Category Archives: Law

Lodsys has gotten a lot of attention for their patent threats against app developers lately, and yesterday came news of Macrosolve doing something similar. Florian Mueller wrote some great stuff about it here, as he usually does.

Basically, Macrosolve is a publicly traded app maker who has done terribly at their core business, losing hundreds of thousands of dollars in the last few years. But they were recently awarded a patent for a “system and method for data management” relating to mobile computers, and now they are going crazy suing small developers.

Unlike Lodsys, Macrosolve isn’t beginning by asking for licenses, and the developers they are targeting run the gamut of mobile operating systems. This is probably a bad idea for multiple reasons: For one, some of the defendants are just going to fight the suit, costing Macrosolve a lot more money than Lodsys, who won’t have to defend their patent. Also, by suing developers on a range of platforms, Macrosolve is more likely to entice Apple, Google, and Blackberry to split the legal costs and fight the patent head on. Apple doesn’t have that option with Lodsys, because Lodsys hasn’t actually sued anybody, and they’ve only asked for licenses from Apple developers.

Still isn’t good for the mobile app ecosystem though, and all of this is demonstrating that the patent system really needs to adjust in some fashion to fix software patents, or risk stifling development in “mobile computers”, a rather broad category that covers every new consumer technology likely to come out in the next ten years. It just doesn’t make sense to reward a company likely Macrosolve, a total loser when it came to making real apps, with the right to IP ownership over such a simple concept. Even if the concept wasn’t simple when Macrosolve “invented” it, clearly others reinvented it quite quickly – nobody was copying Macrosolve, whose most successful app was related to barbeque recipes… and it wasn’t even successful. The patent system allows this logic to prevail when a court looks at whether a patent was “obvious”, but that’s pretty late in the game in terms of litigation, and everybody has spent a pile of money by then. Software patents are a pretty broken system, and hopefully the system will adjust sooner rather than later, before the small app developers are forced out of the market.

Update: The premise of this post was later revealed to be erroneous – Apple probably has a license for the patent in question from Intellectual Ventures, before the patent went to Lodsys…

Last Friday, Lodsys, a patent trolling firm, sued a bunch of small iOS developers for infringing a patent they bought a few years back that they claim covers in-app system features. Lodsys is upset that they are being called a patent troll for suing a bunch of iOS developers for patents reaching back as far as 1992, so they made a blog defending their actions via a Q & A format which treats their readers like children. They also call out individual websites in some of their questions, showing how professional they are.

In short, their defenses are an outrageous joke. Lodsys throws around a bunch of boilerplate defenses to the concepts of patents generally, but don’t address any of the actual criticisms that have been tossed at them. Lodsys, in almost every argument, compares patent law and Lodsys’s actions to classical property issues. Here’s one example, used to “explain” why Lodsys is going after the small developers rather than Apple:

As a comparative example, it is the owner of the hotel who is responsible for the overall service (value proposition) that guests pay for, not the owner of the land that the hotel may be leasing.

The difference between a hotel and an intellectual concept is painfully obvious, but apparently not to Lodsys. Developers have no idea that they are infringing an idea that somebody had back in 1992, because intellectual property isn’t a physical thing. Obvious ideas aren’t something that people assume they can’t use. Hotel owners, on the other hand, know that they are leasing land… they placed their hotel on the land.

Another ridiculous statement comes here:

Historically, the tech industry did not clear patent rights in advance because the amount of time and effort to do so made no economic sense given the relative low cost to create software and the speed at which products were being released… so a norm has arisen where it’s build and ship now, and worry about clearing the patent rights later

If this is accurate, it doesn’t seem like the patents are doing anything to spur innovation in the field at all. If developers are ignoring patents because the cost of finding them are too high (aka all the patent holder did was file a patent, one of tens of thousands issued every year), then why reward the patent holder for disclosing his invention to nobody?

If you want to read a strong critique of Lodsys’s actual arguments regarding patent law, head here. Solid discussion there about how this sort of agressive patent trolling stands to ruin the app market by significantly raising the barrier to entry, but I won’t repeat the entire post here.

What’s more interesting to me is (and it relates to the hotel point), why isn’t Lodsys suing Apple as a third party infringer?

Third party infringement in patent is a very strange, infrequently utilized doctrine, but the key phrases from the Patent Act are “knowledge” and “inducement”. Lodsys claims that Apple has licensed their patents: seems like strong evidence of ‘knowledge’ to me – clearly Apple “knew” of the patent in the strictest sense of the word if they were paying to use it. “Inducement” is typically the wiggle room for defendants, who can often claim they didn’t know that what they were encouraging would be deemed infringement. But how could Apple possibly claim that they didn’t know encouraging use of their in-app system would induce infringement, when they themselves paid to license the patent? Unless the in-app system infrastructure came with a strong warning that using the system opened developers up to lawsuits unless they licensed, Apple seems like they are in trouble.

Maybe the real purpose of these suits is to extort licenses from the small guys as further evidence against Apple of third party infringement, giving Lodsys a stronger bargaining position if Apple winds up paying Lodsys for the patent outright. All this for a patent covering a technology that, in all likelihood, Apple independently reinvented themselves. I’m all in favor of patents on technologies that the inventor actually uses, or that the inventor at least DISCLOSES in some meaningful way to the public. But that is clearly not what’s been happening here.

Since Lodsys seems to be reading blogs that reference them, here is my suggestion: If you take an EXTREMELY unpopular position, don’t spur further debate on the subject by responding with blog posts. If the system is broken in your favor, abuse it quietly, if you must abuse it.