Chronicling the high cost of our legal system

Overlawyered

September 30th, 2008 at 12:51 pm

September 30 roundup


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September 17th, 2008 at 12:31 pm

Nathan Myrhvold’s trollery?

The Wall Street Journal takes a critical look (Amol Sharma and Don Clark, “Tech Guru Riles the Industry By Seeking Huge Patent Fees”, Sept. 17). Via Felix Salmon who adds,

Intellectual Ventures and its ilk are arguably the single biggest risk to America’s continued leadership in technology and innovation. As dsquared elegantly put it in a comment here in May, the company might do a bit of R, but it doesn’t do any D. Instead, it acts as a brake on any company wanting to do substantive R&D of its own, since there’s a good chance Intellectual Ventures will have got there first, patented the idea, and then just decided to sit on it until somebody dares to violate it.


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September 4th, 2008 at 11:06 am

Esquire, turned inventor

“Patent-holding companies are making fortunes through litigation, and some law firm attorneys have decided to play the game for themselves.” One lawyer “says he is mindful of the impression that can be made on the public when lawyers turn up behind shell companies that exist only to file lawsuits. ‘Lawyers have a trusted and special role in society,’ [Dechert's Chris] Graham says. ‘We have a responsibility to restrict our own activities.’” (Joe Mullin, “Tempting Terrain”, IP Law and Business, Sept.).


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August 19th, 2008 at 12:05 am

August 19 roundup


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July 16th, 2008 at 5:54 pm

July 16 roundup

  • Another compilation of the hundred best law blogs, with a familiar name among the nine “general” picks, so thanks for that ["Criminal Justice Degrees Guide" via ABA Journal]
  • Europe has a transnational association of personal injury lawyers, funded by the EU, but with no wheeler-dealer, masters-of-the-universe vibe in evidence [PoL]
  • Delta wasn’t liable in Kentucky Comair crash, but some plaintiffs sued it anyway in what their lawyer describes as an “abundance of caution” — that’s a diplomatic way to put it [Aero-News Net; link fixed now]
  • U.K.: Mom told she’d need to pass criminal record check before being allowed to take her own son to school [Telegraph]
  • Regular coverage of the litigious exploits of delusional inmate Jonathan Lee Riches, if you’ve got the stomach for them [Dreadnaught blog]
  • Federal Circuit reverses $85 million infringement verdict won by Raymond Niro, blasted by critics as original “patent troll” [AmLaw Daily]
  • “Determined to defeat lawsuits over addiction, the casino industry is funding research at a Harvard-affiliated lab.” [Salon]
  • Hired through nepotism by in-laws, then fired after divorce, sues on grounds of “marital status discrimination” [eight years ago on Overlawyered]


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July 8th, 2008 at 2:05 pm

July 8 roundup

  • Business groups have signed off on dreadful ADA Restoration Act aimed at expanding disabled-rights lawsuits, reversing high court decisions that had moderated the law [WSJ; more here and here]
  • U.K. man to win damages from rail firms on claim that trauma of Paddington crash turned him into deranged killer [Times Online]
  • Patent cases taken on contingency lead to gigantic paydays for D.C.’s Dickstein Shapiro and Wiley Rein [Kim Eisler, Washingtonian; related last year at Eric Goldman's]
  • Fort Lauderdale injury lawyer disbarred after stealing $300K in client funds; per an ABA state-by-state listing, Florida has not enacted payee notification to help prevent/detect such goings-on [Sun-Sentinel; more]
  • I’ll pay top dollar for that spot under the bridge: tech firms hope to outbid patent trolls for marginal inventor rights [ABA Journal]
  • Enviro-sympathetic analysis of Navy sonar case [Jamison Colburn, Dorf on Law, first and second posts via Adler @ Volokh]
  • Obama proposal for youth national service “voluntary”? Well, schools will lose funds if they fail to meet goals [Goldberg, LAT; bad link fixed now]
  • Not-so-independent sector: under pressure from Sacramento legislators (Feb. 6, PoL May 30), California foundations pledge to redirect millions toward minority causes [CRC]
  • James Lileks on lawyer-friendly Microsoft Minnesota settlement [four years ago on Overlawyered]


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February 26th, 2008 at 8:55 am

Blogs I wish I read more frequently: Patent Troll Tracker

» by Ted Frank

Just as I was about to say I needed to revise my top-ten blog list to include the excellent anony-blogger Patent Troll-Tracker, I learned from today’s Recorder and WSJ that he has revealed himself as Rick Frenkel, Cisco IP attorney.

When I started the blog, I did so mainly out of frustration. I was shocked to learn that a huge portion of the tech industry’s patent disputes were with companies that were shells, with little cash and assets other than patents and a desire to litigate, and did not make and had never made any products. Yet when I would search the Internet for information about these putative licensors, I could find nothing. I was frustrated by the lack of information, and also by the vast array of anti-patent-reform bloggers out there, without a voice supporting what I did believe and still believe is meaningful reform.

(For the record, I liked the blog even before they praised me.) Plaintiffs’ attorney Ray Niro had put a bounty on the identity of the Troll Tracker, who had been critical of Niro’s tactics (as have Walter and I). Frenkel is considering shutting down his blog now that he is out of the closet; one hopes someone else picks up the torch, because he was performing a valuable service, to the extent that I had limited my blogging about it because he had the subject-area covered so well.

I missed the debate in November among Dennis Crouch, Michael Smith, and Frenkel on whether the Eastern District of Texas is “waning” as a magnet jurisdiction for patent plaintiffs (May 2006, Dec. 2005, Jan. 2005), or I might have made reference to it in my latest Liability Outlook on patent reform. Frenkel seems to have the best of that debate, and follows up:

Let’s highlight one really outstanding statistic from November: The number of defendants sued in the Eastern District of Texas in November 2007: 244. The number of defendants sued in Los Angeles, San Francisco/Silicon Valley, New York City, Chicago, Delaware, and New Jersey combined in November 2007: 162.

Patent lawyers often seem to be of a different stripe than other lawyers, and there is a similar patent-law-blogging community largely separate from the other law-bloggers. The commenters go mad at Crouch’s blog over the Frenkel revelation because Cisco is a strong patent reform supporter. Elsewhere: IPBiz; TechDailyDose; NetworkWorld; 271Blog; Mises Blog; and the anti-reform Patent Prospector.


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February 22nd, 2008 at 12:58 pm

The Patent Reform Act of 2007

» by Ted Frank

My latest Liability Outlook is on the Patent Reform Act of 2007:

Despite some in the media calling patent reform dead, on January 24, 2008, the Senate placed S. 1145, the Patent Reform Act of 2007, on the general calendar. The next few weeks will be critical to the legislation, which the House passed in September. Although much of the discussion has focused on the different perspectives and concerns that the high tech and the biotech/pharma industries have about the legislation, the fact remains that the patent litigation system is broken. Congress should make every effort to fix it by writing into this legislation reasonable formulas for damage awards and venue rules that discourage forum-shopping. …

Affiliates of Erich Spangenberg’s Plutus IP have sued 476 different defendants in 42 lawsuits. The vast majority of those lawsuits allege infringements of patents that Plutus IP purchased for $1,000. The use of invalid patents in litigation is more than theoretical. Philip Jackson sued his attorneys, Chicago plaintiffs firm Niro, Scavone, Haller & Niro, for malpractice after his $12.1 million jury verdict against Glenayre Electronics Inc. was reduced to under $3 million; Niro challenged the malpractice suit by claiming that th e patent Jackson had successfully enforced was invalid. In 2006, approximately 6,000 defendants were sued in 2,800 patent cases; in 2007, the six thousand mark was reached in early October, implying a 30 percent increase in patent litigation in a single year. Such litigation stifles substantial technological innovation. Patent trolls claim to block entire fields, and one cannot hope to innovate in these areas without the financial capital to handle the threat of patent litigation. IBM has 370 corporate patent attorneys, not just to avoid the pitfalls of infringement, but to create a patent portfolio that can provide counterclaims (or cross-licensing opportunities) if a commercial entity were to sue them for infringement. Since the late 1990s, patent litigation costs have outstripped patent profits.


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February 11th, 2008 at 11:19 am

February 11 roundup


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January 25th, 2008 at 12:02 am

Update: Bring me the identity of Patent Troll Tracker

It seems Chicago attorney Raymond Niro has doubled the bounty to $10,000 for anyone who will bring him the identity of the blogger who’s often been critical of his courtroom activities. (Ameet Sachdev, “Patent licencers raising some ire”, Chicago Tribune, Jan. 22). Earlier: Dec. 10.


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December 10th, 2007 at 12:54 pm

Call me a patent troll? See you in court

Watch what you say about lawyers, a continuing feature: the blog Troll Tracker has been critical of firms that make a practice of buying up patent rights to sue on them. Now co-founder Ray Niro of the Chicago plaintiffs firm Niro, Scavone, Haller & Niro is threatening to sue Troll Tracker for alleged infringement of a patent on a technique sometimes used in web graphics, JPEG decompression. (If a website posts graphics at all, there is a good chance that it is in similar violation of this asserted patent.) Niro also wants the anonymous blawger’s identity unmasked and is offering a bounty toward that end. (TrollTracker, Dec. 4; John Bringardner, “A Bounty of $5,000 to Name Troll Tracker”, IP Law & Business, Dec. 4; via Ambrogi, who appends an extensive list of blogs commenting on the story).


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October 23rd, 2007 at 12:11 am

Annals of creative patent lawyering

Highly placed attorney with intellectual-property specialists Fish & Richardson accumulates his own portfolio of patents, quits the firm, begins suing Fish & Richardson clients, things get messy fast (Patent Troll Tracker, Oct. 21). Patent Troll Tracker (h/t Ambrogi) looks likely to become part of our regular blog rounds.


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June 3rd, 2007 at 12:02 am

“No warning…. just a lawsuit”

“Last month, we were hit with two new patent troll cases. With each, there was no warning, no offer to license - just a lawsuit.” Sun Microsystems general counsel Mike Dillon doesn’t hold back (May 14).


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February 18th, 2007 at 12:08 am

Update: Streaming-media patent troll goes respectable?

The Electronic Frontier Foundation in 2004 derided Acacia Technologies Group’s claims of ownership over streaming-media technology as “laughably broad” (see Aug. 17, 2004), but the firm has prospered since then through licensing deals with big companies. It hasn’t had to face its toughest courtroom challenges yet, though. (Xenia P. Kobylarz, “Extreme Makeover: From Patent Troll to the Belle of the Ball”, IP Law & Business, Feb. 15).


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January 10th, 2007 at 12:08 am

Patent troll, meet Rule 11

Just sending out batches of letters claiming infringement and demanding money may no longer be a workable business plan:

Based in the British Virgin Islands, Eon-Net is run by an evangelical minister-cum-inventor, who holds several patents (including one on a device for collecting “canine waste”). In March 2005 the company filed a patent suit in New Jersey against Flagstar, a $16 billion savings bank based in Michigan. The bank was one of 32 companies sued separately by Eon-Net for infringing a patent that, the company claims, covers technology that allows online shoppers to enter information into Web sites and have it transferred to the Web retailer’s computer. Eon-Net, which also has pending litigation against JetBlue Airways and Liz Claiborne Inc., had successfully extracted settlement money from ING Bank and Sony Corp. over the same patent.

Eon-Net’s enforcement method involved filing a complaint followed by a letter offering a settlement ranging from $25,000 to $75,000.

Flagstar decided to fight the suit, and its attorney, Melissa Baily of Quinn Emanuel, noticed that Eon-Net’s lawyers “had used nearly identical complaints and demand letters in all 32 suits,” suggesting a lack of careful advance investigation. Although Rule 11 sanctions are especially hard to obtain in the Ninth Circuit, Western District of Washington Judge Marsha Pechman agreed that the suit was both baseless and made without reasonable inquiry and, after ruling in favor of Flagstar on summary judgment in the case itself, ordered Eon-Net and its attorney, Jean-Marc Zimmerman, to pay the bank’s defense costs, estimated at more than $100,000. (Xenia P. Kobylarz, “Patent Trolls Put on Notice Over Generic Infringement Letters”, IP Law & Business, Dec. 14).


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November 28th, 2006 at 12:06 am

“Jay-Z versus the Sample Troll”

“Similar to its cousins the patent trolls, [Bridgeport Music Inc.] and companies like it hold portfolios of old rights (sometimes accumulated in dubious fashion) and use lawsuits to extort money from successful music artists for routine sampling, no matter how minimal or unnoticeable. … Since 2001, Bridgeport’s shotgun approach has led to many dismissals and settlements, but also two major victories. … there’s only one appellate court, the 6th Circuit, that takes the ridiculous position that any sample, no matter how minimal, needs a license.” (Tim Wu (Columbia lawprof), Slate, Nov. 16). Frank Pasquale at Concurring Opinions has some further thoughts: Nov. 21. More on sampling litigation in Ted’s “Overlawyered iMix” post, Aug. 9, 2005, and comments.


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September 17th, 2006 at 11:15 pm

Patent trolls and Paul Allen

In his New York Times column today, Joe Nocera recounts a battle between a company called Audible.com, headed by Donald R. Katz, and one called Digeo, backed by Paul Allen of Microsoft fame, over whether Audible was infringing on Digeo’s patents. The column is behind the TimesSelect screen (”Tired of Trolls, a Feisty Chief Fights Back”, Sept. 16), but David DeJean at ComputerWorld summarizes some of the relevant content and poses some pointed questions for Mr. Allen (” Patent troll? Say it ain’t so, Paul Allen”, Sept. 16).


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July 21st, 2006 at 10:41 am

“Meet the original patent troll”

“Troll was a derivative of, er, me,” says Chicago patent litigator Raymond Niro, a pioneer of contingency-fee IP practice:

Niro’s former partner Gerald Hosier found fame and fortune turning Jerome Lemelson’s patents on bar code technology into a billion-dollar licensing business. But Niro taught the patent world a more enduring lesson: Lemelson isn’t unique. Like an irritating mosquito that GCs can’t squash, Hosier’s licensing approach could be applied over and over again, on different patents across different industries for huge profits. Niro has extracted royalties on everything from patents covering hemodialysis catheters to wireless technology used to locate items of interest in online maps. In the process, he’s made some serious royalties of his own: a Falcon 10 jet, six Ferraris, acres of land in Chicago, Boca Raton and Aspen, and a $250,000 gift to DePaul University endowing the Raymond P. Niro professorship in intellectual property law…. Love him or hate him, Niro’s methods have become ingrained in the patent world.

(Lisa Lerer, IP Law & Business/Law.com, Jul. 20).


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