Ah, Perfect 10. The adult content company has spent the last decade or so engaged in one copyright lawsuit after another, accusing pretty much every search engine out there of copyright infringement for hosting thumbnails of images that others uploaded. It has lost repeatedly. And yet, it keeps on suing. At some point, you have to wonder if its legal budget might have been better spent on, I don't know, actually innovating and giving people a reason to buy. It looks like yet another of its legal theories isn't working out so well in court. paperbag was the first of a few of you to send in the news that the district court in California's Southern District has refused to grant an injunction against Rapidshare, suggesting that, as a mere file locker, Rapidshare would not be liable for the infringement done by its users.

Amusingly, the ruling came out just a day before a bunch of US politicians tagged Rapidshare as one of the worst copyright offenders out there, and suggested sanctions should be made against Germany for not stopping Rapidshare. Funny, then, that a US court also doesn't seem to think Rapidshare is breaking copyright law...

Of course, this was just the ruling over the request for a preliminary injunction. TorrentFreak's headline jumps the gun a bit in saying a court found Rapidshare "not guilty" for infringement. It sounds like we haven't quite reached that stage yet. This was just a request for an injunction before the actual case goes to trial. That said, at this point, I can't find a copy of the actual ruling, and the only information to go off of is Rapidshare's own press release, which states "The court rejected the application in its entirety. In its ruling, the court stated that as a file-hosting company, RapidShare cannot be accused of any infringements of copyrights." That sounds like the court said Rapidshare qualified for DMCA safe harbors, but without the full ruling, we don't know for sure -- and it's entirely possible that Rapidshare is exaggerating the ruling.

If anyone has access to the actual ruling, and are willing to share it, it could be interesting (and potentially relevant to other ongoing cases, such as the Viacom v. YouTube case). Once I've seen a copy I'll either update this post or post again, if the details warrant a separate post.

Another example of how the patent system is being used to hinder, rather than help, innovation. While we're no fans of Microsoft's view on patents these days, that doesn't mean we approve of ridiculous lawsuits against the company either. The one that got all the attention this year was a tiny Canadian startup, i4i, that claimed a patent (5,787,449) on editing an XML document, and then sued Microsoft and won (in Texas, of course). Not only did the company win, but the court ruled that Microsoft owed $98 per copy of Microsoft Word for this minor feature. On top of that, the court issued an injunction saying Microsoft could no longer sell Microsoft Word with this feature. Given the MercExchange ruling that said that injunctions don't always make sense in patent cases, it was hard to defend such an injunction as being necessary.

But... never let common sense get in the way of how the judicial system works when it comes to patents. The appeals court (CAFC) has now upheld the lower court ruling, requiring Microsoft to pay the $290 million and bars further sales of any copy of Microsoft Word with this feature as of January 11th. Microsoft's response is that it will simply remove this "little-used" feature. So this feature is rarely used, and yet it's worth $98 per copy of Word sold? How does that make sense?

Meanwhile, the tiny Canadian company is thrilled. It just made hundreds of millions of dollars for stating the obvious. And, rather than encouraging innovation, it's forcing a company to remove features. How is that innovative? How does that do anything at all to "promote the progress"? While some Canadian law professors might like to make up facts as to why these types of rulings make sense, I'm still at a loss as to how progress has been promoted here.

Just last week, plenty of tech publications were up in arms over the news that Microsoft had apparently secured a patent on XML word processing documents (patent 7,571,169). Of course, when you live by software patents, expect to die by software patents... as a judge (in East Texas of course) has now issued an injunction against Microsoft, barring the sale of Microsoft Word because it infringes on a patent that involves (you guessed it) XML word processing documents.

The judgment against Microsoft in this case actually isn't new. We wrote about it and the $200 million judgment back in May, noting how insane it was that the company holding the patent, i4i, felt that it deserved $98 for every copy of Microsoft Word ever sold. For what? Its patent, 5,787,449, is about XML editing of a word processed document. How that could be worth $98 per copy of Word is beyond me. Actually, how it's patentable at all is beyond me... but that's another story.

Of course, there's about 0% probability that this will actually stop the sales of Word, but it's ridiculous for Judge Leonard Davis to issue this injunction in the first place. As he well knows, the Supreme Court ruled in the MercExchange case that injunctions often don't make sense in patent infringement cases. In that case, the Supreme Court says that a judge should weigh a variety of factors in determining if an injunction is reasonable. From the actual injunction, there's no evidence at all that the judge weighed anything at all. However, he gave Microsoft 60 days to comply, which is ample time for Microsoft to appeal the injunction, and in such cases it's quite common for the appeals court to stay the injunction.

But, honestly, the whole thing shows (yet again) how screwed up the patent system has become. The fact that a judge would ban all sales of Microsoft Word because it can edit an XML document? And that's on top of a $200 million award for infringing on this patent? How can anyone think that's a sane outcome?

We've been following the story of how CSIRO, an Australian gov't agency, has claimed a patent on WiFi for years. Last year, we were pretty surprised that a judge not only sided with CSIRO in a case against Buffalo Technology, but issued an injunction, barring the company from selling its WiFi equipment. This was despite the recent Supreme Court decision that said patent injunctions should only be issued in certain circumstances (in the past, it was quite common to issue injunctions). The case is now being reviewed, and the good news is that a court has at least temporarily lifted the injunction while the court reviews whether or not the patent is even valid. This case could have a huge impact on a series of other cases that CSIRO has filed against pretty much everyone offering WiFi equipment.

Earlier this week we noted that the judge in the lawsuit over the RealDVD software had placed a secret temporary injunction against RealNetworks selling the software. The original promise was that a more permanent injunction -- or a lifting of the injunction -- would come Tuesday. But Tuesday has come and gone and the judge has decided she needs more time to decide on an injunction, and may want to consult some "experts" on the subject.

I can understand the desire to better understand the situation, but it's hard to see how preventing the sale of the software in the meantime does any less harm to the movie industry. In fact, you could easily make the argument that it does more harm to the industry, based on the way the industry defines harm. That is, right now, if someone wants to make a backup copy of a DVD, they're going to look online and find a variety of free ripping options, that offer no additional DRM and make totally free and clear rips. If Real's software was out there, they might discover that option and pay to get additional DRM (why, I don't know -- but some might feel comfortable with the Real brand, for example). Thus, it's difficult to see how the movie industry is any worse off if Real's software is on the market. In that scenario, at least some might end up with ripped DVDs with DRM. Without Real on the market, those who want to rip DVDs will have their rips with no DRM at all.

Monday morning, we wrote about how a judge had issued a temporary restraining order against RealDVD until he had time to review the details and rule one way or the other on a pre-trial injunction. In our comments, one of our readers suggested this story was incorrect, as there didn't appear to be an actual restraining order on file -- suggesting that Real Networks may have pulled the software on its own. Yet, it turns out that, yes, in fact there was a temporary restraining order, but the judge ordered both sides to keep it secret. This is quite odd, as almost everyone immediately figured it out from Real pulling the software, and then it was confirmed by Real in a filing responding to the court. But all this does is raise a simple question: what could possibly be the rationale for keeping the temporary injunction secret?

We were more than a bit worried last month, when a judge ruled that some bot software of the game World of Warcraft somehow infringed on Blizzard's copyright. It involved a lot of really tortured logic to figure out how such software actually violates Blizzard's copyright. It certainly is true that such software may be annoying to other World of Warcraft players, but that doesn't mean it actually violates copyright. We're already seeing some of the potential unintended consequences of such a decision, as Slashdot alerts us that beyond just seeking an injunction against the software, Blizzard is specifically seeking an injunction against him revealing the code of his software, such as by open sourcing it. If the court agrees, this effectively gives Blizzard control over someone else's source code, just because a judge found it infringed on their copyright. That seems highly problematic and dangerous.