by Mike Masnick

Filed Under:
patents, wifi


Patent Troll Says Anyone Using WiFi Infringes; Won't Sue Individuals 'At This Stage'

from the a-well-thought-out-shakedown dept

Just as some in the copyright trolling business are lowering their settlement fees, but making it up in volume, it appears there's a similar effort under way on the patent trolling side of the world. The Patent Examiner blog has the incredible story of Innovatio IP, a patent troll that recently acquired a portfolio of patents that its lawyers (what, you think there are any employees?) appear to believe cover pretty much any WiFi implementation. They've been suing coffee shops, grocery stores, restaurants and hotels first -- including Caribou Coffee, Cosi, Panera Bread Co, certain Marriotts, Best Westerns, Comfort Inns and more.

There are various interesting things in the article worth commenting on. First is the smaller settlements/making it up in volume technique. While its initial lawsuits against coffee shops and restaurants did focus on the central corporations, with the hotels, Innovatio appears to be focusing on individual franchisees. Yes, the small businesses who own individual hotels and probably have no idea how to deal with a patent infringement lawsuit -- all because they dared to offer WiFi somewhere in their hotels. To make it "easy" of course, Innovatio's lawyers will let them settle for between $2,300 and $5,000. In almost every case, that's going to be cheaper than hiring a lawyer to just get started dealing with this -- which I'm sure is exactly what Innovatio intends.

The company is represented by the infamous law firm of Niro, Haller & Niro, which is the firm that originally inspired the term "patent troll." The lawyer representing the company, Matthew McAndrews, seems to imply that the company believes the patents cover everyone who has a home WiFi setup, but they don't plan to go after such folks right now, for "strategic" reasons:
"Innovatio has made a strategic and business judgment at this stage that it doesn’t intend to pursue [lawsuits on the basis of] residential use of WiFi," McAndrews said during a phone conversation last week.
And while that certainly could change, you may be relieved (or probably not) to learn that McAndrews does not "perceive" such a "strategic" decision will change. However, later in the article, he seems to indicate otherwise:
Ultimately, he said, Innovatio’s "plan is to license this portfolio to the fullest extent possible. That would include anyone who's wireless networking."
And then there's this:
"We want you to continue to use this technology, we just want our client to get his due share,” McAndrews said. “This is not a seat-of-the-pants, fly-by-night shakedown."
I guess he means this is a well-planned, well-financed shakedown that's going to stick around for a while. Lovely.

At least there is some firepower arguing against Innovatio. After its first round of lawsuits, Motorola and Cisco went to court, asking for a declaratory judgment that its WiFi products do not infringe... and that Innovatio's patents are invalid. Hopefully that comes to pass or WiFi may get a hell of a lot more expensive.

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  1. icon
    That Anonymous Coward (profile), 3 Oct 2011 @ 2:02pm

    But this is the savior for our entire economy, suing each other for huge amounts of money none of us actually have.

    Like that fable about a rich man staying at the hotel in the village, he pays the clerk. The clerk goes and pays the maid, the maid goes and pays the grocer, the grocer pays the delivery boy, the delivery boy pays the repairman, the repairman pays the clerk. The rich man then decides he won't be staying and takes his money back. Everyone was paid back, but the net change was nothing.

    And some people still wonder why some of us keep calling it Imaginary Property.

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