Fark Gets Patent Troll To Settle For Nothing... Did Reddit Pay Up?

from the don't-feed-the-trolls dept

Last summer we wrote about an absolutely ridiculous patent troll, named Gooseberry Natural Resources LLC, who holds a ridiculously broad patent (6,370,535) that it claimed covered the basic concept of generating a press release online, which it then used to sue a bunch of companies who had been in business since way before the patent was issued. At the beginning of this year, we noted that Gooseberry tried to expand the definition of what the patent covered, and sued a bunch of tech sites you probably read, including Fark, Reddit, Slashdot, TechCrunch and Digg. As we noted at the time, as with most patent trolls, Gooseberry was just a shell company, and the real owners of the patent were a secret. Tragically, even with the combined investigative power of those sites, no one was able to piece together who really owns that patent.

In February, Drew from Fark explained why patent trolling is so incredibly detrimental. Unlike most other bogus lawsuits, you can't just point out that the patent has absolutely nothing to do with your business and get the case dismissed. You basically have to go to court and spend hundreds of thousands, if not millions, of dollars to fight it. This is what makes patent trolling so successful. It's cheaper to just pay up. In fact, patent trolls totally rely on this, because going to court is expensive for them too -- and they almost always lose. So they have just as much incentive to avoid court as the folks being sued, in many cases.

So it's awesome to hear that Drew stared down Gooseberry and got them to agree to "settle" for absolutely nothing. Even more amazing is that he convinced them to wipe out the "standard" NDA on a patent troll settlement. Almost every settlement includes an ironclad non-disclosure agreement which says you can't say what the amount of the settlement was. This means that even if you pay nothing, they still tell the world that you "settled" and imply it was for millions and talk up how this proves their patent is valid. Not in this case:
Their patent had nothing to do with Fark. The patent troll realized we were going to fight them instead of settle, so they asked for our best offer. I said how about you get nothing and drop the lawsuit? They accepted.

Normally, we wouldn't be able to talk about any of the details. Terms of patent lawsuit settlements are usually bound by ironclad nondisclosure agreements. NDAs allow patent trolls to extract maximum settlements from each entity they've filed lawsuits against - as a result no one knows who paid what. In the last round of settlement negotiations we asked to strike the NDA provision. They agreed (and to the attorneys out there reading this, I'm as baffled as you are).

Striking the NDA was crucial because I wanted to be able to tell everyone what really happened: we didn't pay them a single dime
Unfortunately, Drew also notes that Conde Nast (the owners of Reddit) also "settled" this week, which probably means they paid something (not much), though I wonder if they were able to ditch the NDA as well. It sounds like TechCrunch/AOL is still fighting this (and hopefully will be emboldened by Drew talking publicly about getting them to back down). Still, the bigger point is how much of a toll this kind of thing takes on businesses. Fark is quite successful, but this kind of thing could have destroyed it. As someone who is too often threatened by completely bogus lawsuit threats, I certainly can understand the emotional impact these things can take on someone, which Drew discusses as well:
At any rate, this bullshiat is finally over. It was a nightmare. Imagine someone breaking into your home, then being forced to sit on the couch while their lawyers file motions over how much stuff they can take. My wife Heather said my first draft of this post sounded too angry, probably due to the fact that every third word was an f-bomb (among other things I paraphrased our best one-time settlement offer as "how about jack sh*t and go f*ck yourself", which may be a more accurate depiction of how I really felt at the time). I won't lie though, I was angry and I am still. Too much money was wasted on this, too many sleepless nights, too many hours away from running Fark, and all this because someone else decided that suing companies for bearing a vague resemblance to their patent (patents they don't even appear to use themselves) is a good business model. We're short a full-time employee thanks to these douchebags.
People who cheer on trolls and bogus lawsuits have no idea what a massive emotional impact such bogus lawsuits have on legitimate businesses. Kudos to Drew for not just standing up to one and winning in pretty much every conceivable way, but also being willing to express just what kind of emotional impact these kinds of bullshit lawsuits have on people.


Reader Comments (rss)

(Flattened / Threaded)

  1.  
    icon
    DannyB (profile), Aug 10th, 2011 @ 12:10pm

    Cheaper to settle works both ways

    The patent troll realized we were going to fight them instead of settle, so they asked for our best offer. I said how about you get nothing and drop the lawsuit? They accepted.

    A better best offer would have been:

    How about you drop the lawsuit you started, PAY US, and then go away?

    It's cheaper to pay us and go away than to fight.

     

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

  2.  
    identicon
    John Doe, Aug 10th, 2011 @ 12:15pm

    They know, but don't care

    People who cheer on trolls and bogus lawsuits have no idea what a massive emotional impact such bogus lawsuits have on legitimate businesses.

    The problem is people like this are in it for the money and don't care about the human toll.

     

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

  3.  
    icon
    Him ThatIs (profile), Aug 10th, 2011 @ 12:35pm

    Or use the movie "Ransom" strategy.

    Sometimes, standing your ground is worth it. Would Drew be able to sleep afterwards had he crumbled in front of his wife. He did the best thing he could under the circumstances. How do you move on and stay sane when some anonymous group legally steals your livelyhood from you.
    All these companies would be smart to pool together and attack the patent trolls like a union. That's not going to happen, but if they polled their experiences together (e.g. a forum of some kind), they would be more effective in protecting themselves. Just a thought and I'm sure THIS forum will have better.

     

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

  4.  
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    specialized (profile), Aug 10th, 2011 @ 12:35pm

    We're short a full-time employee thanks to these douchebags.

    There go patents promoting progress and creating jobs.

     

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

  5.  
    identicon
    Anonymous Coward, Aug 10th, 2011 @ 12:38pm

    Re:

    So they really are effective!

     

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

  6.  
    identicon
    Anonymous Coward, Aug 10th, 2011 @ 1:06pm

    "and sued a bunch of tech sites you probably read,"

    You already know what TD readers read through various analytics sites.

     

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

  7.  
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    mike allen (profile), Aug 10th, 2011 @ 1:14pm

    We have a few people in the UK who can deal with any patent troll or lawyer, you may have seen them running round London and other cities on your tv recently. we however are not responsible for extra collateral damage caused. We can send them to you at no charge.

     

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

  8.  
    identicon
    Anonymous Coward, Aug 10th, 2011 @ 1:14pm

    Re:

    What, you don't have NoScript installed in your copy of Firefox? You don't use BetterPrivacy? You don't erase cookies?

     

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

  9.  
    identicon
    Anonymous Coward, Aug 10th, 2011 @ 1:30pm

    Re: Re:

    I do, and you do, but I'd wager the common reader doesn't.

     

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

  10.  
    icon
    mike allen (profile), Aug 10th, 2011 @ 1:33pm

    Re: Re: Re:

    i do too.

     

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

  11.  
    icon
    Jeffrey Nonken (profile), Aug 10th, 2011 @ 2:17pm

    Re:

    Sold! We'll take two hundred to start, and see how they work out.

    We'll provide nightsticks and aluminum bats on arrival.

     

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

  12.  
    identicon
    Nicedoggy, Aug 10th, 2011 @ 2:23pm

    They got farked!

     

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

  13.  
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    Prashanth (profile), Aug 10th, 2011 @ 2:38pm

    Good on them for putting pressure on patent trolls. It's great that momentum is finally building in the public (as far as we can see) to do something meaningful about patent trolling.

     

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

  14.  
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    The eejit (profile), Aug 10th, 2011 @ 2:42pm

    Re: Re: Re:

    I'm the Lowest Common Denominator, and even I do.

     

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

  15.  
    identicon
    Anonymous Coward, Aug 10th, 2011 @ 4:13pm

    Shell company

    " Gooseberry was just a shell company, and the real owners of the patent were a secret. Tragically, even with the combined investigative power of those sites, no one was able to piece together who really owns that patent. "

    Know what we need here? A corporate income tax that takes money EVERY time one shell company gives money to its parents. If you want to nest them 12 deep, fine; but you won't have much left at the other end.

    Oh, and I'd also ban NDA's for lawsuits. They aren't in the public's best interest.

     

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

  16.  
    icon
    Atkray (profile), Aug 10th, 2011 @ 4:27pm

    Re: Re: Re: Re:

    nuh uhn I am.

    "I do, and you do, but I'd wager the common reader doesn't."

    TechDirt readers are not common.

    In fact that is one of the things that kind of upsets me when people here talk about editing your host file etc... common people have no clue what that means, so when DHS takes away a domain name even though the site exists elsewhere for common people it is gone and once they see the scary DHS warning in place of the website the delete all memory of the site from their minds and their computers.

    Back on topic yup yup even I do!

     

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

  17.  
    identicon
    IPTrolltracker, Aug 10th, 2011 @ 5:33pm

    Fark farks a troll

    And in celebration, a haiku:

    Farked with the wrong guy / had your hat handed to you / buh bye, Gooseberry!

     

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

  18.  
    identicon
    Anonymous Coward, Aug 10th, 2011 @ 7:09pm

    Where is RJR, anyway?

     

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

  19.  
    identicon
    Anonymous Coward, Aug 11th, 2011 @ 1:59am

    They sue over a patent that they had for online new letters. Other are sueing over online payment system. Still others are sueing over online snippets of code being used. Are we going to see more law suits over patents about online website services? could facebook/myspace or other social sites sue google+ for doing the socal modal or the way they have it setup to "friend" others? Maybe I need to break out my old dos programs that was a BBS chat program that you "friended" ppl and claim a patient and sue everyone with a chatbox or "friend" system in place.

     

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


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