Has Seagate Realized That Patent Infringement Lawsuits Won't Help It Stay Afloat?

from the probably-not...-but... dept

A year ago, we noted that Seagate's outspoken CEO, Bill Watkins, had admitted that if the company found it impossible to compete technologically with solid state drives, it would resort to patent infringement lawsuits. And... indeed, it did exactly that just a few weeks later, suing SSD provider STEC. So, it's a bit surprising to find out that Seagate has suddenly dropped the lawsuit entirely, with the rather odd excuse that the troubled economy has hurt STEC's business so much that it's not really selling enough infringing SSDs to matter. STEC, in response, suggests that Seagate actually realized it had no chance of winning the lawsuit -- which is probably true (though, that certainly hasn't stopped some patent holders from dragging out such lawsuits). However, given that it was Bill Watkins that was so gung ho in pursuing a patent litigation strategy, perhaps the real reason has something to do with Watkins getting fired in January. Maybe that means the new management actually would prefer to focus on innovating to build its business, rather than litigating to hold innovation down.


Reader Comments (rss)

(Flattened / Threaded)

  1.  
    identicon
    John Paradox, Feb 26th, 2009 @ 11:02pm

    Innovation?

    How 20th Century!

    J/P=?

     

    reply to this | link to this | view in thread ]

  2.  
    identicon
    Azrael, Feb 27th, 2009 @ 12:22am

    What a shocker: a CEO that prefers trowing its company's money to the lawyers, instead to its engineers.

     

    reply to this | link to this | view in thread ]

  3.  
    icon
    Ronald J Riley (profile), Feb 27th, 2009 @ 2:42am

    Seagate’s explanation makes perfect sense

    Patent infringement lawsuits are very expensive, typically something from millions of dollars to many tens of millions of dollars. Considering the high costs, the recover potential of an infringement needs to be at least several tens of millions with $200 million or more being ideal to make it worth pursuing.

    With this in mind Seagate’s explanation makes perfect sense. No one is going to spend the kind of money it takes to enforce a patent if the infringer is not making enough money to be able to pay the judgment.

    There is a huge difference between companies who have actually invented something and the ways you use the word innovate. As a mater of law the company which actually invents does not have to “innovate” to compete with those who have stole their invention. It is most certainly true that no one is going to put the large amount of time into teaching with patents if they do not get a tangible benefit for teaching in the form of the limited period of exclusivity.

    What you failed to address here is rather the case was dismissed with or without prejudice.

    Ronald J. Riley,


    Speaking only on my own behalf.
    Affiliations:
    President - www.PIAUSA.org - RJR act PIAUSA.org
    Executive Director - www.InventorEd.org - RJR at InvEd.org
    Senior Fellow - www.PatentPolicy.org
    President - Alliance for American Innovation
    Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
    Washington, DC
    Direct (810) 597-0194 / (202) 318-1595 - 9 am to 9 pm EST.

     

    reply to this | link to this | view in thread ]

  4.  
    identicon
    Kevin, Feb 27th, 2009 @ 3:56am

    Huh?

    So Ronald, let me get this straight. Mike Masnick is actually giving credit to the new CEO at Seagate for having the good sense to realize that suing for patent infringement is a really stupid business model. But you're saying they actually DON'T have enough sense to realize that, they just realized that their target didn't have enough money to make the patent infringement case profitable enough to pursue? So rather that "defending their IP" on principle, they're only interested in "defending their IP" when it can make them a bunch of money?

    Somehow I think that your post has done the exact opposite of it's intended effect.

     

    reply to this | link to this | view in thread ]

  5.  
    identicon
    Another Planet, Feb 27th, 2009 @ 4:36am

    Seagate's Products among the lowest quality

    Gee, maybe Seagate should concentrate on producing hard drives that have a less than 60% failure rate.

     

    reply to this | link to this | view in thread ]

  6.  
    identicon
    some old guy, Feb 27th, 2009 @ 4:49am

    Re: Huh?

    Somehow I think that your post has done the exact opposite of it's intended effect.

    He's a paid IP troll. As such, every single post he ever makes has the opposite of it's intended effect.

    Ronald Riley is nothing more than a clueless troll hoping to make a few bucks off of fanning the flames of the IP "rights" war. If you ever pay attention to what a troll says, you will realize they never makes any sense.

     

    reply to this | link to this | view in thread ]

  7.  
    identicon
    Anonymous Coward, Feb 27th, 2009 @ 4:51am

    Re: Seagate�s explanation makes perfect sense

    "What you failed to address here is rather the case was dismissed with or without prejudice.

    Ronald J. Riley"

    The article indicates that Seagate dropped the case. I'm no lawyer, but I would imagine dropping a suit and having it dismissed are two different things. Would there need to be prejudice (or not) to drop a case?

     

    reply to this | link to this | view in thread ]

  8.  
    icon
    Ronald J Riley (profile), Feb 27th, 2009 @ 4:52am

    Re: Huh?

    Patent cases are very expensive. How many companies can afford to expend what may amount to tens of million of dollars if they do not think they can recover those costs?

    This doesn't change the fact that patent infringement is theft of someone's property.

    Look at Microsoft. They got away with a great deal of questionable conduct because recovery was not likely. Once they had deep pockets people started taking them to task.

    You have the same situation in open source. The community has a belligerent attitude, an entitlement mentality but at this point few in the community have deep enough pockets to make it practical to extract retribution.

    As the movement grows and parties make money, much of it at the expense of those who actually invented the technology, it is inevitable that the time will come when they will also be held accountable.

    To the degree that open source is based on inventions which are willing donated to the cause I support them. But when the community collectively rationalizes that they should be able to socialize the property of others I say hell no.

    This forum is dominated by those who think they should be able to personally profit by giving away others' property as a loss leader. I think that the free business model is just another version of the car chop shop business model.

    Ronald J. Riley,


    Speaking only on my own behalf.
    Affiliations:
    President - www.PIAUSA.org - RJR act PIAUSA.org
    Executive Director - www.InventorEd.org - RJR at InvEd.org
    Senior Fellow - www.PatentPolicy.org
    President - Alliance for American Innovation
    Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
    Washington, DC
    Direct (810) 597-0194 / (202) 318-1595 - 9 am to 9 pm EST.

     

    reply to this | link to this | view in thread ]

  9.  
    icon
    Ronald J Riley (profile), Feb 27th, 2009 @ 5:02am

    Re: Re: Huh?

    "He's a paid IP troll. As such, every single post he ever makes has the opposite of it's intended effect.

    Ronald Riley is nothing more than a clueless troll hoping to make a few bucks off of fanning the flames of the IP "rights" war. If you ever pay attention to what a troll says, you will realize they never makes any sense."

    Actually I am an inventor-entrepreneur. I am not and never have been paid for the inventor advocacy work I do. I have funded such work with royalties from my patents and with profits generated from making products.

    The only thing standing between developed countries current standard of living and a precipitous drop is their ability to command higher profit margins with inventions. When you advocate undermining the patent system you are advocating giving away the rights to American ingenuity to low wage countries. In that situation there is nowhere for our standard of living to go except down to the level of developing countries.

    Ronald J. Riley,


    Speaking only on my own behalf.
    Affiliations:
    President - www.PIAUSA.org - RJR act PIAUSA.org
    Executive Director - www.InventorEd.org - RJR at InvEd.org
    Senior Fellow - www.PatentPolicy.org
    President - Alliance for American Innovation
    Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
    Washington, DC
    Direct (810) 597-0194 / (202) 318-1595 - 9 am to 9 pm EST.

     

    reply to this | link to this | view in thread ]

  10.  
    icon
    Killer_Tofu (profile), Feb 27th, 2009 @ 5:41am

    Re: R. Riley

    This doesn't change the fact that patent infringement is theft of someone's property.

    Okay, that right there shows that you are confused. You cannot own thoughts, or processes. Patents are artificial limits on how humanity has worked for most of the past 5000 years. You can not steal them. If I use it, that does not mean that you cannot. That is why it is infringement and not theft. It was not stolen. Calling it such makes you appear ignorant. Even in your own sentence there you call it infringement, which is accurate. In the end though, they are still artificial limits that should almost never exist.

    The community has a belligerent attitude, an entitlement mentality ...

    Um, no. I am a software programmer. I, and every single other programmer I know wishes patents would have stayed the hell away from programming. They only hold things back and slow down progress. You post here from time to time, so you have seen the evidence of this in the various techdirt posts. Most programmers are helpful people who willingly share their code and experience with others. Computer people are mostly good people in that regard. So don't you even dare to try to lump us in there with the money grubbing greedy corporate bastards who love software patents. The only groups I have ever seen who like software patents, are the huge corporations who usually use them to try to smash out the small guy competition. Again, you post here from time to time so you have more than likely seen the evidence. If not, simply search through some of the archives here.

    Again, software patents suck and should have NEVER been approved. Every other programmer I know agrees with that, as well quite a few posters here in Techdirt have agreed with me in a previous thread when I mentioned I was happy that the courts were starting to revoke the idea of software patents. None of us like them. Only people that do, are the large corps who care only about money and monopolies.

     

    reply to this | link to this | view in thread ]

  11.  
    identicon
    Not a defender, Feb 27th, 2009 @ 6:04am

    I respect Riley for using his name and info on his posts.
    I would say a real troll is someone who posts anonymously (like myself).

    BTW anybody read the book about how AG Bell stole the idea for the telephone?...From the freakin' patent office!

     

    reply to this | link to this | view in thread ]

  12.  
    identicon
    Patent Basher, Feb 27th, 2009 @ 6:48am

    Die Patents! Die!

    The real problem with America is that we are fat and weak and lazy. Look at invention throughout history and at the incredible advances people have made by building on the work of others.

    We've stifled that with patents, copyrights and trademarks. Generally, the biggest reward for inventing something is that you are the first one to get to market with it. That gives you a huge edge.

    You must then continue to innovate to keep that edge. Instead, people want to seal up their inventions in IP law and ride the easy bus for the rest of their lives. Instead of continuing to work and innovate, they choose to be lazy. And unfortunately, we've created a system that allows them to continue to be lazy. We REWARD laziness and penalize inventiveness and improving existing technology.

    That's why America is in such dire straights... laziness and greed.

     

    reply to this | link to this | view in thread ]

  13.  
    identicon
    Anonymous Coward, Feb 27th, 2009 @ 6:49am

    Re: Re: R. Riley

    To play the devils advocate here the software developers I work with believe their work should be patented. Just trying to point out there is no "everyone" in anything.

    But I believe they don't understand. If someone "stole" our code there is nothing they could really do with it. We are constantly paid to produce enhancements to a product for our client. If someone stole our code it would be quite apparent it was stolen and they would not be able to improve upon it unless they understood the deeper working of the program. Now, lets say they could figure out... that would take almost as long and sometimes longer to just make up your own version of it. So "stealing" software so you can make money off of it makes no long term sense and people know who you are and your business model tanks fast.

    Also to me, it doesn't make sense to copyright/patent/whatever a tool. What if someone patented blogging websites. Patent the tool used to which to blog with... think about that IP people!

     

    reply to this | link to this | view in thread ]

  14.  
    identicon
    James, Feb 27th, 2009 @ 7:28am

    Patents and BS

    I think most people's arguments against patents is that ideas and processes should never be allowed a patent.. anyone recall Amazon's infamous "one-click" patent? Or the guy who patented the process of "swinging a person on a swing"? Ridiculous.

    What isn't ridiculous is when you invent a real item and ask that it be legally protected so that you can benefit from your efforts; that can promote innovation.

    Sadly, it can also stifle it. This wouldn't be the first time that technology has allowed innovation in an area by others before a company with a patent in that field themselves is willing to innovate; its the corporate mentality of milking the buyers for as possible--for as long as possible (do you hear me wireless phone carriers??).

    In any case, Seagate may be within their legal right, I don't really know.. whether they do or whether they don't I think it makes them look a bit ridiculous to use litigation to pursue an obviously aging business model, even if they are in the right. It just smells alot like a certain company suing Monster (insert any company name/product/brand here) for trademark infringement... and personally, I think it stinks.

     

    reply to this | link to this | view in thread ]

  15.  
    identicon
    Overcast, Feb 27th, 2009 @ 7:45am

    At this very second I am on Newegg's page looking for Hard Drives...

    I don't like the fact that some of these companies sue - rather than innovate products.

    What does that tell me as a consumer?

    Patent cases are very expensive. How many companies can afford to expend what may amount to tens of million of dollars if they do not think they can recover those costs?

    So then - this is money that *could* be spent on R&D instead of litigation?

    That the product itself may not be as innovative as it could be? Or that the company may not be viable for years to come as they are running scared to the courts?

    I have no issues otherwise buying this Seagate drive, except for this one. I think I'll skip on down to the next one.. or narrow the search to another brand..

    Shame, I never really had any problems with Seagate drives, but I can't stomach the 'Netscape' attempt at keeping a business afloat. There are other companies that I trust with drives too... To me, the data is the very most critical portion of the system, so it's a bit more of a choice I make with caution and never buy 'cheap' drives or drives where I question the company's commitment to quality.

    It has nothing; whatsoever to do with who has what patent or who has some silly 'feature' - It's all about quality.

    Make quality drives and I'll buy them. Even if 5000 companies make the very same drive, stealing technology from each other - as a consumer, I don't care - I care only about who's drive will be the most dependable. And as well, I may skip drives that offer a better speed or density vs. cost... because again, quality trumps all when it comes to the reliability of my data.

    Maybe it seems overly simple or whatever - but at this point, I have many options, but only one real concern.

    In all seriousness, if they took all that money - and instead of dumping it into the pockets of lawyers; they invested in better quality control, better warranty, better customer support - all the stuff *after* the sale; it would draw more customers.

    And yeah - for good or bad, I don't care, I take things just like this into consideration when buying... maybe I'm too much of an idealist, but hey - I'm an idealist AND a consumer.

    Well, back to my search :)

     

    reply to this | link to this | view in thread ]

  16.  
    identicon
    CastorTroy-Libertarian, Feb 27th, 2009 @ 9:15am

    Re: Re: Huh?

    i was going to type this long drawn out verse but i have come to the shocking conclusion that it would be wasted on Ron and his reasoning makes my head hurt (double speak and bad ideas)...

    Oh and many free business models work much better than your Wall street/DC businss models (look at the mess today)....

     

    reply to this | link to this | view in thread ]

  17.  
    identicon
    Anonymous Coward, Feb 27th, 2009 @ 9:25am

    Re: Re: Re: Huh?

    Used to be good netiquette that sigs were no more than four lines. You have half a resume on here.

    Sheesh

     

    reply to this | link to this | view in thread ]

  18.  
    identicon
    Anonymous Coward, Feb 27th, 2009 @ 10:40am

    Another possibility

    The article that Mike points to suggests that the firing of was
    a combination of a big mouth (article enumerated the greatest
    hits) and bad company performance (said big mouth mentioned
    that a restructing is expected).


    I'll suggest that quality issues probably contributed to this.
    That was what killed Maxtor-- or rather weakened them to the
    point where Seagate can acquire them.

    My drive I brought from them needed a firmware update(!). There
    was a potential of the drive locking up to the point where I have
    to send it to Seagate to get my data out of it.

    From what I've just read, it appears that they had seriously botched
    the first release of that update.

    The board of directors would be right to be deathly afraid of
    history repeating itself at their company.


    Had I known about the SSD lawsuit, I probably would of taken that
    as a big red flag in my purchase decision. Their resources isn't
    going into places such as quality assurance or their own SSD
    division-- either by hiring or acquiring.

     

    reply to this | link to this | view in thread ]

  19.  
    identicon
    Technage, Feb 27th, 2009 @ 10:43am

    Come now we all know old crotchety innovation is the best innovation. I hate these new kids ideating.

     

    reply to this | link to this | view in thread ]

  20.  
    identicon
    Anonymous Coward, Feb 27th, 2009 @ 11:15am

    Re: Re: Re: Huh?

    Developing countries don't have to deal with our messed up patent system and as such are more free to innovate than we are here in the United States, putting us at a direct disadvantage. We will pay the price for this

     

    reply to this | link to this | view in thread ]

  21.  
    icon
    Killer_Tofu (profile), Feb 27th, 2009 @ 1:18pm

    Re: Re: Re: R. Riley

    To play the devils advocate here the software developers I work with believe their work should be patented. Just trying to point out there is no "everyone" in anything.

    I believe several of my statements went to the tune of:
    Every other programmer I know and the only groups I have ever seen
    I apologize for not being more clear on this point.
    I do not doubt that there are programmers out there who like the idea of software patents. I have not met any personally. And I have not searched for them online as I believe they are in the wrong, and there are more of us who do not have that view (thankfully).

     

    reply to this | link to this | view in thread ]

  22.  
    identicon
    George Bush, Feb 27th, 2009 @ 3:46pm

    Re:

    I respect Riley for using his name and info on his posts.
    I would say a real troll is someone who posts anonymously (like myself).


    And just how do you know that's his real name?

     

    reply to this | link to this | view in thread ]

  23.  
    identicon
    bob, Feb 28th, 2009 @ 3:49am

    High returns

    I have sent many Seagate drives back to Seagate for warranty exchange. Many had the $MFT delayed write problem. I see now that they are going back to a 3 year warranty with some of their product. Western Digital is now offering a 5 year warranty on it's black series of hard drives. I might have to look at them now.

    Oh Yeah patent trolls, fap fap fap fap etc. etc.

     

    reply to this | link to this | view in thread ]

  24.  
    identicon
    moelarry, Mar 2nd, 2009 @ 6:28am

    here's a clue

    innovation without patents and lawsuits is worthless. otherwise, one company develops and all others reap the rewards.

     

    reply to this | link to this | view in thread ]

  25.  
    icon
    Mike (profile), Mar 2nd, 2009 @ 10:28am

    Re: here's a clue

    innovation without patents and lawsuits is worthless. otherwise, one company develops and all others reap the rewards.

    Except... that's not what actually happens. Try looking up some of the history of innovation -- and the fact that it tends to happen *faster* in countries with no or weak patent systems.

    It's not hard to understand this if you actually had a clue instead of thinking you had a clue: those who develop the real innovations keep on innovating. Those who copy are always a step (or three) behind. Guess who wins?

     

    reply to this | link to this | view in thread ]


Add Your Comment

Have a Techdirt Account? Sign in now. Want one? Register here
Get Techdirt’s Daily Email
Save me a cookie
  • Note: A CRLF will be replaced by a break tag (<br>), all other allowable HTML will remain intact
  • Allowed HTML Tags: <b> <i> <a> <em> <br> <strong> <blockquote> <hr> <tt>
Follow Techdirt
A word from our sponsors...
Essential Reading
Techdirt Reading List
Techdirt Insider Chat
A word from our sponsors...
Recent Stories
A word from our sponsors...

Close

Email This