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The Costs and Benefits of Patents to Innovators

Interesting. They don’t address software patents exclusively, but it illuminates the growing gap between the intent and purpose of patent law and the reality of it.

Patent Law Blog (Patently-O): The Costs and Benefits of Patents to Innovators

We conclude with three important notes. First, patents do provide profits for their owners, so it makes sense for firms to get them. But taking the effect of other firms’ patents into account, including the risk of litigation, the average public firm outside the chemical and pharmaceutical industries would be better off if patents did not exist. Second, our best evidence relates to the eighties and nineties, but the evidence we have for this decade suggests that the patent tax has grown with the continued growth of patent lawsuits. We find no offsetting evidence that patents have become substantially more valuable in this century. Third, we find that small publicly traded firms get small positive R&D incentives from patents. This is also very likely to be true for small, non-publicly traded firms and non-profit inventors.


Then they fight you…

This is a real shame. Patent Troll Tracker was a great blog that did most of my work for me. Quite a loss.

The Prior Art

The Daily Journal’s Tuesday edition (not linkable) reports that Troll Tracker author Rick Frenkel, and his employer Cisco, have been sued for defamation by two East Texas attorneys who are players in that district’s patent litigation scene, Eric Albritton and T. John Ward, Jr.

John “Johnny” Ward, Jr. is a Texas lawyer who has filed a large number of patent infringement lawsuits in recent years. Between January and mid-October of 2007, his name was attached to 54 separate lawsuits by my count; in all but four, he represented the plaintiff. He is also, as I reported in October, the son of Judge T. John Ward, the judge who is largely responsible for making the Eastern District of Texas a hotspot for patent litigation.

There’s a lot more on this, here.


Microsoft’s Open Specification Promise: No Assurance for GPL

Microsoft’s Open Specification Promise: No Assurance for GPL - Software Freedom Law Center

There has been much discussion in the free software community and in the press about the inadequacy of Microsoft’s Office Open XML (OOXML) as a standard, including good analysis of some of the shortcomings of Microsoft’s Open Specification Promise (OSP), a promise that is supposed to protect projects from patent risk. Nonetheless, following the close of the ISO-BRM meeting in Geneva, SFLC’s clients and colleagues have continued to express uncertainty as to whether the OSP would adequately apply to implementations licensed under the GNU General Public License (GPL). In response to these requests for clarification, we publicly conclude that the OSP provides no assurance to GPL developers and that it is unsafe to rely upon the OSP for any free software implementation, whether under the GPL or another free software license.

Read the full paper here.


Lawyering Up

Red Hat Puts More Muscle On Its Legal Staff — Linux — InformationWeek

Red Hat is beefing up its legal staff with two appointments to strengthen its hand in patent disputes and open source licensing issues.

Company spokesman on Wednesday declined to comment on whether Microsoft (NSDQ: MSFT)’s claims in early and mid-2007 that its patents cover parts of Linux had anything to do with the expansion.

“We are helping pave the way for open standards and changes in the IP regime needed for the future,” responded Robert Tiller, VP and assistant general counsel for IP, one of the new hires at Red Hat’s legal department. “We feel a responsibility to lead these efforts and to encourage projects that support open, multi-vendor standards,” he wrote in an email response.

Red Hat announced Wednesday that it was adding Tiller and Richard Fontana, a former associate of Eben Moglen at the Software Freedom Law Center, to its legal staff. Fontana will be Red Hat’s open source licensing and patent counsel.


Negroponte Stands Aside

Negroponte Seeks a Laptop CEO

Over the past two decades, multimedia pioneer and college professor Nicholas Negroponte has gained a reputation for producing outsize ideas. Chief among them was his goal of providing 150 million of the world’s poorest children with inexpensive laptop computers by the end of this year through the One Laptop Per Child organization. But, with the group far short of his goal, Negroponte is looking for help in piloting OLPC. During an interview with BusinessWeek, he revealed publicly for the first time that he’s searching for a chief executive while he continues in the role of chairman. He says the organization has been operating “almost like a terrorist group, doing almost impossible things” for three years. Now, he says, it needs to be managed “more like Microsoft.”

The CEO search comes amid a retrenchment for the organization that Negroponte started three years ago. OLPC will hand more of the development and support of its XO laptop and its core software to technology companies, including Red Hat (RHT), the leading distributor of the Linux open-source operating system, and Microsoft (MSFT), which is just now putting the finishing touches on a version of Windows for the XO machine. OLPC will concentrate on developing prototypes and other new concepts. “In the end, we should not be in the hardware or software business. We should be in the learning business,” says Negroponte, 64.


CCIA Asks House To Oppose Telecom Immunity

CCIA Asks House To Oppose Telecom Immunity

Washington, D.C. — The Computer & Communications Industry Association sent a letter to House members Friday asking them not to support retroactive immunity for major telecommunications companies as part of the Foreign Intelligence Surveillance Act legislation.

Click here to see the letter[PDF]

For some background on this story, and what telecom immunity for warrentless wiretapping has to do with national security, the Electronic Frontier Foundation has a good rundown here.


Strike One Against Microsoft

Red Hat News | Strike One Against Microsoft

by Michael Cunningham, Executive Vice President & General Counsel

Strike One!

In our last blog posted on February 21, I proposed three test pitches for Microsoft to help judge the meaningfulness of its latest efforts to turn over a new leaf on interoperability. The first of these was to embrace the extant, multi-vendor ISO standard, ODF (Open Document Format) in lieu of its single vendor dominated efforts to create a new standard, OOXML (Office Open XML).

The first pitch was thrown in Geneva last week at the ISO ballot resolution meetings on OOXML. And we can safely say: strike one! There was no renouncement of the OOXML standard by Microsoft. Instead, every indication was business as usual.

By the way, you have to seriously wonder about those Geneva meetings. According to reports I’ve received about the meetings (which were closed but reportedly audio recorded), only a disturbing 25 or so of the approximately 1,000 substantive comments that were scheduled to be acted upon were actually discussed. As for the remainder of the comments, it appears that, in order to complete the agenda, a decision was made to vote on all of the remaining, undiscussed comments in a single vote.

Read the rest.


Counsel Cunningham Criticizes Patent System

From the Raleigh News and Observer:

Boosting our innovation system

Michael Cunningham

RALEIGH - Red Hat has been based in North Carolina for over a decade. As a leading provider of open-source software solutions, we’ve been able to witness and contribute to the state’s recent growth in high-technology jobs. While it is our hope that North Carolina’s future continues to be filled with this kind of development, companies must be given the tools they need to add to the state’s rich history and to create jobs for North Carolina’s future.

We, along with many other local and global companies, believe that our ability to create is being compromised by an outdated and imbalanced U.S. patent system. This issue affects all businesses, from smaller companies like us to large multi-national corporations.

The current system has not been significantly updated in more than 55 years. America’s abilities and needs have changed greatly since that time, and it’s important to have a system in place that not only adapts to these transformations, but encourages them.


Negative People Upset Me

Comedian Daniel Lyons crushed morale here at Red Hat last week with this post. It was ugly, people were bumming. They quit in droves. (I only stayed because I got a better office and joined a support group that meets where the ping pong table used to be. I’m a survivor.)

Red Hat, the single company freetards always point to when they want to prove that open source can make money, has turned into an inept cluster[NAUGHTYWORD], with nothing but bluster and bravado and a deluded belief that they’re actually a thorn in Microsoft’s paw. Bottom line: they’re the new Borland. They’re 15 years old and have been publicly traded since 1999 and last year they did all of $400 million a year in sales. Microsoft does more than $1 billion a week. That’s right. Red Hat’s entire fiscal year is a good three days for Microsoft. Last quarter the Borg added $2.6 billion in revenues — that’s six entire Red Hats. In a quarter.

There’s another measure of the hugeness of Microsoft Lyons can add to his schtick: The $1.3 billion fine imposed on Microsoft by the EU for its legendary anti-competitive practices is worth almost three Red Hats.

Good for them.


OSI’s Tiemann on Microsoft Announcement

Microsoft and standards–deja vu all over again? | Open Source Initiative

Let’s be clear: Microsoft’s lawyers have a deep understanding of open source software. They submitted two licenses to the OSI earlier this year after many years of internal discussion, deliberation, and refinement. They went through one of the most difficult gauntlets of reviews I have seen on license-discuss. They succeeded in having those licenses approved because they met all the criteria spelled out in the OSD, and because the answer to every question posed to them (within the scope of the license approval process) was answered well and to the satisfaction of all who reviewed objectively. (You can see for yourself that some people did not want to approve the licenses on the principle that Microsoft is evil, and rightly or wrongly we chose to not consider that question in the review process.) So given that Microsoft does understand the rules and requirements of open source, why would they make a major announcement about open source interoperability that so clearly violates the principles of our community?

We have shown tolerance for Microsoft as a company by reviewing and approving their licenses. Soon, I would like to see Microsoft show respect for our community by actually issuing a patent covenant that we can all embrace and applaud. Any steps that fall short of universal safe harbour look like strategic behavior against the community, and we will continue to reject that in the strongest possible terms.


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