Assignment 11B: Nest Cuts Deal with Devil to Fight Competitor

The term, "patent troll" generally holds a strong negative connotation, conjuring images of an office building empty of employees but filled with cash. However, patent trolls hold the tools necessary to fend off enemies, as can be seen in the case of Honeywell v. Nest.

As many of you might know, Nest is known for disrupting the traditional thermostat business, selling clean, modern-looking, and innovative products. It currently holds more than 200 patents in its arsenal. However, in 2012, it was sued by Honeywell, a major competitor in the thermostat industry, on the basis of patent infringement. According to Techcrunch, the suit "alleges Nest Labs infringes on several of Honeywell’s patents involving thermostats." To fight Honeywell, Nest engaged in a patent licensing deal with Intellectual Ventures (IV).

This controversial move has a number of benefits:

• It allows Nest to keep its current momentum as a fast-growth, innovative tech company.
• It augments Nest's current IP portfolio.
• It protects Nest from IV and other patent trolls from patent infringement cases.
• It protects Nest from its competitors from patent infringement cases.

The last bullet point is extremely critical, especially in the current case against Honeywell. Honeywell sued Nest, demanding that Nest cease and desist as well as pay for damages. This amounts to a huge sum of money and as Honeywell has the financial resources and time to fight Nest, Nest most likely cannot settle. 

Assignment 11A: Technology Adoption Lifecycle

Efrat Kasznik in class talked about this graph, otherwise known as the Technology Adoption Lifecycle (TALC) which depicts the progress of a company's product through its life stages as it relates to IP. The area under the graph is the number of customers using the product.

• In the beginning, people using the product are innovators who are the most excited to try out the new product. These people are generally more educated, prosperous and risk-oriented.
• In the second stage, early adopters are usually be younger, more educated, tended to be community leaders, and less prosperous.
• The early majority are more conservative but open to new ideas, active in community and influence to neighbours.
• The late majority are older, less educated, fairly conservative and less socially active.
• Finally, the laggards are very conservative, the least well-off, the oldest, and the least educated.

As you can tell, the user base of a product grows more conservative, less educated, and less active as time goes on. This trend can be seen in multiple industries; one that comes to mind is the desktop market. As time went on and substitutes became more widely available, the majority of people today who use desktops tend to be of the older generation. 

Assignment 10B: Kirby Ferguson on the Idea of Remix

Good artists copy and great artists steal. Even visionaries like Steve Jobs agree to the concept and idea behind this phrases. However, the controversy begins when these great artists get stolen from. Steve Jobs in 2010 publicly announced a war on Android because he believed that the company had stolen the technology from Apple.

Especially regarding the music industry, we all realize that many products are simply "remixes" of others, incorporating lines of code, lines of lyrics, or components of other products. On one side of the coin, this is clearly copying or stealing the innovation of another. On the other side of the coin, improvements are necessary for advancement. If the human race had not improved upon the original invention of the chair, then we would have constant back pains or even stunted growth.

As such, the patent system should be revised so that the infringement conditions be clearly defined and more reasonably measured. This way, innovation in the form of remixes will not be treated as infringement and thus be welcomed as a source of new inventions.

Assignment 10A: Ellen 'T Hoen on Medical Patents Pool

The Medical Patents Pool is a great idea on paper. It is a voluntary mechanism that lets participating pharmaceutical companies such as Gilead to license its medical patents to allow generic manufacturers to produce and sell the medicine. While Gilead does get a royalty for each sale, the question of whether the costs incurred to research and develop the patent will be covered by these royalties and Gilead's sales.

Even if Gilead does manage to break even, it still must make a certain level of profit in order to satisfy its stakeholders. If it doesn't project that licensing will result in this, then it has no incentive to participate. But it did, which is good news for both parties.

However, in the long run, we must seriously consider Hoen's words. Hoen, at the end of her talk, basically says that pharmaceutical companies must do it now or governments will force them to do it later. This is an ultimatum, not to be taken lightly. With the enormous multitude of countries and forms of government, bio-pharmaceutical companies need only to move their operations to another geographic location to avoid government pursuers.

Assignment 9B: Silly Patent 2 [Method and system for increased realism in video games]

U.S. Patent No. 8,529,350, “Method and System for Increased Realism in Video Games” is owned by a patent troll, White Knuckle. The patent itself involves "remotely updating a sports video game based on real-world events—a player injury or a change in a stadium, such as new grass." The patent covers a "computer 'configured' to 'provide a sports video game' with 'parameters' that can be updated over the Internet."

The funny thing is that White Knuckle did not invent computers, sports video games, the Internet, or software that allows updates from a server. However, it claims to have invented a system that involves all of these components. The USPTO gave White Knuckle the patent rights on the grounds that the specific application of these elements on a single idea (updating sports video games using software over the Internet) is enough to grant White Knuckle the rights.

This is clearly abuse of the patent system by trolls. White Knuckle used this patent to sue Electronic Arts among other video game companies on the basis of patent infringement. The troll, much like the one in my other post, received settlement money from more than a few companies because the patent covers all software that allows for system updates over a live server.

Assignment 9A: Silly Patent 1 [Method and apparatus for an automatic vehicle location, collision notification, and synthetic voice]

U.S. Patent No. 6,442,485, “Method and apparatus for an automatic vehicle location, collision notification, and synthetic voice," was filed in 1999.

The "Background of Invention" depicts a method and device that speaks for a driver involved in a collision and transmit location details to 911. At first glance, this is a really good idea, especially because many collisions may render the victim(s) unable to pick up their phone or even speak. However, everything after the background is vague and clearly fabricated with no substantiation. 

The patent includes phrases such as “Location Comparator-Indicator Module” and “Automatic Speed Controlled Location Detection Module” with no description as to what they are or how they operate. There is no prior art or any information on the internet supporting these phrases. Furthermore, key terms in the claims do not show up in the invention description. Overall, this patent is exceedingly hard to decipher or understand. Despite all this, the patent was successfully given to NovelPoint Tracking LLP.

NovelPoint Tracking LLP has proceeded to sue around 100 companies using this patent as a basis for infringement. These companies include Subway, McDonald's, and Burger King. Can you guess why? Novelpoint accused these companies for infringement because their mobile applications allow users to check their physical locations and communicate their information to the restaurant. Despite these two industries being vastly different, NovelPoint was able to receive settlement money because the patent covers all sorts of GPS technology.