technology companies – many of which have amassed large patent portfolios, which they often justify as defensive weapons – have complained for years about patent trolls/patent assertion entities [PAE] /NPEs, which are companies that exist to file infringement claims.

Legal changes, like the US Supreme Court's Alice Corp. v. CLS Bank International decision, which made software patents more difficult to obtain, have reduced patent trials – more claims are being dismissed. But Intel in its antitrust argument against Fortress has suggested that patent assertion entities are adapting to the new legal landscape.

"In the face of these challenges, PAEs have evolved," the company said. "PAEs have increasingly been partnering with investment firms to fuel their litigation."


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  • (Score: 5, Insightful) by Booga1 on Friday November 18 2022, @03:30PM (10 children)

    by Booga1 (6333) on Friday November 18 2022, @03:30PM (#1280351)

    This entire class of lawsuits should be legislated out of existence.

    Patent holding groups that don't actually use the patents should not be allowed to sue over those patents. It is to my understanding that most of these types of lawsuits from patent holding corps are over patents they purchased rights to. They didn't come up with the idea, nor did they ever have the ability to put that idea into practice. Their sole purpose of acquiring the patent was so they could charge other people for doing something vaguely similar to what's described in it or sue them if the extortion attempts fail. It's an entirely predatory operation with no benefit to the public, which is what the patent system is ostensibly created for.

    The last line of the summary really drives home the point. They're partnering with deep pockets to wield a bigger bat over their targets instead of the companies that they're suing.

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  • (Score: 3, Touché) by Adam on Friday November 18 2022, @04:09PM (5 children)

    by Adam (2168) on Friday November 18 2022, @04:09PM (#1280355)

    The service to the public is that they paid the inventor for the patent, who could then go on to invent other things rather than wasting their research funds and decades of time trying to sue Intel.

    • (Score: 2, Informative) by Anonymous Coward on Friday November 18 2022, @05:30PM (3 children)

      by Anonymous Coward on Friday November 18 2022, @05:30PM (#1280367)

      The trolls sweep up patents by buying up bankrupt companies.
      The inventors don't get squat

      • (Score: 2) by RamiK on Friday November 18 2022, @06:49PM (2 children)

        by RamiK (1813) on Friday November 18 2022, @06:49PM (#1280386)

        While that specific innovator won't be compensated and this might not really be the case regarding this particular patent, maybe in the future when Intel realizes they're violating someone's patent, they'll might try to license it from them while they're still in business instead of keeping quiet, hoping they'll go under so they'll be able to pick their patents at the fire sale.

        --
        compiling...
        • (Score: 0) by Anonymous Coward on Saturday November 19 2022, @01:18AM (1 child)

          by Anonymous Coward on Saturday November 19 2022, @01:18AM (#1280428)

          > license it

          That does happen in some industries, I've read about a few cases. But not nearly enough (according to me!)--thus the opening for patent trolls.

          Among the worst is ex-Microsoftie Nathan Myhrvold, co-founder of Intellectual Ventures. In an article or interview about him is where I saw the justification (as noted elsewhere in this discussion) that by paying the inventors for the patent, the inventors save all that mucking about in the legal system while trying to license or actually develop their patented idea. Sure looks like rationalization to me.

          • (Score: 0) by Anonymous Coward on Saturday November 19 2022, @12:22PM

            by Anonymous Coward on Saturday November 19 2022, @12:22PM (#1280484)

            Here's an example where licensing is the goal of the startup,
                https://news.mit.edu/2022/24m-batteries-1025 [mit.edu]

            They have a new design of lithium-x battery that uses less inert material and is considerably cheaper to manufacture. Because it's an MIT spin-off, with the initial backing of the MIT IP department, I'd say they have a good chance of hanging on to their patents and making real money from licensing. It appears that the inventor(s) are part of the company, so they should profit personally(??)

    • (Score: 2) by Booga1 on Friday November 18 2022, @06:51PM

      by Booga1 (6333) on Friday November 18 2022, @06:51PM (#1280387)

      I don't buy this argument. Your hypothetical encouragement of money to "free up" the inventor would hold water if the people purchasing the rights actually used the patent. They don't. They never will. They never intend to.

      These organizations purchase patents solely as tools for extortion. A legal club to wield against companies that are actually making things and providing services. These lawsuits suppress inventions and result in the exact opposite of what the patent system is intended to achieve.

  • (Score: 2) by JoeMerchant on Friday November 18 2022, @04:50PM (3 children)

    by JoeMerchant (3937) on Friday November 18 2022, @04:50PM (#1280358)

    Without this type of patent protection there would be even less chance of "smaller entities" being able to effectively patent and market new technology.

    As it is, you already have to have an operation in the top half of the market to really leverage a patent, if you don't then a bigger player can just buy you to circumvent any patent judgements. Case in point: little pacemaker company wins big judgement against big pacemaker company, judgement exceeds the value of the little pacemaker company, big pacemaker company takes the discount on the judgement by buying the little pacemaker company and shutting it down - two birds with one stone: less competition and lower price for the judgement settlement. If the little pacemaker company had sold their patent to a holding company, then the judgement would have been payable to the holding company.

    --
    🌻🌻 [google.com]
    • (Score: 4, Interesting) by theluggage on Friday November 18 2022, @06:05PM (2 children)

      by theluggage (1797) on Friday November 18 2022, @06:05PM (#1280373)

      if you don't then a bigger player can just buy you to circumvent any patent judgements.

      So you get a shedload of money from the buyout - based on a patent that is now known to be worth a lot of money. Where's the problem? OK, bad for competition, but patents are artificial, government-granted monopolies so was anybody expecting them to help competition?

      If the little pacemaker company had sold their patent to a holding company,

      ...then they wouldn't own the patent any more and would be dependent on the holding company choosing to protect their interests (rather than, say, sitting on the patent until/unless it became part of a billion dollar business and was with vastly more than the inventor got paid).

      then the judgement would have been payable to the holding company.

      ...rather than the small firm who'd lost the rights to their invention and had probably already been driven out by the big players by the time the potential damages got big enough to get the holding company out of bed. Of course, if the inventor didn't make anything either, just patented whatever they thought up while sitting on the toilet and sold patents by the dozen to the holding companies, nothing would ever get made (and couldn't get made without violating a hundred of the trivial, junk patents that such a system would generate).

      Anyway, this all assumes that the patents and infringement claims are valid - and the real problem is that the patent system is a nice idea built on the fallacy that you can reliably define and enforce (with lay juries FFS!) the difference between an obvious idea and an innovation. There's no fundamental moral basis behind a patent (as there maybe is with copyright) - the infringer doesn't need to have stolen or copied anything - and the sole justification is that they is supposed to promote industry and science. It's about time that somebody stumped up the evidence to prove that, because it looks like all it does is promote parasitic rent-seeking.

      The NPE problem is just a symptom of a more deeply broken system - but while big near-monopoly players who get their pockets picked are happy to call for an elastoplast to be slapped ob the NPEs they'll fight like hell against any more fundamental reform that might decimate their own patent portfolios.

      • (Score: 2) by JoeMerchant on Friday November 18 2022, @07:14PM

        by JoeMerchant (3937) on Friday November 18 2022, @07:14PM (#1280390)

        >So you get a shedload of money from the buyout - based on a patent that is now known to be worth a lot of money. Where's the problem?

        Didn't really work so great for the pacemaker company - I mean, a few principals ended up with enough dosh to almost start a new venture before they had to get VC involved, but we're talking about a couple hundred specifically skilled people who had relocated to the R&D site who were rather suddenly twisting in the wind. The buildings stood empty for years, there was a giant sucking sound in the local real-estate market as the ex-employees shuffled off to other employment. Companies are much more than their principals.

        Brings to mind when Mount Sinai bought Miami Heart, the principals walked away with a shedload of money from the deal, leaving both Sinai and Miami Heart to struggle with crippling debt after the deal went through. So, was it a win for the two jackasses who skipped town with hundreds of millions, or a loss for the thousands of employees who had to pick up the pieces and tens of thousands of patients who suffered with poorer care than they would have had if the institutes had proper funding, like they did before the buyout? Also, I was working with a researcher who was developing new CPR knowledge and systems just before that - at Mt. Sinai funded by Miami Heart. Guess what happened to the funding for his, and lots of other, research after the deal...

        >then they wouldn't own the patent any more and would be dependent on the holding company choosing to protect their interests

        Are we then agreeing that the system, as currently structured, is fundamentally broken leaving no attractive options for small patent holders?

        >had probably already been driven out by the big players by the time the potential damages got big enough

        Well, what actually went down was: the little pacemaker company developed (at great expense to themselves) a far superior electrode anchor to hold the pacing lead on the cardiac wall. It was a big problem at the time, but the big pacemaker companies were making big bucks even with the problems so they didn't really feel like going to great expense to develop a better solution. Then, the better solution comes along and is offered to them at a rate which would have recouped the cost of development for the developers in, roughly, 5 years of licensing fees - not to mention saving the big pacing companies on expenses associated with faulty anchors and saving thousands of patients from repair surgeries for the inferior anchor failures. Big company does what roughly 99% of big companies do when presented with a shiny new patent not invented by themselves, they ignored it. Most times the big companies just continue doing business without the innovation (hydraulic power steering was a classic early example of this), but in this case the big company decided to try to rip off the invention and beat the smaller company in court with their superior legal firepower. Well, they got their court battle, and lost - which is pretty rare. At least pacemaker patients could finally start getting the superior anchor, but that would have happened in about the same timeframe either way: If the big company hadn't tried to infringe, the smaller company's market share was rising fast due to the performance data on their anchors.

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        🌻🌻 [google.com]
      • (Score: 3, Interesting) by sjames on Saturday November 19 2022, @01:27AM

        by sjames (2882) on Saturday November 19 2022, @01:27AM (#1280429) Journal

        Arguably, the mere fact that the infringer came up with the idea independently should be taken as strong evidence that the patent was wrongfully issued in the first place and so, null and void.