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Startup Seeks To Preempt Patent Trolls

CmdrTaco posted more than 5 years ago | from the wonder-how-long-that'll-last dept.

Patents 117

anaesthetica writes "The WSJ reports that a San Francisco startup is buying up patents with the promise never to assert them in order to help large corporations hedge against patent trolling firms. The company, RPX Corp, receives an annual fee in exchange for licensing the patents it has purchased. Cisco and IBM have already signed up for this service of 'defense patent aggregation.'"

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Preempt them (5, Insightful)

nurb432 (527695) | more than 5 years ago | (#25877887)

By being one..

Could we call it the General Patent License? (4, Interesting)

tepples (727027) | more than 5 years ago | (#25878085)

As I see it, patent pools like this turn patent law against the patent trolls in much the same way that the GNU General Public License and other copyleft licenses turn copyright law against some publishers of proprietary software.

Re:Could we call it the General Patent License? (3, Insightful)

TubeSteak (669689) | more than 5 years ago | (#25880529)

As I see it, patent pools like this turn patent law against the patent trolls in much the same way that the GNU General Public License and other copyleft licenses turn copyright law against some publishers of proprietary software.

A patent cartel ("defensive pooling" my ass) only protects members of the cartel.
It doesn't 'free' patents like the GPL 'frees' software.

Re:Could we call it the General Patent License? (1)

RichiH (749257) | more than 5 years ago | (#25883091)

So what? If they do a legally binding "we will not attack anyone unless you attack a subscriber" stunt, you can simply ignore those patents. Of course, a large corp might not want to use a particular piece of software as they are battling someone else, but I don't care about that. And yes, abolishing the stupid (not all!) patents would be better. But in the current system, it means that pressure is taken off the community.

Re:Could we call it the General Patent License? (1)

arth1 (260657) | more than 5 years ago | (#25880785)

As far as I can tell, you're wrong in comparing the two.

If this company goes tits up, the patent portfolio can be bought by patent sharks and used for exactly what it was intended to prevent. Similar if they get a CEO like McBride, or if their current leaders suddenly turn evil. Promises aren't worth the paper they never were written on.

GNU copyleft, on the other hand, doesn't rely on the copyright holder retaining the rights or holding true to his promises, because the rights are already assigned.

I think this is a very bad idea, and that the company sets itself up for being bought by someone with less scruples.

Re:Could we call it the General Patent License? (1)

SL Baur (19540) | more than 5 years ago | (#25881329)

If this company goes tits up, the patent portfolio can be bought by patent sharks and used for exactly what it was intended to prevent.

Something very much like that happened with the Chaum digital money patents. Digicash was on the verge of some remarkable things before they went tits up and NOBODY was allowed to use the technology.

Re:Preempt them (5, Interesting)

rudeboy1 (516023) | more than 5 years ago | (#25878393)

I see where this is going...
  Company buys up billions of dollars worth of IP (cheaply, due to the business concept), promising never to use it.
  Company gets bought out, at a reasonable price considering all they own, since they're "not really the IP owners".
  New company decides it's not bound by previous company's ethics, decides to call in the lawyers for the billions of dollars worth of IP.
  New company litigates the living shit out of everyone.
  New company buys out other companies using the money won from being sued for using their own IP.
  New company now owns 50.1% of the world.

Can someone verify the whereabouts of Pinky and The Brain please? I'm getting a little nervous.

Re:Preempt them (1, Funny)

Anonymous Coward | more than 5 years ago | (#25878677)

Can someone verify the whereabouts of Pinky and The Brain please? I'm getting a little nervous.

They haven't been seen since last Friday night, when CmdrTaco did his Richard Gere impersonation

I'd imagine IBM is smarter than that (2, Insightful)

Sycraft-fu (314770) | more than 5 years ago | (#25879059)

What you do is you have them sign a contract. The contract says thing like "You can never sue us." When you buy a company, you buy their obligations too. You don't get to say "Oh look, we are a new company so we can just ignore the contracts." Nope, you bought all that as well.

Remember: If you could get out of a contract with a sale, people could do this with houses. For example I buy a house, I sell it to you for a dollar. I then don't pay the mortgage. The bank comes to repossess the house and you say "It's my house, you can't take it, the contract is void because of the sale." No, not the case actually. Turns out if that mortgage isn't paid off, the bank gets to take the house (this is what title insurance is for, in case the sale is invalid). You can't just eliminate the contract like that.

So all companies have to do is make sure when they sell patents, it is done with a good contract. Then if a company buys it out, well then they'll be bound by the contracts too.

Re:I'd imagine IBM is smarter than that (2, Insightful)

TheRaven64 (641858) | more than 5 years ago | (#25879175)

You don't get to say "Oh look, we are a new company so we can just ignore the contracts." Nope, you bought all that as well.

Nope, you liquidate the first company, sell its assets (the patents) to a third party, and then let the company fold complete with all of its contracts. Someone else buys it for a dollar and gets all of the remaining assets.

Re:I'd imagine IBM is smarter than that (1)

jlarocco (851450) | more than 5 years ago | (#25879539)

A properly written contract would prevent that from happening. A clause saying "This agreement is no longer valid if either company goes into bankruptcy or is liquidated" or something like that.

That seems like a fairly obvious clause to add, and I only thought about it for 30 seconds. I'm sure IBM and Cisco's army of lawyers thought it over a bit more carefully. And if not, who gives a shit? It's not my problem, and it's probably not your's either. It's their IP, let them do what they want with it.

Re:I'd imagine IBM is smarter than that (1)

Nicolay77 (258497) | more than 5 years ago | (#25881023)

I think it is backwards in this case.

What we want is that the agreement remains valid even in the company goes into bankruptcy or liquidation. Very unlikely to happen.

If the contract is no longer valid, THEN the sharky lawyers will sue everybody and be very patent-trollish.

Re:I'd imagine IBM is smarter than that (1)

jlarocco (851450) | more than 5 years ago | (#25881537)

I'm not sure that's true.

If the agreement lets everybody use everybody else's IP, you'd eventually end up in a situation where even if the IP reverted back to its original owners, you'd end up in a situation where nobody can really sue anybody without opening themselves up to several countersuits. Almost a "mutually assured destruction" kind of scenario.

Technically companies with more patents would have a bit of an advantage, but I think it'd still be cheaper to form a new patent shelter company than start suing people.

It also depends on not allowing patent trolls into the group.

Re:I'd imagine IBM is smarter than that (1)

Gideon Fubar (833343) | more than 5 years ago | (#25881271)

It'd have to be more like "all intellectual holdings of the holding company become public domain if the company is liquidated".

It's pretty unlikely that they'd include this in their own contracts, and i'm not sure how it could actually be enforced.

Re:I'd imagine IBM is smarter than that (1)

Godji (957148) | more than 5 years ago | (#25880551)

The contract says thing like "You can never sue us."

Sure, but what's to stop them from suing everyone except "us"? They'll sue "us" for something else that someone else gave them.

Re:I'd imagine IBM is smarter than that (0)

Anonymous Coward | more than 5 years ago | (#25883319)

Turns out if that mortgage isn't paid off, the bank gets to take the house (this is what title insurance is for, in case the sale is invalid).

Title insurance has nothing to do with it. The reason the bank gets the house is that, until the loan is paid off, the bank is effectively the real owner of the house. Just as you get to make all your car payments and the bank (the legal owner on your pink slip) is the true owner. When it's paid off, you get a new pink listing you as both the legal and the registered owner.

The lender effectively owns the collateral and can take possession in case of a default.

You can't just eliminate the contract like that. You don't have a legal right to sell the collateral without the creditor's permission.

Too bad it doesn't work that way with union contracts. large corporations do it all the time -- they just go into Chapter 11 and say that the union contract is "too burdensome, so please, Judge, would you kindly fuck the union in the ass for us, huh, please."

Re:Preempt them (1)

canajin56 (660655) | more than 5 years ago | (#25879269)

Two things. One, you can't just void all the contracts that a company you bought out signed. Two, even the companies why didn't license would be protected by promissory estoppel. They can't say "We will not sue over these patents" and then do so later. If not for promissory estoppel, there would be so many awesome money making schemes. Take a song and say "Feel free to share this on P2P" and then track down people who share it and sue their asses of! Put up signs that say "free parking" on your private parking lots, then give them tickets anyway for trespassing! You don't need a contract to be bound by your promises. And you can't have a shell corporation buy yourself out to escape from your legal obligations!

Re:Preempt them (2, Interesting)

ScrewMaster (602015) | more than 5 years ago | (#25879849)

True, and then there's also the Nazgul. No patent troll in his right mind would take them on. Not if he knows what's good for him.

Re:Preempt them (3, Funny)

ScrewMaster (602015) | more than 5 years ago | (#25879821)

Can someone verify the whereabouts of Pinky and The Brain please? I'm getting a little nervous.

"What are we going to do today, Brin?"

"Same thing we do every day, Sergey ... try and take over the world!"

Re:Preempt them (1)

shentino (1139071) | more than 5 years ago | (#25881191)

In the case of a buyout, the new company would almost certainly be bound by the contractual obligations of the old one.

If old company signed a "will not sue" agreement, the new company cannot go litigation happy without breaching said contract.

That like saying: join them, if I can't beat them? (0)

Anonymous Coward | more than 5 years ago | (#25878651)

I think I'll start doing that as soon as I buy a Macy's Bohemian Grove T-shirt [infowars.com] and support Bush/Obama/Clinton/McCain by waving that pretend fallen-stripe anti-American flag that has the gold fringes not applicable in Title IV USCode.

In other words, never! I'll burn myself before I ever become a patent troll. However, a patent Troll is somthing different from a Patent troll that everyone wanted me to be.

Re:Preempt them (1)

overcaffein8d (1101951) | more than 5 years ago | (#25879603)

so it's either fight fire with fire or (more likely) be the bad guys in disguise

This just in (3, Insightful)

TheSpoom (715771) | more than 5 years ago | (#25877915)

Company buys up all other patent trolls, seeks funds from major companies while saying "we don't use them against you (if you pay us), honest!"

News at 11.

Re:This just in (5, Insightful)

virtualXTC (609488) | more than 5 years ago | (#25878023)

That's what I didn't get.
If they "won't assert their claims" then why do you need to buy a license from them?
If you do need to buy a license from them, how are they not trolls?

Consideration (3, Interesting)

tepples (727027) | more than 5 years ago | (#25878159)

If they "won't assert their claims" then why do you need to buy a license from them?

A contract, such as the purchase of a patent, requires some sort of consideration [wikipedia.org] in order to be binding. This consideration could be a token amount such as one dollar, or (more likely in this case) it could be only as much money as is needed to maintain the patent pool.

Re:This just in (5, Insightful)

SydShamino (547793) | more than 5 years ago | (#25878297)

I believe their claim is that they won't assert these patents against anyone. IBM isn't willing to buy out these patents to prevent their exploitation, but IBM is willing to donate a smaller amount of money to achieve the same thing. Cisco believes the same thing.

I see this as companies doing something that is beyond themselves. It's in their own interest, yes - the have neutralized a series a patents at less than it would cost to buy them or fight off a lawsuit - but in the process they have protected other companies that didn't help fund the operation.

Re:This just in (1)

SavvyPlayer (774432) | more than 5 years ago | (#25880803)

Good citizenship aside, if this were a non-profit entity, these donations would also be tax-deductible.

Re:This just in (3, Insightful)

Piranhaa (672441) | more than 5 years ago | (#25878421)

I can see it from both sides and I'm not entirely sure where I stand.

Take these into consideration however:
1) They need money in order to buy patents out. This isn't an ad driven service...
2) They do have to buy out a LOT of patents (only if the squatter is in fact willing to give it up) to make this worthwhile.
3) The patents were already held in hand, so it could have ended up in a multimillion dollar lawsuit OR the companies wanting to use them would not have been able to make a product with that particular patent, resulting in unattainable revenue.
4) If the price is reasonable, it's basically a (cheap?) insurance policy. It's practically a guaranteed way to use any patent this company has.
5) Companies don't need to request, or pay large amounts per patent, but rather pay into the pool and can use them ALL.

These are just some of the facts that came to my head. What I want to know is what happens if a company decides not to buy in, or doesn't realize they are violating a patent, if they'll get slammed hard.

Also, if these guys are just squatting on these patents and not producing ANYTHING with them, how will they hold up in court? IANAL, but I thought a company needs to show some effort in actually USING the technology for it to be considered VALID.

Re:This just in (0)

Anonymous Coward | more than 5 years ago | (#25881749)

IANAL, but I thought a company needs to show some effort in actually USING the technology for it to be considered VALID.

IAN(Yet)AL but validity has nothing to do with use. A patent that has been granted by the USPTO is presumed valid until proven otherwise, and failure to use is not part of that proof. That said, failure to use the patent may lessen the amount of damages that a patent holder can get.

Re:This just in (1)

SleepingWaterBear (1152169) | more than 5 years ago | (#25879287)

Well, they claim that they're never going to use the patents, so no one is required to pay them. If IBM or Cisco decides not to join, they still won't use the patents. That makes them very different from patent trolls.

Obviously the question is, why would anyone pay a company to do what it intends to do anyway? The answer is, most companies wouldn't, but the very largest companies with the most to lose from patent lawsuits are willing to pay because they like being safe from those lawsuits. They know that if they don't pay no one will, and the patent company will go out of business, so they're willing to pay because it will cost them less than buying the patents themselves, or dealing with expensive lawsuits. Probably the paying companies will also have some say in which patents get bought up, which would be well worth paying for.

This really isn't all that complicated, I'm not sure I understand why so many comments calling the new company a patent troll are getting modded up.

Re:This just in (1)

General Wesc (59919) | more than 5 years ago | (#25879579)

I assume they'll start patenting in areas relevant to your company.

Lots of places apply for defensive patents for their technologies. This is simply a company you can hire to do that for you.

Re:This just in (0)

Anonymous Coward | more than 5 years ago | (#25879807)

That is like a bank hiring security. You don't pay security guys because they would rob you otherwise. You pay security guys because others would rob you otherwise.

So if you have a contract with that company, and someone else is suing you about a patent, they will search a patent to counter sue that company with. If you don't have a contract with them, then they won't help you, but they won't sue you either.

Re:This just in (1)

PMuse (320639) | more than 5 years ago | (#25881335)

. . . how are they not trolls?

I believe the theory is that buying up all the abandoned / firesale patents on the market is cheaper than getting hit up by 1-2 trolls who want real money. The phrase "cheap at twice the price" comes to mind.

Yes, they do ask their "licensees" to contribute money, but this troll-suppression scheme can't work without funding from somewhere. We'll see if it can work at all.

Re:This just in (1)

qw0ntum (831414) | more than 5 years ago | (#25878027)

Yeah... I don't see how this is any different from regular old patent trolls. They are still owning patents with no intention of marketing the products they cover. Why is it worthwhile to give a patent to this company and then license it back from them?

Re:This just in (3, Insightful)

networkBoy (774728) | more than 5 years ago | (#25878089)

maybe because the license fee is not extortionistic, but rather only covers the cost of staff?

Re:This just in (1, Interesting)

Anonymous Coward | more than 5 years ago | (#25878265)

The cost of staff, where some of the staff have 6-digit salaries? I like it.

Re:This just in (0)

Anonymous Coward | more than 5 years ago | (#25878117)

Why is it worthwhile to give a patent to this company and then license it back from them?

To let large corporations indirectly work together to crush small companies and open source?

Patents patents patents (4, Funny)

CopaceticOpus (965603) | more than 5 years ago | (#25877937)

Interesting business plan, I wonder if they patented it.

Re:Patents patents patents (1)

geekmux (1040042) | more than 5 years ago | (#25877977)

Interesting business plan, I wonder if they patented it.

Too late, I just did.

(strokes bald cat and adjusts monacle)

Re:Patents patents patents (1)

Bill, Shooter of Bul (629286) | more than 5 years ago | (#25878257)

Then prepare for litigation! I patented the Idea of patenting this. As well as patenting the process of responding to patent lawsuits in the English, French, Spanish, German, Japanese, and Chinese languages. Prepare to study Dutch!

Re:Patents patents patents (0)

Anonymous Coward | more than 5 years ago | (#25878619)

<yawn>

Re:Patents patents patents (1)

Bill, Shooter of Bul (629286) | more than 5 years ago | (#25878683)

<golf_clap/>

Re:Patents patents patents (1)

j_sp_r (656354) | more than 5 years ago | (#25878767)

Val dood

Re:Patents patents patents (0)

Anonymous Coward | more than 5 years ago | (#25878919)

Prepare to study Dutch!

Uw patent is niet rechtsgeldig in landen waar Nederlands wordt gesproken!

Re:Patents patents patents (1)

Bill, Shooter of Bul (629286) | more than 5 years ago | (#25879267)

No, but you need the *ahem* herbs that are only legally available in the Netherlands in order to understand the logic contained in the patents.

Re:Patents patents patents (1)

AceofSpades19 (1107875) | more than 5 years ago | (#25878999)

No one expects the Spanish Inquisition!

sorry, too late (0)

Anonymous Coward | more than 5 years ago | (#25878347)

IBM patented this last year [theregister.co.uk] . Maybe you can patent ignoring prior art when filling for a patent.

Re:Patents patents patents (2, Informative)

DogDude (805747) | more than 5 years ago | (#25877997)

No, at the very least, Sourceforge, Inc (the owner of Slashdot), is doing it as well.

(From their latest 10-K filing):
We protect our intellectual property through a combination of copyright, trademark, patent and trade secret laws, employee and third-party nondisclosure agreements, and other methods of protection.

Re:Patents patents patents (2, Funny)

Mister Whirly (964219) | more than 5 years ago | (#25878373)

SourceForge has the advantage of not only enforcing patents, but they can Slashdot effect companies as well...

Re:Patents patents patents (0)

Anonymous Coward | more than 5 years ago | (#25879757)

Hail the Slashdot Army Republic!

Interesting new business model (1, Interesting)

Anonymous Coward | more than 5 years ago | (#25877947)

So they buy up patents that are most likely to cover the technologies already employed by firms, and then offer to the firms to pay a license fee for which in exchange they receive a guarantee that they will not be sued for infringement? That's a novel idea.

While the patent trolls state "I'm going to burn your store down!", these guys clearly say "It's a mighty fine store you have there, I can protect it from being burnt down for only a small fee".

Re:Interesting new business model (2, Funny)

pxlmusic (1147117) | more than 5 years ago | (#25878279)

that's a nice military base you've got here...

sounds like a scam to me (0)

Anonymous Coward | more than 5 years ago | (#25877955)

1. Buy patents to prevent patent trolls
2. Charge a small fee to companies
3. Get more patents
4. Increase the fee cost once companies are hooked
5. ????
6. profit

What prevents this startup from suing someone that doesn't pay?

Word of the Day: Patent-squatting (1)

geekmux (1040042) | more than 5 years ago | (#25877957)

Legalized "patent-squatting"? Are we serious?

And IBM signing up? Didn't the rest of us concede they won the race for most patents about 74,273 applications ago?

Re:Word of the Day: Patent-squatting (1)

KPU (118762) | more than 5 years ago | (#25878249)

When was patent squatting not illegal?

What? (2, Insightful)

Anonymous Coward | more than 5 years ago | (#25877961)

Won't this just encourage patent trolls?

Is it a patent troll? (1)

H4x0r Jim Duggan (757476) | more than 5 years ago | (#25877971)

I better go RTFA, coz from the intro it sure sounds like a patent troll itself.

IBM patentented this idea a while ago (0)

Anonymous Coward | more than 5 years ago | (#25877987)

seriously.

Re:IBM patentented this idea a while ago (0)

Anonymous Coward | more than 5 years ago | (#25878725)

For the interested [uspto.gov]

Blackmail? (1)

Dripdry (1062282) | more than 5 years ago | (#25878003)

What's to stop them from turning around and blackmailing these huge companies once they've amassed all these patents?

They must be getting a really nice chunk of change.

Re:Blackmail? (1)

mshannon78660 (1030880) | more than 5 years ago | (#25878111)

Contracts?

Re:Blackmail? (1)

Dripdry (1062282) | more than 5 years ago | (#25878235)

Oh, sure. But I've known enough lawyers who scoff at all sorts of contracts. Like rules, they seem made to be broken.

You're probably right, though. Perhaps my overzealousness to get an early post and mod points blinded me to the apparent simplicity of my contribution.

Re:Blackmail? (1)

Amazing Quantum Man (458715) | more than 5 years ago | (#25878881)

Silly person! Haven't you learned anything from Darl McBride?

Contracts are what you use against parties you have relationships with.

House of cards (0)

FiloEleven (602040) | more than 5 years ago | (#25878017)

Does anyone else see this as a harbinger for another legal quagmire in the future, or am I just trying to get karma by using big words?

Re:House of cards (1)

Amazing Quantum Man (458715) | more than 5 years ago | (#25878907)

Depends on which quagmire you're referring too... Giggety, giggety.

[Yes, I know you were talking about "harbinger" as your big word.]

What this really says. (1)

rhythmx (744978) | more than 5 years ago | (#25878021)

"New startup makes it easier and standard practice to legitimize the practice of patent trolling."

Just fix the damn system already!

Response to IBM and Cisco... (0)

Anonymous Coward | more than 5 years ago | (#25878107)

IBM and Cisco must be new here, or just online in general...

Do NOT Feed the Trolls.

So is this the first Venture Alturist firm? (1)

w0mprat (1317953) | more than 5 years ago | (#25878217)

If you've read Accelerando by Charles Stross the occupation of Manfred Macx the novel's protagonist does exactly what this company does. Stross terms this a Venture Alturist. He goes a step further with his character, whom not only sits on patents so the trolls can't get at 'em, but spends time alot of time furiously dreaming ideas and patenting them.

But really this is a bit "Honestly officer, I picked it up before someone stole it."

Re:So is this the first Venture Alturist firm? (1)

liquiddark (719647) | more than 5 years ago | (#25879657)

Venture Altruist. And yeah, Accelerando is exactly what I thought of as well.

Days of Our Patents (3, Interesting)

earlymon (1116185) | more than 5 years ago | (#25878287)

Plot^H^H^H^H History:

1. Government develops the concept of patents to protect the little, lone creator from amoral, robber industries - because even in groups, the creators have no defense against amoral industries. Government protection against business.

2. Developments soar - we're beyond the end-of-day-almost-off-air programming of the 60s that warned one day technology would double every year - technology doubles faster than we can measure.

3. Characters arise to be lionized and demonized in the tech age. They are given primary credit - in the mass mind (including on /.) - for their companies' successes and failures. Creation still in the hands of individuals, despite mass mindset.

4. Charlatans seize upon the opportunity, start trolling patents like crazy. It gets out of hand.

5. A business develops the patent-license-protection-clearinghouse to protect the large, rich businesses from the amoral, robber trolls' abuse of the law - because even in groups, corporations have no protection against the amoral trolls. Business protection against government.

If I invoke the name of Calculon does it help illustrate the point? It's a multi-year-long plot, very boring, very circular, and I'm calling it: Days of Our Patents.

I don't know about you guys, but I signed up decades ago to be a part of this thing called tech - not to become a forced extra in some asinine soap opera - which I fear we are all going to become part of, like it or not, know it or not.

Re:Days of Our Patents (1)

multipartmixed (163409) | more than 5 years ago | (#25878849)

> If I invoke the name of Calculon does it help illustrate the point?

The gold robot on Futurama? Who is a famous soap star, and falls in love with Bender? Who is temporary female, so he could compete in the Olypics?

What's he got to do with this?

Re:Days of Our Patents (1)

LandDolphin (1202876) | more than 5 years ago | (#25878927)

The next sentance answered your question: It's a multi-year-long plot, very boring, very circular, and I'm calling it: Days of Our Patents.

because, as you know: Who is a famous soap star

Re:Days of Our Patents (1)

earlymon (1116185) | more than 5 years ago | (#25878931)

The gold robot on Futurama? Who is a famous soap star...

Exactly. Only a star of Calculon's range could possibly hope to act this all out.

Defensive publication (2, Informative)

loonycyborg (1262242) | more than 5 years ago | (#25878309)

The best and cheapest defense against patent trolls is defensive publication [wikipedia.org] .

Oh the irony (1)

karlwilson (1124799) | more than 5 years ago | (#25878441)

The irony here is laughable.

Intellectual Ventures Refugee (1)

blankhead (1414857) | more than 5 years ago | (#25878477)

Intellectual Ventures started this way and now are supertrolls, RPX is refugees from there and *must* inevitably go the same way. A license to patent A is not a license to patent B, so this concept just plain won't work and RPX knows it. It's just plain deception - it's like paying off the mafia when everyone knows the tongs and yakuza are waiting on the step for their cut.

patent system overhead (1)

glyph42 (315631) | more than 5 years ago | (#25878549)

*Any* business based solely on patents is pure overhead for the rest of us. Overhead of the patent system, I mean. The fact that you can have a growth business of just dealing with patents and nothing else means that the overhead of the patent system itself grows over time. At some point the overhead costs more than the benefit that we get from the system! Don't get me started on insurance companies, lawyers, bankers and brokers either. Each system has players that are pure overhead, and increasingly so.

Inefficiency (1)

ProzacPatient (915544) | more than 5 years ago | (#25878601)

I think our patent system has truly gotten out of control when companies start doing stuff like this.

This is a great idea (1)

DJRumpy (1345787) | more than 5 years ago | (#25878637)

Assuming this company is on the hook for all legal costs/suites regarding said patents. It sounds a bit like outsourcing patent and associated legal costs, without all of the bad connotations that go with the word 'consulting' anyway ;)

Not Being Done for Free (1)

Nom du Keyboard (633989) | more than 5 years ago | (#25878649)

This is not being done for free. Someone is making money off of it. It takes cash to buy patents. Ergo someone is also paying money for this. Anyone care to guess who?

The flaw with this plan... (0)

Anonymous Coward | more than 5 years ago | (#25878673)

...is that if patent trolls wanted money instead of patents, they would have just kept their money. I doubt they would sell patents at a loss or even at marginal gain, so the acquisition process would be quite expensive. We would effectively be giving patent trolls an additional revenue stream, i.e., they can profit by litigation AND resale, thus giving them even more money to spend on...
guess what? MORE bunk software patents!

Wait a minute... (2, Insightful)

roc97007 (608802) | more than 5 years ago | (#25878681)

Isn't this, like, the same thing... only cheaper?

Re:Wait a minute... (1, Interesting)

Anonymous Coward | more than 5 years ago | (#25879285)

Yeah, competition is tough in the patent troll sector.

But you should come to me, you get a free iPod with every patent I successfully sue you for!

Nice, but Rue Pledge Break Season (1)

Fieryphoenix (1161565) | more than 5 years ago | (#25878727)

We're sorry to interrupt your usage of this fine product, but we really really need to reach our goal of $1,000,000 in revenue this quarter. You know you use the product, so why not give? And if you contribute now, we'll send you a nice shiny mug!

Amazing (4, Insightful)

stinerman (812158) | more than 5 years ago | (#25878759)

If this isn't a wakeup call to Congress that our patent system is entirely and completely broken, I don't know what is.

Any doubt left that patents are bust ? (2, Insightful)

Alain Williams (2972) | more than 5 years ago | (#25878795)

Probably the only voices left saying that patents are OK belong to certain ''well funded'' politicians.

Re:Any doubt left that patents are bust ? (0)

Anonymous Coward | more than 5 years ago | (#25878829)

There's a whole other world outside of Slashdot, by the way.

Re:Any doubt left that patents are bust ? (2, Funny)

Alain Williams (2972) | more than 5 years ago | (#25878877)

There's a whole other world outside of Slashdot, by the way.

Really? Your kidding me!

Re:Any doubt left that patents are bust ? (1)

Zordak (123132) | more than 5 years ago | (#25878869)

Well that, and pretty much everybody who isn't a Slashbot.

Is the promise legally binding (1)

westlake (615356) | more than 5 years ago | (#25878865)

...and how long will it last? Now and again even a troll can strike patent gold.

Market Solution to Patent Trolling (0)

Anonymous Coward | more than 5 years ago | (#25879605)

It seems like a good compromise between patent producers and the tech driven corporations. Patent producers are compensated for their research investment by a centralized fund while tech corporations are protected from unforeseen litigation or expensive patent searches. As long as there is some kind of fiduciary control on the centralized corporation and anti trust laws don't get in the way, then I believe that we have a market plugin to patch a problem in the patent system. The only ones who lose are the lawyers. . . so I doubt a certain legal-representative cartel will approve of it. Expect legislation against such market innovation in the name of economic stability.

Re:Market Solution to Patent Trolling (1)

EEBaum (520514) | more than 5 years ago | (#25879985)

The only ones who lose are the lawyers

And the businesses who don't care to pay the patent company's all-you-can-eat fees.

I see what you did there. (2, Interesting)

EEBaum (520514) | more than 5 years ago | (#25879963)

From TFA:

The company, called RPX Corp., buys up patents to keep them from firms that might use them as the basis of lawsuits or to press for licensing payments. Companies that pay a fixed annual fee receive licenses to the patents purchased by RPX...
(emphasis mine)

So they'll buy patents and try to sell you licenses to them, in order to prevent other firms from buying patents to try to sell you licenses to them?

Sounds to me like the only difference between this company and the nasty patent trolls is that they've embraced the One-Bill business model, a la Verizon. I wonder if that's patented...

Consolidated Trolling (0)

Anonymous Coward | more than 5 years ago | (#25880311)

Now you can increase you convenience by making all your patent licensing payments to one consolidated patent troll, RPX Corp. Convenient drive thru window coming soon...

The essence of a defensive patent pool (1)

hpa (7948) | more than 5 years ago | (#25880689)

The essence of a defensive patent pool is explained by this statement from the RPX website [rpxcorp.com] :

Members in RPX pay an annual fee to have a license to all patents and associated rights in the aggregation. Over time, companies receive perpetual licenses to all patents purchased in the aggregation and any patents that are sold during their tenure as members. Patents in the aggregation are also available to use in a counter-suit against any non-member who initiates litigation against a member. [my emphasis]

In other words, RPX don't need to assert patents themselves, they are leaving it up to their members/licensees to do so if a nonmember company is suing.

Is this better than a patent troll? If nothing else, it's probably a cheaper patent troll. Now, this is the kind of stuff that companies have been doing internally for a long time; this is just outsourcing.

This Is Patent Trolling (1)

Doc Ruby (173196) | more than 5 years ago | (#25881427)

To defend against a patent being used to interfere with invention, you have to release the patent into the public domain. Doing that eliminates the artificial government monopoly, forever, for everyone.

If you don't do that, if you keep the patent, and license it to select licensees, you are using your patent to interfere with everyone else.

Therefore, there is absolutely no difference between these new patent holders and "patent trolls". Including big IT corps paying their extortion.

Re:This Is Patent Trolling (1)

AdamWill (604569) | more than 5 years ago | (#25882879)

Exactly. To me, telling people they should pay you not to assert your patents sounds exactly like...well...asserting your patents.

not sure how this works (0)

Anonymous Coward | more than 5 years ago | (#25881539)

I don't get it. If you have a patent that you don't want anyone to ever assert, simply forget to pay the fees and let it go abandoned, or torpedo it in one of many countless ways. If you have an invention that you don't want anyone to assert patent rights against, publish it and every conceivable variation, working or not.

Maybe I'm missing something..

It's the wrong answer. (1)

Jane Q. Public (1010737) | more than 5 years ago | (#25881997)

But at least it's an answer.

It's the wrong answer because even though on one end it relieves the pressure from bullshit patents, on the other end it encourages bullshit patents by buying them up.

We are better off letting legislation and court judgments takes their courses. Recently, a judge made a decision that effectively invalidates most "process" patents of recent years, and would make it much more difficult to get them in the future.

Extortion (1)

Telepathetic Man (237975) | more than 5 years ago | (#25882475)

See Subject.

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