Acacia's Latest Target: NetFlix

from the sue,-sue,-sue dept

Acacia has become one of the most hated firms by technology companies that actually do stuff. That’s because Acacia is one of the biggest (if not the biggest) firms out there in the business of buying up patents solely to sue companies. Acacia learned a while ago, though, that it was best to keep its name out of many of these suits, so it apparently tries to set up subsidiaries for many of the patents it buys (sometimes giving them silly names to make people think the companies actually do something). Now, one of those subsidiaries, named Refined Recommendation Corporation is suing Netflix over a patent it holds on optimizing interest potential. It’s a patent on the idea of making recommendations or presenting specific information based on user actions. I can recall both individuals and companies working on similar things well before this patent was applied for in 2000, but that’s a different issue altogether. Does anyone believe that Netflix (and plenty of other companies) wouldn’t be doing content recommendations for people without this particular “breakthrough”?

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Companies: acacia, netflix, refined recommendation corporation

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Comments on “Acacia's Latest Target: NetFlix”

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Barrenwaste (profile) says:

So Stupid

Ok, lets try this again with text this time.

First of all, that there is even a patent for this blows my mind. This process has been going on as long as there has been trade. Why would a patent have even been issued on this? Don’t get me wrong, in many cases I am for patents. Used correctly they can help smaller businesses gain thie foothold in markets innundated with monolithic multi-nationals. Unfortunately our judicial system and government tends to promote the abuse of the system.

Second of all, how can anyone have the sheer gall to patent an idea that has been around for over a thousand years? This one should be chucked out the window and Refined Recomendation Corporation should be levied some heavy fines.

And finally, how can any judge sitting this case not see it for what it is, armed robbery. Refined Recomendation Corporation may not be holding the gun itself, but that hasn’t seemed to matter in other cases of armed robbery. “Give us $20mil or we have our government lackies kill you NetFlix!” Or, if you like, it’s at least blackmail. No wonder our country is falling apart with the government allowing, no encouraging, such travesties.

Denis says:

Down the shitter

I am sorry to say, that the US patent office is not even bothering to look at 99% of these patents (ok my number might be made up, but I think I am close). Because of this, many US companies are trying to sue companies outside of the US based on a shoddy system and are getting away from it.

I have read articles about some US companies patenting an item even though it was already patented in another country. It’s almost like the US is saying. “Hey, if it’s patented here in the good ol’ US of A, we take precedent.”

The system is shot, corrupted and just plain retarded and until there is a huge overhaul of it, courts will be full with lawsuits by idiots

Joe Smith says:

shell game

The company is probably setting up a separate subsidiary for each patent to insulate them from claims for legal fees when they lose.

The patent does not seem to cover how the user preference would be calculated – merely that it would be calculated in some way which depends on user input and content. So anyone who filtered content for display and tried to refine the filter based on user feedback would be afoul of the patent.

The real challenge is the mechanics of calculating the user preference. Netflix has offered a Million dollar prize for anyone who can make a 10% improvement over their existing system ( )

MostlyWrong says:

The problem with the courts is that a granted patent is presumed valid unless you have compelling evidence to the contrary. The burden of proof is rather high by design and protects an entity who is granted a patent and has started practicing — i.e. you shouldn’t be able to remove patent protections from an entity who has invested time and capital in a product.

The problem with the patent office is that until relatively recently (maybe 10 years or so) it was not necessarily recognized as possible to patent things such as business models or software algorithms. A lot of bad patents have gotten through because of the volume of new patent applications in this area and because this was (is) out of the domain of expertise of the many of the patent reviewers. No excuse, but reality. Once a bad patent has been granted it is very hard to get it nullified (see above).

The problem with the complainants is that they want to supplant the judgment of one overworked bureaucrat (the patent reviewer) with another (the judge), or better yet supplant both of their judgments by the rule of the mob depending upon how likable or sympathetic the patent holder and alleged patent violator are.

This should eventually work itself out. Personally, I do not see the validity of patenting a business process or algorithm, but that is merely opinion and in conflict with USPTO policy.

Clueby4 says:

Duty of disclosure

Duty of disclosure is a joke. The patent system is setup to allow invalid patents to be resolved in court. Which I find disturbing since it essentially turns the patents into a rubber stamp.

Leaving the validating of a patent to occur in a court room is problematic at best. Corrupt justice system, jury pool intelligence borders on functionality handicapped, and that doesn’t even address victims of the fraudulent patent who never made it to court.

Hence when people gush about patents and how good they are I pretty much place that person into a delusional category, usually the same people think “free markets” are possible to, but hey they say ignorance is bliss so at least they’re happy. 😛

Hael says:

Predatory Practices

The problem with a company that utilizes the predatory approach taken by Acacia is that there is no consumer to ‘vote’ with their spending power. Revenue is based solely on the volume of patents they can get their hands on and using those patents to litigate dollars from companies that make up the backbone of our economy. Make no mistake about it, this type of predatory business model is just a step away from criminal extortion. Since the average consumer is powerless to impact this company with their dollars, it will take legislative action to put up roadblocks to prevent this type of abuse. Will Acacia find a way around the legislation? Probably. But why sit back and accept it? Write your congressman and Senator. That is how the ‘little person’ can influence this situation.

wvhillbilly says:

Patent trolls

Congress should have dealt with patent trolls like Acacia a long time ago. And I believe congressional action will be the only thing that will be able to stop patent trolling.

Suits by patent trolls are particularly hard to defend against, and especially with a certain court in Lufkin TX which seems to be a magnet for patent trolls, which almost invariably finds in favor of the patent holder and issues exorbitant judgments to the trolls. A portfolio of a million defensive patents is useless against a patent troll because a patent troll practices no invention and and therefore can’t infringe anyone else’s patents. Their only inventions are the patents themselves. About the only defense against patent trolls is to get the patent invalidated, and that can cost 10s of millions of dollars, putting that strategy out of reach for all except large corporations.

Perhaps congress could pass a law that in order for a patent to be valid, the owner of the patent must also be the owner of the thing patented. And there should be stiff penalties for those who use patents abusively, including large monetary penalties and invalidation of the patents so used. But I suspect congress is so much in the thrall of large corporations it is doubtful they would do such a thing unless forced to by a major grassroots outcry from ordinary citizens like you and I.

So. want to do something? Write to your congressmen!

bugstomper says:

But NetFlix itself is prior art!

The patent’s filing date is June 2, 2000.

Looking up the history of NetFlix I find:

The company opened for business on April 14, 1998 […] once a customer had rented several titles a profile would be generated that automatically suggested additional films of interest based on the characteristics of ones already chosen

In February 2000, NetFlix introduced a new service, CineMatch, which compared rental patterns among its customers and looked for similarities in taste, using this information to recommend titles to people whose profiles were similar. It could also be programmed to combine the attributes of two users, such as a married couple, and recommend titles that both might like.

It seems too farfetched that they would sue over something that NetFlix had prior to the filing date. Does anyone have a reference to the court filings to see exactly what they are suing over?

By the way, I checked Amazon’s history, and their recommendation system not only goes back to 1997, but was the subject of a patent law suit from Cendant over this patent, which is not cited as prior art by Acacia’s patent, that ended up being settled with a cross-licensing agreement. Amazon’s system sure looks like prior art for Acacia’s patent, but even if it isn’t it is hard to argue that NetFlix infringes without it being prior art if it was online before the patent was filed.

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