by Mike Masnick
Mon, Dec 14th 2009 8:17am
by Mike Masnick
Thu, Nov 5th 2009 7:54am
from the questions,-questions,-questions? dept
Finding the whole thing bizarre, but remembering that I have some Canadian currency from my last trip there, I checked -- and, indeed, in tiny print in the lower right-hand corner, there is a copyright notice. And then... bonus. Tucked in with my Canadian cash was a 5 euro bill as well... and it also appears to have a copyright notice on it right at the top in the center (though, it's tiny). I did a quick search, and indeed, it appears that the design of the euro is also covered by copyright with specific limitations on copying. Of course, I thought that was what counterfeiting laws were for -- so why even bother with copyright?
by Mike Masnick
Wed, Nov 4th 2009 12:51pm
Patent Holder Sues McAfee, Gets $25 Million... But May End Up Losing $5 Million Due To Everyone It Has To Pay Off [Update]
from the this-is-fun dept
Joe Mullin has uncovered some of the details of how Altitude works (and how some of these lawsuits work), because Altitude is upset with the amount of money it got back from one of the patent holders whose lawsuit it "invested" in. Note, here, that it does not appear that Altitude invested in the company in question, DeepNines, but specifically in the lawsuit. Altitude gave DeepNines $8 million for its lawsuit in the structure of a loan. DeepNines sued security firm McAfee and worked out an eventual $25 million settlement. How much did DeepNines actually get? Less than $800,000 -- and even that's in dispute. (Updated in the next paragraph).
Basically, because Altitude had a "model" of what it felt DeepNines should get in a lawsuit, and that model popped out a $200 million award, it felt that it didn't get enough. But the breakdown suggests it did fine. DeepNines paid back the loan at a 10% interest clip, plus another $700,000 as its "contingency fee" on the winnings, adding up to $10.1 million. Then DeepNines ended up having to pay its lawyers at Fish & Richardson over $11 million in fees, plus another $1.25 million to local lawyer (and former federal judge) Robert Parker. DeepNines also had to pay additional expenses for travel and other legal costs, adding up to another $2.1 million. In the end, it was left with less than $800,000. Doesn't seem quite worth the effort. (Update: Good discussion in the comments suggesting that the math here doesn't quite add up, and DeepNines may have actually ended up with about $8.8 million, because you have to add the original $8 million investment to the $25 million in counting in the inflow. That makes sense, so the numbers may be off. I was initially relying on the report claiming $800k was leftover, but it may have actually been higher. The rest of the story does make sense however).
Especially since Altitude is demanding another $5.3 million, saying that DeepNines should have calculated its contingency fee based on the overall award, not after subtracting legal fees. Of course, if it did that, then DeepNines -- despite having "won" $25 million, will have lost nearly $5 million on the overall deal. Be careful who you partner with. This should be a huge warning to any patent holders who think about accepting money from a firm like Altitude. Even a $25 million "win" can turn into a huge loss, if you're not careful.
by Mike Masnick
Mon, Oct 26th 2009 4:34am
from the revealed! dept
Most intriguing is the sum paid by Apple to settle an SPT suit brought over the iPhone in the Eastern District of Texas in 2008: $865,000. Without any motions being filed after the intial complaint or any substantive discovery, a bit more than 30 percent of that amount, $271,817, went to Niro Scavone, which also billed $46,568 in expenses. Nearly $40,000 went to someone identified as "Ward"--most likely Johnny Ward Jr., who served as local counsel to SPT in the case. Of what was left, almost $109,000 went to SP Technologies, then owned by investor Courtney Sherrer, and $311,400 went to Boesen.There's a lot more in Mullin's post. Not sure how much is worth commenting on, but given that such patent holders and patent hoarding companies tend to be incredibly secretive about all of this stuff, it's still an interesting peek behind the curtain.
Also noteworthy: a full 10 percent of Apple's payout, $86,500, is marked as going to "LG"--an apparent reference to LG Electronics, which, according to the Boesen receipt, paid $834,964.01 to settle a separate SPT suit in 2006. Why would LG be getting a cut of the settlement in a suit to which it was not a party? And was Apple aware that a piece of that settlement might wind up with one of its competitors? Representatives from Apple and LG did not immediately respond to requests for comment.
Oh yeah, as for Mullin's question about LG receiving 10% of the payout from Apple, that might not be all that surprising really. Last year, we covered how it was becoming increasingly common for patent hoarders to play this neat trick where they sue a bunch of companies and promise the ones who settle quickly a cut of what they can get from the others. This sets up a little an interesting game theory situation, whereby companies have extra incentive to settle quickly, which makes the patent holder very happy, and which they use to tout how "legitimate" their patents must be (yeah, right). It sounds like, perhaps, that's what happened here. Since LG settled earlier, perhaps part of the settlement was the right to 10% of a cut against others.
by Mike Masnick
Tue, Oct 6th 2009 12:27pm
from the fascinating! dept
In fact, Clive Thompson points us to a study that highlights this in a really strong way. It's a series of studies that show that when people overestimate the monetary benefits (or costs) and underestimate the nonmonetary ones, they often set up really bad incentives.
For example, they've found that fewer people give blood when they're paid for it. For someone who thinks only in terms of the monetary benefits, this would make no sense. Why would giving people money lead to less of the activity. But the reasoning is that the real marginal benefit that people get from giving blood is the belief that they're doing good in the world and helping to save lives. Getting paid for it, actually hinders that feeling, by making the whole thing feel like a transaction. And the money paid is apparently a lot less than the decreased "good feelings" from the marginal benefit.
On the flip side, other experiments showed that fining people over certain actions (such as picking up their kids from daycare too late), actually increased the number of tardy parents. Again, if you think of this solely in monetary terms, this makes no sense. It now costs more, monetarily, to be late to pick up a kid. But, in making it a monetary transaction, it removed non-monetary costs -- such as the "guilt" of being late. As the article notes:
The fine seems to have reduced their ethical obligation to avoid inconveniencing the teachers and led them to think of lateness as simply a commodity they could purchase.This is really fascinating stuff that is important for people to understand in setting up any sort of incentive structure. Money -- either on the cost or benefit side -- is not the only incentive. And thinking that it is often leads to miscalculating a series of other, potentially more important, costs and benefits. That doesn't mean that economics is wrong. It can handle all of that. The problem is when people assume that it's only the direct monetary costs and benefits that go into the equation. It is, unfortunately, a common problem, and leads to all sorts of confused thinking both about business models, but also about the economics profession itself.
by Mike Masnick
Thu, Sep 10th 2009 10:55am
from the nice-trick dept
But, back to the original point. ASCAP, BMI and their supporters insist that they're not as bad as the big, mean RIAA, and that they're especially focused on providing important royalties to less well known artists. Except... even that may be questionable, at least when it comes to live performance royalties (admittedly, a smaller segment of overall royalties). Reader btr1701 sent in some email exchanges from a mailing list, which I won't share directly since I don't have approval, concerning a jazz musician trying to find out why she doesn't receive any live performance royalties, despite knowing that these organizations collect them, supposedly on her behalf. In response, she's told that ASCAP and BMI only distribute that royalty money to "the top 200 grossing US tours of the year." If you're smaller than that? Too bad. Except... they do have one minor exception. If you play "serious music" (no joke), then they'll pay you your royalties. So, the musician asks what is "serious music" and is told it's "generally considered to be classical music."
The musician tried re-registering her own (jazz) compositions as "serious music" but it "does not appear to have made any difference whatsoever" and she notes that she is "yet to receive a single penny... for any US performance or radio broadcast of any kind" despite the fact that her music has been performed in the US for almost ten years, and "the vast majority of performances of my music take place in the US."
I went looking for some more details, and it appears that, indeed, ASCAP and BMI have a policy in place to only provide performance royalties to the top 200 grossing tours in the US. If you're a "smaller" act, the only way to get paid is to be an opening act on such a tour. Otherwise? Too bad, you're on your own. Aren't you glad you signed with ASCAP or BMI? Update Good clarifications in the comments on this. Despite what the musician was told originally, it appears that it's not that ASCAP and BMI only pay the top 200 tours, but that they only monitor them (it's not explained how they know ahead of time which are the top 200) in order to figure out who to pay. The end result, of course, is functionally quite similar. If they're only monitoring the top 200 grossing tours, then the likelihood of them finding out about songs from less well known composers is close to nil. But those big names? They get more than their fair share.
by Mike Masnick
Thu, Jun 11th 2009 7:33am
from the this-won't-end-well dept
by Mike Masnick
Thu, May 28th 2009 9:50am
from the good-job,-guys dept
by Derek Kerton
Tue, May 26th 2009 3:40pm
from the Fleece-'em,-Danno dept
Your U.S.A. cellular phone bill, since the early 1990s, has had a fee levied on it by governments for E911 services. The fee differed from state to state, and was ostensibly to fund the upgrade of 911 call centers. The public safety call centers were to be readied to receive location information from cell phones, and to use that information to instruct emergency crews. The cellular carriers were required to collect this tax for the government, but were also separately required to design, create, and deploy the (much more expensive) systems that can determine where the caller is. The government basically required the carriers to fund a public safety system (which you may or may not agree with). One thing with which none of us could agree was that the E911 taxes on our phone bills were promptly squandered by governments, for years, on just about everything except 911 call center upgrades. Money was mis-spent on ballpoint pens, conference attendance, dry cleaning, and boots.
Most of that is history; much of the US is now ugraded. (Please don't rely on E911, as it only works when you have a good cell signal, battery power, and a few other things. Don't use it as a crutch or as a "safety device"!) So what do you think will happen to those monthly taxes that were collected for so many years? Time to cancel them, right? Not so fast, says the State of Hawaii, which gets 66 cents of E911 fees from every monthly bill. This article in the Honolulu Advertiser shows how various government agencies are trying to get their hands on the "windfall." A few examples of this include: the Honolulu PD wants a new dispatch system for $20m, the Board that manages the fund wants their mandate extended to spend on other tech like VoIP location, the State hired a new Executive Director of the E911 fund for $294,421/yr, the legislature is taking $16M from the fund to help balance the budget, and some are trying to build new cell towers with the money. The article predicts future raids on the funds, and given what we've seen nationwide, we would agree.
What is it about this country that we can't just call a tax a tax. We seem to have an addiction to tucking and hiding fees into a wide range of services, where over time the fees have little to do with the services. Dear government: If you're going to tax me, please just do it up front, talk to me honestly, and say it's a tax. I want to feel you reaching into my pocket, instead of having you just skim the till behind my back.
by Mike Masnick
Wed, May 6th 2009 3:33am