Patent Validity

[murphman]

Four years ago while taking a finance class we were required to participate in a mock trading account project. It was a simple free setup our professor established through Marketwatch.com. During this project doing simulation trades I came across a company called Vringo. The company was suing the monstrosity of a company known as Google. They were suing Google on patent infringement.

I do not trade stocks but because of this class and coming across this particular litigation I became interested and have kept an eye on this case ever since. The initial trial did not start till I believe late Fall of 2012 and a jury decision came way later.

Long story short the jury ruled in favor Vringo that indeed Google was infringing on their patents which I believe there was four. During that time and post trial the USPTO ruled and confirmed multiple times that all four patents are valid.

Of course Google is not going to accept this and it was a sure thing they would appeal and they did. Well today came the day that the appeals court has ruled the patents to be invalid based on obviousness.

My question is, is this even possible? did the appeals court just set a precedence that a patent validated by the USPTO means absolutely nothing?

Would like to hear those with a good grasp on patent laws and just the way our justice system works if this is legitimate or if this ruling is going to come back and bite the appeals court in the ass?

[interfan]

It is the golden rule - he who has the gold makes the rules. Having been through this type of process before, the opinions of the USPTO mean nothing and they have no teeth in their bite. If someone infringes on your patent and you don't have the staying power or finances to sustain a very long and expensive fight, it doesn't matter whether the patent is valid or not. An appellate judge can make a bad ruling, as seems to be the case with increasing regularity. That doesn't mean yet that it is settled law or precedent if the ruling is later overturned.

[murphman]

It is the golden rule - he who has the gold makes the rules. Having been through this type of process before, the opinions of the USPTO mean nothing and they have no teeth in their bite. If someone infringes on your patent and you don't have the staying power or finances to sustain a very long and expensive fight, it doesn't matter whether the patent is valid or not. An appellate judge can make a bad ruling, as seems to be the case with increasing regularity. That doesn't mean yet that it is settled law or precedent if the ruling is later overturned.

Thanks for the insight, I guess I was under the impression that a patent validated by the USPTO meant something and that an appeals judge did not have the powers to decide if a patent is indeed valid. I could understand an appeals court overturning the ruling of infringement but validity of a patent has me scratching my head.

[TAZ]

The US patent office is a bunch of beaurocrats with a gazillion applications to process every year. They do not have the time and resources to go out and check every letter of every claim. Patents are written by lawyers in a foreign language with no grammar rules so they are hard to interpret. An examiner may look at the words on your patent and may not make the connection that I have a similar patent out there and approve it. Later a judge rules the other way and so on. Look at the whole Apple Samsung fiasco. Patents can also have their claims invalidated for other reasons. False claims, false applicants... Patents are also regional beasts. You can have world wide patents or patents that apply to specific countries. You can patent something in the US but when you try to sell it in Germany you might be in violation of someone else's patent. Given that Google services cross borders it isn't all that unfathomable that they just missed something during their IP search. It's not hard to do. Plus the bigger wallet a company has the more likely people are actively searching for ways to get a pay out. You'd be surprised at patent trolls who buy up nearly out of date patents and then shotgun lawsuits hoping that 1:100 will just settle. Things get messy fast when there a lawyers involved and lots of cash on the table.

[FromMyColdDeadHand]

Sometimes I think there are all kinds of examiners trapped in the USTPO offices because they couldn't figure out how to use a door knob, there was no prior art and to them it wasn't obvious how to use a knob. Thank Vishnu that we have someone besides the USTPO to look at patents. Maybe the field of human knowledge is so vast now that "Obvious to someone skilled in the art" is not relatable to people outside the art.

'Obvious", hell; most patents I see don't pass the 'Duh' test. Thank God we can have someone besides the USTPO look at patents.

[murphman]

The US patent office is a bunch of beaurocrats with a gazillion applications to process every year. They do not have the time and resources to go out and check every letter of every claim. Patents are written by lawyers in a foreign language with no grammar rules so they are hard to interpret. An examiner may look at the words on your patent and may not make the connection that I have a similar patent out there and approve it. Later a judge rules the other way and so on. Look at the whole Apple Samsung fiasco. Patents can also have their claims invalidated for other reasons. False claims, false applicants... Patents are also regional beasts. You can have world wide patents or patents that apply to specific countries. You can patent something in the US but when you try to sell it in Germany you might be in violation of someone else's patent. Given that Google services cross borders it isn't all that unfathomable that they just missed something during their IP search. It's not hard to do. Plus the bigger wallet a company has the more likely people are actively searching for ways to get a pay out. You'd be surprised at patent trolls who buy up nearly out of date patents and then shotgun lawsuits hoping that 1:100 will just settle. Things get messy fast when there a lawyers involved and lots of cash on the table.

This is what that company did, I would have ended that class with never paying any attending to this stock nor any other stock accept for the fact they were going into litigation with Google and Mark Cuban had just purchased a 7% stake in the company. It intrigued me to say the least that Mark Cuban would make that gamble on a company who purchased a patent to sue Google.

[TAZ]

This is what that company did, I would have ended that class with never paying any attending to this stock nor any other stock accept for the fact they were going into litigation with Google and Mark Cuban had just purchased a 7% stake in the company. It intrigued me to say the least that Mark Cuban would make that gamble on a company who purchased a patent to sue Google.

Cuban ain't stupid when it comes to making $$. There is a lot of money to be made by patent trolls. You'd also be surprised at just how much time and money companies waste defending from these trolls. Last year I had to deal with a couple troll suits. The time to research each claim to make sure we really didn't miss anything originally. Time spent with lawyers... Blah blah blah. This is just me and I'm not on a lot of patents. All that down time not pushing product out the door to make $$. This is why lots of companies just settle. The downtime measured against a sealed settlement sometimes favors a settlement.

Companies also have little recourse against the trolls. They hold no assets to go after and in a lot of cases they are defending a patent in good faith. It's a win win for the trolls especially since not many cases actually make it to court.