Ocean Tomo Patents Being Used To Shake Down Companies That Have Online Recommendations

from the ebay-for-patent-trolls dept

Ocean Tomo is a company that's been around for a few years, trying to establish itself as the auction house for patents. I've already made clear how troubling I believe its business model to be, but the company always tries to put a friendly face on it, claiming that it's not about aiding so-called "patent trolls" but actually reducing the problem of patent trolling. However, that (of course) isn't what's actually happening. A patent on personal recommendation systems ("if you bought x, you'll like y") was bought via Ocean Tomo by what seems likely to be a bunch of lawyers under the company name Quito (though, it's not entirely clear who's involved) and is now being used in a lawsuit against thirteen big internet companies that employ any type of rating system. The companies being sued are: Netflix, Amazon, Yahoo, RealNetworks, last.fm, Pandora Media, Slacker Inc., Veoh, Hulu, NBC Universal, CBS, News Corp., and Strands.

As you look through that list, you'll recognize that some have done significantly innovative work in taking the concept of an online recommendation system and actually making it useful. The simple idea of doing recommendations is pretty straightforward. Making it work well? Not so much. Hell, that's why Netflix is offering $1 million to anyone who can improve their recommendation engine by just 10%. The basic ideas expressed in the patent are not where the value in these recommendation systems lies. It's in the actual effort of figuring out how to make them work better. This patent has nothing to do with the actual success of a recommendation system, but the holders of it may now get a pay day just for holding the patent, thanks to Ocean Tomo's auctions. And, of course, this means that all of those companies that were actually innovating will, at the very least, now need to spend legal dollars defending against this massive innovation blocker.


Reader Comments (rss)

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  1.  
    identicon
    Techguy, Jan 13th, 2009 @ 5:04am

    Patent trolls and other scum

    Is it a big surprise that someone with probably no knowledge of how these technologies even work is trying get a payday from them? Lawyers are the biggest scum pile on the face of the earth, let's not work for a living just file lawsuits, typical!!!

     

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  2.  
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    ConceptJunkie (profile), Jan 13th, 2009 @ 5:21am

    Patent Reform

    And how long are those do-nothings in Congress going to sit around letting these scum sabotage the American business world before they bother to take a break from voting for each others' earmarks and actually do something useful to reform the system?

     

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  3.  
    identicon
    CCRick, Jan 13th, 2009 @ 5:37am

    How long will they avoid doing something useful?

    Congress has lost sight of doing something useful. They do things for $ and votes.

    So when it's politically correct to fix patents, it will happen. BUT since the patent system is now driven by lawyers, any contention is good for business.

    Rather - expect them to force patents to be more vague so the chaos is raised a level.

     

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  4.  
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    Steve R. (profile), Jan 13th, 2009 @ 5:39am

    Phony Recommendations

    "The simple idea of doing recommendations is pretty straightforward. Making it work well? Not so much. Hell, that's why Netflix is offering $1 million to anyone who can improve their recommendation engine by just 10%.".

    Boy, do I wish we had a good user based recommendation system. The problem is that many companies create phony recommendation systems to entice you to look at their website so that you will buy their products. It is really tiring looking at an endless list of so-called "reviews" that are really come-ons or simply product specs.

    The solution is for companies to have the integrity not do have this misleading crap. The problem of course, like a drug addict, these companies are addicted to using any means, including misleading ones, to generate sales.

     

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  5.  
    identicon
    Chuck Norris' Enemy (deceased), Jan 13th, 2009 @ 7:22am

    Re: How long will they avoid doing something useful?

    Most congressmen were once lawyers. Everything is working as planned.

     

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  6.  
    icon
    Steve R. (profile), Jan 13th, 2009 @ 8:08am

    Re: Re: How long will they avoid doing something useful?

    Good one!

     

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  7.  
    identicon
    MDH, Jan 13th, 2009 @ 8:53am

    Curious how you can fault Ocean Tomo in this situation. What have they done to support this behavior? Aren't They merely an facilitator and marketing tool of the transaction?

    Put another way, if the holder of said patent(s) wants to sell them, what's stopping them? and why is it wrong for Ocean Tomo to profit from the sale? Seems to me they provide a valuable service by marketing the patent(s) availability more visibly, and to a larger pool of possible buyers. Perhaps Amazon, et all should watch for auctions like this and buy the patents for defensive reasons (??)

     

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  8.  
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    Steve R. (profile), Jan 13th, 2009 @ 9:44am

    Two Fundamental Problems

    First - the legitimacy of the patents themselves. Basically patents are being given-out for virtually anything. The patent system has been bastardized. It would be my opinion that many patents being granted are NOT valid.

    Second - The purpose of a patent is to provide the inventor with a limited monopoly, so that a product based on that patent can be marketed. However, what is happening is that patents without an underlying product are being traded and being used as a mechanism for lawsuits. That is uneconomic.

    Yes, I realize that they buying/selling/trading of assets is a vital component of the free market. However, the buying/selling/trading of patents, in some cases, has simply been used as a form of extortion. You buy some obscure patent then go out and find a company to sue. That isn't what the free-market is about.

     

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  9.  
    identicon
    angry dude, Jan 13th, 2009 @ 10:05am

    patent bashing by techdirt punks

    I have one patent
    it is perfectly valid but does not make a separate produvct -rather it can be a part of many products
    I spent years researching and developing this new technology, but cannot make a product based on my patent for obvious reasons (need many other patent licenses AND a huge amount of funding to start manufacturing etc.)

    But my patent is MY property

    Am I entitled to compensation if some company just reads my patent and uses it in their products (actually, it was published and prsetned at various conferences a few years back so those companies don't even need to read the actual patent - patent is a legal document after all) ?

    Who is to blame if those infringers don;'t want to pay a dime to the actual small inventor, but will probably have to pay a large sum of money if patent gets sold on Ocean Tomo action to one of those so-called "patent troll" firms going after corporate infringers for large settlements ?

    I guess this is all my fault

    KIll all independent inventors in this country (or have them enslaved by the likes of MShit or IBM), destroy patent system and burn the US Constitution - that's Mikey's solution

    Have a nice day fellas

     

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  10.  
    identicon
    angry dude, Jan 13th, 2009 @ 10:13am

    Re: Two Fundamental Problems

    Perhaps you should know that all modern high-tech products are based on hundreds if not thousands of various patents
    Only in pharma "one product = one patent"

    Second: patents have nothing to do with economics
    They are meant to promote the human progress by sharing novel and unobvious ideas, as opposed to secrecy

    YOu should educate youreself a litle better on the subject before passing opinions

     

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  11.  
    identicon
    Patent Flamer, Jan 13th, 2009 @ 12:13pm

    Recommendation...

    If you liked this article, you may also like...

    SCO Looking To Ditch Actual Business To Try To Keep Lawsuit Going

     

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  12.  
    identicon
    DanC, Jan 13th, 2009 @ 12:14pm

    Re: Re: Two Fundamental Problems

    patents have nothing to do with economics
    They are meant to promote the human progress by sharing novel and unobvious ideas, as opposed to secrecy


    And they attempt to accomplish that task by establishing a limited time monopoly for the author, just as Steve R. stated. And since many companies base are reliant on this ability for their business model, there is an economic impact as well.

     

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  13.  
    identicon
    dinnerbell, Jan 13th, 2009 @ 1:32pm

    stop the shilling!!!

    All this talk about “patent trolls” is pure hype. If you will look at the 1898 Rude et al. v. Westcott et al. SCOTUS case [130 US 152, 9 S Ct 463, 32 L Ed 888] you will see that at least since 1874 inventors have been selling and partnering with other parties to enforce their patents. Without doing so, few inventors and small companies can afford to enforce their patents, meaning larger competitors can easily beat them out of the market they created and run them into bankruptcy. That’s big companies idea of “patent reform”. Therefore, all this present day discussion of “trolls” is a hoax whose purpose is to cut off the small entity support system and deny them any profit from their creations. Simply put, its intent is to legalize theft.

     

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  14.  
    identicon
    Anonymous Coward, Jan 13th, 2009 @ 1:34pm

    Personally, I find it interesting that one of the firms engaged in the Florida lawsuit is an IP firm out of NYC that according to its site does consider representation on a contingency fee basis, and the two other firms are each personal injury firms where contingency fees are the order of the day.

     

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  15.  
    identicon
    DanC, Jan 13th, 2009 @ 4:11pm

    Re: stop the shilling!!!

    Therefore, all this present day discussion of “trolls” is a hoax whose purpose is to cut off the small entity support system and deny them any profit from their creations.

    Ah, so none of these patent holding companies that file multi-defendant lawsuits are based on poor patents with bad, overly broad claim constructions? One need look no further than Global Patent Holdings' attempt to file lawsuits over the "JPEG" patent to realize that some of these small entities readily deserve the derogatory labels applied to them.

    Simply put, its intent is to legalize theft.

    Simply put, it's painfully obvious that both angry dude and yourself have little interest in facts or common sense, and are merely interested in perpetuating the "innocent little guy vs. big, evil corporation" myth. So please, stop shilling your propaganda.

     

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  16.  
    identicon
    DanC, Jan 13th, 2009 @ 4:23pm

    Re: patent bashing by techdirt punks

    But my patent is MY property

    You certainly own the patent, which provides an artificial level of control over the intellectual work. But you don't own the intellectual work itself, which is why the work will revert to its natural state after your patent expires.

    Who is to blame if those infringers don;'t want to pay a dime to the actual small inventor, but will probably have to pay a large sum of money if patent gets sold on Ocean Tomo action to one of those so-called "patent troll" firms going after corporate infringers for large settlements ?

    Typical - since the situation, in your mind, epitomizes your favorite scenario of David vs. Goliath, you'll side with smaller company regardless of the merits of the case.

    KIll all independent inventors in this country (or have them enslaved by the likes of MShit or IBM), destroy patent system and burn the US Constitution - that's Mikey's solution

    It's highly hypocritical of you to chastise someone's supposed lack of education in a previous post while you continue to propagandize, lie, and intentionally misrepresent the arguments on the site yourself. Perhaps you should follow your own advice and stop commenting until you can actually provide some substance for your allegations.

     

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  17.  
    identicon
    dumbboflies, Jan 13th, 2009 @ 4:38pm

    Re: Re: Two Fundamental Problems

    Careful on this one. Part of the strategy of those trying (very successfully so far) to destroy independent inventors by "reform" is to drive a wedge between "tech" and "pharma".
    There is no difference. One drug is *not* one patent. Every patent has a certain scope, and a give product (or drug) can be with in the scope of many patents. You may hold a patent with the drug in its scope, but that doesn't give you the right to manufacture the product/make the drug. You need rights to all the patents which cover that scope. A patent is a right to exclude others. It is not the right to make a product. patent /= product. Trying to equate them is the big lie/distortion that people like Masnick are falling for, no need to help them.

     

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  18.  
    identicon
    Lonnie E. Holder, Jan 13th, 2009 @ 6:11pm

    Re: Re: How long will they avoid doing something useful?

    I am unsure of how old this data is, but, if it is accurate, you are wrong. Most congressmen in fact were NOT lawyers.

    http://www.historylearningsite.co.uk/recruit.htm

    http://www.senate.gov/CRSReports/crs -publish.cfm?pid='0DP%2BP%2C%5B%3B%23%20%20%20%0A

    In the 110th Congress, there were 159 members of the legal profession out of 435 members in the House of Representatives and 58 members of the legal profession out of 100 members in the senate. That equals about 40.5%, which seems like an amount less than "most."

     

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  19.  
    identicon
    Lonnie E. Holder, Jan 13th, 2009 @ 6:12pm

    Re: Re: How long will they avoid doing something useful?

    I am unsure of how old this data is, but, if it is accurate, you are wrong. Most congressmen in fact were NOT lawyers.

    http://www.historylearningsite.co.uk/recruit.htm

    http://www.senate.gov/CRSReports/crs -publish.cfm?pid='0DP%2BP%2C%5B%3B%23%20%20%20%0A

    In the 110th Congress, there were 159 members of the legal profession out of 435 members in the House of Representatives and 58 members of the legal profession out of 100 members in the senate. That equals about 40.5%, which seems like an amount less than "most."

     

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  20.  
    identicon
    Anonymous Coward, Jan 13th, 2009 @ 7:40pm

    Re: Re: Re: How long will they avoid doing something useful?

    Mr. Holder,

    On my first day of law school (so many years ago) my professor noted that those of us who excelled in law would go on to practice it, whereas those who did not would go into politics (obviously there are some exceptions, but they tend to be in the clear minority).

    Experience has proven the wisdom he imparted.

     

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  21.  
    identicon
    Anonymous Coward, Jan 13th, 2009 @ 8:05pm

    Re: Re: patent bashing by techdirt punks

    While AD does make his points with pejorative language, there is a large measure of truth to what he is saying. So many people keep throwing about the word "troll" that they overlook the fact "troll" lawsuits are a miniscule part of the patent system. The overwhelming majority of patents are used by their holders as a part of the normal give and take that goes on in the business world. To taint them because of the actions of a very, very few is quite unfair.

    I do agree with the above post by SteveR in that I too am bothered by the activities of some who are trying to turn a patent into nothing more than a negotiable instrument to be bought and sold much like stock certificates, debt paper, etc. I am not, however, bothered by those who hold patents and diligently attempt in good faith to partner with others to try and create a marketable product or service. When potential partners in bad faith tell the patent holder to take a hike, I am also not in the least bit bothered if the patent holder feels no choice but resort to litigation using whatever financial resources he/she can find.

     

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  22.  
    identicon
    DanC, Jan 13th, 2009 @ 9:13pm

    Re: Re: Re: patent bashing by techdirt punks

    While AD does make his points with pejorative language, there is a large measure of truth to what he is saying.

    I would hardly say there's a large measure of truth in much of anything angry dude says. A small measure perhaps, but no more. The fact of the matter is that he doesn't investigate the merits of the cases, doesn't care about whether the patent is actually valid, and doesn't bother to justify himself beyond petty insults. He always, without fail, sides against what he considers "big evil corporations". He has demonstrated this multiple times, most notably in some of the JPEG patent articles on the site.

    While I agree that the term patent troll is thrown around too often without proper justification, his assertion that all the David vs. Goliath situations are the result of corporations infringing on the patents of poor innocent small time inventors is simply false. He's been reading too many Horatio Alger stories.

     

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  23.  
    identicon
    angry dude, Jan 14th, 2009 @ 7:19am

    Re: Re: Re: Re: patent bashing by techdirt punks

    hey punky

    Are you a bastardized child of Billy Gates and Co. ?

    Why are you defending those scumbags ?

    Big multinational corporations are evil by their very own nature
    They will not stop at anything to maximize their profits, even if it means destroying person's life
    Why pay a dime to a small guy if there is a 95% chance that they will get away with stealing patented invention ?
    A simple business decision: rational and immoral

    This "Do no evil" mantra from Larry and Sergey is a delirium of a punk: it has no place in today's corporate world
    Big corporations are the root of most present problems in this country: willfull patent infringement aside, corporations are behind the current financial meltdown and implosion of tech job market helped by the influx of cheap H1Bs from India amidsts the most severe unemployment in decades

    of course, corporations are helped a lot by their buddies in US Congress earning their corporate (re)election dollars

    Heck, just watch the movie "Flash of genious" - this was based on real events, not some fiction

    Or there is another educational film for clueless punks like you: it's a documentary called "The Corporation"
    Rent it at your nearest Blockbuster

     

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  24.  
    identicon
    DanC, Jan 14th, 2009 @ 8:49am

    Re: Re: Re: Re: Re: patent bashing by techdirt punks

    Are you a bastardized child of Billy Gates and Co. ?

    Exactly my point - resorting to juvenile insults and baseless accusations of corporate affiliation for pointing out that your rationale is severely flawed.

    Big multinational corporations are evil by their very own nature

    I'm reminded of the Tim Robbins caricature from Team America:

    "The corporations sit there in their corporation buildings and see, they're all corporationy, and they make money."

    Heck, just watch the movie "Flash of genious" - this was based on real events, not some fiction

    When the title of the movie itself is a myth, I'm going to express doubts as to how accurate the movie chooses to portray the actual story. The movie chose to glamorize the little guy vs. big auto angle, while minimizing or ignoring Kearns' unhealthy obsession and self-destruction. I'm also curious if it bothered to mention all the times Ford offered to settle that Kearns shot down. They also chose to include the cork-in-the-eye anecdote that Kearns himself denied actually happened.

    Or there is another educational film for clueless punks like you: it's a documentary called "The Corporation"

    Let me get this straight - you're going to use one film to portray all small inventors as the innocent victims of corporate infringers, and another to condemn all corporations as evil. Instead of exploring the issues on a case-by-case basis, you've chosen to base your arguments on a logical fallacy. You have deluded yourself into believing that every small inventor can do no wrong when attacking a corporation.

     

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  25.  
    identicon
    DanC, Jan 14th, 2009 @ 1:44pm

    Re: Re: Re: Two Fundamental Problems

    It is not the right to make a product. patent /= product. Trying to equate them is the big lie/distortion that people like Masnick are falling for, no need to help them.

    Um, that's the point that's usually being made - 1 patent holder holding up an innovative product because they claim that some aspect of the product infringes.

    If you don't think that's understood on the site, you're mistaken.

     

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  26.  
    identicon
    Kirk, Jan 19th, 2009 @ 11:07am

    Re: patent bashing by techdirt punks

    Do you not see the real obstacles in your path?
    1. You can't sell your patent.
    2. You can't develop your own product because of other people’s patents.
    If the current patent system did not exist, you would surely have a different set of problems which would include competing at a disadvantage against the big boys, but you would have the opportunity to compete if you chose. Your designs would be copied and, dare I say it, improved upon. So, you get the opportunity to do something instead of complaining around here, and the rest of us get to live in a world were your invention exists somewhere besides in a legal document. It is interesting that you would defend your right to compensation for your invention over the freedom to do something useful with it.

     

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  27.  
    identicon
    Kirk, Jan 19th, 2009 @ 11:48am

    Re: Ocean

    I agree. Blaming Ocean Tomo for abuses of the patent system is like blaming gun stores for holes in people's bodies. And as with a Gun Store, if you were to shut down Ocean Domo you would force their activities underground, instead of watching them out in the open.

     

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  28.  
    identicon
    Joe, Feb 5th, 2009 @ 4:02pm

    Ocean Tomo not interested in Bio/ medical patents?

    Ocean Tomo is very selective in which patents they will push/ auction. If you’ll notice the spread of big money Technology patents relating to computer and internet. To me if they were a true auction company you would see a broader example of patents. I place my medical device patents with them like other and their was no interest in marketing or developed an auction market. Are they looking for the easy kill?

     

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  29.  
    identicon
    Sonicon, Apr 16th, 2009 @ 4:13pm

    Patent Reform

    Be careful what you ask for. Now is truly the time for all good people to come to the aid of our country. Are we to bash inventors? This is the one true fix to the situation we are now in. Of all government agencies, the Patent Office has been the truest to scientific reward. Is it flawed? Of course, but it has not yet been, but is in the process of being politicized. We as a nation have been rewarding the wrong people. To be so chintzy on rewarding our inventors is a grave mistake. A patent is presumed valid, but by clear and convincing evidence can be determined to be invalid and unenforceable. The fact that it costs so much and takes so long is a fault of the system that works to the advantage of the empowered. The too big to fail determine the rules of the game and if it is gun slinging trolls that are required to bring honesty to the system so be it. The fundamental problem is that typically a good inventor is a lousy entreprenuer. The entrepreneur, being the wolf it is, will first devour the inventor. This is nothing new. It is our Constitution. It has a mandate to promote the progress of science and useful arts. Now lets see how we can best achieve that objective.

     

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  30.  
    identicon
    Sport Watches, Jun 17th, 2010 @ 5:22am

    Wow ... finally, I found what I'm looking at this web ... thank you my friend ...

    Drafting Table

     

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