Score One For The Trolls: Supreme Court Says Congress Intended It To Be Very Difficult To Invalidate Patents

Patents

from the canada-celebrates dept

This isn’t a huge surprise, but in the Microsoft v. i4i case over what the standard for invalidating a patent should be (either the super high bar of “clear and convincing evidence” or the slightly lower bar of “the preponderance of the evidence,”) the Supreme Court has now decided that the higher bar is what Congress intended (pdf). This means that it’s that much more difficult to invalidate bad patents. The Court’s ruling is basically that the common law presumption of validity mostly (but not entirely) used this standard, and when Congress passed the 1952 Patent Act (really written by patent lawyers), it simply meant to codify what the common law had said on that issue. It was an 8-0 ruling (with Chief Justice Roberts not taking part due to Microsoft investments, I believe), though Justice Thomas had some reservations about the thinking, but not the final judgment. The opinion was written by Justice Sotomayor, who got a bit snarky at points:

“Squint as we may, we fail to see the qualifications that Microsoft purports to identify in our cases.”

I recognize the general reasoning of the Court in the case. Basically, it looks like, historically, a higher standard was frequently used, and since Congress didn’t specify a different standard, it seems to suggest they were fine with the standard. But I think to some extent that ignores reality. First of all, the 1952 Act was written by patent lawyers and it’s not clear Congress even understood all of it, so it seems a bit rich to suggest that it purposely was trying to codify that standard. On top of that, the use of the patent system has changed dramatically over the past few decades, and the entire presumption of validity is increasingly in question given the massive number of ridiculously bad patents approved by the Patent Office. As it currently stands, USPTO examiners rush through applications, spending an average of about 18 hours on each application. To grant patents with so little review and then presume they’re valid with a ridiculously high barrier to challenging that presumption seems economically stupid.

In what world does it make sense to grant innovation-limiting monopolies for nearly two decades based on 18 hours of review?

But, in the end, this is really Congress’ problem to fix — which means they won’t. Congress could fix this quite easily by clarifying a lower standard to invalidate patents. This makes tremendous sense. The only patents it would impact are bad patents. And no one — even patent supporters — should want bad patents. But you know who does like bad patents? Those who have them and those who profit from them — and those people are really loud in their support of not messing with the system that gives them so much in monopoly rents. So it seems highly unlikely that Congress will even bother to look at making this simple change to the patent system.

Filed Under: patents, standard, supreme court, validity
Companies: i4i, microsoft

4th Amendment? What 4th Amendment? Supremes Say Police Can Create Conditions To Enter Home Without A Warrant

Privacy

from the did-they-really-say-that? dept

We’ve been discussing various ways that our government and the courts have been slowly chipping away at the 4th Amendment, what with warrantless wiretaps, searching laptops, TSA agents groping people, etc. And the Supreme Court just took a huge chunk out of the 4th Amendment in saying that police can raid homes without a warrant if there are “exigent circumstances” — even if those “exigent circumstances” are created by the police themselves.

The law, to date, had been that police cannot enter a home without a warrant unless they had both (a) probable cause and (b) “exigent circumstances” in which getting a warrant would not make sense. In this case, police were searching for a drug dealer who had gone into an apartment complex. Outside of one apartment, they smelled marijuana — which created probable cause. At this point, they should have obtained a warrant. Instead, they banged on the door and shouted police. At which point they heard a scramble inside, and busted in the door, claiming that they believed the scramble was the possible destruction of the drugs. The argument then was that this noise — even though it was entirely created due to police action — represented exigent circumstances that allowed them to bust in the door without a warrant. The Kentucky Supreme Court said that while the noise might be exigent circumstances, since it was illegally created by the police, it could not be used.

Tragically, the Supreme Court — by an 8-to-1 vote — has now disagreed, saying that this is perfectly consistent with the 4th Amendment. With all due respect to the 8 Justices and the Court, I can’t see how that’s reasonable at all. This sets up a dreadful situation which will be abused regularly by law enforcement. It lets them create yet another situation where they may avoid oversight, by creating their own exigent circumstances, and then using that as an excuse for avoiding a warrant and any required oversight or limitations. I believe that Justice Ginsburg’s dissent is much more compelling. Her dissent points out that exigent circumstances are only supposed to be used in very rare circumstances when getting a warrant is not possible or practical. Yet, in this case, the police easily could have secured a warrant quickly upon smelling marijuana.

That heavy burden has not been carried here. There was little risk that drug-related evidence would have been destroyed had the police delayed the search pending a magistrate?s authorization. As the Court recognizes, “[p]ersons in possession of valuable drugs are unlikely to destroy them unless they fear discovery by the police.” … Nothing in the record shows that, prior to the knock at the apartment door, the occupants were apprehensive about police proximity.

In fact, she notes that “Home intrusions, the Court has said, are indeed ‘the chief evil against which . . .the Fourth Amendment is directed.'” So it seems positively ridiculous to claim that such a home invasion is acceptable under the 4th Amendment. This is a tragically bad ruling by the Supreme Court that will have massive and dangerous consequences. We already have law enforcement pushing the boundaries of individual privacy rights, and now they have even more tools to take that further.

Filed Under: 4th amendment, home searches, police, supreme court, warrants

Winklevii Promise To Appeal To Supreme Court

Too Much Free Time

from the and-the-court-will-laugh dept

Well, that didn’t take long at all. We noted that the tone deaf Winklevoss twins would probably appeal their latest legal “loss,” which “only” entitles them to the $160 million or so from their original settlement with Facebook and Mark Zuckerberg. Even while I said I expected them to appeal since they’d already gone this far, there was still a little voice in the back of my head saying they couldn’t possibly think that the Supreme Court could see a Constitutional issue to consider in their case. And yet… hours later, the Winklevii lawyer has announced plans to appeal to the Supreme Court. And I will announce plans to not laugh out loud when the Supreme Court turns them down.

Filed Under: appeal, ideas, supreme court, winklevoss
Companies: connectu, facebook

A Succinct Description For Why Assuming Patent Validity Is A Problem

Patents

from the no-adversarial-process dept

Law professor Doug Lichtman has an op-ed in the NY Times, timed to the Supreme Court’s hearing on the Microsoft/i4i case. As we’ve discussed, the focus is on what the standard should be for reviewing patents in the courts. We were disappointed that the US government supported keeping patents difficult to invalidate. Lichtman’s op-ed does a nice job explaining why this makes no sense:

Patent examiners give most applications only a quick look, spending on average 16 hours to 17 hours per application ? nowhere near the time needed to assess whether an invention is truly new and not obvious. Worse, those hours are typically spread over two to three years, and they are interspersed with work on hundreds of other open files.

These problems could in theory be fixed with more money. But resources aren?t the only issue. The extent and quality of Patent Office review is also limited by the fact that the process is not adversarial. Indeed, the only parties involved in Patent Office review are the applicant and the applicant?s lawyers ? people with an obvious incentive to see the application move forward. Contrast that with litigation, where patent plaintiffs have to square off against very motivated patent defendants.

Those two issues cover exactly why it’s a screwed up system where patents are automatically considered valid. The lack of time given to reviewing patents is often talked about, but the lack of an adversarial hearing is important as well. Obviously, defenders of the system today will point out that’s what the court system is for. They argue that it’s better for the courts to sort it out than to burden the Patent Office even further. But, if that’s the case, then we should make it so the court system actually can invalidate bad patents more easily. Instead, the system works on an assumption of validity, with a very high bar (“clear and convincing,” rather than the lower “preponderance of the evidence.”). I still can’t figure out how anyone defends this aspect of the current system. Moving the bar lower will only serve to get rid of bad patents. So the only argument I can see for defending the current system is that these people somehow believe that bad patents are important as well. And I’m left scratching my head as to who, outside of those who hold or profit from bad patents, could think that.

Anyway, the Supreme Court has, thankfully, released the transcript (pdf and embedded below) of today’s hearing, and in typical Supreme Court fashion, it doesn’t give away too much, but is still interesting. It seems like most of the Justices are pretty focused on the procedural issues and the specifics of Congress’ intent, prior rulings, and whether or not the specific “preponderance of the evidence” standard is any more reasonable than “clear and convincing evidence.” The one Justice who seems to grasp the deeper issues (again, not surprisingly if you’re aware of his past), is Justice Breyer, who repeatedly brings up issues about bad patents and the harm they do. He seems to be fully aware of what’s really at stake here, beyond a standard used by courts. Of course, none of that gives any indication how the case will eventually turn out. Also, Microsoft is at a bit of a disadvantage here, in that Chief Justice Roberts recused himself from this case, since he owns Microsoft stock. If the result comes out as a 4 to 4 tie, then i4i wins, and we’re left with a bad standard, unless Congress finally makes its intent clear (unlikely).

Filed Under: patents, standard, supreme court, validity
Companies: i4i, microsoft

Danish Supreme Court Sets High Bar For Evidence In File Sharing Cases

Copyright

from the good-for-it dept

One of the complaints that many have made concerning various file sharing lawsuits is how rightsholders too often rely on highly questionable or weak evidence. Over in Denmark, where efforts against file sharing by record labels and the IFPI have been aggressive, the Supreme Court has now deemed weak evidence insufficient for such cases. The case involved a guy who was accused of sharing 13,000 tracks. The court eventually decided he should pay $1,900 — significantly less than what the record labels requested. The main reason for the lower dollar amount was the limited quality of the evidence by the “anti-piracy” group Antipiratgruppen:

APG used techniques which scraped the index of the files said to be being made available by the defendant and then linked them back to his IP address, a method which has been acceptable in the past. But while the Court accepted that some sharing had occurred due to the defendant?s confession, it wasn?t satisfied that the index was an accurate representation of the files physically present on the defendant?s computer.

Nice to see some courts recognizing that just having an IP address is not enough evidence on its own.

Filed Under: denmark, evidence, file sharing, supreme court

Supreme Court Agrees To Hear Important Copyright Case: Will Review First Amendment vs. Copyright Issue

Copyright

from the fingers-crossed-that-they-get-this-right dept

We’ve been covering a very important copyright case — Golan vs. Holder — which involves a key question about copyright law. While the case may seem narrowly focused, it has much larger implications. As we’ve discussed, it’s the third case in a trio of cases that involved Larry Lessig, concerning the ability of the US to retroactively change copyright law. The first two, Eldred and Kahle, both ended up in losses, but they did get the court to establish some boundaries for when and how the US could retroactively change copyright law. As a very quick review, Eldred argued that the ongoing extension of copyright violated the “limited” part of the copyright clause in the Constitution. The Supreme Court eventually said that this was Congress’s call, and noted that it wouldn’t review copyright extension on First Amendment grounds unless the change in the law went beyond the “traditional contours of copyright protection.” Of course, many of us believe that an automatic copyright that lasts multiple lifetimes goes way beyond the traditional contours of copyright protection that kicked off with very limited protections, requiring registration and only lasting for a short period of time. But what do we know?

The second case, challenging the registration/automatic question, pointed out that under the Eldred ruling, the 1976 Copyright Act should be reviewed for First Amendment issues, since it certainly changed the traditional contours by switching copyright from “opt-in” to “opt-out.” Actually, it didn’t even switch it to opt-out, as there’s really no way to officially opt-out of copyright coverage. That seems like a massive change to the traditional contours of copyright law. However, the appeals court got confused and simply assumed that what was being argued was the same issues in Eldred.

The third case is this case, the Golan case — which noted that due to a treaty agreement, the US took some foreign books that had been in the public domain, and retroactively put them under copyright protection, putting some sellers of those books at risk for infringement. Two years ago, we were a bit surprised to find a court agreed, and said that this part of the Copyright Act was unconstitutional. Basically, the court suggested that Congress could have written the law in such a way that left those works in the public domain. Last summer, the 10th Circuit appeals court reversed the lower court, and basically said it was okay to take these works out of the public domain, and that there was no First Amendment issue in doing so, because copyright law “addresses a substantial or important governmental interest.” For a variety of reasons, I found this reasoning to be quite problematic.

Golan appealed, and it was just announced that the Supreme Court will actually take the case and will review the First Amendment issue (along with the Progress Clause issue). While I wouldn’t be surprised if the Court made a ruling that flies in the face of reason, as it did with Eldred, perhaps we can be hopeful that some on the court will finally recognize how the massive expansion of copyright over the last century really does raise serious First Amendment issues. This is an important case to follow, even if it seems likely that the Supreme Court will make another bad ruling. And, even though it may be a narrow issue, getting the Supreme Court to actually look at some of the issues when the First Amendment comes into conflict with copyright is still important.

Filed Under: copyright, golan, public domain, supreme court

Supreme Court Says AT&T Has No Right To 'Personal Privacy'

Privacy

from the don't-take-it-personally dept

Last year, we wrote about an important case in which AT&T bizarrely claimed that it had personal privacy rights over information the FCC collected in an investigation concerning AT&T overbilling the government. An organization had made a Freedom of Information Act (FOIA) request on the info, but AT&T protested that, as a corporation, it had a personal right to privacy. As we noted, that seemed like a pretty ridiculous claim, but the appeals court accepted it. We were therefore happy to see the Supreme Court pick up the case last fall, and now it has unanimously ruled against AT&T (8 – 0, with Kagan not taking part, since she filed the original brief for the federal government in support of the FCC). Considering the complaints some have made about the Supreme Court taking the idea of “corporate personhood” too far, I think plenty of people (who don’t work for AT&T) will agree that this ruling makes plenty of sense. A corporation has a right to keep certain information secret and confidential, but the idea it has a “right to privacy” makes no sense.

The actual ruling (embedded below) is quite interesting in noting, while corporations may be “persons,” that does not automatically afford them “personal” rights.

Adjectives typically reflect the meaning of corresponding nouns, but not always. Sometimes they acquire distinct meanings of their own. The noun “crab” refers variously to a crustacean and a type of apple, while the related adjective “crabbed” can refer to handwriting that is “difficult to read,” Webster’s Third New International Dictionary 527 (2002); “corny” can mean “using familiar and stereotyped formulas believed to appeal to the unsophisticated,” id., at 509, which has little to do with “corn,” id., at 507 (“the seeds of any of the cereal grasses used for food”); and while “crank” is “a part of anaxis bent at right angles,” “cranky” can mean “given to fretful fussiness,” id., at 530.

Even in cases such as these there may well be a link between the noun and the adjective. “Cranky” describes a person with a “wayward” or “capricious” temper, see 3 Oxford English Dictionary 1117 (2d ed. 1989) (OED), which might bear some relation to the distorted or crooked angular shape from which a “crank” takes its name. That is not the point. What is significant is that, in ordinary usage, a noun and its adjective form may have meanings as disparate as any two unrelated words. The FCC’s argument that “personal” does not, in fact, derive from the English word “person,” but instead developed along its own etymological path, Reply Brief for Petitioners 6, simply highlights the shortcomings of AT&T’s proposed rule.

“Person” is a defined term in the statute; “personal” is not. When a statute does not define a term, we typically “give the phrase its ordinary meaning.” Johnson v. United States, 559 U. S. ___, ___ (2010) (slip op., at 4). “Personal” ordinarily refers to individuals. We do not usually speak of personal characteristics, personal effects, personal correspondence, personal influence, or personal tragedy as referring to corporations or other artificial entities. This is not to say that corporations do not have correspondence, influence, or tragedies of their own, only that we do not use the word “personal” to describe them.

Certainly, if the chief executive officer of a corporation approached the chief financial officer and said, “I have something personal to tell you,” we would not assume the CEO was about to discuss company business. Responding to a request for information, an individual might say, “that’s personal.” A company spokesman, when asked for information about the company, would not. In fact, we often use the word “personal” to mean precisely the opposite of business-related: We speak of personal expenses and business expenses, personal life and work life, personal opinion and a company’s view.

Justice Roberts, who wrote the decision, then goes on to pick apart each argument made by AT&T as to why it should be allowed “personal” privacy, leading to the rather obvious punchline that you have to think the Justices had in mind to use from the very beginning:

We reject the argument that because “person” is defined for purposes of FOIA to include a corporation, the phrase”personal privacy” in Exemption 7(C) reaches corporations as well. The protection in FOIA against disclosure of law enforcement information on the ground that it would constitute an unwarranted invasion of personal privacy does not extend to corporations. We trust that AT&T will not take it personally.

Filed Under: corporations, fcc, foia, personal privacy, personhood, privacy, supreme court
Companies: at&t, fcc

Supreme Court Lets Price Fixing Claims Against Major Labels Over Digital Music Move Forward

Legal Issues

from the fix-that dept

For many years, we wondered why the major record labels weren’t brought up on price fixing charges concerning their various digital music deals. It involved all of the major labels working out deals where the price of music was exactly the same across the board and where it was the labels themselves who got to determine the end-user price rather than the retailer, which seemed like clear cases of price fixing. It used to be that manufacturers were not allowed to require a retailer to price in a certain way, as that would be prima facie evidence of price fixing but more recently rulings have dialed back that rule. Still, it seemed like some of the other aspects of digital music pricing still represented clear price fixing. It took long enough but finally some people sued. While a lower court had tossed out the lawsuit, last year we noted that the 2nd Circuit appeals court had reinstated it. The labels appealed to the Supreme Court, who has now allowed the case to move forward by rejecting an appeal from the labels. At this point, I wonder if the labels won’t try to settle the lawsuit in an attempt to avoid a full trial. The chances that the labels might lose seems decently high and the costs to them could be quite high.

Filed Under: collusion, price fixing, record labels, supreme court

Appeals Court Says (Again) That Diagnostic Tests Are Patentable

Patents

from the supreme-court-please? dept

Last year, we wrote how a bunch of doctors were quite worried about an ongoing patent lawsuit, Prometheus Laboratories v. Mayo Collaborative Services. It involved a company, Prometheus, that claimed it could patent basic medial diagnostics, and basically said no one (such as the Mayo Clinic) could diagnose patients in the same way without paying Prometheus. The whole concept was abhorrent to many doctors. Yet, as we worried, last year the appeals court (CAFC), as it has done so often, sided with the patent holders. This summer, when the Supreme Court decided Bilski, one thing it asked CAFC to do was reconsider the Prometheus case. It’s now done so, and nothing much has changed. Once again, CAFC has said that basic diagnostic tests may be patentable. Many also think (probably correctly) that this is a good indication that CAFC will also reverse a lower court ruling in the Myriad Genetics case, concerning whether or not genes are patentable. If diagnostic tests are patentable, why not genes? Of course, all this really means is that sooner or later the Supreme Court is going to have to weigh in again, and hopefully it won’t punt the issue like it did in Bilski.

Filed Under: cafc, diagnostic tests, genes, patents, supreme court
Companies: mayo clinic, myriad genetics, prometheus labs