We're still confused as to why Google has continued to have Motorola Mobility play the role of a patent bully ever since they bought it. Over a year ago, we suggested that Google could make a real statement on patents by stopping its aggressive patent licensing program via Motorola. After all, Google bought Motorola Mobility just a few weeks after the company appeared to be taking a strong stance against patent bullying. Ever since, it has seemed rather hypocritical for Motorola Mobility to have kept on being a patent bully.

And it seems to be backfiring all over the place. It was the one real area that Google got in trouble over with the FTC's antitrust investigation. And, the patent legal fight with Microsoft hasn't gone well for Motorola Mobility either. And, now, the latest bit of news is that the EU is coming down on Motorola Mobility for seeking an injunction over standard-essential patents as well.

Honestly, this whole thing has left me really confused. The patent aggression hasn't worked out at all for Google, is leaving them wide open to fines and complaints from various powerful government bodies, isn't doing much in the courts and (most importantly) is leaving the company itself wide open to charges of hypocrisy. Why not just do the right thing -- the same thing that Google itself has done in the past, and which it has spoken out about on numerous occasions: stop being a patent bully. It makes no sense that they company has continued down this path.

For many years we've wondered why countries bend over backwards to stay in the US's good graces concerning the infamous "Special 301" report, put together by the USTR. The list has no objective methodology at all. Instead, companies send their complaints to the USTR, and the USTR launders rewrites those complaints and puts certain countries on the "naughty" list. Back in 2007, Canada explicitly announced that it did not recognize the legitimacy of the list, by saying:

Canada does not recognize the 301 watch list process. It basically lacks reliable and objective analysis. It's driven entirely by U.S. industry. We have repeatedly raised this issue of the lack of objective analysis in the 301 watch list process with our U.S. counterparts.

And we've wondered why other countries do not do the same. When I was in Spain last week, a reporter I spoke to kept asking about the Special 301 list, as it seemed to be such a key concern for people there, and I noted that more countries should do what Canada does. I realize that there are other issues there, and Canada knows that the US isn't likely to create a trade war over the list, but it still seemed odd how seriously some other countries take the list.

That's why it's good to see at least one more country follow Canada's lead. Chile, which is on the "priority watch list," has officially announced that it, too, does not recognize the legitimacy of the list (translated):

The Chilean government said today it does not recognize as a valid instrument rating called "301 list" that makes the United States on violation of intellectual property rights and this year again includes the country in its Priority Watch section .

"This report is conducted outside the margins of the Free Trade Agreement between our country and the U.S., and therefore not recognized by Chile as a valid instrument rating," said a statement released this morning.

The "'301 List' lacks clear criteria for categorizing the different countries, but is rather a reflection of the interests of American industry selectively applying their intellectual property standards to other countries," it added.

Good for Chile to stand up for itself against the list.

Of course, it's no surprise that Chile got put on the list. As we noted last year, the country is actually a pioneer in strongly protecting intermediaries from liability, thus much more strongly protecting internet free expression and innovation. They're also actively encouraging innovation by luring startups to Chile with all sorts of benefits. Basically, Chile is quickly showing itself to be a supporter of innovation, which apparently isn't something the USTR wants to encourage.

For this week's awesome stuff post, we've got links to movies about things that we regularly talk about here on Techdirt: the prosecution of Aaron Swartz, the CFAA, patents and piracy.

• First up, is a documentary about Aaron Swartz called The Internet's Own Boy by Brian Knappenberger, who previously did a documentary about Anonymous. Knappenberger's film isn't a "memorial" about Swartz, but rather an "investigative" documentary about his story and the lawsuit against him, as well as the legal structure that led to his arrest and trial. The video that Knappenberger has put together is really compelling and touching: This project has received a lot of attention, so there's no surprise that it's quite close to its $75,000 target with a few weeks to go. It looks like it should be a great project to support.
• From once CFAA case to another. Krystof Andres & George Russell are doing a documentary called The Hedgehog & The Hare, all about the CFAA, but mainly focused on the case against Andrew "Weev" Auernheimer. The documentary will also explore how the CFAA goes way too far in trying to criminalize perfectly reasonable computer activities. The target for this project had much more modest goals than the Swartz one, though the production values definitely look a bit more amateurish. Plus, frankly, the rewards on the Swartz movie are a lot more reasonable. That said, with just a few days left, it looks like this movie is likely to squeak by the target even if it's just slightly under as I write this.
• This next one, I'm a bit less sure about, but the topic could be interesting. It's supposedly a short film, made in South Africa about the big pharmaceutical makers going after generic drug makers, called The Cure. What makes me a bit unsure about is that the filmmakers, Katey Carson and Errol Schwartz, seem a hell of a lot more excited about the fact that (a) they signed up some "Oscar-winning talent" to be in the film and (b) that they're filming the whole thing with an iPhone, than they are about the story, which they barely mention at all. The topic sounds interesting. I just wish they'd actually have said something about that, rather than the other stuff which really isn't that interesting. The project has barely raised any money, and they're pretty ambitious to seek $35,000 for this. But since it's an Indiegogo "flex funding" campaign, they'll get the money even if they don't raise the full amount. Also, the "rewards" you get back seem ridiculously high priced. You have to pay $100 just to get a download of the short film and $50 for the script? Hmmm. Love the idea of a film that highlights problems with drug patents, but not sure this is the best way to do it.
• And, finally, a documentary about piracy. I mean that's what critics insist this site is all about, right? So I figured, why not. Here's a documentary film about a Somali pirate -- you know, one who actually hijacked a ship, called The Smiling Pirate, which aims to tell the story of the one remaining living member of the pirates who hijacked the Maersk Alabama. As the story suggests, despite a forthcoming Tom Hanks movie about this whole thing, there appear to be a lot more questions than answers about what really happened both aboard the ship and then with the captured pirate after the whole thing happened. Sounds like an interesting story, but it hasn't picked up very many backers yet. It's also an Indiegogo flexible funding project, so will receive any money it raises, but it's not clear if it'll get enough to really support the making of the documentary any time soon.

That's it for this week. Next week we'll be back with more awesome stuff.

Oh boy. Tim Cushing recently had a post here about a very angry patent lawyer, by the name of Andrew Schroeder. The story of his unbelievable rant filed with the patent office was originally highlighted over at PatentlyO, by Dennis Crouch, who most folks in the patent business are well aware of because of the blog and his regular commentary on patent-related issues. After Crouch published the rant, the story caught on in the press and it got a bit of coverage, including on our site as an example of how not to conduct business before the patent office. Everyone has bad days. And the best thing to do is to admit that you had a bad day and move on.

But that's apparently not how Andrew Schroeder rolls.

Our friends over at Above The Law have alerted us to the fact that Schroeder is back... and is he ever pissed off about people knowing just how pissed off he is. In what may be one of the worst-designed blogs ever made (and, warning, it's so badly designed that it doesn't even work at all if you have javascript turned off) Schroeder has announced that first, Dennis Crouch is the "Dickhead of the Year" for 2013 (I'm wondering who the past winners are) and (even better) that he believes Crouch violated the CFAA in finding and publishing his rant.

Both posts are filled with poorly designed graphics, mostly mocking Crouch, which Schroeder proudly takes credit for late in that first post. These aren't even "bad in an ironic way" graphics. They're just bad. In the way that someone is when they first discover how Photoshop works and suddenly thinks they're a master of design bad. But the rant is just as wacky. He never apologizes for the language he uses, beyond noting that it was "less than flattering." No, his focus is on the claim that his insane rant -- in which he accused a patent examiner of taking drugs, being drunk, not reading the patent application, of having to write with crayons and a variety of other euphemisms to suggest that the examiner has mental problems -- was a "confidential" communication between himself and the examiner, and revealing it involved both (a) illegal hacking into the USPTO site and (b) being a "dickhead" for thinking it might be entertaining to highlight his ranting.

One of the things I find fascinating about this whole ordeal is the fact that many of the articles written since Patentlyo’s blog post all assume that this was some sort of “PUBLIC” rant or tirade. Everyone assumes that this was some sort of “Open Letter” to the USPTO that I wrote to shame this particular Examiner (in fact, this was just between the Examiner, his Senior Examiner and me…and no one else). In fact, this was a confidential letter and anyone who tells you anything to the contrary is full of shit, I don’t give a fuck what they tell you.

Uh, no, it wasn't.

From there, Schroeder goes into a big rant about how terrible it is to use the USPTO's filing system. That may be true, but so what? That has nothing to do with the inappropriate nature of his rant. Schroeder, however, connects the dots to claim that because the USPTO site is so complicated, he would have thought that it would protect his "confidential" communications better (there's an assumption in there that's not quite true...). He also includes some totally gratuitous ad hominem attacks on Crouch, because no Schroeder rant is complete without resorting to sophomoric trash talking.

He further complains that Crouch appears to be "sympathizing with the Examiner!" because no one could possibly sympathize with a patent examiner. Now, we're generally no big fans of patent examiners around here, because we tend to think they approve all sorts of junk patents, but I think it's rather easy to sympathize with the recipient of Schroeder's rage rant. Of course, Schroeder hates examiners for the opposite reason we do. He insists they're not approving nearly enough patents, and that their default is to reject patents. In fact, he gives an anecdotal "side note" about some mythical patent examiner who has a 100% rejection rate. That's amusing, since (as we pointed out recently) in 2012, nearly 90% of all patent applications were eventually approved. And Schroeder thinks examiners are too quick to reject?

In the second post, Schroeder insists that as far as he can tell it's absolutely impossible that Crouch could have found his rant in the PAIR system, and therefore, he believes that Crouch hacked into the USPTO's computers and violated the CFAA.

I’m gonna have to crowdsource this one because I’ve been doing research and can’t seem to figure out how Dennis Crouch was able to access my account with the USPTO. It has always been my understanding that patent applications less than 18 months old and their office action responses are to remain confidential. I’m starting to think that Patentlyo’s Dennis Crouch just wants me to believe that it is common knowledge that you can access anyone’s records there at the USPTO. However, from my own research I have found no evidence whatsoever that it is possible. And more importantly, I DON’T EVEN KNOW IF HIS ACTIONS WERE EVEN LEGAL!

The more I think about it, the more likely it is that Dennis Crouch may have broken a whole bunch of laws. When it comes to cyber crimes there are state laws (one for where he lives, possibly where I live, and that of Alexandria, Virginia (USPTO).

And then of course there are Federal laws as well such as the CFAA (Computer Fraud & Abuse Act) which makes it a felony to hack and steal documents similar to what Dennis mother fucking menace may have done.

That one comes complete with a poorly executed graphic showing Crouch's head mixed in with the text "Computer Hacking is Cool" and pretending that this is a class that Crouch teaches at the University of Missouri Law School.

Randomly, at the end of the first blog post, Schroeder goes off on how proud he is of the hard work he puts into designing his websites:

You see, for the past several years I have taught myself how to build my own websites, everything…from A-Z. I can do HTML, the Videos, the graphics, the images, CSS, and even the SEO. And I think that I can build one hell of a website. For the past several years, I have had countless people call me out of the blue and ask me who built my website. When I reveal to them that it was me, they usually respond with something like, “No, really, who actually built your website?”

I love building websites. I get absorbed in it, and I can’t tell you how many times I have looked up at the clock to see “3:AM”, and wonder where the past 12 hours went. Some guys have video games, girls have shoe hunting expeditions, I have the website munchies. So, if any of you have gotten this far and think you need a website, go ahead and give me a call, and I’ll hook you up!

The website has to be seen to be believed. Not only does it not function without javascript, but the layout is ridiculous and confusing, the graphics don't line up, and (as mentioned) the graphic design is awful. So, not only can you get a patent lawyer who might start cursing you out and rant at you for not approving the patent he wanted you to approve, but he might start advertising his awful web design skills in the middle of it all. Wow. Here's a screenshot of one of the blog posts (each has their own "background" image that distracts from, well, everything. Schroeder might do well to consider taking a deep breath before writing any more angry rants and maybe, just maybe, taking a class on web an graphic design.

You may have seen the news recently that the US government has kicked off a lawsuit against Novartis, the pharmaceutical giant, for paying kickbacks to doctors to get them to prescribe certain drugs.

Authorities said the Basel-based company for a decade lavished healthy speaking fees and "opulent" meals, including a nearly $10,000 dinner for three at the Japanese restaurant, Nobu, to induce doctors to prescribe its drugs.

They said this led to the Medicare and Medicaid programs paying millions of dollars in reimbursements based on kickback-tainted claims for medication such as hypertension drugs Lotrel and Valturna and the diabetes drug Starlix.

The charges are detailed in a whistleblower lawsuit first filed against Novartis Pharmaceuticals Corp by a former sales representative in January 2011 and which the U.S. government has now joined.

Of course, this is hardly a surprise to anyone who has followed the medical profession at all over the past few decades. The stories of "favors" and benefits for doctors from mis-named pharmaceutical "sales reps" (often very young, just out of school, incredibly attractive, but with little knowledge of the actual field), whose jobs often seemed more akin to cruise director and entertainer rather than knowledgeable, helpful sales person, are everywhere. That it's finally taken this long for the government to think that maybe, just maybe, this might distort the nature of our healthcare system, and lead to wasteful prescriptions, including prescriptions that cost significant taxpayer money is somewhat incredible.

What's worse, as economist Dean Baker points out, is that anyone at all is surprised that this happens. After all, when our own government policy is to hand those drugmakers incredibly powerful monopolies on life-saving pharmaceuticals, we've actually created the incentives ourselves for such activity to take place:

When the government grants drug companies patent monopolies that allow them to sell drugs at hundreds or even thousands of times the free market price it gives them an enormous incentive to do things like pay off doctors to prescribe drugs. Everyone who has ever taken an intro economics class understands that fact.

Unfortunately our leading economists do not seem aware of how protectionism in the prescription drug industry leads to corruption that can both raise costs and jeopardize the public's health.

Perhaps that's why it took the US government so long to even attempt to crack down on such activities. It created the environment in which such activities thrive and are encouraged.

If we want to stop such practices, perhaps, rather than just suing the pharmaceutical companies, we start to look at the ridiculous incentive structure we've set up, whereby drug companies take on very little of the actual risk (most drugs today are actually first created by universities using publicly funded money), but are given incredibly powerful monopolies, such that the prices are considered unbelievable.

True competition in the market would -- as always -- lead to both more actual innovation, lower prices, less corruption and (most importantly) better health and public safety.

Ever since Google decided to stick with Motorola Mobility's existing patent fights with various companies, I've been wondering why they did so. Here was a chance for Google to take the high road and actually live up to what it had been claiming concerning the problems of patents. But, instead, it's basically continued to try to use patents as a weapon. The fight against Microsoft has been particularly silly. While Microsoft did initiate things, Motorola's decision to fight back had seemed dubious from the start. Being a patent bully is no way to run a long-term business, and that's doubly true when you're a company telling people how broken the patent system really is.

And yet, Motorola Mobility pushed on against Microsoft... and it's not going well. On Friday, a judge knocked the damages down to next to nothing, basically siding with Microsoft. Microsoft had argued that if there were any infringement, the amount owed should be about $1.2 million. Motorola Mobility had argued for... $4 billion. The judge came down at just $1.8 million.

I recognize, of course, that the whole reason that Google bought Motorola Mobility was to get access to these patents. And, on top of that, Microsoft did strike first here. However, Motorola Mobility had hit back quite strongly, and even once Google was in control, it seemed to have little interest in pulling back. The whole thing makes Google look a bit hypocritical, and it certainly hasn't helped the company win any of these legal battles.

A few years back, a patent attorney made a simple suggestion to me, asking that, whenever I write about patent lawsuits, that I include the US patent number on the patent within the text of the article. He explained that for those sued, one of the most useful things is to find other lawsuits regarding that patent, and it's actually not that easy, so having stories list the patent numbers becomes a big deal. In many cases, when companies are sued, their lawyer does a general search to see if the patent has been used in litigation before -- and it's that general Google Search, which is why the request was made to me to include patent numbers. However, for companies or individuals sued by patent holders, having a lawyer sit there and do a Google search can cost you an extra $500 to $700 per hour of lawyers' fees. Many lawyers have argued that the system needs to be much better.

Thankfully, the folks over at Patexia have recently launched a new feature on their site that makes it much easier to look up such things. For example, here are the Patexia results for lawsuits involving US Patent 6,857,067 which is held by Uniloc, who recently used it to sue X-Plane, Mojang and others. While, in that case, you can see all the recent lawsuits come from Uniloc (who could be searched via Pacer), it may not be as complex. But when patents get passed around a lot, following the trail isn't always so easy. No matter what, this seems like it could be a useful tool, especially for those sued by patent trolls.

One of the many problems with the secretive nature of trade agreements is that it insulates negotiators from the real-world consequences of their actions. That's particularly true for the FTA talks between the EU and India, currently taking place behind closed doors. One of the key issues for the EU side is India's role as a supplier of generic medicines to the world, and India's tough stance on issues like the evergreening of pharma patents. From the various leaks that we have, it seems that the EU is demanding that India toe the line on drug patents, and cut back its supply of low-cost generics to emerging countries.

That might seem a reasonable request, since there is no doubt that India's production of generics reduces the profits of the pharma companies in Europe, which could charge far higher prices were there no competition from generics. But what that overlooks -- and what secret negotiations allow those involved to overlook -- is the impact such a move would have on millions of people around the world.

A letter from a group of Cambodian activists that struggle to supply much-needed medicines to those too poor to buy them, published on the infojustice.org site, provides us with a rare insight into what the EU's demands would mean for the world's poor:

We are saddened that behind the rhetoric of democracy, human rights and freedom the EU is in fact prioritising corporate interests to the lives of millions of people. It is needless to say that those affordable generic drugs are absolutely vital for the lives of millions who otherwise cannot afford expensive treatment of life threatening diseases such as tuberculosis, malaria and HIV-AIDS. Many suffering from such serious diseases would not be able to survive without these generic drugs produced in India.

…

Having seen the importance of made-in-India generic drugs for the lives of millions, we in no ways can express our frustration about the attempt of EU and European pharmaceutical giants to control the production of these cheap medicines. This must stop right now. It is a true example of putting profits before people's lives and take advantage of people's illness for corporate profits. Our lives should not be regarded as a business opportunity. We urge the EU to reconsider its pursuit of intellectual property rights for medicines and to realise that blindly protecting the interests of large European pharmaceutical corporations will lead to nothing but a subtle form of genocide of the poor, their families and children in developing countries across the world.

It's hard to believe the EU negotiators personally wish to kill thousands of the poor; but the secretive nature of the talks means that they can close their eyes to the fact that if they succeed in forcing India to cut back its production of generics, large numbers of people will certainly die as a direct result. That's another reason why these kind of talks must be held openly: not just so that we know what is happening and can give our input, but also so that those conducting the talks realize that what they are doing is not some abstract game, but a matter of life and death for millions around the world.

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As many people know, on Monday, the Supreme Court finally heard the Myriad Genetics case, to look at whether or not genes are patentable subject matter. For the past few decades, the USPTO has generally argued that you can patent genes, which just seems crazy to most folks who point out that it's nuts to patent something that exists in your body. Supporters argue that they're trying to patent the process of isolating the gene, but that's just semantics. As you may recall, the appeals court, CAFC, had decided that genes are patentable because they're separate from your DNA. After that, the Supreme Court disallowed patents on medical diagnostics, and asked CAFC to reconsider the Myriad case with that as a guide. In response, CAFC stuck by its guns, insisting that genes are patentable.

With the big caveat that oral hearings are often meaningless in terms of how the Supreme Court eventually rules, the transcript and the various reports from those who were there suggest that there is at least some good skepticism about patenting genes. First off, we should point out that Myriad's CEO, Peter Meldrum posted a ridiculous op-ed at USA Today over the weekend, in which he argued that Myriad should be allowed to get patents because it worked hard to get them.

To create tests for hereditary breast cancer and ovarian cancer, our company and its investors spent more than $500 million over 17 years before we were able to recoup this investment.

Except, of course, patents aren't about the sweat of your brow and how much work you put into something. Nor -- despite Meldrum's silly claims -- are they about letting companies "own" their findings:

We think it is right for a company to be able to own its findings, just as pharmaceutical and other companies do all the time.

Except, of course, that's wrong. Because Meldrum does not want any other companies, who came up with the same thing independently, to "own" their "findings." Instead, he wants them to pay up or go out of business. For all of those companies, who may have spent even more money, that, apparently, doesn't matter at all, which highlights the complete hypocrisy of Meldrum's position. His argument only applies to his company, and not any other.

Furthermore, Myriad's critics made clear to point out that other labs were working on the same thing and were happily foregoing patent protection. The clear suggestion: it wasn't the patent that created the incentive, and the end result was that all of those other businesses were harmed. So Myriad's argument that it's helping researchers is doubtful.

We know that there were other labs looking for the BRCA genes and they had announced that they would not patent them if they were the first to find it. We also know that prior to the patent actually being issued, there were other labs doing BRCA testing and Myriad shut all that testing down. So we know in this particular case that problem would not have arisen.

But the point of the whole -- the whole point of the product of nature doctrine is that when you lock up a product of nature, it prevents industry from innovating and -- and making new discoveries. That's the reason we have the product of nature doctrine, is because there may be a million things you can do with the BRCA gene, but nobody but Myriad is allowed to look at it and that is impeding science rather than advancing it.

Justice Scalia followed that up by asking why would anyone invent anything if they can't get a patent. Of course, he might want to ask all of those labs that invested in the same process, but can't do anything about it. It seems they lose out, too.

In the end, there was clear skepticism from the Justices, but also a suggestion that they might try to punt the issue (again!) by ruling narrowly on particular issues, rather than by taking on the big question. We'll see how it all comes out in a few months...