2012-13 GIPLA Executive Board
Facebook Claims Yahoo Infringes on 10 Patents
Abigail Holman, 1L
In the patent battle between giants Facebook and Yahoo, Facebook filed a counterclaim against Yahoo, saying that Yahoo infringed on 10 of their patents. One of these 10 was co-invented by Mark Zuckerberg. The content of these patents ranges from Yahoo’s home page to Flickr.
Facebook’s counsel asserted that this move was made in self-defense, made “in response to Yahoo’s shortsighted decision to attack one of its partners and prioritize litigation over innovation.”
Yahoo complains that Facebook has been stealing ideas from their upstart.
For full article, see 9th Circuit Daily Journal, “Facebook fires back at Yahoo in patent battle” By Craig Anderson.
By: Abigail Holman, 1L, Gonzaga University School of Law
On February 2, 2012, Professor Michael Risch, from the University of Villanova Law School, presented to the Federalist Society at Gonzaga University School of Law. Thank you to Professor Risch for his very interesting and informative presentation regarding patent trolls, patent filing, and the pricing of patent portfolios.
The message portrayed by Professor Risch, is that patent quality is no longer about patent trolls. Patent quality is defined by the likelihood of the patent holding up in court based upon obviousness and description. A patent troll, also known as a non-practicing entity (“NPE”), is a person or entity who purchases a patent from an underprivileged party (i.e. an individual or small business with a single patent), and enforces the patent against purported infringers without any intent to manufacture the patented product or provide the patented service. Some of the most litigious NPE groups are more than 25 years old.
Despite the connotation from the name, 75% of NPE patents come from business entities or corporations. 42% of the patents come from companies with 500 or more employees. According to Professor Risch, these are the people we want to be receiving patents because they are fueling productivity. Thus, the myth that NPEs are hindering productivity by buying up these patents is absolved.
Under the macro view of NPEs and investment, Professor Risch felt that if NPEs are there to aid investment, they are not doing a good job. The inadequacy of studies on the topic cannot rule the investment of trolls as a factor in deciding if they have an effect on patents with larger businesses. However, in the case of individuals, NPEs keep individual inventors in business by providing an outlet to sue and enforce their patents.
The micro view of NPEs involves individual patent quality. A study was conducted of 350 patents; 28% percent of judgments on the NPE patents completely invalidated them, whereas only 20% of the total patents were invalidated. Infringement judgments were rare with only about two per thousand patents. Professor Risch considered this result to possibly be because NPE patents tend to be more broad, and are therefore easier to invalidate.
Next, Professor Risch compared the effect of selling a patent to an NPE to holding onto the patent, but later being sued by a competitor. NPEs will always take a percentage of the possible profit, but if a competitor succeeds in prosecuting, they will completely stop production of the good if possible. The greatest factor determining whether a patent will be litigated is payment of maintenance fees, which has nothing to do with NPEs.
The goal of patent portfolio quality should be to accurately price the portfolio, otherwise questionable patents will be litigated. On the macro scale, patent aggregators may be better off because patent-by-patent litigation is highly unlikely when there are hundreds of patents. Bulk patent litigation is also unlikely. On the micro scale, especially for individuals with patents, joint efforts and cross-licensing that is not based on quality or the same technology family is likely to be more successful. The ultimate goal is to minimize transaction cost and make the process for obtaining patents more efficient for everyone.
Gonzaga Saul Lefkowitz Trademark Moot Court Team: BEST Brief
Congratulations to Gonzaga’s team of Lorie Mallari, Reid Jennings, John Nelson, and Libby Zinke competing down in San Francisco for having the best brief in the region!
For more information on the Saul Lefkowtiz Moot Court Competition: INTA.org
Temporary Restraining Order Issued Against RIM over BBX Trademark
By: Peter Nguyen, 3L, Gonzaga University School of Law
In an update to the post on November 2, 2011 by Alex Ferguson, a judge has issued a temporary restraining order against RIM from using BBX as the name of its next operating system at an upcoming developer’s conference in Singapore. As a result, RIM has decided to rename its operating system to the Blackberry 10.
In the order against RIM, the judge found in favor of Basis, the registered holder of the BBX mark, because it found that a likelihood of confusion (LOC) existed. In its analysis, the court examined found that all of these LOC factors favored Basis: (1) the degree of similarity between the marks; (2) similarity of products and manner of marketing; (3) the strength or weakness of the mark; (4) evidence of actual confusion; (5) intent of the alleged infringer in adopting its marks; and (6) the degree of care likely to be exercised by the purchasers.
Links:
(1) NYT – After Court Ruling, Rim Changes Name of New Operating System
Apple vs Samsung: The Complete Picture
By Alex Ferguson, 3L, Gonzaga University School of Law
New technology website, The Verge, put together an incredible timeline of the patent war between Apple and Samsung over various design patents. As the article points out, the war erupted between Apple and Samsung in the United States and then spread throughout the rest of the world. Each side has won some battles in different regions of the world.
In the recently released biography of Steve Jobs by Walter Isaacson, Steve Jobs said, “I will spend my last dying breath if I need to, and I will spend every penny of Apple’s $40bn in the bank, to right this wrong.” Additionally, Steve Jobs told Isaacson. “I’m going to destroy Android, because it’s a stolen product. I’m willing to go thermonuclear war on this.” The biography also reports that Steve Jobs was not interested in settling the claims.
Apple brought suit against HTC, another Android handset maker, in March of 2010 for patent infringement. HTC has counter-sued Apple. The case with HTC is still ongoing. In October 2010, Apple sued Motorola for patent infringement. Apple brought suit against Samsung in April of 2011, also for patent infringement. Even though the suit against Samsung is the most recent of the patent suits filed by Apple, it has garnished the most attention, because of the global scale and ferocity that each side has been fighting.
It will be interesting to see how the cases against Samsung proceed in the coming months as new devices are released and more hearings are held throughout the world. However, more interesting will be how Tim Cook, Steve Jobs successor, handles any settlement offers.
The full timeline, with updated events, can be found at http://goo.gl/DyvkA
IP Licensing Drafting Issues
By: Reid Jennings, 3L, Gonzaga University School of Law
This is an overview of the presentation given by K&L Gates attorney, Nancy S. Kim, at the WSBA Intellectual Property Institute regarding the issues that crop up when drafting IP Licensing agreements. These were some of the highlights and takeaways from the presentation.
The first step when meeting with a client regarding an IP licensing transaction is to educate the client about the most common terms covered by these types of agreements. A partial list of topics and terms that should be covered are discussed in the General Drafting Tips section below. The next step to be taken when meeting with a client is to figure out what IP the client wants to license and what rights in the IP those licenses will grant. For example, consider whether software and/or the source codes are going to be licensed and whether the licensee has the right to reproduce such material. Finally, after the broad scope of the agreement has been determined, you should help the client to formulate approaches to each of the topics of the agreement.
- Topics to specifically address in your IP licensing agreement
- Work made for hire – this issue is present in many IP licensing agreements (this is especially relevant for employee-employer relationship).
- Extra security built into agreement in the form of assignment to any outside collaboration or outside exposure to the IP.
- Make sure to include the scope of the license grant (this includes all the applicable terms from the statutes – e.g. for patent, you should include terms addressing make, use, have made, offer to sell, sell, import).
- General Drafting Tips and issues
- License Conditions v. Contract Covenants – broader damages are allowed for license conditions (license grant is subject to another event, such as promise not to do something).
- Licensee v. Licensor – who are the parties actually benefiting from the agreement (is a third party receiving deliverables with licensee’s added work or is licensee passing IP straight through).
- Restrictions that should be included – reverse engineering; open source access; disclaimer of implied licenses; export restrictions (licensee may gain implied rights if those rights are not disclaimed).
- Term and Termination – these must be considered in terms of clients short and/or long-term goals, the relationship of the parties, and the type of technology
- Confidential and Sensitive Information concerns – should also consider specific remedies for breach of these obligations.
- Indemnification – licensee indemnification from licensor or mutual indemnification; insurance; choice of counsel; rights/obligations of parties (settlement approval, notice, cooperation with litigation, etc.).
- Warranties and Limitations of Liability – non-infringing use warranties; any other excluded warranties.
- Assignability – whether the IP can be assigned; approval by licensor; portions of IP to be assigned; limitations on assignment.
