An Inside Look at Apple's Role in the Patent Industry

[LordVic]

Originally Posted by Forkjulle

I'd counter that by saying that I don't believe it's fair to monopolise the market as a defensive measure for "just in case". And in the event that someone comes up with the same idea (perhaps they're a smaller company than you), you get the government to criminalise them for having the same idea as you.

In effect, you believe it is fair to interfere with other people's private (intellectual) property for your own gains.

A good example of Apple doing this very behaviour are some of their recently awarded NFC patents.

Thats right. For everyone bitching that there was no NFC actually in the iphone 5, the question as to why people believed it would have NFC is because Apple has been actively throwing patent applications at the patent office for NFC related tasks.

http://www.engadget.com/tag/apple,nfc,patent

A strong example is the patent that was recently awarded for "Airport Checkin"

The text of this patent is:

There is provided a method and system for transportation check-in (e.g., ticketing and identification) via near field communication (NFC) using a handheld electronic device, such as a cellular phone or a personal media player. The handheld device may store and transmit travel reservations and traveler identifications using a travel management application. Various methods may be employed to acquire the reservation and identification information on the handheld device. For example, travel reservations may be made via the management application or may be retrieved from an email, a website, another NFC-enabled device, or a carrier-provided confirmation number. User identification may be acquired by scanning a radio frequency identification tag embedded in a government-issued I.D. In another embodiment, an I.D. number may be entered via the travel management application, and the user's identification information may be downloaded from the issuing authority.

with the "drawing" of


Thats right. Apple has patented using NFC to check in at an airport. not the software of doing it. Not the actual chips for doing it. not the booths, not the receptacles. They patented the ACT of checking in with NFC. That means if any other company develops an actual system to do this, Apple would legally have every right to sue and stop them, Even if apple never actually releases their own NFC.

This is a perfect example to me of both patents that are too broad in scope and definition, that outline the outcome of a task and not the tasks themselves to complete it, and of a patent being done exclusively to inhibit innovation by blocking other companies from doing what they were trying to do in the first place (as NFC was designed exclusively for this sort of task alongside payment).

While they haven't actually sued anyone over this yet, owning it gives them this power.

[kdarling]

A side comment:

I think another sad situation can happen when one company buys another for their patents and/or employee knowledge, and discontinues some/all of their best products without building newer versions.

E.g. Apple bought Fingerworks in 2005 and ever since then, their unique multi-touch keyboards have no longer been available. Used ones command high prices.

That's a loss for the world, and especially for people with hand stress injuries.

[kdarling]

Originally Posted by LordVic

A strong example is the patent that was recently awarded for "Airport Checkin"

The text of this patent is:

The description doesn't matter. Look at the patent Claims instead:

1. A method for transportation ticketing check-in, comprising: prompting a traveler to place a handheld electronic device comprising a display and a plurality of wireless communication interfaces within range of a near field communication (NFC) reader, wherein the display is configured to display a graphical user interface, wherein each of the plurality of wireless communication supports a respective communication protocol, and wherein one of the plurality of wireless communication interfaces comprises an NFC interface; retrieving ticketing and traveler identification information from the NFC interface of the handheld electronic device via the NFC reader; and verifying the traveler's identity using the retrieved traveler identification, wherein verifying the traveler's identity comprises comparing a photograph retrieved from the handheld electronic device to the traveler.

Basically, it's almost as bad. They're claiming the idea of using photos, fingerprints or retinal scans from the device as identity verification when using the ticket.

Clever? Sure. Something that's obvious to an expert in the field of handhelds and purchase verification? Also yes. For that matter, probably most people in this forum could think of this idea.

What's the difference between using those identification techniques for unlocked a phone vs unlocking a transportation ticket. Or a bank account. Or a house lock. It's all just one more tiny variation on the same theme.

[uknowimright]

the continuation on the slide to unlock patent is ridiculous (saw it was granted yesterday)

[samcraig]

Originally Posted by uknowimright

the continuation on the slide to unlock patent is ridiculous (saw it was granted yesterday)

Indeed - ridiculous. How Apple is able to extend their patent post-facto as to prohibit solutions (and workarounds) is an appalling statement on the patent review process.

This is where I "draw the line" and say that with patents getting approved/extended like this - it stifles innovation/competition.

[SPUY767]

Originally Posted by kdarling

What about buying companies and never using their tech? Or doing it to keep a previously common product out of other people's new devices?

Apple got an exclusive on LiquidMetal, for example, which prevents anyone else from using it in consumer electronics. Samsung had been using LM in phones since 2002, IIRC. Apple has used it to make what? SIM ejectors?

Now Apple has taken over Authentec fingerprint sensors... which have been used in competing phones and PDAs for years.

Like I said, Apple needs to be able to show, i a reasonable amount of time, that they are attempting to bring the patent to market. Do they have prototypes? Do they have R&D heavily invested in the patent? That's only half the problem though. Their is too low a bar set for receiving a patent. Patents for "Method for receiving audio wirelessly" shouldn't be granted. Companies like to dress up patents with fancy jargon, but in the end, Tesla / Marconi invented that, and the patent is long since void.

[theBB]

Originally Posted by tbrinkma

What would be the benefit for your company paying the actual inventor to sue someone? Such an arrangement is sketchy at best from a legal perspective, and it puts all the risk on the inventor, while the only way a company would go for it is if it got all the reward. That's a tough sell.

Sketchy at best? Why? Let's say I am the patent troll of today, not making anything, but buying patents of questionable value and suing others to get at least some nuisance value settlements. Now, instead of buying the patent, I get into partnership with some of the vastly more numerous inventors (compared to the more limited number of employers) so that I represent them in lawsuits against the exact same targets. If I win, I will get a large portion of the settlement by charging the inventor expenses and commissions against the settlement money. Completely legal and I really don't see how you made anything better.

It would be *much* easier, safer, and less expensive for the company to simply negotiate an exclusive license to the patent in the first place.

Same story if I am the employer of the inventor. If I have an "exclusive license", nobody else can use that idea in any product. Inventor may own the patent on paper, but if the employer has an exclusive license, it can sue anybody using that idea. Eventually I can sell my zombie company with the exclusive license, wielding the actual power of the lawsuit, even though the inventor owns the patent on paper.

If you want companies to just get licenses to practice without any exclusivity, well that is what Lodsys and every other troll is offering: "Just pay me some money and I'll go away."

As I've said before, your rule (3) does not make any improvement.

[tbrinkma]

Originally Posted by theBB

Sketchy at best? Why? Let's say I am the patent troll of today, not making anything, but buying patents of questionable value and suing others to get at least some nuisance value settlements. Now, instead of buying the patent, I get into partnership with some of the vastly more numerous inventors (compared to the more limited number of employers) so that I represent them in lawsuits against the exact same targets. If I win, I will get a large portion of the settlement by charging the inventor expenses and commissions against the settlement money. Completely legal and I really don't see how you made anything better.

So your hypothetical inventor has nothing better to do than risk large amounts of money, and waste large amounts of time in order to make large amounts of money for a company who serves no purpose other than to encourage them to do so?

You're forgetting that the patent-troll companies right now don't *have* any more (or fewer) employees than they'd have in your scenario. They're legal entities which exist for no purpose other than the filing of law suits.

And yes, sketchy. If you don't actually own the copyright/patent in question it takes some serious legal finagling to be able to sue on behalf of the owner *without* exposing the owner to potential legal repercussions. Law firms, for example, act explicitly as *agents* of their clients. If they do something, it can come back to bite the *client* legally unless there's a solid paper trail of the lawyer acting against the wishes of the client (which opens them up to malpractice claims and potential disbarment).

See Righthaven for an example of how well this works when you have an entity without ownership rights suing third-parties for violations. (Copyright and patents are different, but similar enough for comparison in this scenario.)

Originally Posted by theBB

Same story if I am the employer of the inventor. If I have an "exclusive license", nobody else can use that idea in any product. Inventor may own the patent on paper, but if the employer has an exclusive license, it can sue anybody using that idea. Eventually I can sell my zombie company with the exclusive license, wielding the actual power of the lawsuit, even though the inventor owns the patent on paper.

An exclusive license to practice the patent does not convey the right to sue over someone else using the patent. The legal right to sue for violation of copyrights and patents is explicitly reserved to the *owner* of the patent.

Originally Posted by theBB

If you want companies to just get licenses to practice without any exclusivity, well that is what Lodsys and every other troll is offering: "Just pay me some money and I'll go away."

As I've said before, your rule (3) does not make any improvement.

Well, let's just say your misunderstanding of things doesn't make rule 3 bad.

[theBB]

Originally Posted by tbrinkma

So your hypothetical inventor has nothing better to do than risk large amounts of money, and waste large amounts of time in order to make large amounts of money for a company who serves no purpose other than to encourage them to do so?

Inventor would not be not risking anything. The setup would be similar to the proverbial ambulance chasing lawyers. The lawyers risk the cost of litigation and gets a chunk of the rewards if they win.

You're forgetting that the patent-troll companies right now don't *have* any more (or fewer) employees than they'd have in your scenario. They're legal entities which exist for no purpose other than the filing of law suits.

Of course they don't, because there are not any artificial barriers to trading patents as in your proposal. As I said, lawyers can take on the inventors as clients, just as easily as trolls buying the patents and suing other companies.

An exclusive license to practice the patent does not convey the right to sue over someone else using the patent. The legal right to sue for violation of copyrights and patents is explicitly reserved to the *owner* of the patent.

Copyrights and patents are different animals. I don't see how conflating the two gets you to an answer, but let's play that game. When an author grants an "exclusive" copyright to the publishing house, the publisher gets the right to sue for violations. They don't beg the author to sue instead. (If there is a parallel between copyrights and patents, your assertion has gone right out of the window.) You might want to read up on Righthaven cases a bit more to understand why it got into trouble with its lawsuits.

You cannot grant an exclusive license to somebody and just shrug when other people violate the same patent. Otherwise, what would be the difference between buying one of many licenses and an exclusive license? One way or another there will be a lawsuit.

[djphat2000]

Originally Posted by Forkjulle

Not true. How do you know that I copied your idea? Can you prove that I didn't also happen to come up with the same idea? (The burden of proof lies with you, since it is you making the accusation.) Also, people think up the same stuff often, and have done so throughout history.

Secondly, so what? Carry on making your product and use your resources to get to the market first. Consumers will reward your hard work by giving you market share and sales. If the copycat gets more sales than you, then you'd need to ask why; are you doing something wrong? Are you charging too much? Is your advertising subpar? And consumers aren't stupid; they'll figure out which is the knock-off and which isn't. (They always do.)

Protecting (via the government) your IP will only keep costs up and competition down.

You prove it by getting it patented. FIRST. It's not a perfect system. But, its what we have.

[Forkjulle]

Originally Posted by djphat2000

You prove it by getting it patented. FIRST. It's not a perfect system. But, its what we have.

What you're saying is that, whoever rushes to the patent office first, is proof of who conceived the idea first.

That's very clumsy.

The simplest option, IMO, is to ignore patents and just carry on innovating, making money, and persuading consumers to buy your product (marketing). So what if others copy? If your product is superior, then consumers will buy it.

The amount of money spent on patents, state protection, and lawsuits is absurdly high and, in the end, it's the consumer who pays for it in more ways than one.

[djphat2000]

Originally Posted by Forkjulle

What you're saying is that, whoever rushes to the patent office first, is proof of who conceived the idea first.

That's very clumsy.

The simplest option, IMO, is to ignore patents and just carry on innovating, making money, and persuading consumers to buy your product (marketing). So what if others copy? If your product is superior, then consumers will buy it.

The amount of money spent on patents, state protection, and lawsuits is absurdly high and, in the end, it's the consumer who pays for it in more ways than one.

That's utter crap. If you make a product and I can come along and copy it freely and maybe even do a better job. That just screws you out of having made it first. Yes, its a race to the patent office. Unless someone can figure out a way of inventing something that instantly then gets transmitted to the patent office. There by making the person whom invented it first 100% guarantee that there idea/invention gets the credit and possible patent first.


Rule, if you invent it . Go get it patented immediately. Its the only way we got right now, its broken in many ways. But, if you want to have that patent to protect your idea from being stolen, its what we got.

[Forkjulle]

Originally Posted by djphat2000

That's utter crap. If you make a product and I can come along and copy it freely and maybe even do a better job. That just screws you out of having made it first. Yes, its a race to the patent office. Unless someone can figure out a way of inventing something that instantly then gets transmitted to the patent office. There by making the person whom invented it first 100% guarantee that there idea/invention gets the credit and possible patent first.


Rule, if you invent it . Go get it patented immediately. Its the only way we got right now, its broken in many ways. But, if you want to have that patent to protect your idea from being stolen, its what we got.

If I invent something and you come along and improve on it, then that means that I didn't do a good enough job and have an incentive to strive for excellence (to avoid such mediocrity on my part).

If I invent something and you come along and improve on it, then that means that the consumer wins by getting a better product (and cheaper, thanks to competition). If I invent something mediocre and want to criminalise you for improving on it, then we all lose in the end.

[djphat2000]

Originally Posted by Forkjulle

If I invent something and you come along and improve on it, then that means that I didn't do a good enough job and have an incentive to strive for excellence (to avoid such mediocrity on my part).

If I invent something and you come along and improve on it, then that means that the consumer wins by getting a better product (and cheaper, thanks to competition). If I invent something mediocre and want to criminalise you for improving on it, then we all lose in the end.

That would depend on what the improvement was. Say it was the incandescent light vs Florescent light. Anyone could argue they are doing the same thing "lighting up a room" or whatever. But the way they work "IS" different. It could also be considered an improvement over the incandescent bulb. Same with LED or Neon/Xenon etc. Not taking the incandescent bulb and say, putting a gas in the bulb (vs a vacuum), and making it last longer. Someone should get credit for improving it, but certainly not get a new patent for it. Unless said person invented a new "gas".

[Forkjulle]

Originally Posted by djphat2000

That would depend on what the improvement was.

The improvement is determined by the market. Consumers will decide.