Kodak Says Intellectual Ventures Behind Patent Lawsuit Filed By Shell Company

from the piercing-the-veil dept

Last year, Zusha Elinson broke the story that, despite Nathan Myhrvold hiding behind the claim that Intellectual Ventures hadn’t sued anyone over patent infringement, IV’s patents were miraculously showing up in lawsuits being filed by shell companies. Of course, IV and the shell companies have been completely silent over how this all works, so IV can pretend to be totally separate. However, multiple reports have come out claiming that IV “sells” these patents to patent attorneys, who set up shell companies with which to sue, and IV gets a cut of any money won. In other words, it’s hiding behind these shell companies to pretend it’s not suing, when the truth is quite different.

It seems that at least one company sued over such a patent is hitting back. Joe Mullin points us to the Legal Pad blog, which notes that Kodak, who has been sued for patent infringement by a shell company (PFI) being represented by Ray Niro (famous for, among other things, being the first person labeled a “patent troll,” as well as suing a bunch of companies he didn’t like with a bogus patent — finally rejected for good, recently — that he claimed covered any website that used a JPEG image), doesn’t believe that it’s really the shell company that’s behind this lawsuit. It’s demanding that Intellectual Ventures take part:

“Kodak should be accorded the right to sit down across the table from IV as well as PFI, so that it can inquire as to IV’s intentions,” Jones Day lawyers write. “It should come as no surprise that Kodak’s attitude towards settlement may be affected by learning whether or not this case is the first of a series of patent litigation salvos to be launched against it by IV, whether directly or through a proxy like PFI.”

IV’s response, as per usual, is to play dumb:

“At this point, we haven’t made a decision yet. We don’t know what Kodak wants or why they want us there. We don’t have a say in the litigation nor do we have control over Picture Frame Innovation or the patent.”

Note that this doesn’t actually answer the question of whether or not IV has a financial interest in the lawsuit. Of course it doesn’t have actual control over the shell company or the lawsuit. No one thinks IV is so stupid to leave a trail that direct. But that doesn’t mean it didn’t sell this patent with the plan of profiting from such a lawsuit. The whole thing is so wink wink nudge nudge it just shows off IV’s total arrogance. It thinks that it’s smarter than everyone else and can play the system to its (very profitable) advantage — even if it’s stifling innovation left and right.

Filed Under:
Companies: intellectual ventures, kodak

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Comments on “Kodak Says Intellectual Ventures Behind Patent Lawsuit Filed By Shell Company”

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35 Comments
General Patent says:

IP

Companies like intellectual ventures, play a paramount roll in innovation. They force other companies to work around the patent, thus inventing new things that would never have come about if they were permitted to use the ideas of the company that claimed ownership first.

Think of all the great things that have come out of software patents. Google, Windows, PhotoShop, Linux etc, etc.. If Linux were not infringing on 150+ patents belonging to Microsoft, there would be no reason for them to spend so much time innovating around them!

Take the infamous Fat32 patent, This patent pretty much covers all plug & play out of the box file formats. This results in locking Linux out of the game without infringing. But guess what? … Thats great for consumers!! Think of all the choices they will never need to make!

Come on people!

Ronald J Riley (profile) says:

Re: IP

I have every reason to believe General Patent is a reputable company. Posting using their name is sleazy, even by TechDIRT standards. It is one thing to be nasty and quite another to make false posts in someone’s name.

Ronald J. Riley,

I am speaking only on my own behalf.
Affiliations:
President – http://www.PIAUSA.org – RJR at PIAUSA.org
Executive Director – http://www.InventorEd.org – RJR at InvEd.org
Senior Fellow – http://www.PatentPolicy.org
President – Alliance for American Innovation
Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
Washington, DC
Direct (810) 597-0194 / (202) 318-1595 – 9 am to 8 pm EST.

Ronald J Riley (profile) says:

Re: Re: Re: IP

Yes, I am serious. Mike Masnick, how would you react if people started posting with our name or one of your company names? Do we have some common ground on this issue?

Ronald J. Riley,

I am speaking only on my own behalf.
Affiliations:
President – http://www.PIAUSA.org – RJR at PIAUSA.org
Executive Director – http://www.InventorEd.org – RJR at InvEd.org
Senior Fellow – http://www.PatentPolicy.org
President – Alliance for American Innovation
Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
Washington, DC
Direct (810) 597-0194 / (202) 318-1595 – 9 am to 8 pm EST.

Ronald J Riley (profile) says:

Re: Re: Re:3 IP

Common ground can mean that people agree on one issue while continuing to disagree on another.

Ronald J. Riley,

I am speaking only on my own behalf.
Affiliations:
President – http://www.PIAUSA.org – RJR at PIAUSA.org
Executive Director – http://www.InventorEd.org – RJR at InvEd.org
Senior Fellow – http://www.PatentPolicy.org
President – Alliance for American Innovation
Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
Washington, DC
Direct (810) 597-0194 / (202) 318-1595 – 9 am to 8 pm EST.

Ronald J Riley says:

Re: Re: IP

I have every reason to believe Ronald J Riley is a silly person. Posting using a dead guy’s name is sleazy, even by Ronald R Ugly standards. It is one thing to be nasty and quite another to make false posts in someone’s name.

Ronald J. Riley,

I am speaking only on my own behalf.
Affiliations:
President – http://www.ScamU.org – RJR at ScamU.org
Executive Director – http://www.IgnoranceEd.org – RJR at IgnEd.org
Senior Fellow – http://www.PatentTrolls.org
President – Alliance for American Stagnation
Caretaker of Intellectual Property Hoarders on behalf of Zombielands and its Zombies.
Fantasy World, RJR
Direct (810) 555-0194 / (202) 555-1595 – 9 am to 8 pm EST.

abc gum says:

Hey, ya wanna buy a bull?

I do not understand … how is this not illegal? Wth is the justice dept doing, sitting on their thumbs?

This obvious gaming of the system can no longer be overlooked. This is tantamount to organized crime. Instead of some greaseball with a broken nose busting your kneecap, it is a high priced lawyer in an Armani suit dragging your ass to East Texas.

Ronald J Riley (profile) says:

I am not a fan of IV because I think that their dealings with inventors leave much to be desired.

But I must disagree with claims that their enforcing their patent rights is wrong, because they are perfectly justified in defending their patent property rights.

There are good reasons to conduct enforcement actions from a unique entity for each case. They are the same reasons that people create corporations for any business, in that it compartmentalizes liability.

Kodak is also perfectly justified in enforcing their patent rights.

Every reader of TechDIRT derives income from some source. Some are wage slaves and others may be in their own business. In every case you expect some sort of compensation for what you do. Inventors also must have compensation in order to support their business of inventing.

The only difference between the invention business and others is the amount of risk and a much larger payout when one succeeds. In the end, every business regardless of the time frames and risk factors must payoff or it will fail.

Big companies also take risks, like intentionally infringing smaller entities patents hoping that those entities will not be able to afford to hold them accountable. Those who take this risk deserve what they are getting.

Ronald J. Riley,

I am speaking only on my own behalf.
Affiliations:
President – http://www.PIAUSA.org – RJR at PIAUSA.org
Executive Director – http://www.InventorEd.org – RJR at InvEd.org
Senior Fellow – http://www.PatentPolicy.org
President – Alliance for American Innovation
Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
Washington, DC
Direct (810) 597-0194 / (202) 318-1595 – 9 am to 8 pm EST.

abc gum says:

Re: Re:

Oh please.

You dismiss the outrageous actions of IV (only) because they treat the “inventors” poorly … and then you defend their actions because they are “enforcing their patent rights”

You sir, are are full of it.

Seriously … do you think this sort of business environment is sustainable? If so, please include your rational for thinking so, because I really do not see it.

Ronald J Riley (profile) says:

Re: Re: It is sustainable

The point of the patent system is to encourage others to invent their own solution in order to avoid having to pay another inventor. This works very well.

If you remove patent protection and enforcement all inventions will be pilfered and America will not be able to sustain our standard of living.

Ronald J. Riley,

I am speaking only on my own behalf.
Affiliations:
President – http://www.PIAUSA.org – RJR at PIAUSA.org
Executive Director – http://www.InventorEd.org – RJR at InvEd.org
Senior Fellow – http://www.PatentPolicy.org
President – Alliance for American Innovation
Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
Washington, DC
Direct (810) 597-0194 / (202) 318-1595 – 9 am to 8 pm EST.

Anonymous Coward says:

Re: Re: Re: It is sustainable

If you remove patent protection and enforcement all inventions will be pilfered and America will not be able to sustain our standard of living.

Wouldn’t America just do the same as everybody else?

“America?!? Never! America would never do anything like that, ever, not America! If patents were demolished tomorrow and it were a free-for-all, why America would just sit there not doing a thing. America certainly wouldn’t join in the free-for-all. It’s just not in America’s nature. They would probably pout.”

BearGriz72 (profile) says:

Re: (RJR)

From http://www.piausa.org
“Conserving the American Patent System is the only way to preserve our technological and economic future!
(This is not alarmist, this is serious and it is true!)”

*** Actually that is ‘Patently’ untrue, as Mike and others have have pointed out on multiple occasions many economic models thrive without using patents.

From http://www.inventored.org
*** Other than the fact that this site appears to have been designed sometime in the early 1990’s (Although the other two were not much better). I did not notice any blatant misinformation I did notice this…
“Page last revised 10-10-2008”

From http://www.patentpolicy.org
“Many experts contend that the United States Patent and Trademark Office is the cornerstone to the U.S. economy.”

*** Many experts contend the exact opposite as well, evidence please.
“The USPTO’s ability to prosecute and track new invention is one of the most significant dimensions of U.S. competitiveness around the world.”

*** Ha ha Ha ha Ha ha Ha ha Ha ha Ha ha

If you choose to be a Troll/Shill Please at least do so with some respect for our intelligence, and quit spamming us with your ridiculous signature.
[/rant]

Ronald J Riley (profile) says:

Re: Re: (RJR)

“If you choose to be a Troll/Shill Please at least do so with some respect for our intelligence,”

What intelligence?

How about you sign what you write or are you too ashamed to sign your name and if by some remote chance you have any relevant affiliations you disclose them:)

Ronald J. Riley,

I am speaking only on my own behalf.
Affiliations:
President – http://www.PIAUSA.org – RJR at PIAUSA.org
Executive Director – http://www.InventorEd.org – RJR at InvEd.org
Senior Fellow – http://www.PatentPolicy.org
President – Alliance for American Innovation
Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
Washington, DC
Direct (810) 597-0194 / (202) 318-1595 – 9 am to 8 pm EST.

Ronald J Riley (profile) says:

Re: Re: (RJR)

We are in the process of converting InventorEd to Drupal at this time. InventorEd services people all over the world, many of whom are using older computers and may be on dialup or radio link communications (outback) which are costly. So InventorEd was intentionally designed for low bandwidth. And yes, it was designed starting in the 1990s and has been through two major updates. It was created in raw html initially and then maintained with Front Page because doing so was easy. And yes, I do realize that Front Page produces crappy code but with over 700 web pages on the site expediency trumped the code issue.

PIAUSA serves as an example of how open source can be a very poor value. It is based on EZ Publish, an atrocious piece of bloated crap. We paid for commercial use and I have to say that it never delivered on the claims. When we are finished with InventorEd we will also be converting PIAUSA to Drupal.

I have nothing against open source except for the fact that much of it is worth exactly what people pay and the entitlement mentality of those in the community who think that they should be able to pilfer others intellectual property to use as a loss leader to generate consulting fees.

Ronald J. Riley,

I am speaking only on my own behalf.
Affiliations:
President – http://www.PIAUSA.org – RJR at PIAUSA.org
Executive Director – http://www.InventorEd.org – RJR at InvEd.org
Senior Fellow – http://www.PatentPolicy.org
President – Alliance for American Innovation
Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
Washington, DC
Direct (810) 597-0194 / (202) 318-1595 – 9 am to 8 pm EST.

Ronald J Riley (profile) says:

Re: Digital Majority???

The name reminds me of how a small minority called themselves the Moral majority when in fact they were the Immoral Minority.

Also, the referenced link has pretty poor quality, both the writing and content.

Ronald J. Riley,

I am speaking only on my own behalf.
Affiliations:
President – http://www.PIAUSA.org – RJR at PIAUSA.org
Executive Director – http://www.InventorEd.org – RJR at InvEd.org
Senior Fellow – http://www.PatentPolicy.org
President – Alliance for American Innovation
Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
Washington, DC
Direct (810) 597-0194 / (202) 318-1595 – 9 am to 8 pm EST.

Anonymous Coward says:

The thing is that we need laws and standards to prevent patent abuse, one good standard being that patents should only apply from the moment a product is released to the first who actually releases a product.

There was a whole discussion about that here

http://www.techdirt.com/articles/20100316/1732228591.shtml?threaded=true

and I just responded to someones counterclaims, thought people might be interested. See post Mar 18th, 2010 @ 7:20am

Robert M. Case (profile) says:

Patent Debate

Ronald J. Riley is correct in my opinion in nearly every statement above. Just check Wikipedia’s listing for “patent” and learn. Hiding behind anonymous posting is the bane of the internet … if you feel strongly about something, don’t be afraid to stand up for it, as Mr. Riley does. It’s a shame that every generation has to re-invent the wheel … the open source community’s denouncing of patents is simply a way of hiding one’s head in the sand and not checking the prior art (which is getting easier to do every year.) That’s not to say there are not abuses in the worldwide patent system, but I give credit to Mr. Riley for speaking up in this forum.

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