VirnetX Wins Another $502.6 Million Award From Apple in Patent Trial

[ani4ani]

Well, anyone who's done even the tiniest bit of research knows that people come up with remarkably similar solutions to common problems, in isolation from one another, all the time. So patent trolling is nothing but ******* irritating, and risks thwarting innovation... Worse, it risks limiting innovation to companies with very deep pockets for paying legal fees (yes, like Apple). And who actually runs off with the money? ******* LAWYERS. What a joke. Infuriating. Besides that, there are probably a dozen ways to do what they're claiming Apple stole, none of which would significantly impact the value of FaceTime, which is entirely down to its simple design and the fact that it's tied into the Apple device ecosystem. The concrete value of the IP is equal to approximately **** all... (Certainly not $1B.)

Well good, then there is no need for Apple to infringe...they just, in isolation, come up with a remarkably similar solution.
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I’m so bloody fed up with the patent system! Invent it, use it, or lose it. Good lord, I loathe these leeches who only exist to suck money out of someone else’s work.

I own land, but choose not to grow crops, or build things on it, it doesn't mean someone else can!

 

[tongxinshe]

I don’t buy that definition. IMO, the actions taken by owners of patents is what defines them as trolls, not the organization of their company. A company that make products could act like a troll and a company that only owns patents could behave ethically and not be a troll.

If I’m a small independent inventor, and I come up with a new invention, then I’m supposedly a patent troll because I don’t actually manufacture anything? What if I want to license my invention to a large company, because I don’t have the millions (or billions) required to go into production? Suddenly I’m a troll just for creating something but not producing it myself?

You need to read the whole thread before refuting. He actually expressed the meaning clearly. In short, patent trolls are those who meet ALL of the description below:
1. are not original creators of the patents;
2. hold a lot of patents ranging many different areas;
3. never try to create actual products using any of these patents;
4. don't try to persuade other companies to implement their patents into their products and earn money from that;
5. try to monetize from successful products ONLY AFTER they've been on the market for years.

 

[tobyw7]

We all know that this is pocket money to Apple. Not ideal, but not going to hurt them in any way, shape or form.

 

[CrystalQuest76]

It's not where you sell the product. The patent troll companies set up a "local office" to establish a legal presence there. What they are really doing is renting a cheap office which is not actually occupied and is completely empty and unused. To save money, hundreds of them actually use the same office address.

The town specifically is Marshall, TX. The town receives a heck of a lot of "coincidental" donations and philanthropy from companies that just happen to be involved in patent lawsuits there, which of course are totally-not-bribes.

This town has become so infamous that an episode of a tv show called "Bull" made it the center of a plot.

 

[old-wiz]

I often wonder if the judges and juries in East Texas get a little bonus "gifts" from the trolls?

 

[travelsheep]

So the only thing VirnetX ever did was register a patent? And now employing lawyers to get money for nothing?

 

[kdarling]

What patents does Apple litigate that they’re not using?

Just last year, Apple sued Samsung over a claimed method that Apple themselves don't use.

And of course, there was the infamous Rockstar troll that Apple helped created to do nothing but sue others (Google in particular) over the extra Nortel patents Apple gave it.

You need to read the whole thread before refuting. He actually expressed the meaning clearly. In short, patent trolls are those who meet ALL of the description below:
1. are not original creators of the patents;
2. hold a lot of patents ranging many different areas;
3. never try to create actual products using any of these patents;
4. don't try to persuade other companies to implement their patents into their products and earn money from that;
5. try to monetize from successful products ONLY AFTER they've been on the market for years.

Well, then VirnetX is in no way a troll by that definition.

1. VirnetX is greatly owned and run by the inventors of its core patents.
2. Their patents are all about internet security.
3. They wrote and sell code libraries. Software IS a product, you know.
4. They market their libraries and licenses.
5. For those who don't know, Apple traditionally does not respond to outside licensing requests. They prefer to wait for a lawsuit.

In short, VirnetX is an American entrepreneur success story. The guys who invented the patents decided to quit their jobs and buy back their patents from the places they worked, so they could set up shop licensing what they had invented to everyone.

 

[Kabeyun]

I own land, but choose not to grow crops, or build things on it, it doesn't mean someone else can!

An articulate discussion of false analogies.

 

[Michael Goff]

Just last year, Apple sued Samsung over a claimed method that Apple themselves don't use.

And of course, there was the infamous Rockstar troll that Apple helped created to do nothing but sue others (Google in particular) over the extra Nortel patents Apple gave it.



Well, then VirnetX is in no way a troll by your definition.

1. VirnetX is greatly owned and run by the inventors of its core patents.
2. Their patents are all about internet security.
3. They wrote and sell code libraries. Software IS a product, you know.
4. They market their libraries and licenses.
5. Apple traditionally doe not respond to outside licensing requests. They prefer to wait for a lawsuit.

I’ll be honest, I forgot the Rockstar thing existed. Thanks for reminding me.

 

[oneMadRssn]

You need to read the whole thread before refuting. He actually expressed the meaning clearly. In short, patent trolls are those who meet ALL of the description below:
1. are not original creators of the patents;
2. hold a lot of patents ranging many different areas;
3. never try to create actual products using any of these patents;
4. don't try to persuade other companies to implement their patents into their products and earn money from that;
5. try to monetize from successful products ONLY AFTER they've been on the market for years.

By this definition, most research universities would be considered "patent trolls." Also, most bankruptcy entities trying to settle debts would also be considered "patent trolls."

I would delete #5 since it is irrelevant and the law (shackles, unclean hands) already provides that law suits have to be filed reasonably promptly, and also since we don't want to put pressure on lawyers to hastily file lawsuits without doing enough due diligence.

I would add "try to settle for nuisance values such as cost of litigation, and have no plan for taking the case all the way to trial and through appeals."
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I own land, but choose not to grow crops, or build things on it, it doesn't mean someone else can!

This is a really good analogy, I like to think of infringement as analogous to trespass, so this fits quite well.

 

[Tech198]

Gotta hand it to Apple... They put up a good fight. Any other company would have accepted defeat by now.

 

[cmaier]

I get the distinct feeling that the posters yapping about "having to make something with the patent" have never invented or patented anything.

LISTEN UP, ALL OF YOU WHO THINK YOU SHOULD NEED A PRODUCT TO OWN A PATENT:

Let's say that YOU invent a new way of saving battery power in a smartphone. You patent it. But you cannot afford the millions of dollars it would take for you to build and sell a smartphone yourself.

So what do you do? Well, duh, you sell or license your invention to anyone who wants to use it in their product. Or if you're really not into spending your life tracking down clients and selling to them, you sell or license your invention to a patent holding company which has the resources to do the marketing for you. (This is pretty much what universities do internally.)

Licensing your invention to anyone who wants it, is contributing to society. NOT LICENSING IT would NOT be contributing. And of course companies are free to NOT use your patent if they don't want to.

So there's nothing wrong with not making a product yourself. This is AMERICA AT ITS BEST, letting even the small guy make a living from his inventive labors.

WHAT APPLE DID WITH VIRNETX:

Later you discover that a major company is using your method without paying for a license from you. So you offer them a license. But they instead call in their lawyers who do the usual claims that it's not a valid patent, and even if it is, it's not worth what you want for it.

Problem 1: Apple itself had tried to patent at least one of the methods, but found that they could not because Virnetx already had a patent. One of their engineers even admitted it, before Apple's lawyers tried to withhold his testimony. Ooops! Proof of willful infringement of a method that even Apple had thought was patentable.

Problem 2: Apple then claimed that it would cost them too much to switch to a different method. Ooops again. Proof that the patent really was worth money after all.

UPSHOT:

Folks, someone who licenses a patent freely to anyone for a fee is not evil. They're making a legitimate living and offering their invention to those who want to enhance their products. It might even be you, if you're creative.

Unfortunately big companies can use legions of lawyers to try to get around paying you. Sometimes that works, sometimes it doesn't.

FWIW, the fact that Apple thought it was patentable, if true, is irrelevant. And the fact that switching methods would “cost too much” ranges from irrelevant to slightly relevant, depending on the components of the cost.

 

[Tech198]

Its more about protecting your own methods...

Why should u just hand something off, you clearly do not care about how what you've done...?

Besides, in these types of cases, you have something to go on if someone "violates" something. If you give it away for free, you can't fight anything, because "everyone would would your own creativity" and no one can benefit from anything.

That would mean, nothing to prove.

 

[Lyoha]

Whilst that may be right, do two wrongs make a right, I mean someone being a patent troll makes it Ok for you to steal something they own does it?

1) Given that VirnetX's patents have been ruled as invalid, I would seriously question the ownership of whatever it is VirnetX is claiming to own.

2) Law != ethics in everybody's minds. I don't consider software patents ethical even if they are legal.

 

[oneMadRssn]

2) Law != ethics in everybody's minds. I don't consider software patents ethical even if they are legal.

What about software patents is unethical? How is your reasoning any different on mechanical patents, electrical patents, or life sciences patents?

Also, consider that the software startup culture wouldn't exist if it weren't for investors throwing money at software engineers, knowing that worse case scenario at least the IP will have value if the business ultimately fails. No patents > much more conservative investment > no software startup culture.

 

[Swift]

VirnetX originally had 4 patents related to LTE. They have never used one to sell an actual product. They have over 100 now. Nothing they created, just bought up. 90% of their employees are lawyers.

They define the term "Patent Troll".

Wait, where is these trials taking place? That berg in East Texas that makes all its money on the lawyers coming to town? Beagle, Beagle & Cowflop? I think we could spare an awful lot of foolishness if we just made a company that never produces anything through its patents except lawsuits illegal. The inventor, number one. Companies that use the patents to make stuff and sell things to the public? Number two in line. The cheap swindlers who buy up often unused patents, even superseded ones, and whose expertise is only in the courtroom and houses of ill repute, well, you can just declare that business an illegal hustle.
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What about software patents is unethical? How is your reasoning any different on mechanical patents, electrical patents, or life sciences patents?

Also, consider that the software startup culture wouldn't exist if it weren't for investors throwing money at software engineers, knowing that worse case scenario at least the IP will have value if the business ultimately fails. No patents > much more conservative investment > no software startup culture.

Please, these guys are unethical patent hoarders. They do this for one reason: to collect money. No startup, no inventor or creative engineer gets squat. This is sheer gouging. The patient system was created for inventors and innovators to be protected in the first years of their venture. These guys, I guarantee, have bought up a number of patents with no intention to do a thing but to sue. They give the patent system a black eye, and they should be drummed out of business and have all their money taken away and given to startups and engineering companies. They can have the patent to use them, not to sue.

 

[Mirice99]

VirnetX is in litigation with every company Apple, Google, Microsoft for Skype and Cisco. The company has 80 DNS and Networking patents, and not even a single implementation of those, and their royalty rates are quite high http://www.virnetx.com/licensing/royalty-rates-and-guidelines/

So the thing is its not cool if you have a hand-drawing of a car and other people have actually made a car but you dont want them to drive their car because you think you drew it , somehow you have the right to stop others from making a car unless they award a door from every car they ever make to you. Until then everyone is infringing on your drawing of the car.

That is just crazy!! And VirnetX is using this crazy broken Patent system. They will go ahead and take this money from every company involved in video conferencing type applications.

My neighbor has alot of land he bought as an investment from a real estate broker who planned to developer a row of houses but lost funding. Right now he isn't using it and doesn't actually plan on developing or doing anything with it so I guess i can take it over and use it how ever i see fit while not pay him anything and when he gets upset people like you will defend me right?

 

[cmaier]

My neighbor has alot of land he bought as an investment from a real estate broker who planned to developer a row of houses but lost funding. Right now he isn't using it and doesn't actually plan on developing or doing anything with it so I guess i can take it over and use it how ever i see fit while not pay him anything and when he gets upset people like you will defend me right?

https://en.m.wikipedia.org/wiki/Adverse_possession

 

[llarson]

Take a lesson from Samsung. Keep appealing and it will go away eventually.

The cases were heard in east Texas a well known patent troll venue. East Texans have turned jury trails into a business by finding in favor of patent trolls.

 

[kdarling]

Please, these guys are unethical patent hoarders. They do this for one reason: to collect money. No startup, no inventor or creative engineer gets squat. This is sheer gouging. The patient system was created for inventors and innovators to be protected in the first years of their venture. These guys, I guarantee, have bought up a number of patents with no intention to do a thing but to sue.

None of that is true in this case, because unlike with companies that many people consider trolls...

The core VirnetX owners and officers ARE the inventors of the core patents that they license.

Basically, a group of American inventors realized they had done something valuable back around the turn of the century, so they quit their jobs and bought the patents they had previously assigned to their employers while working for them.

Then they formed VirnetX to promote and license what they had invented, along with code libraries they wrote, and yes, some related patents they bought.

 

[oneMadRssn]

Please, these guys are unethical patent hoarders. They do this for one reason: to collect money.

1. Making money isn't unethical.
2. They paid money for the patents, why shouldn't they be allowed to make money from them? If a grocery store buys a pack of soda for $1 and tries to sell it for $2, is that also unethical?

No startup, no inventor or creative engineer gets squat. This is sheer gouging.

Wrong. The inventors and innovators got paid when they sold the patent rights.

The patient system was created for inventors and innovators to be protected in the first years of their venture. These guys, I guarantee, have bought up a number of patents with no intention to do a thing but to sue. They give the patent system a black eye, and they should be drummed out of business and have all their money taken away and given to startups and engineering companies. They can have the patent to use them, not to sue.

The patent system exists today to lubricate investment. How else can a startup create valuable assets out of thin air, which they can use as collateral to get investors?

Here is what happens 75% of the time. A startup has a great idea, develops it, and patents it. They get investments, based on that IP. Engineers get a salary, people get paid. They fail, most startups fail. They file for bankruptcy. The bankruptcy estate sells all the assets, as they're supposed to do, to repay the investors as much as possible (investors still lose overall, but less). A patent aggregator buys the patents from the bankruptcy estate and pays value for them because they can sue.

What about the above is wrong? Don't you understand that if patent aggregators can't sue, then patents have no value, then bankruptcy estate can't sell them, then the inventors will not invest, then the startup doesn't get investment?

 

[kdarling]

Wrong. The inventors and innovators got paid when they sold the patent rights.

In this case, the core inventors are the ones who started VirnetX, and some are company officers. All own stock.

So when VirnetX patents are licensed, the actual inventors (and those who invested in them) get paid.

 

[cmaier]

In this case, the core inventors are the ones who started VirnetX, and some are company officers. All own stock.

So when VirnetX patents are licensed, the actual inventors (and those who invested in them) get paid.

Even if that weren't the case, the actual inventors wouldn't get paid unless the buyer could assert the patents.

 

[oneMadRssn]

In this case, the core inventors are the ones who started VirnetX, and some are company officers. All own stock.

So when VirnetX patents are licensed, the actual inventors (and those who invested in them) get paid.

Right, of course. My more general point was, inventors always get paid in these sorts of transactions. (Noting that often the inventor/innovator is the corporation with employees that must assign their rights as a condition of the employment. But said employees have steady jobs with benefits).

I think the larger thing people don't understand is that these patent assertion entities provide a very important and necessary market function. They give value to IP by enforcing it. Without them, a lot of funding that goes to innovation, which depends on the value of IP being high, would dry up.

The only PAEs I would consider trolls are the ones that target unsophisticated entities (small businesses, individual people) and bully them into low-value / cost of litigation settlements. Those are not actually helping the market, and are more parasitic in their business practice.

I represented a defendant once against such a troll. My client said they refused to settle no matter what. The troll first offered $1mil, then $500k, then $200k, then $100k. I hadn't given a single counter-offer at this point. They demanded a counter, I said $0 and we won't invalidate your patent. They returned with $80k. We invalidated their patent, but it cost us well over $150k.

Going from $1mil to $80k in settlement offers show they didn't give a squat what the patent was worth, they were just trying to extract whatever cost of litigation nuisance money they could. They are bum. But there are actually very very few PAEs like that in my experience. Most know what their stuff is worth, and they'll take you all the way to prove it.

 

[kdarling]

Even if that weren't the case, the actual inventors wouldn't get paid unless the buyer could assert the patents.

Makes sense. So patent holding/assertion companies don't usually pay anything up front?