First, Twitter didn't pay off IBM for trolling here. They outright bought a set of patents in the hope that Twitter's own new portfolio would be enough to discourage other companies from suing Twitter in the future.
Defensive portfolios of garbage patents used to be the key to preventing competitors from suing you with their garbage patents. After the eBay v. MercExchange [0] case in 2006, it's not as dangerous to be sued but defensive portfolios are now much less useful also because you can't threaten to shut down aggressors' businesses with injunctions. The Apple v. Samsung and Microsoft v. Motorola cases also recently demonstrated that vague garbage patents are much more useful in court than technological patents. Juries and judges understand them better and are inclined to award hundreds of times more damages.
Second, IBM is the least awful kind of patent troll. They generally ask for small fractions of revenue or investment in companies that have established themselves. The IPO phase is a favorite time for them to ask for a few million from growing companies. The worst kind of trolls -- such as Microsoft's Intellectual Ventures -- ask for much more money from companies and often go after startups. IBM exercises restraint with the idea that they might have an ongoing relationship with companies someday in some other context.
And IBM, unlike most trolls, actually does real research. Most of the new ideas in Google Search were first published in an IBM research paper that Larry and Sergei read. IBM didn't patent those ideas, though; they mostly seem to accumulate scattershot patents at random. I think IBM's primary goal is to top the list of prolific grantees every year.
> The Apple v. Samsung and Microsoft v. Motorola cases also recently demonstrated that vague garbage patents are much more useful in court than technological patents. Juries and judges understand them better and are inclined to award hundreds of times more damages.
I don't think that I agree with this part especially if you are equating Standards Essential Patents with "technological patents" and all other patents as "vague garbage patents". If that wasn't what you meant I misunderstood.
The reason that SEP are worth less (than other valid patents) and not entitled to injunctions is because commitments were entered into by their owners to enable them to be included in the standard. And some SEPs are pretty low grade too and alternative approaches are often only prevented by the standard itself.
The reason that SEP are worth less (than other valid patents) and not entitled to injunctions
Actually, almost no patents are entitled to injunctions since the eBay decision made courts apply the same standard to patent cases as to other injunction requests, and we all owe many thanks to the Supreme Court for that.
some SEPs are pretty low grade too
Indeed, the Microsoft v. Motorola patents were particularly lousy. One Motorola patent was on the use of a particular number as a key in an error correcting code. The code itself was prior art but any two devices needed to use the some identical arbitrary key to communicate. It's embarrassing that the PTO allowed that one, but the court is making Microsoft pay for every device shipped now. Fortunately the price is small.
The Apple v. Samsung case involved a few Samsung radio channel efficiency patents that the jury found not infringed even though Apple did infringe them. They were probably as invalid as all the utility patents in the case but they failed to be useful probably because they were complicated and juries don't pay much attention to technological patents or discussions of them.
Apple's garbage patent about bounce-back was much more effective. Juries can measure that.
Now SEP (standards essential) patents are much less useful because judges are not inclined to allow them to be used defensively. And arguably valid patents are slightly more powerful than clearly erroneous ones. But simple garbage patents focused on non-technological UI and superficial means of doing business are much more effective in all litigation than actual technological patents independent of SEP status or validity.
Fair enough, I have seen plenty of comments on here assuming that SEPs are better patents than others but your view seems clearly much more nuanced. I mostly agree with your actual view and did incorrectly interpret the section I quoted.
I'm not sure the bounce back patent is inherently garbage (although it may be invalid due to prior art) but that sort of patent is entirely possible to work around. I'm not saying it is great patent but it does strike me as somewhat inventive, novel (AFAIK). I do understand what you mean about the likelihood of juries putting too much weight on what they understand.
I'm not aware of the details of the Samsung radio channel efficiency patents but I wonder why Samsung didn't bring them to (or didn't win with them) at the ITC where there isn't a jury. I'm not actually disagreeing here but it would be something ai would want to understand before completely agreeing with you about the lack of value in true technological patents (I'm in a don't know state rather than disagreement at this point).
The Obama administration vetoed ITC's Samsung-requested ban on importation of Apple phones last year. That ban depended on SEPs, so perhaps Samsung should start over with some of its other patents. Samsung seems to have unlimited money for American legal fees but little wisdom in spending it so far.
It seems quite unlikely, though, that an iconic American company like Apple will ever see an ITC action that really harms its interests sustained. It is especially unlikely to happen in favor of an Asian competitor company, given American trade politics.
Apple's ITC bans against Samsung phones don't face similar barriers so far.
In any case, since particular phone models are seldom sold for longer than two years and both district court and ITC cases take longer than that, it has almost always been obsolete phones targeted by injunctions. Until the companies get more clever about targeting broad classes of devices, that is some small relief for the industry from the insanity.
I don't know if the Presidential veto would have been applied if the companies' nationalities had been reversed (I hope it would have been as it was correct). [0]
ITC bans include devices that aren't explicitly listed if there is no colourable difference in the infringement.
There's a lot of guessing and conjecture about how IBM deals with patents, so I thought I'd write a new parent thread to discuss.
I worked at IBM for 7 years, leaving many years ago. I am an IBM Master Inventor, having 36 patents filed with the USPTO with my name on them (some are still winding their way through the system). I worked heavily on patents for 3 years, and the last 2 years I was there, I was on the Patent Review Board. I'd also estimate during my active time with patents, I submitted 250-300 patent ideas to the board.
The Patent Review Board is organized along technologies - so, mobile would have its own Patent Review Board. People on the Patent Review Board tend to be Master Inventors and others who are active in the patent process. Once a week, about 3-4 hours of presentations are made to the Board (which includes the patent lawyers as well). After a 5-10 minute presentation, they are asked to leave the room, and the Board votes whether it should continue to the lawyer, or whether to close it. Most obviously are closed at this step with prior art. If it's voted to go to the lawyers, in my background, there was a pretty good chance it was going to get filed.
If your patent got filed with the USPTO, you got a point. IBM is very generous with their patent bonuses. You get $750 per patent filed. You also get an additional $1500 on your first patent filing, and $1500 every 3 after that. So, effectively, about $1000 per patent.
Patent ideas could be anything and everything. If they could patent it, they would. I remember from my time on the board seeing ideas on everything from dog doors to server optimization techniques to music devices. Given the people who work at IBM, most tended to be tech related, but it definitely was not a requirement at all.
The stuff people have asked about royalties makes me laugh as well - I never got the feeling once they cared if your patent would make them $1B or $1. And they certainly didn't care about compensating us for an idea that could make $1B. I was awarded the Software Group Patent of the Year one year, and other than an email denoting that fact, nothing was different than some of the lame ones I had filed.
Overall though, I thoroughly enjoyed every aspect of the patent process at IBM - it was one of the few outlets that rewarded creativity and hard work at the company.
This is a good way for a company to amass tons of low quality patents. After a few years, the maintenance fees start to drag them down. IBM sold some of these crap assets to Twitter to avoid paying $9.9m in maintenance fees over the next 10 years.
The bullshit patents that IBM threatened to sue Twitter over were for url shortening [1], inline user-customized advertising[2], and diff-ing contact lists[3].
This is how companies become members of the exclusive club known as "entrenched interests."
It would be interesting for a company to take an alternative route and threaten to go out of business, or, say, publicly announce that they can't implement certain features, because it would require them to purchase their freedom to do so. [Insert your own slavery metaphor here]
However, now Twitter will have to say that their position on a given technical controversy is "complicated" and "nuanced" and imply that we rabble just don't understand the real world of business.
I wonder how many people could take medical care, buy food (mind goes to Africa), etc with that amount of money that apparently was given to a patent troll (IBM).
Just sad.
ps. Nothing against twitter, or IBM. They are just exploiting rules made by humans.
It's tragic that IBM built technology that helped enabled the death of large number of people. One thing the wikipedia page doesn't make clear was IBM aware of the atrocities? The article cites the 1933 census, but things in Germany didn't really heat up until Kristallnacht in 1938?
Anyway, the point was, things are not always black and white. IBM has certainly done some bad things, but it has also had a tremendous positive impact on society, medicine, techology, etc easily; more than 36m.
>The article cites the 1933 census, but things in Germany didn't really heat up until Kristallnacht in 1938?
"As the Nazi war machine occupied successive nations of Europe, capitulation was followed by a census of the population of each subjugated nation, with an eye to the identification and isolation of Jews and Gypsies. These census operations were intimately intertwined with technology and cards supplied by IBM's German and new Polish subsidiaries, which were awarded specific sales territories in Poland by decision of the New York office following Germany's successful Blitzkrieg invasion."
In practice the powerful would be able to restrict supply lines and access to market for upstart competitors using anticompetitive contracts, so those not in a cartel would simply wither.
Sure, and in communism there's no need to do even that, because the state provides and we're all happy 20-hours per-week workers.
Every social movement has two sides: a theoretical and a real one. When studying. If we have to accept that China, Cuba and Stalin's Russia what applied Communism looks like, we have to accept for coherence and mainly because it seems to be the truth that what we're seeing (wall street, monopolies, free market not auto-regulating, etc) as applied Liberalism.
Libertarians should find another term for what they mean by 'free market', because as it stands, they're appropriating an existing term, then telling everyone else that they're using it incorrectly.
Do you mean "economists?" Because no economist worth his salt (regardless of affiliation) would describe what we have as a "free market" when it comes to patents.
"OK," [IBM] said, [to Sun in the 1980s] "maybe you don't infringe these seven patents. But we have 10,000 U.S. patents. Do you really want us to go back to Armonk [IBM headquarters in New York] and find seven patents you do infringe? Or do you want to make this easy and just pay us $20 million?"
After a modest bit of negotiation, Sun cut IBM a check, and the blue suits went to the next company on their hit list.
Interesting how the playing field changes when you reach a critical mass.
Reforming patent law could be part of the solution against this type of thing, but the bigger problem may actually just be that IBM is run by assholes.
Creating / getting a patent at IBM is comical. Sort of like a game. All you have to do is document something, pass it to their patent lawyers ... and they fill it with so much verbose lawyer language and fluff that any normal person can't read and interpret it. Then it gets submitted and ... voila ... patent pending (and quite typically a couple years later, patented).
(Source: Me, a former employee of IBM (Indian Business Machines)).
Really, THAT is the procedure they use to 'invent' new patents? Wow, just wow. Appreciate you sharing this.
Curious, did you submit any yourself? Did they provide incentives for you or staff to come up with these 'documents' ? Do they have a monthly quota for # of new patents per week/month? In addition to staff submissions, did they have special division specifically their to conjure up new patents fulltime? Feel free to indulge, I find it fascinating to hear it from someone who has been in the belly of the beast.
For example, my good friend had to submit and modify his idea 3 times because the lawyers were not quite happy with the novelty of it. Documenting your idea is a bit more involved then just slapping a few paragraphs down and sending it off to the legal team.
As an IBMer, I've refused to participate in patents because they are a net negative for society. IBM does however reward you for filing patents.
In the USA, it's like $1000 for your first file and then royalties from the patent in some cases (I've heard 1%, but this is just a rumor) if it is granted. Beyond filing your first patent there are different tiers for the number filed & accepted that provide extra monetary reward.
As far as I am aware, there are no divisions at IBM that just sit around and come up with new patents. Novel ideas come as a product of working on other things, so a team doing nothing but patents would probably quickly run out of inspiration. There are however monthly meetings with "Master Inventors" who have been through the process several times and are willing to help mentor you through the process. As an employee, management regularly has asked (2-3x a year) if anything we've done we thought was patentable.
My experience at IBM in the US (six years worth) was that management "strongly suggested" patent submissions as part of the review/promotion game.
On one occasion at a meeting of a second-line managers entire org (4 or 5 teams), an employee questioning the utility of making patent submissions a numbers game (e.g, everybody better submit some) was told - with limited paraphrasing - "Hey, 1,000 people on the street want your job and will do the work plus publish technical reports plus submit patents for less money. You should keep that in mind."
I suspect, but didn't really know enough people in other software group divisions to verify, that this particular managerial mindset may have been more tied to our specific division than IBM "in the large."
Oh yeah. This sounds familiar (6 years at IBM). Very familiar. I wasn't even in the software division. I was in GBS. EVERY thing we did would get discussed and executives would ALWAYS ask if it could be patented. Half the time stupid, normal stuff like making AJAX requests to improve a web page's UX or embedding a browser in some piece of software would be cause for execs to encourage us to try to get a patent for it. It's insane. IBM will one day be the world's largest non-practicing entity.
As an ex-IBM'er who is a Master Inventor (36 patents), there are no royalties offered ever for any patent submissions. They grant you $750 per patent, with a bonus of $1500 on your first patent and $1500 every additional 3 patents.
My 2nd-hand (but family) knowledge about the energy business is that there're no royalties for patents there either. You get paid anywhere from $10 (really) to a few $hundred for a successful patent filing. My impression is that the aversion to royalties isn't mainly worry about the amount of royalty payments (them not wanting to give you 1% of something that turns into a blockbuster patent), but more that they don't want to deal with the legal complications that could result from not owning their patent portfolio free & clear.
Particularly the case since it's patent portfolios that are valuable more than individual patents. If they had a regular policy of small-percentage royalty share, a company could well end up with a portfolio of 10,000 patents that has maybe 15,000 or 20,000 royalty-share agreements attached to it. That would be hugely more risky to manage than just 10,000 patents owned by the company with no riders attached. For example, say the company wants to sell this portfolio. A sale of the portfolio could potentially be held up by any of those 15,000+ people objecting that the terms prejudice their contractual agreement to a share of revenue. A share of a patent's revenues is a valuable quasi-ownership interest guaranteed by some contract terms, so any sales or other dealings that might impact it could be challenged by the contract holder. Even if any challenge is ultimately unsuccessful, having your portfolio encumbered by tens of thousands of people with some kind of claim on it is undesirable.
It's the same story in US too. Many startups are desperate to build a patent portfolio. Those who can afford the lawyer fee, throw out big incentives to employees to patent left & right. Much of the stuff is crass. After a while I started hating the patent process at my work places (respected, popular companies).
Interesting. So they do have a reward system built in for employees as incentive to submit these 'drafts'. In addition to management routinely asking/encouraging this practice. Not surprising I guess, but nice to bring some specific details to light. Good on you.
I have not, but was on teams/worked with people that had submitted and were awarded patents. These weren't scientists or researchers. One was not even a developer. I hate to give too many details, as litigious as this "beast" (your word, good description) is, but I would say that a very large percentage are just junk/obvious crap. There are quite a few divisions within IBM and some are obviously very much dedicated to research and high-end engineering (e.g. IBM Almaden). You would expect patents coming from there. However, when practitioners in services divisions "reinvent" the wheel on something trivial, document it sufficiently and vaguely enough (especially after it has been through cycles of lawyer-ese) ... and patents are issued, it is laughable.
Here is an example of one that is not exactly it (for reason stated above), but similar enough to illustrate absurdity: Think of a Firefox plug-in that would let you right-click at a certain point on a long web page (e.g. on a word, a highlighted paragraph, anyplace .. that is a couple pages down on a long news article) and choose "Bookmark". This would save a "Bookmark" to your toolbar that you could later click and it would not only take you to the web page, but also scroll you to the exact spot you were at before on the page.
This type of stupid simple functionality ... would actually be patented by IBM. Yes .. that functionality had already really existed in one form or another, from multiple methods, yet ... no other company had the absurd gall and audacity to try to actually patent it. You would now search this patent # on USPTO.gov and read it and be amazed at how absurdly abstract and broad this vague function would be described. I would guess it would take you 10-15 minutes of reading and deciphering to even begin to realize what it was for (and would be as stupid simple as what I mentioned above). This is IBM's patent machine.
I can't speak for IBM's research divisions, but I know of no quota for other IBM practitioners (say in one of their services divisions). It is a "badge of honor" in someways (or so they think for some of those folks that submit this stupid crap) as you do have a "Patents" section on the internal profile intranet where it lists if you are a (co)-creator of any patents. Of they hundreds I've seen on people's profile, I don't recall seeing anything meaningful. Mostly of the type that we talk about in places like this as "Patent Troll" material.
There are quite clearly quotas dictated from above, typically because IBM wants to win the "patent race" every year. If they feel Intel/Samsung/ContenderX will file more/fewer during the year, they adjust the pace, and your idea will be (de-)prioritized accordingy. This being said, patents are generally not entirely vacuous, as they come out of things that researchers are, in fact, working on.
It's true that we don't have much in the way of details, but it's also very hard to imagine "very kind" fitting the bill here in any way, shape, or form. "We have a portfolio of patents that we are now going to use to sue you, unless you'd like to buy them" just does not qualify as "kind" to me regardless of the rest of the interaction.
They had (and everyone has) the option to simply not file this kind of suit (or even go hog wild in the patent field). But they consistently choose to. I understand that it'd be fairly irresponsible for a large company to ignore patents, or to ignore actual, real infringement that affects its bottom line, but it is and has been blown so far out of proportion that no one in IBM's position gets a pass.
> I understand that it'd be fairly irresponsible for a large company to ignore patents, or to ignore actual, real infringement that affects its bottom line
Bingo. This is a corporate organization and your needs, or really anyone's needs but the company's, are not in its best interest to consider. From the perspective of profits, playing the patent ransom game is the best decision, especially for entrenched business giants like IBM.
As someone who used to work at IBM and generated 36 patents for them, I can tell you that the incentives at IBM are HEAVILY in favor of patents at the expense of your "real" work. At IBM, you can bust your A## off all year, work 60 hours a week, and get a PBC rating of 1 (top 10%) and get rewarded with a bonus of 5% (if you're lucky). Or, you can slack off and spend the majority of your time ducking assignments, getting a PBC rating of 2 (middle 50%) and get rewarded with a 2% bonus, and using your work time to submit patents, where you get $1000 per patent. Which path would you choose? Is it any wonder they have so many patents submitted by their employees?
1. If a developer co-own a patent with his former employer (IBM), does this developer have the right to use his patent technology later at Google? I don't know how IBM handles patents with his or her employees.
2. Developer does not own any patent but being the person who invented the technology does he have the right to invent a similar technology like his earlier invention at Google? People carry knowledge with them!
On #1, the answer would be yes if they really did co-own it and had no other contract regulating terms of their co-ownership (unlikely). Under U.S. law (not true everywhere!), co-owners of a patent each have an independent right to exploit and/or non-exclusively license the patent, without consultation with the other co-owners, unless they've entered an agreement providing for other terms of co-ownership. This is also true for copyrights on jointly authored work, incidentally.
However, companies usually just get the patent assigned to them by the employee, in return for some token compensation (varies, sometimes it's really token, like $1, other companies will pay employees $100-$1000 per patent).
One place where it can sometimes come up is that a co-inventor who was omitted from the patent application can later try to get him/herself retroactively added. Trying to dig up such people, get them added, and then buy a license from that person is one strategy for defending a patent lawsuit. E.g. if IBM bought a patent from a university spinoff, you could try to dig up a grad student who can document he/she co-invented the relevant technology but wasn't listed on the patent, get them added, then license it from them. Since they now co-own the patent with IBM, you only need to license it from either them or IBM, so IBM's suit fails. I think doing this successfully is pretty rare, but there's a fairly famous case: http://scholar.google.com/scholar_case?case=8929550350181055...
1. No. Assumption being that any thing "invented" while working for IBM, belongs to IBM. The developer does not "own" it. He/she is only listed as basically the "(co)-inventer". He cannot go to Google and "use" it with out licensing / agreement from IBM. Now .. it is plausible that an employee invented something totally on their own time while an employee of IBM. That said, if this had any value (now or in the future), it is entirely likely and plausible that IBM could make a case legally for having rights to said invention. This is especially true if your "invention" is in the same domain you work in for IBM (e.g. if you are a middleware developer for IBM Software Group and you make a new type of messaging technology .. on "your own time" in the evening/weekends).
2. This is a grey area that will ALWAYS be open to legal interpretation (enter the lawyers). There are different things involved in your question: Are there non-competes in your employment contracts?, are they actually enforceable legally?, will they be enforced legally?, what specifically is the "technology"? So .. this is not possible to answer beyond just saying: It depends. It is case-by-case and is balance between an business' intellectual property, any contractual agreements (non-compete) you may have signed, and your right to work / find gainful employment.
1. Correction on #1 - technically you "invent" whatever the patent is, and then assign its rights over to IBM, whereby the compensate you. That's why the inventors' names are on the patent.
The reason for that is that under the prevailing caselaw, companies can't be "inventors" of things, and therefore they don't fit under the clause of the U.S. Constitution that authorizes patents, which specifically mentions securing exclusive rights to an invention to its "inventor". Hence the legal dance where the inventors (specific humans who invented something) are named in the patent, but then they assign their exclusive right to the invention to another legal entity (their employer).
I think that might be a bit of a historical anomaly, though, related to when different doctrines were developed. Nowadays legal personhood is personhood-enough for most areas of law. One could imagine a court in 2014, looking at this issue for the first time, deciding that when a company puts a bunch of R&D money into something, and an invention results, through the actions of perhaps dozens of people working within the company's structures and facilities, it is in effect the company as an aggregate entity that has invented the invention. That might even fit a bit better (though still imperfectly) with modern scientific/historical understanding of invention, which generally views single-person "eureka!" moments as the exception, and collaborative efforts where some R&D "system" can be reasonably credited with the invention as the norm.
But this particular body of law was settled back in the days when the prevailing legal fiction around corporations was a bit different, so only humans can legally invent things. Due to the common dance around assignment, it doesn't make much practical difference anyway.
Thanks for making the world a worse place, Twitter, by giving in to the patent bullies, and setting an example for others. It's sort of "understandable" for small start-ups who would be ruined by the trial alone, but for companies that have billions of dollars in their coffers to do this is just plain pathetic and cowardly. Instead of fighting the problem, they become part of it and accomplices to it.
This also completely devalues the credibility of their IPA [1] patent thing. If Twitter gave in, why would everyone else who might've been interested in the whole IPA thing not do the same, too?
Actually Twitter didn't just pay IBM, but bought the 900 patents from IBM outright, which hopefully Twitter will not then use offensively as IBM did, so this could be a good thing, and perhaps another way to deal with patent trolls: buy their arsenal leaving them with fewer extortion tools.
I'm not a lawyer, but the documents look legally binding. They say to have a lawyer if you want to implement it. It forms part of their employee agreements and their patent filings.
The patents that Twitter bought from IBM were mostly low quality assets. IBM, largest patent holder for the last 21 years straight, is known for having tons of narrow patents on every little feature they develop. This deal was a good way for IBM to get rid of some garbage and a good way for Twitter to get a Big, Scary looking patent portfolio.
According to patents, innovation is property that you must pay the "innovator" to use. The innovator is someone who bought the property of the innovation.
In most peoples' worlds, innovation describes the act to innovate. An act is not someone's property.
Defensive portfolios of garbage patents used to be the key to preventing competitors from suing you with their garbage patents. After the eBay v. MercExchange [0] case in 2006, it's not as dangerous to be sued but defensive portfolios are now much less useful also because you can't threaten to shut down aggressors' businesses with injunctions. The Apple v. Samsung and Microsoft v. Motorola cases also recently demonstrated that vague garbage patents are much more useful in court than technological patents. Juries and judges understand them better and are inclined to award hundreds of times more damages.
Second, IBM is the least awful kind of patent troll. They generally ask for small fractions of revenue or investment in companies that have established themselves. The IPO phase is a favorite time for them to ask for a few million from growing companies. The worst kind of trolls -- such as Microsoft's Intellectual Ventures -- ask for much more money from companies and often go after startups. IBM exercises restraint with the idea that they might have an ongoing relationship with companies someday in some other context.
And IBM, unlike most trolls, actually does real research. Most of the new ideas in Google Search were first published in an IBM research paper that Larry and Sergei read. IBM didn't patent those ideas, though; they mostly seem to accumulate scattershot patents at random. I think IBM's primary goal is to top the list of prolific grantees every year.
[0] http://en.wikipedia.org/wiki/EBay_Inc._v._MercExchange,_L.L.....