OT: Newegg Wins Important Verdict for Onling Shopping

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January 27th, 2013 at 10:24 PM
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I Bleed Maize N Blue
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Joined: 09/27/2008
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OT: Newegg Wins Important Verdict for Onling Shopping

All Our Shopping Cart are NOT Belong to You, or

Screw You, Patent Troll

How Newegg crushed the "shopping cart" patent and saved online retail

Appeals court invalidates three patents that Soverain was using to claim ownership of online shopping carts and file suits against online retailers.  (Ruling PDF link)  Soverain loses the $2.5M it had won from Newegg, as well as almost $18M plus a ~1% "running royalty" it had won from Victoria's Secret and Avon.  (And it has many other lawsuits pending.)

For Newegg's chief legal officer Lee Cheng, it's a huge validation of the strategy the company decided to pursue back in 2007: not to settle with patent trolls. Ever.

"We basically took a look at this situation and said, this is bullshit," said Cheng in an interview with Ars [Technica]. "We saw that if we paid off this patent holder, we'd have to pay off every patent holder this same amount. This is the first case we took all the way to trial. And now, nobody has to pay Soverain jack squat for these patents."

Yay, Newegg!

Michigan Resurgent?  Michigan Resurgent!

The beatings will continue until the uniforms improve!

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January 27th, 2013 at 10:27 PM | Way OT? (Score:-1 Normal)
January 28th, 2013 at 12:03 PM | Way Misspelled? (Score:2 Normal)
Sinsemillaplease
Joined: 01/01/2011
MGoPoints: 489

Definitely.

2014 Offer List BOYCOTT ADIDAS

January 28th, 2013 at 12:16 PM | Not really. There's a meta (Score:3 Normal)
Seth
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Joined: 10/14/2008
MGoPoints: 48268

Not really. There's a meta element since this affects the MGOSTORE as much as it does Newegg. We weren't paying royalties to anybody for the Shopping Cart but we do run into online patent trolls and this ruling can be relatively broadly applied. No change to anything but we're safer today than we were before.

(Blogger alias: "Misopogon") This team is under construction. We thank you for your patience.

January 27th, 2013 at 10:31 PM | I guess you could say it's On Topic (Score:5 Normal)
wresler120
Joined: 10/17/2010
MGoPoints: 565

I mean we often times put the Michigan products we are buying online into that cart ... right??

January 27th, 2013 at 10:31 PM | I was wondering when this (Score:5 Normal)
MontuckyYooper
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Joined: 10/04/2009
MGoPoints: 1418

I was wondering when this would show up on the MgoBoard.

/s

January 27th, 2013 at 10:33 PM | This is fantastic.. (Score:4 Normal)
Atlanta_Blue
Joined: 06/30/2008
MGoPoints: 71

I think we've seen quite a bit of the new strategy of attacking the validity of the patent vs. trying to win in the lopsided Eastern District of Texas federal courts.  Hopefully lawmakers will consider an overhaul to the patent system in the near future, though given they can't even agree on major issues I'm not holding my breath.

January 27th, 2013 at 10:33 PM | Just in case anyone wants to (Score:4 Normal)
bluebyyou
Joined: 09/07/2009
MGoPoints: 2682

Just in case anyone wants to read a few more details, here is a pretty good synopsis.  I'm still in a bball frame of mind.

http://www.bakerlaw.com/alerts/patent-watch-soverain-software-llc-v-newe...

January 27th, 2013 at 10:44 PM | gallery (Score:3 Normal)
blueheron
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Joined: 03/26/2009
MGoPoints: 2299

I would (seriously) like to hear from some MGoLawyers on this issue (what's known as patent trolling, not specifically the NewEgg case).

"..."

January 27th, 2013 at 11:01 PM | Irony (Score:2)
UAUM
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Joined: 11/03/2010
MGoPoints: 1017

I think it's funny how the IP rights damages that corporate America/the entertainment industry pushed for and used to shut down those who infringe upon their rights were used against them.



I also think copyright trolls (much more prevalent) than patent trolls are an abuse of the system. We were offered to prosecute copyright infringement and after listening to their methods, it just blew my mind how shady those clowns are.

 

Your MGoLawyer in Columbus.  Unabashedly representing the interests of Wolverines all across enemy territory and now back hoMe.

January 27th, 2013 at 11:12 PM | Generally speaking (Score:3 Normal)
BiSB
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Joined: 08/15/2009
MGoPoints: 27875

A "patent troll" (or a "non-practicing entity") is one who owns a patent on something, but doesn't use it. They wait for someone ELSE to do something that infringes on the patent they own, and then they sue them to try to get paid off. In other words, they wait under the bridge until someone tries to cross, and then they try to collect their toll; hence, the 'troll' moniker.

There are a number of proposals for dealing with patent trolls, but there really is no silver bullet. Cases like this give me more hope, though.

They no longer call me Bisbiño

January 28th, 2013 at 1:06 AM | Why aren't declaratory (Score:2 Normal)
TheGhostofYost
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Joined: 04/20/2011
MGoPoints: 2559

Why aren't declaratory judgments pursued more frequently?  I thought the main takeaway from the Genentech case was that you no longer have to wait to be sued even if the patent holder has no intention of filing a lawsuit.  Could be wrong though.

January 28th, 2013 at 7:25 AM | One of the basic concepts (Score:2)
bluebyyou
Joined: 09/07/2009
MGoPoints: 2682

One of the basic concepts behind patent ownership is that a patent gives you the right to exclude others from using your invention.  You can practice your invention, sell or license it to others or sit on it and do nothing. This is only touching the surface of this area of IP law. Ultimately, the quid pro quo is that when the patent expires the public is free to use the information disclosed and claimed in the patent grant.  One could write one or more books on the subject and still only scratch the surface.  

January 27th, 2013 at 11:31 PM | As far as actual solutions (Score:3 Normal)
BiSB
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Joined: 08/15/2009
MGoPoints: 27875

The best one I've heard is being a little more targeted with the length of time and expansiveness of particular kinds of patents. Drug manufacturers might need 17 years from filing to recoup their expenses, but a software maker doesn't need that kind of time. Leaving these things dangling out there for decades increases the chances of trolls springing up. 

They no longer call me Bisbiño

January 27th, 2013 at 11:51 PM | Software patents are too broad (Score:2)
mgotom
Joined: 03/03/2011
MGoPoints: 50

I am not an attorney, but I am a software developer. Most software patents are too broad, and very frequently cover things that are prior art, or obvious, or simply routine stuff developers do all the time. Unfortunately, as the Ars article pointed out, defending patent suits is so expensive most defendants simply settle just make the problem go away. Good for Newegg for fighting this one.

I don't know if the fault for all this lies with the Patent and Trademark Office, or with patent legislation, but software patents should be much rarer and much narrower in scope than they are now.

January 28th, 2013 at 1:16 AM | I patented the Internet a few (Score:5 Normal)
nikj
Joined: 01/04/2009
MGoPoints: 1099

I patented the Internet a few years back. Currently just waiting for the right time to file my lawsuit.

January 28th, 2013 at 9:34 AM | WHAT? (Score:2)
BiSB
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Joined: 08/15/2009
MGoPoints: 27875

YOU'RE SITTING ON A GOLD MINE, TREBEK...

They no longer call me Bisbiño

January 28th, 2013 at 1:23 AM | The problem with software (Score:2)
bronxblue
Joined: 11/22/2008
MGoPoints: 12579

The problem with software patents isn't so much that the enforcement as the fact that for many years the examiners had so few resources to rely on for prior art that bad patents were getting issued.  It's happened with other fields in their infancy, and over time the database of prior art fills out and these types of patents become rarer.  Also, the USPTO adopted a crowdsourcing-type program called Peer-to-Patent a couple of years ago that seeks prior art references from the community, with a particular eye on circumstances like this.  Still not a perfect system, but it is improving.  I do agree, though, that term limits for a variety of patents, including software and hardware, should be shortened, or at the very least tiered such that protection disappates the more ubiquitous the underlying technology becomes.

And this is coming from a software developer AND an IP attorney.  

January 27th, 2013 at 11:40 PM | This American Life (Score:2 Normal)
Dominick's_Lunch
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Joined: 02/10/2012
MGoPoints: 352

There is a joint NPR Planet Money/ This American Life show from a year or so ago that does a great job of detailing the Trolling issue. It does a much better job that I could, but I was too dumb to even take the IP Bar exam.

January 28th, 2013 at 12:00 AM | You may not have taken the IP Bar (Score:5 Normal)
Happy Gilmore
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Joined: 01/13/2011
MGoPoints: 643

But you were still tricky enough to somehow get a free trip to Bolivia

January 28th, 2013 at 1:14 AM | Link? Link.   (Score:5 Normal)
david from wyoming
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Joined: 03/15/2009
MGoPoints: 2813

Link?

Link.

 

Are you a park ranger at Yellowstone? Say hi to Yogi Bear for me. - the_big_house 500th

I may not be a 70 year old man. - Herm

January 28th, 2013 at 1:19 AM | This is a big decision, and (Score:2)
bronxblue
Joined: 11/22/2008
MGoPoints: 12579

This is a big decision, and one that frankly needed to be made.  I understand the desire to protect one's intellectual property even if the principle venture fails, but companies like Soverain stymie innovation and put unnecessary taxes on successful companies through this trolling.

I love the court's reasoning because, for once, it felt both logical and systematic.  Even the expert witness's attempts to show differences amounted to "well, they didn't make a website when they used their system.  Of course, had the web been how it is now, they would have."

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