MESSAGE
| DATE | 2010-08-28 |
| FROM | Ruben Safir
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| SUBJECT | Subject: [NYLXS - HANGOUT] Patent Litigation Madness
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http://www.vosizneias.com/63100/2010/08/27/founder-files-patent-suit-against-apple-google-facebook-others/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+vin+%28Vos+Iz+Neias%29
Microsoft co-founder Paul AllenMicrosoft co-founder Paul Allen
Silicon Valley, CA - Billionaire Paul Allen has made major forays into
cable television and sports teams since leaving Microsoft Corp. more
than two decades ago. Now he’s adding another pursuit: patent
litigation.
Mr. Allen, who co-founded Microsoft with Bill Gates, on Friday sued
Apple Inc., Google Inc. and nine other companies asserting they are
using technology developed about a decade ago at his now-defunct Silicon
Valley laboratory. Mr. Allen, a pioneer of computer software, didn’t
develop any of the technology himself but owns the patents.
None of the defendants could immediately be reached for comment.
Patent litigation in general is on the rise and Mr. Allen’s lawsuit
comes amid high-profile successes of firms such as NTP Inc. and Acacia
Research Corp., which enforce patents without making products. Courts
have tried to rein in patent litigation with mixed results, and Congress
has yet to act on legislation that would do the same.
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For Mr. Allen, the lawsuit marks new terrain. He is aggressively going
after companies, including many of Silicon Valley’s biggest names,
that he thinks are violating technology that was developed at his
Interval Research Corp., a Palo Alto, Calif., lab and technology
incubator he financed with about $100 million during the Internet
bubble.
Mr. Allen wasn’t available for comment, according to a spokesman,
who said Mr. Allen’s lab created the technology that he wants to
mark as his own. “Paul thinks this is important, not just to him but
to the researchers at Interval who created this technology,†said
the spokesman, David Postman. “We recognize that innovation has a
value, and patents are the way to protect that.â€
Mr. Postman said the timing of the suit wasn’t related to Mr.
Allen’s health or personal finances. Mr. Allen recently pledged to
give away the majority of his fortune, which Forbes in March estimated
at $13.5 billion. The 57-year-old was diagnosed last year with
non-Hodgkin’s lymphoma, but has completed treatments.
Mr. Allen’s lawyers said a team has been reviewing his patent
portfolio for years, seeing what’s relevant to the current
marketplace and pursing the technicalities necessary to complete the
lengthy patent process. During that time some patents were sold or
licensed.
“There are a lot of companies making a lot of money from licensing
patents,†said Jonathan Singer, a Minnesota attorney at Fish &
Richardson who defends companies from patent suits.
NTP in July sued Apple, Microsoft and four other companies over patents
related to the wireless delivery of email to cellphones. BlackBerry
maker Research In Motion Ltd. paid NTP $612.5 million in 2006 to settle
similar patent charges.
One of Mr. Allen’s former Microsoft colleagues, Nathan Myhrvold, has
amassed thousands of patents and secured hundreds of millions of dollars
in patent-licensing deals from telecommunications companies and others.
Mr. Myhrvold’s Seattle-based firm Intellectual Ventures patents some
of its inventions but also acquires patents to license.
Named in Mr. Allen’s suit, along with Apple and Google, are AOL
Inc., eBay Inc., Facebook Inc., Netflix Inc., Office Depot Inc.,
OfficeMax Inc., Staples Inc., Yahoo Inc. and Google’s YouTube
subsidiary. Notably missing from the defendants’ list are Microsoft,
in which Mr. Allen remains a major investor, and Amazon.com Inc., which
is based in Mr. Allen’s hometown of Seattle. Mr. Postman declined to
comment on the selection of defendants.
Mr. Allen’s firm had sent letters to the defendants telling them it
held “patents of interest†to the company and that his firm
would like to talk to the defendants about them.
The suit, filed by Mr. Allen’s Interval Licensing LLC, lists
violations of four patents for technology that appear to be key
components of the operations of the companies—and that of e-commerce
and Internet search companies in general. The suit does not estimate a
damage amount.
The technology behind one patent allows a site to offer suggestions to
consumers for items related to what they’re currently viewing, or
related to online activities of others in the case of social networking
sites.
A second, among other things, allow readers of a news story to quickly
locate stories related to a particular subject. Two others enable ads,
stock quotes, news updates or video images to flash on a computer
screen, peripherally to a user’s main activity.
Since he left Microsoft in 1983, Mr. Allen has launched into a variety
of enterprises. Mr. Allen founded a Frank Gehry-designed rock museum in
Seattle and owns the Seattle Seahawks professional football team and the
Portland Trailblazers professional basketball team.
The billions of dollars’ worth of investments his firm, Vulcan Inc.,
put toward pursuing his vision of a “wired world†haven’t
all paid off. He lost $8 billion in his investment with cable company
Charter Communications when it filed for bankruptcy protection.
Mr. Allen also bankrolled Interval Research. During its heyday, the lab
employed more than 110 scientists, physicists, engineers “and was at
the forefront in designing next-generation science and technology,â€
the suit says. The lab included Robert Shaw, a co-creator of chaos
theory, which is a field of study in mathematics; Max Mathews who wrote
the first widely used computer program for music; and David Reed was one
of the founders of the Internet protocol TCP/IP.
The lab worked on numerous projects, with goals to create technology to
use in Mr. Allen’s ventures in telecom. In later days it also
focused on developing technology to license to others. Over the course
of a decade, Interval was issued 300 patents.
It successfully marketed some of its patent portfolio, including
cellular voice processing technology and motion-detection technology
used in games that allows a computer to “see†commands. It also
created a “smart†toy called “Red Beard’s Pirate
Quest†and later sold the technology behind it to Lego Group.
Work at Interval Research was phased out after plans for commercializing
its technology didn’t materialize as expected. “The market
lagged behind Interval’s technology,†Mr. Postman said.
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