Patent Troll Suing FTC, Claims Constitutional Right to Threaten Lawsuits Over Alleged Patent Infringement

careful, might be patented"Office Space"/FoxThere’s a certain way to scan documents and e-mail them that MPHJ Technology Investments says it holds a government-awarded patent for. The company, a so-called “patent assertion entity” or troll, is accused of threatening to sue companies for infringement if they don’t pay a thousand dollars per worker, according to Legal Newsline, which reports that MPHJ is now suing the FTC to stop the FTC from suing it for “unfair trade practices,” or threatening to sue patent infringers without actually intending to. Outside of the lawsuit, MPHJ claims free speech protections, too. Via Legal Newsline:

In a corporate statement last week, MPHJ said it believes the FTC has decided it simply does not like the free speech in which the company is engaged and is seeking to interfere with or stop that speech.

“The FTC does not contest that MPHJ’s patents are valid, that they may be are infringed by thousands of businesses, that MPHJ has the right to enforce its patents against those infringers, that MPHJ has a right to send letters in doing so, and does not contest that MPHJ has the right to threaten suit for infringement,” the company said in its statement.

Legal Newsline notes a September ruling by a federal judge that the attempt by the Nebraska attorney general to stop MPHJ’s law firm from sending cease and desist orders was a violation of the First Amendment, and patent law.

Indeed, while the “patent troll” MPHJ exists only to buy patents and then target perceived patent infringers, companies that hold patents to mundane-sounding processes like scanning documents for e-mail but actually also make things, in part using those patents, sometimes engage in trollish behavior as well.

Apple and Samsung have been engaged in a protracted legal war over smartphone technology patents for several years, with Apple also claiming Samsung’s phones and tablets copied Apple’s look and feel. The patents include processes like how to pinch your screen to zoom, again, mundane-sounding in 2014.

Patent laws, originally, were meant to “promote the Progress of Science and useful Arts,” as the Constitution describes them in one of the actually enumerated powers of Congress. Yet when fights like Apple and Samsung’s lead to dueling orders to prevent certain products from entering certain markets, it retards technological progress, as contrary to the stated aims of laws protecting copyrights and patents as a company that goes around threatening to sue office workers for the way they e-mail documents, because the government granted it a piece of paper granting it rights to that process.

The Supreme Court will be hearing a case on software patents specifically, where Ronald  Bailey argues the court could strike a blow for innovation by killing off the software patent.

Related video: Last February, Reason TV explored "How Patent Trolls Kill Innovation":

 

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  • thom||

    Somebody should patent a method for "threatening lawsuits over alleged patent infringement" and then go after these guys.

  • Rasilio||

    Actually you could very easily do such a thing if you should somehow show it was different from what other patent trolls are already engaging in

  • DJK||

    I'm not sure that you can. Algorithms are generally unpatentable. They only become patentable when tied to a machine for some purpose. Typing up a lawsuit and filing it in federal court doesn't really tie you to a machine. I suppose you could make the argument that you do it on a computer...

    Damn, software patents are stupid.

  • Rasilio||

    Algorithms might not be patentable but business processes are

  • DJK||

    Yep. SCOTUS did a good job of fucking that up in Bilski v. Kappos. They killed the Federal Circuit's "machine-or-transformation" test which would have allowed a business method patent only if it were tied to some type of machine or physical transformation.

  • Acosmist||

    Patent trolls are bad, so all patents are bad.

    2 is a prime number, so all even numbers are prime numbers.

  • Rasilio||

    Even if you accept the validity of Intellectual property there is no realistic way to accept the idea that any software written in a higher level language than assembler is worthy of a patent because every single one of them is obvious to anyone who knows how to code.

    There is nothing novel or unique about the size, shape, or location of a button on a screen or almost any other design or coding solution. You might be able to make an argument for things like hardcore mathematical search algorithims and the like to be patentable but since no one pirates those (there is just no value in advertising "hey we return the exact same results as Google so use us instead") it would be largely irrelivant.

  • entropy||

    That is true. Unless you wrote your own language and compiler (into assembler) it'd be like trying to patent something you assembled with legos.

    Speaking of which does anyone hold a patent on building a square house with lego blocks? Cuz if not I'm about to sue a whole bunch of toddlers.

  • ||

    "Ma'am, is this your infant son, Joe Jr.?"

    "Yes."

    "Joe, you just got served. See you in court."

  • Almanian!||

    LEGO PWN'D

  • Pro Libertate||

    Speaking of Legos, where will they be when consumer 3-D printing is commonplace? I mean, printing bricks out of some polymer has to be one of the easier applications. Not to mention that Legos are quite expensive, anyway.

  • Rasilio||

    I don't know that it will impact them much if at all. Even with commonplace 3d printing I suspect that most people would still rather leave the hard work of designing a kit to make a specific object to someone else and that will be the Lego company.

    Hell they could probably turn it into a secondary revenue stream, selling the print files they designed

  • Pro Libertate||

    I intend to make so many bricks that I can build a space elevator with them.

  • DJK||

    Wouldn't have enough tensile strength to withstand its own weight.

  • SugarFree||

    Wouldn't have enough tensile strength to withstand its own weight.

    And if it could, centrifugal force would pop the bricks apart.

  • Pro Libertate||

    Depends what I make my bricks out of!

  • Pi Guy||

    I'm pretty sure that, if you make the base wide enough, it could be made of balsa.

  • ||

    They could sell you a virtual kit that would contain the diagrams for all of the bricks you would need to build it. Then you just press "print".

    They've got a program now where you can virtually design pretty much anything you wanted. It would be really cool if you could design it and then they sell you the print diagrams and BAM custom designed and printed bricks.

  • ||

    The tolerance for the snap is too tight for 3d printing at present. And getting that smooth a surface finish requires a polished mold. Maybe someday, but not yet.

  • 110 Lean||

    (there is just no value in advertising "hey we return the exact same results as Google so use us instead. And we show porn while we search")

    What about now?

  • DJK||

    Also, SCOTUS has repeatedly held that general scientific principles, mathematical laws, and algorithms cannot be patented.

  • ||

    There is nothing novel or unique about the size, shape, or location of a button on a screen or almost any other design or coding solution.

    Says the Programmer and not the UI designer.

    I couldn't disagree more. The assembly of parts into a particular arrangement for use by another absolutely is a unique piece of intellectual property. Good UIs are copied all the time because of their value.

    Whether that IP should be protected by patents is a wholly different argument vs. whether it is IP in the first place. I don't happen to agree that patents encourage investment in software which might otherwise not occur. Replicating software is easy. Acquiring the staff who could maintain/improve on such replicated software is hard.

    The true value of software is rarely in the code. More frequently it is in the company and its employees who provide a home for the code.

  • Rasilio||

    I would agree that particular UI designs could be trademarked, not patented however and I doubt that there are many (any?) libertarians who have the same issues with trademark protections as they have with patents.

  • ||

    How much real difference is there between the two?

    For example, some would argue that copyright is sufficient to protect source code. But then, to what extent? If I re-write IF/ELSE to ?: is it new code? If not, when? That's the gap that patents end up filling, because they aren't as concerned with the specific text as the end result.

    I just happen to believe that the cost/benefit of patents just isn't there. The protections hinder, rather than encourage, innovation.

  • ||

    How much real difference is there between the two?

    Quite a bit. For instance, if you don't enforce your trademark, you can lose it, which makes "trolling" somewhat harder since you can't, for instance, sit on your trademark until the infringing entity happens to be making a lot of money.

    Trademarks are also much more specific. It is a lot harder to have problems with independent invention, whereas with patents, that is inevitable in many industries.

    For example, some would argue that copyright is sufficient to protect source code. But then, to what extent? If I re-write IF/ELSE to ?: is it new code? If not, when? That's the gap that patents end up filling, because they aren't as concerned with the specific text as the end result.

    Bullshit. If I translate Harry Potter into Cantonese without permission, I've still committed copyright infringement. Even pretty radical transformations are still derivative works and still subject to copyright.

  • DJK||

    I would imagine that all of the ancaps are opposed to all forms of IP.

  • Rasilio||

    But trademark is categorically different as it is a way of identifying the creator of something. If you infringe my trademark it is identical to your forging my signiture and a form of fraud.

    It is one thing to copy my product, it is something diffetent to sell a product not made by me claiming that it was, that is called fraud.

    Trademark protections are just an organized way of documenting and enforcing organizational "signitures" and most ancaps I have talked to have agreed that such a system would be needed in any environment government or not.

  • ImanAzol||

    Without IP, all creative process is done under a patron, as it was in monarchical Europe. Very libertarian.

  • ||

    Let's see, what caused the root of this problem in the first place? Oh, that's right, artificial monopolies enacted by government diktat.

  • WTF||

    So clearly this can only be fixed by more government diktat.

  • ||

    Of course. What other solution could there possibly be?

  • SweatingGin||

    Look, if you don't have government grants of monopoly, there won't be an INNOVATION! At all.

  • ImanAzol||

    Yeah. Even without a monopoly, plenty of pharmaceutical companies will be willing to drop a billion $ into developing, testing and approving a drug, so that some local lab can knock it off for $100 less per dose.

    Because they know that legitimate supporters and fans will happily pay the extra money to support their efforts.

    Because information wants to be free.

    Insert some other stupid shit from the "give me your stuff for free because it doesn't matter, and I want it" crowd.

  • ||

    So you're saying the answer is net neutrality?

  • ||

    Absolutely. The solution to government-created monopolies is always to just make the government the monopoly instead. It works every time!

  • Mr. Soul||

    government monopolies are heavy on "community chest" cards and light on "chance" cards but the railroads run on time.

  • ||

    Yeah, but Boardwalk and Park Place now cost $40TT when you land on them with a full compliment of hotels.

  • Rotbard||

    "artificial monopolies enacted by government diktat"

    Intellectual property is an "artificial monopoly" now? Huh. And the government "enacts" (grants) rights to property-owners, like a gift? Because without government, there's no such thing as property, or property rights? BRILLIANT.

  • ||

    Do..do you have a point, or are your ramblings just a function of your mental disease?

  • Almanian!||

    Uh, his PATENTED mental disease, Epi. Tread lightly, lest Patent Troll From Hell pay you a visit...

  • ||

    He managed to like, reverse-understand you in a sort of mind-bending way though. He managed to make you a statist in his mind.

  • entropy||

    Apple and Samsung have been engaged in a protracted legal war over smartphone technology patents for several years

    We need this to encourage invention. Nobody would invent smartphones if they weren't guaranteed the legal ability to sue each other over them.

  • Rasilio||

    The funny thing is the patent troll actually has a point here.

    Even though the threats should be laughed out of court if they ever came about they do have a 1st amendment right to threaten to sue

  • ||

    Indeed they do, and if they actually do sue, the defendant has the right to challenge whether there is infringement and whether the patent is valid in the first place. If they can afford it, of course.

    The root cause here is NOT the existence of patents, which are necessary for innovation, but the de facto absence of recourse for a successful defense.

  • entropy||

    Patents are not necessary for innovation. People innovated before there was such a thing as patents.

  • entropy||

    And honestly, if you're relying on a patent to protect you from competition, China is going to eat you for lunch anyway (they don't give a shit about patents), which is just as well.

  • ||

    That is patently untrue. They can copy all they want, but they have to sell it in the US and Europe. Oops.

  • DJK||

    I was going to reply along these lines. Moreover, China is becoming increasingly more protective of IP as its people come out of extreme poverty. There's no reason to believe that this trend won't continue as it becomes a first-world nation.

  • Pro Libertate||

    U.S. was home to massive piracy in the 1800s. But we got better.

  • Rasilio||

    You have a massive assumption in that statement which is no where near as guaranteed as you think.

    China's only chance of reaching 1st world status is for the Party to disband itself and even then they are still looking at a good 20 - 30 years to clean up the endemic corruption in their systems.

    Far more likely the US and most of Europe falls to what we now consider 2nd world status

  • Aresen||

    ...even then they are still looking at a good 20 - 30 years to clean up the endemic corruption in their systems.

    Given the rate at which we are becoming corrupt (Solyndra, anyone?), we may pass them coming up on our way down.

  • ||

    Yes, in the Dark Ages, there were no patents. Ditto in much of the non-European world. Lots of innovation from there, eh?

  • Aresen||

    Suggest you get a copy of James Burke's Connections and The Day the Universe Changed series. There was lots of innovation in Medieval Times. However, the Aristocracy and the Church did everything they could to discourage the lower classes (anyone not a member of the nobility) from bettering themselves, so there was precious little incentive to innovate.

    I also suggest you read up on Chinese technology ca 1000 CE. Lots of stuff there that would not be duplicated anywhere for hundreds of years. Again, the Imperial bureaucracy frowned on innovation and people 'rising above their station', so most of the technology was eventually lost.

  • ||

    I think communication and commerce was a wee bit different in 1000 CE.

  • ||

    "were"

    Jesus, I need coffee.

  • Aresen||

    True, commerce was much more restricted, especially in China, where the bureaucracy was a Bloomberg wet dream.

    My point was that, despite the lack of patents, there was innovation. However, it was heavily discouraged and therefore ideas languished and were forgotten.

  • DJK||

    Perhaps not necessary, but there's a very good chance that they're very helpful. One only need look at the pace of technological change from the age of invention of the wheel versus from the age of invention of the smartphone. It's pretty clear that the latter era, which includes well-developed patent systems, is much better under that metric. It may or may not be causal, but it's hard to make a prima facie case that it's not true.

    This is the problem with arguing from a utilitarian standpoint, which you do when you suggest that the outcome (innovation) is the important part. We get bogged down in trying to prove the negative. Much better to go from the standpoint of rights.

  • ||

    Much better to go from the standpoint of rights.

    But then you could argue, with the exception of reverse engineering, that it's also fully enforceable via contract law.

    Yes, that's a big exception. But with today's technology, it's not the same as reverse engineering a loom.

  • ||

    Someone didn't see Paycheck.

  • Diggit||

    Innovation is a consequence, not the prime reason, for IP rights.

  • ImanAzol||

    Which "person" will develop the next cancer treatment, in their garage, in their spare time, and give it away for free?

    Grow up.

  • entropy||

    And honestly, if you're relying on a patent to protect you from competition, China is going to eat you for lunch anyway (they don't give a shit about patents), which is just as well.

  • entropy||

    WTF?

  • LynchPin1477||

    Should have copyrighted it.

  • ||

    3:00pm squirrels are feeling lazy today.

  • Aresen||

    Don't challenge the squirrels or you may find your posts appearing at Coptalk or Huffington Post.

  • JeremyR||

    It's not a patent, but the makers of Candy Crush Saga have trademarked (or in the process of) both Candy and Saga and are going after any game using either Candy or Saga in it...

    Trademark abuse is just as bad.

  • ImanAzol||

    Abuse" being the key word.

    Some IP gets abused, therefore, all IP is bad.

    Just like some guns get abused, therefore all gun owners are bad.

    Some people use painkillers to excess, therefore pot is bad.

    Some people use computers to scam people, therefore the internet is bad.

  • ||

    To hold patent rights doesn’t mean that we use it in against of the other companies. Certain conflicts between the industries are the reason for the products degrading in the market. Implementing those software patents asking a patent consultant
    leads to the right path in your business.

  • cheap soccer jerseys||

    This is the problem with arguing from a utilitarian standpoint, which you do when you suggest that the outcome (innovation) is the important part.

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