Patent Law and Disorder: The Trolls Are At It Again
What do Apple, Microsoft, Google, and Facebook have in common with ADT Security, the Cartoon Interactive Group, Walt Disney, and Wal-Mart? They're among the 138 companies being sued for patent infringement by Walker Digital.
Founded by Jay Walker, creator of Priceline.com, Walker Digital owns more than 400 U.S. and international patents, and now it's cashing in. This week, it filed 15 suits against the biggest names in and out of high tech.
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For example, Walker Digital is suing pretty much every company that has ever made or sold a GPS system or handheld mapping device with turn-by-turn directions, among them Apple, Google, Microsoft, BMW, Samsung, MapQuest, and Telenav. Why? Because it's claiming they allegedly violate WD's Patent No. 06199014 "System for Providing Driving Directions With Visual Clues."
The patent describes the process of showing a picture of a place next to where it might appear on a map, based on its GPS coordinates. A neat idea? Sure. An original one? Probably not, and the method it describes doesn't strike me as particularly ingenious. But Walker Digital got its patent application in first, which is all that seems to matter.
Or take the suit it's filed against Amazon, Groupon, Living Social, and eight other online discount houses. Among other things, WD is accusing these companies of violating Patent No. 6249772, "Systems and Methods Wherein a Buyer Purchases a Product at a First Price and Acquires the Product From a Merchant That Offers the Product for Sale at a Second Price."
Imagine, for example, you had patented a System for Distributing Processed Dairy Products Over Boiled or Baked Grain-Based Foodstuffs, with a related patent for the Application of Smoked Fish to Grain-Based Foodstuffs. You'd now be in an excellent position to sue every bagel shop in the country that sells cream cheese and lox -- or at least get them to (ahem) fork over licensing fees.
Per Walker Digital's press release announcing the suits:
"Filing these lawsuits is not a step we sought or preferred," said Walker Digital's CEO Jon Ellenthal. "We have reached out to a wide range of companies that are engaging in commercial activities that clearly depend on inventions created and owned by Walker Digital. Unfortunately, many of these companies have refused to engage in meaningful negotiations that acknowledge the market value they derive from the use of our property," Ellenthal continued.
According to Ellenthal, "Patent protection is a key part of our business model. It provides us with a period of exclusive ownership during which we can recoup our investment in innovation and generate the profits necessary to continue our invention efforts."
Let me translate: Walker Digital said, "Hey, you make a GPS product that shows pictures of places -- you have to pay us or we'll sue you." The companies told Walker to take a hike (with or without visual cues); now here's the lawsuit.
To be clear, unlike pure patent trolls, Walker Digital has actually invented and marketed products, not just simply snapped up another company's portfolio in an effort to make a few bucks off someone else's hard work. Priceline, for example, is a truly innovative service that has totally changed the travel industry (and saved me buckets of money on hotels, I might add).
But is this what the patent system was created for? I don't think so. Yet there seems to be a new multi-million-dollar patent suit every damned week, usually over business processes whose paternity is suspect at best. That's why Google and Microsoft are fighting to get control of Nortel's patent portfolio. They want to insulate themselves against lawsuits, essentially telling the world, "If you sue us for violating your patents, we're sure to find a patent you violated and sue you, so back off Jack."
Patent law was designed to protect inventors and innovators, not as a tool for extortion. But that's what it's become. How patents are issued and what can be done with them needs to change -- before we're all sued for common acts we perform every day.
Who would you sue for patent infringement? File your briefs below or email me: email@example.com.
This article, "Patent law and disorder: The trolls are at it again," was originally published at InfoWorld.com. Track the crazy twists and turns of the tech industry with Robert X. Cringely's Notes from the Field blog, and subscribe to Cringely's Notes from the Underground newsletter. For the latest business technology news, follow InfoWorld.com on Twitter.