Ridiculous Patent Troll Gets Stomped By CAFC, Just Months After Being Awarded A Huge Chunk Of Google's Ad Revenue

from the couldn't-have-happened-to-a-nicer-bunch dept

We've written a few times about Vringo, a patent troll (which got its name, and public stock status, from a reverse merger with a basically defunct public "video ringtone" company and a pure patent troll called I/P Engine). The company was using some very broad patents (6,314,420 and 6,775,664) to claim that Google and Microsoft were infringing based on how their search ad programs worked. In effect, Vringo, whose patents were at one time associated with Lycos, was trying to pull off another Overture move -- patenting a basic idea for search ads, and then cashing in from Google actually making it work. The case took a slight detour into the bizarre when Microsoft not only settled with Vringo for $1 million -- but also with a promise to pay 5% of whatever Google had to pay.

While the original ruling against Google in 2012 had the jury reject Vringo's request for nearly $700 million, and giving it "just" $30 million, in February of this year, a judge magically decided that 1.36% of all of Google's AdWords revenue (which is most of its revenue) belonged to Vringo.

Between February and now, however, something wonderful happened. That something wonderful was the Supreme Court's ruling in CLS Bank v. Alice. As we noted at the time, depending on how you read it, it certainly could be interpreted that nearly all software patents were invalid -- even as the ruling itself insisted that wasn't the case. Still, the early returns are promising, with CAFC (apparently finally getting the message) starting to smack down software patents.

So with the Vringo patents before CAFC, it appears they got the Alice treatment, with CAFC tossing them out as totally invalid for patenting a basic concept. The ruling focuses on how the ideas were obvious to those skilled in the art based on (a rather large amount of) prior art:
As the asserted patents themselves acknowledge, however, search engines, content-based filtering, and collaborative filtering were all well-known in the art at the time of the claimed invention.... The record is replete, moreover, with prior art references recognizing that content-based and collaborative filtering are complimentary techniques that can be effectively combined. The WebHound reference explains that “content-based and automated collaborative filtering are complementary techniques, and the combination of [automated collaborative filtering] with some easily extractable features of documents is a powerful information filtering technique for complex information spaces." ... The Fab reference likewise notes that “[o]nline readers are in need of tools to help them cope with the mass of content available on the World-Wide Web,” and explains that “[b]y combining both collaborative and content-based filtering systems,” many of the weaknesses in each approach can be eliminated.... Similarly, the Rose patent, which was filed in 1994 by engineers at Apple Computer, Inc., states that “[t]he prediction of relevance [to a user’s interests] is carried out by combining data pertaining to the content of each item of information with other data regarding correlations of interest between users."
The ruling laughs off Vringo's claims that its patents took things a step further by combining two ideas, pointing out that this was quite obvious at the time.

But the concurring opinion by Judge Mayer calls out the Alice ruling and the fact that this stuff isn't patentable in the first place:
Because the claims asserted by I/P Engine, Inc. (“I/P Engine”) disclose no new technology, but instead simply recite the use of a generic computer to implement a well-known and widely-practiced technique for organizing information, they fall outside the ambit of 35 U.S.C. § 101...

[....]

I/P Engine’s claimed system is merely an Internet iteration of the basic concept of combining content and collaborative data, relying for implementation on “a generic computer to perform generic computer functions.” ...

Moreover, the scope of the claimed invention is staggering, potentially covering a significant portion of all online advertising. I/P Engine’s asserted claims fall outside section 101 because their broad and sweeping reach is vastly disproportionate to their minimal technological disclosure.
That last line is a fun one.

Either way, it looks like the writing may be on the wall for software patent trolls. Vringo's stock collapsed after the ruling and some other public patent trolls also saw their stock drop. Couldn't happen to a more deserving group of leeches on innovation.

Reader Comments (rss)

(Flattened / Threaded)

  1.  
    identicon
    Anonymous Coward, Aug 18th, 2014 @ 12:25pm

    Now, if only there were a way to ensure that the parasitic owners of these troll companies lost every penny of the wealth they gamed from this clearly broken patent system.

    A bridge too far?

    I surely hope not.

     

    reply to this | link to this | view in thread ]

  2.  
    icon
    That Anonymous Coward (profile), Aug 18th, 2014 @ 12:41pm

    kill it, kill it with fire

     

    reply to this | link to this | view in thread ]

  3.  
    icon
    DannyB (profile), Aug 18th, 2014 @ 12:55pm

    Re:

    Something...something...something from orbit. It's the only way to be sure.

     

    reply to this | link to this | view in thread ]

  4.  
    icon
    OldGeezer (profile), Aug 18th, 2014 @ 1:06pm

    Can Google and Microsoft get any money back?

     

    reply to this | link to this | view in thread ]

  5.  
    identicon
    Anonymous Coward, Aug 18th, 2014 @ 1:14pm

    Re:

    I don't think Google's paid anything yet seeing as this was part of their appeals process. Microsoft isn't seeing their million back, but will be having to pay 5% of 0.

     

    reply to this | link to this | view in thread ]

  6.  
    icon
    Richard (profile), Aug 18th, 2014 @ 1:19pm

    Re: Re:

    Of course if costs were awarded Vringo then Microsoft could claim that they should pay 5% of a negative quantity...

     

    reply to this | link to this | view in thread ]

  7.  
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    Richard (profile), Aug 18th, 2014 @ 1:19pm

    Re: Re: Re:

    Whoops - should say "against Vringo"

     

    reply to this | link to this | view in thread ]

  8.  
    icon
    gab4moi (profile), Aug 18th, 2014 @ 2:27pm

    Lucky that...

    Circuit Judge Raymond Chen dissented, writing that "the majority fails to accord sufficient deference to the jury’s findings of fact... We need something beyond the invocation of the phrase 'common sense' or 'simple logic' to demonstrate the reason to combine the prior art references in this case."

    "The record does not suggest a benefit or rationale that would have caused a skilled artisan to use the query as part of collaborative filtering in 1998," wrote Chen, who joined the court last year after serving many years as a top lawyer at the US Patent and Trademark Office.

    ... only one ex Patent lawyer was on the panel!

     

    reply to this | link to this | view in thread ]

  9.  
    identicon
    Anonymous Coward, Aug 18th, 2014 @ 6:00pm

    That sound you hear is Whatever, average_joe and Ronald J. Riley gnashing their teeth and stamping their feet.

     

    reply to this | link to this | view in thread ]

  10.  
    icon
    Neo (profile), Aug 18th, 2014 @ 6:51pm

    1. You call VRNG a patent troll. You clearly aren't aware that Ken Lang, the creator of the patents is actually the CTO at VRNG are you? He was the innovator, he is attempting to enforce his technology plain and simple so let's get past the angry third grade, less than intelligent media speak. We all get the attempts by the media to vilify this company.

    2. The decision by the CAFC flew in the face of law as per Chen's own dissent, as well as Mayer's OWN WORDS in the Highmark vs Allcare case. I suggest you read on that, and I anticipate VRNG lawyers will be utilizing Mayer's own words against him. In that case, similar to here, Mayer described the de novo review of factual determination (as is the case here with obviousness) as 'appellate overreach".

    3. This story is not over, VRNG will be filing for an En Banc review, whether they get it or not is another issue.

    4. What people should be concerned about is not a company that owns intellectual property simply trying to enforce its right to property (last time I check property rights are a pretty big part of a capitalist society), but rather the theft and use of that property from those with bigger wallets and monopoly power. There is a reason Google attempted (and thankfully failed) to have a patent bill passed through congress, because that would have legalized their theft of technology from small players that couldn't fight them. You see, while you may call VRNG a troll, they do play an important role in ensuring that big companies can't abuse the little guy. Unfortunately, many in our society are simpletons and hang on to whatever the media tells them, never think deeper into implications, just want to be part of the group think du jour.

    5. You may want to think about the implications to patent protection and IP in general, and resultant impact on small innovators if a judge can simply say, I don't agree with a multiple reviews by the USPTO, a District Court Judge, a jury (that according to his hubris is not capable of understanding) to simply wipe out someone's patents. Again, rather than discussing legal and technological implications of a decision you have written a fluff piece to simply either 'pile on' with the group.

     

    reply to this | link to this | view in thread ]

  11.  
    identicon
    Anonymous Coward, Aug 18th, 2014 @ 7:00pm

    Re:

    Right, and Personal Audio and Intellectual Ventures are all gods who can do no wrong.

     

    reply to this | link to this | view in thread ]

  12.  
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    That One Guy (profile), Aug 18th, 2014 @ 7:08pm

    Re:

    Let's see, constantly referring to infringement as 'theft', going with the laughable claim that 'patents are for the little guys', ignoring that even the patents in question admit that they weren't doing anything more than 'combining' processes that were already in use and obvious to those in the field...

    8/10, would mark 'Funny' again.

     

    reply to this | link to this | view in thread ]

  13.  
    identicon
    Anonymous Coward, Aug 18th, 2014 @ 8:29pm

    Re:

    What did he innovate, exactly?

     

    reply to this | link to this | view in thread ]

  14.  
    icon
    That One Guy (profile), Aug 18th, 2014 @ 9:16pm

    Re: Re:

    It's like this. Say you've got two ideas, 'Fire creates heat', and 'To cook foods, apply heat'. The innovation that would clearly be impossible without patents is the combination of these two ideas, 'Apply fire to food to cook it' in this case.

    While the underlying ideas may be obvious to anyone in the field, the combination of those two ideas is something that deserves protection and a government granted monopoly, since clearly it would never have occurred to anyone to combine those two into one, such a step being incredibly complex and difficult.

    /s

     

    reply to this | link to this | view in thread ]

  15.  
    icon
    techflaws (profile), Aug 18th, 2014 @ 10:47pm

    Re:

    Ken, is that you?

     

    reply to this | link to this | view in thread ]

  16.  
    identicon
    Lawrence D’Oliveiro, Aug 18th, 2014 @ 11:37pm

    Re: last time I check property rights are a pretty big part of a capitalist society

    Yes they are. But unfortunately “intellectual property” infringes on those rights. Don’t believe it? Just think about the answer to this question: if I buy something, do I own it?

     

    reply to this | link to this | view in thread ]

  17.  
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    royleith (profile), Aug 19th, 2014 @ 1:04am

    a generic computer

    One day the CAFC will realise that the computer that runs generic apps in a smart phone, tablet, smart TV or smart Blu-ray player is also a generic computer.

    The generic computer is added to a dumb device that already requires a user input device and a display for its operation and is only powerful because of the need to run generic software.

    Is swiping a mechanical slide switch to power a device on or off a different invention to swiping a touch pad to do the same thing? Is it a novel machine invention being patented or is it just patenting the abstract idea of using a swipe motion to power a device on or off?

    A browser running on a TV is no less generic software than a browser running on a desktop computer.

    A software invention onna phone or onna computer or onna server or on the interweb is a software invention on one or more generic computers.

     

    reply to this | link to this | view in thread ]

  18.  
    icon
    John Fenderson (profile), Aug 19th, 2014 @ 8:25am

    Re:

    "What people should be concerned about is not a company that owns intellectual property simply trying to enforce its right to property"

    What people should be concerned about is companies enforcing overly broad or bogus patents in an attempt to extort from others.

     

    reply to this | link to this | view in thread ]

  19.  
    identicon
    Anonymous Coward, Aug 19th, 2014 @ 9:41am

    Re:

    last time I check property rights are a pretty big part of a capitalist society


    According to my dictionary capitalism is "An economic system in which the means of production and distribution are privately or corporately owned and development occurs through accumulation and reinvestment of profits gained in a free market." [emphasis added]

    Government granted monopolies do not a free market make. You can argue how great or necessary they are but that doesn't change the fact that they are government interference in the market. As such, trying to use capitalism as a justification for IP laws is ridiculous.

     

    reply to this | link to this | view in thread ]

  20.  
    icon
    Stosh (profile), Aug 19th, 2014 @ 1:42pm

    Dang, there goes my patent for displaying text on a screen after clicking a link!!

     

    reply to this | link to this | view in thread ]

  21.  
    icon
    trollificus (profile), Aug 19th, 2014 @ 2:02pm

    derpdedurrr...

    per Neo:
    "...they do play an important role in ensuring that big companies can't abuse the little guy"

    "...many in our society are simpletons,...never think deeper into implications..."

    "You may want to think about the implications to patent protection and IP in general..."

    "...rather than discussing legal and technological implications of a decision..."

    Cases are not, and cannot be, decided based on such down-the-road effects as you promote here. They are decided by law. Period. Not to serve some "little guy vs. big guy" rooting interest. Not merely to thwart Big Corporation A.

    And also, a judge damn well better be able to disregard "...multiple reviews by the USPTO, a District Court Judge, a jury" if the results have been uniformly stupid, as here.

    Still, kinda cute how you went with numbered points to make it look like you're presented a large number of "proofs", when the Commutative Property of Bullshit shows that 4bullshit+3bullshit=bullshit, same as 10bullshit+4bullshit=bullshit. Nice try.

     

    reply to this | link to this | view in thread ]

  22.  
    identicon
    Anonymous Coward, Aug 20th, 2014 @ 6:01am

    Re: derpdedurrr...

    Judges are allowed to consider the effects of their decision when clearing up ambiguities - they can assume that the legislature was trying to achieve the most beneficial outcome and so pick an interpretation accordingly.

    Of course, SCOTUS can pull whatever decision it likes out of its collective arse and call it law - the insane claim of medical privacy needed to make Roe v Wade come out right, for example. (You don't have a right to medical privacy when it comes to being the victim of certain crimes (DV, gunshot wounds, etc.), but you do when you are the perpetrator. Sounds sensible to me. But abortion is victimless? Well, maybe (IMO yes, but that's irrelevant), but so is taking home-produced drugs, but that's not protected.)

     

    reply to this | link to this | view in thread ]

  23.  
    identicon
    Tom Gallagher, Aug 21st, 2014 @ 11:15am

    Alice or Not

    The CAFC case really had nothing to do with ALICE §101 patentable subject matter. The patents were invalidated under good old §103 grounds. Nothing controversial here.

    Although the "concurring opinion" discusses Alice, the opinion of the court was clearly based on §103 not Alice §101.

    Part of the problem in any Alice application is that SCOTUS can't figure out the difference between §101 and §103.

    This was a §103 case, not a §101 case.

     

    reply to this | link to this | view in thread ]

  24.  
    identicon
    egis, Mar 15th, 2015 @ 12:09pm

    Ill informed article

    The premise that this company is trying to extort Google for their ideas is idiotic. The patents in question were written in 1996. Years before Google ever existed. It created a hybrid search engine that was nothing like existed at the time. Had Lycos been smart enough to pursue Ken Lang's invention, you would have never heard of Google. Google is a COPY of the technology described in the patents.

     

    reply to this | link to this | view in thread ]


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