This is really great news.
I had a sigh of relief and my chest relaxed a little bit. We may be on the right track finally.
Ruling from USPTO Invalidates All Claims Used to Threaten Podcasters
31–40 of 87 posts
Re: Ruling from USPTO Invalidates All Claims Used to Threaten Podcasters
#32Earlier quoted context omitted.
A good license would probably say royalties are nonrefundable, and this makes sense -- if you threaten to sue me for $1 million and I settle for $25K, I've essentially paid to make the suit go away. So long as you don't sue me, I've got the benefit I bargained for. If it later turns out that the suit wouldn't have been valid, great, but it doesn't matter to me since I've already bought peace. To your other question,…
I am not sure if you're correct. In the This American Life episode on patents they interview someone discussing this precise issue, who is still on the hook for licensing fees despite someone else subsequently winning a patent action against the counterparty.
Interesting. I tracked down the transcript (http://www.thisamericanlife.org/radio-archives/episode/496/t...) and found the section I think you're remembering:
And for the 16 companies that did settle, the verdict may not change anything. In most cases, these licensing agreements have language that makes them nearly impossible to get out of, no matter what happens with the patent later on. This week, we heard back from a spokesman from one of the companies that chose to settle.
The spokesman wrote in an email, quote, "We were hit hard by this lawsuit. Infringement on our part seemed completely bogus, but we could not afford to fight it. Even with the settlement, we were forced to lay off employees. We are still--" and "still" is in all caps-- "still paying out on the settlement agreement. We were unaware that the patent had been invalidated. We will be contacting our attorney to see what recourse we may have."
Re: Ruling from USPTO Invalidates All Claims Used to Threaten Podcasters
#33The fact this patent was granted in the first place seems completely absurd. But then again, we live in a world where Boeing has a patent on certain trajectories that use the moon's gravity ( http://www.google.co.uk/patents/US6116545 ), so it shouldn't really surprise me.
> But then again, we live in a world where Boeing has a patent on certain trajectories that use the moon's gravity
Interesting. That particular patent was owned by Hughes Electronics, though, not Boeing [1]. EDIT: Apparently in 2000 Boeing acquired that division of Hughes Electronics [2] but the transfer of ownership of the patent was never recorded in the USPTO.
The patent expired in 2012 because the owner didn't pay the required "maintenance fee," which is a statutory fee that must be paid every few years to keep a patent alive [3]; see the end of the document to which you linked.
[1] http://assignment.uspto.gov/#/search?adv=patNum%3A6116545&so...
[2] http://en.wikipedia.org/wiki/Hughes_Aircraft_Company#Hughes_...
[3] http://www.uspto.gov/patents-maintaining-patent/maintain-you...
Re: Ruling from USPTO Invalidates All Claims Used to Threaten Podcasters
#34Earlier quoted context omitted.
A good license would probably say royalties are nonrefundable, and this makes sense -- if you threaten to sue me for $1 million and I settle for $25K, I've essentially paid to make the suit go away. So long as you don't sue me, I've got the benefit I bargained for. If it later turns out that the suit wouldn't have been valid, great, but it doesn't matter to me since I've already bought peace. To your other question,…
I am not sure if you're correct. In the This American Life episode on patents they interview someone discussing this precise issue, who is still on the hook for licensing fees despite someone else subsequently winning a patent action against the counterparty.
You aren't on the hook for future royalties for invalidated patents. But you don't get back royalties you already paid.
And typically you get a royalty for that company's entire portfolio of patents. So even if a few are invalid there are bunch more.
Re: Ruling from USPTO Invalidates All Claims Used to Threaten Podcasters
#35When a patent gets overturned, can those who already paid license royalties typically sue the patent holder to get their money back? (I know that the entity can file bankruptcy, so the chance of getting money is slim). Or do the license agreements typically include a clause that money is not refundable if the patent is invalidated? Or, even worse, do license agreements typically include language that says the license…
It's only tangentially related, but it's a good story: Apparently at some point an American producer licensed the patent for a mouthwash for a percentage of sale – I think it was Listerine, but can't find this story on Wikipedia right now. A decade or two later, the patent ran out. Anybody could now copy the formula without royalties. Except: the original licensor sued his american licensee for continued royalty paym…
That case, Warner-Lambert Pharmaceutical v. John J. Reynolds, actually hinged on the fact that there was no patent license involved. Listerine's formula was a secret, and Jordan Lambert offered its creator royalties if he would share it with him. Later, the formula became widely known and Warner-Lambert wanted out of the deal since they were no longer getting any advantage from it. They sued to get out of their contract and recover past payments, citing patent cases as support for the idea that they should be set free of their obligations. The judge ruled that with patents, there is an understanding from the outset that they are paying for access to a time-limited monopoly, while the contract in this case was pretty clear about not having a termination date other than "whenever they stop making Listerine".
Source: http://law.justia.com/cases/federal/district-courts/FSupp/17...
Re: Ruling from USPTO Invalidates All Claims Used to Threaten Podcasters
#36When a patent gets overturned, can those who already paid license royalties typically sue the patent holder to get their money back? (I know that the entity can file bankruptcy, so the chance of getting money is slim). Or do the license agreements typically include a clause that money is not refundable if the patent is invalidated? Or, even worse, do license agreements typically include language that says the license…
It's only tangentially related, but it's a good story: Apparently at some point an American producer licensed the patent for a mouthwash for a percentage of sale – I think it was Listerine, but can't find this story on Wikipedia right now. A decade or two later, the patent ran out. Anybody could now copy the formula without royalties. Except: the original licensor sued his american licensee for continued royalty paym…
The current precedent in the United States is that a patent holder cannot collect royalties past the expiration of the patent, and license agreements requiring payments beyond expiration are unenforceable.
This doctrine is being challenged at the Supreme Court currently, in Kimble v. Marvel:
http://www.scotusblog.com/case-files/cases/kimble-v-marvel-e...
Re: Ruling from USPTO Invalidates All Claims Used to Threaten Podcasters
#37Earlier quoted context omitted.
It's only tangentially related, but it's a good story: Apparently at some point an American producer licensed the patent for a mouthwash for a percentage of sale – I think it was Listerine, but can't find this story on Wikipedia right now. A decade or two later, the patent ran out. Anybody could now copy the formula without royalties. Except: the original licensor sued his american licensee for continued royalty paym…
The current precedent in the United States is that a patent holder cannot collect royalties past the expiration of the patent, and license agreements requiring payments beyond expiration are unenforceable. This doctrine is being challenged at the Supreme Court currently, in Kimble v. Marvel : http://www.scotusblog.com/case-files/cases/kimble-v-marvel-e...
One wrinkle -- even under current case law, payments can still validly be collected for non-patent IP (most often trade secrets). Thus, the best practice from the licensor's is to delineate what portion of the royalty rate is attributable to the patent, the trade secret, the trademark, etc., and stop collecting each portion once the corresponding IP expires or is (finally, unappealably) held invalid.
Re: Ruling from USPTO Invalidates All Claims Used to Threaten Podcasters
#38The fact this patent was granted in the first place seems completely absurd. But then again, we live in a world where Boeing has a patent on certain trajectories that use the moon's gravity ( http://www.google.co.uk/patents/US6116545 ), so it shouldn't really surprise me.
> But then again, we live in a world where Boeing has a patent on certain trajectories that use the moon's gravity Interesting. That particular patent was owned by Hughes Electronics, though, not Boeing [1]. EDIT: Apparently in 2000 Boeing acquired that division of Hughes Electronics [2] but the transfer of ownership of the patent was never recorded in the USPTO. The patent expired in 2012 because the owner didn't pa…
They maybe got embarrassed by it as it is the patent they used to screw with the AMC-14 satellite in 2008.
Re: Ruling from USPTO Invalidates All Claims Used to Threaten Podcasters
#39Earlier quoted context omitted.
It's only tangentially related, but it's a good story: Apparently at some point an American producer licensed the patent for a mouthwash for a percentage of sale – I think it was Listerine, but can't find this story on Wikipedia right now. A decade or two later, the patent ran out. Anybody could now copy the formula without royalties. Except: the original licensor sued his american licensee for continued royalty paym…
That case, Warner-Lambert Pharmaceutical v. John J. Reynolds, actually hinged on the fact that there was no patent license involved. Listerine's formula was a secret, and Jordan Lambert offered its creator royalties if he would share it with him. Later, the formula became widely known and Warner-Lambert wanted out of the deal since they were no longer getting any advantage from it. They sued to get out of their contr…
Thank you – had trade secrets and patents mixed up in memory.
Re: Ruling from USPTO Invalidates All Claims Used to Threaten Podcasters
#40The fact this patent was granted in the first place seems completely absurd. But then again, we live in a world where Boeing has a patent on certain trajectories that use the moon's gravity ( http://www.google.co.uk/patents/US6116545 ), so it shouldn't really surprise me.
I recall a story a while back about a satellite that ended up in the wrong orbit after launch. The engineers knew how to correct it using various orbital maneuvers, but alas those maneuvers were patented and it was too expensive to license them. So the decision was made to splash the satellite and let the insurance companies pay out. At least that's my recollection... Edit : Here's a description of the issue, which i…
I thought that algorithms couldn't be patented?