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Don't mess with Newegg

blog.newegg.com

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Re: Don't mess with Newegg

#81

Post by lotharbot »

xtrumanx wrote: post #71
lotharbot wrote: post #68

Earlier quoted context omitted.

> "I was just trying to present some truth" Here on HN, we don't want mere truth. We also optimize for interesting and directly relevant comments. "Newegg egregiously screwed up a return for me" may be true, but how exactly is it interesting or relevant in a discussion about their response to patent trolls?

> ...but how exactly is it interesting or relevant in a discussion about their response to patent trolls? Another comment on this thread simply states "Newegg is my hero!". How come you're not lecturing that commentator? I found joshjdr's comment relevant. From my years on Hacker News, I've never had the impression that every comment was directly relevant to the posted link. Most of the time someone leaves a comments…

> "How come you're not lecturing that commentator?"

joshjdr indicated that he wanted to understand the negative response his comment was generating. I provided him with an explanation; this is a service many HN commenters have expressed appreciation for in the past. The other guy made no such indication, so I gave him a downvote without explanation.

> "I've never had the impression that every comment was directly relevant to the posted link."

Perhaps my explanation was less clear than I hoped.

The HN community has certain expectations for comment quality. Generally speaking, the less directly relevant a comment is, the more of some other positive quality it needs to have in order to be well-received. "Newegg really screwed up something unrelated to patent trolling" is both tangential and unenlightening.

Re: Don't mess with Newegg

#82

Post by danieltillett »

nitrogen wrote: post #66
danieltillett wrote: post #55

Does anyone know why these cases are so expensive to defend? They can't be that complex given the troll basically has nothing. Could you not just hire a junior lawyer out college for next to nothing and put them in charge of running all the defences?

My layman's guess is that the discovery and documentation processes would be very invasive and time consuming. Plus the risk of a loss is severe.

It looks like discovery is the cause - quoting from [0] "After all, the great struggle in every patent litigation is balancing the fact that discovery is by far the most expensive part of the process...".

It would seem that basically patent trolling is really discovery trolling - pay us or else we will make you go through discovery.

[0] http://patentlawcenter.pli.edu/wp-content/uploads/2010/09/Di...

Re: Don't mess with Newegg

#83

Post by aptwebapps »

jebblue wrote: post #78
bsder wrote: post #21

Earlier quoted context omitted.

And the troll companies are always shell companies with nothing but the patents. So, even if you win, the shell company will declare bankruptcy. This is what changed the game. Before, two big companies generally had enough patents that they would simply agree to cross license because they both infringed one another's patents. So, for the company being sued, it's a no win situation.

>> And the troll companies are always shell companies with nothing but the patents. So, even if you win, the shell company will declare bankruptcy. I think you've hit on it. Anyone who proclaims patents are bad overall are not considering that the real problem is the shell companies, "patent trolls", who are taking advantage of a system that was intended to encourage good faith between businesses; these shell compani…

Patent trolls are definitely a distinct problem, although the problem is exacerbated by, if not created by, the profusion of bad software patents.

So if you reduced the number of bad patents you might fix that particular problem but, for me, software patents are a problem in and of themselves.

Re: Don't mess with Newegg

#84

Post by jacquesm »

us0r wrote: post #48

Acacia Research has been at this for a long time now. I remember when they went after porn. They claimed to own streaming media and thought the adult industry would settle. While some did, one company took them up and won. If I remember he said it cost them $500k to defend.

It cost them quite a bit more than that but they won anyway. That did not stop acacia from extorting (or in some cases trying to) pick fights with smaller entities. They then started to withdraw their cases if it became apparent someone would actually fight back.

(I know this because I supplied a whole bunch of information in that lawsuit and the defendants are customers of mine, Acacia also tried to sue TrueTech Canada Inc but dropped the case when they realized that (1) I wasn't going to budge and (2) the IP was all vested in the Dutch parent company, so the 'shell' effect worked to our advantage for a change. If they'd won in Canada we'd have declared bankruptcy, opened a new office two doors down the hall and continued business with a new daughter company. The Canadian subsidiary had little to no assets, just desks and a bunch of computers.).

Re: Don't mess with Newegg

#85

Post by gcb0 »

mixmax wrote: post #14

It seems to me that the legal system in the US is largely broken, and that just about anyone can be sued if only you find the right grounds. Being sued and defending yourself is enormously expensive which is what patent trolls exploit. Why not use this offensively against patent trolls? Find all sorts of ways to take them to court, the American legal seems to have plenty of opportunities in that regard. There are som…

yep. it is broken.

even in this win, they wasted time and money, that a bankrupt shell company cant pay back.

meanwhile, amazon paid a small settlement fee (which makes the troll case even better) and wasted those same resources hiring engineers to build a tablet or whatever.

Re: Don't mess with Newegg

#86

Post by busterarm »

glesica wrote: post #32
mixmax wrote: post #24

Earlier quoted context omitted.

be a bit more creative. It's known who the parent company is, so sue them. Since you're basically just suing for whatever you can get away with you should of course go for the mother ship.

But there isn't always (or even usually) a "mothership" from what we've seen lately. Look at the Prenda Law saga (Ars Technica has some great write-ups). They can't even figure out who officially owns the company, it is almost entirely opaque. I think the problem is that corporate personhood has run completely amok. It is far too easy to invent a new corporate person with little or no visible or even provable connect…

Oh Prenda Law. My favorite angle on their scam was when they started embedding malware into gay porn downloads to extort money out of them.

I hope someone eventually gets to the bottom of who is behind that enterprise and they can be very publicly shamed and exposed.

Re: Don't mess with Newegg

#87

Post by sounds »

hyp0 wrote: post #69
bsder wrote: post #21

Earlier quoted context omitted.

And the troll companies are always shell companies with nothing but the patents. So, even if you win, the shell company will declare bankruptcy. This is what changed the game. Before, two big companies generally had enough patents that they would simply agree to cross license because they both infringed one another's patents. So, for the company being sued, it's a no win situation.

I think the idea is to increase the marginal cost of doing business, so it isn't economic any more. That is, assuming it takes enough some time and effort to declare bankruptcy, set up a new corporation etc. But you're right, it wouldn't be a win for a specific defendant, it's more a long-term strategy to change the ecosystem by the community - crowdsourced, as the GP suggests. Another option is a consortium of well-…

Excluding billed time for the process, it is amazingly easy to set up a corporation and transfer patents to it. Fixed costs for creating a shell corp are around ~$100.

Newegg's approach (Never settle. If you sue us expect to pay our legal fees.) is maybe the best way to eliminate the economic incentives, given the uncertainty of the US legal system.

There's a comment downthread by jacquesm detailing one way he exploited shell companies _against_ the trolls and they backed off...

Re: Don't mess with Newegg

#89

Post by sounds »

danieltillett wrote: post #80
wtallis wrote: post #65

Earlier quoted context omitted.

They're expensive because the eastern Texas courts are so favorable to patent plaintiffs that in order to have a meaningful chance for a win you have to either get the USPTO to throw out the patent or get the case moved to a different court (as Newegg did here). The former is extremely time-consuming and expensive, and the latter is difficult and rarely successful. A direct fight against the subject and claims is all…

Why is it more expensive to run a case in East Texas with some junior lawyer than anywhere else?

Because you will lose, regardless of whether you hired a junior lawyer or the most expensive law firm in the world.

Re: Don't mess with Newegg

#90

Post by jeorgun »

mantis369 wrote: post #88

Newegg are cheapskates. The publicity from doing this pays far more than the money they'd save by settling with patent trolls.

The fact that they're being rewarded for their actions doesn't mean that those actions aren't laudable (especially when that reward consists of their being lauded).
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