Patents & bankers (was: x plane being litigated against for infringement)

[the mad hatter]

http://www.x-plane.com/x-world/lawsuit/details/

what is the world coming to, why past it buy sell date

[Jeroen Hoppenbrouwers]

http://en.wikipedia.org/wiki/Patent_troll

[John Golin]

Pft - US patent system....

[Jeroen Hoppenbrouwers]

I still have that vague idea that basically ok systems (healthcare, legal, patents, education, ...) that leave a loophole open to abuse them just & only for making big money, are doomed. Where the tool becomes the target, things break. Same for metrics by the way.


Jeroen

[stekeller]

What is most sad about this is that even trivial or patently frivolous (sorry for the pun) suits are expensive to defend against. So, often companies choose to settle because it is financially more advantageous. Austin Meyer's estimate is $1.5 million in legal fees. So this still means a payoff for the patent trolls and only encourages them to keep going after more companies. By the sound of it, almost any Android app that has some sort of activation would be in a similar situation. It is much like not negotiating with kidnappers and terrorists. If nobody settled or paid off, this wouldn't happen.

I agree with Jeroen. Any system that encourages people to do destructive things and get a big payday, rather than creating a product or innovating, is doomed.

- Stekeller
KORD

[Richard McDonald Woods]

Hear, hear!

[Phil Bunch]

This thread stirs up my own negative feelings about the US patent system in particular, and the associated litigation methods, etc.  At the risk of boring or otherwise boring everyone, here's  my personal experience with the patent system and the associated legal processes:

My career in industrial R&D for a large company required that I work to obtain patents, of usual.  I soon decided that it was mostly not a rational activity and that scientifically it was of little if any interest to me in terms of where I would like to spend my time and effort.  Some of my colleagues obtained over 100 patents, and were given substantial raises, bonuses, etc, for such things.  

Fast forward a number of years, and Murphy's Law decreed that I became fully engaged in a major patent lawsuit against a competitor, featuring a patent of mine.  The lawsuit of course quickly became a costs-no-object battle between the opposing law firms, with me caught in the middle.  The other side even hired private detectives to follow me around, and they investigated every aspect and my personal life in an apparent attempt to "impeach me as a witness".  They even interviewed my grad school professors, and made sure I learned that they were doing this type of thing as an intimidation technique.  I caught their investigators following me to my hotel room at one convention, no doubt observing me and my partner (which freaked her out, of course).  I protested all this to the company's law firm, and they said I was lucky that the other side had chosen a civilized law firm since some of them were completely ruthless in their attempts to harass and legally discredit named inventors.  After years of endless preparation, including disclosing every email I had sent or received for over 15 years, the videotaped, stenographically recorded depositions began.  Here, opposing teams of lawyers examined and cross-examined me for something like 15-20 hours, including one day of 6 hours of non-stop questioning.  It was so fatiguing that I had trouble driving home at night after the effort.  A key goal of the depositions was to mentally burn out the deposed person and provoke him into saying something that they could use against us in the Federal Court trial that was the next step.  Sure enough, one day I became so severely fatigued from repetitious questions, etc, that I gave the opposite answer to the one I supported and had previously testified about.  This occurs quite predictably during lengthy depositions and is one of the basic tactics of all opposing lawyers.  So, they accomplished their goal of capturing me on video tape giving an incorrect answer.  We were allowed to introduce my corrected answer but they also got to keep and use their false answer.  One of the purposes of this tactic is to demoralize the witness, of course, which it very much did even though I was warned that it might happen, etc.

As I neared retirement, I learned that under US law I could be required to continue supporting this multi-year lawsuit after retiring, without time or other limits, and that I did not have to be paid for the time and effort.  I protested that if they wouldn't pay me they were not so likely to get an ideal effort on my part and was reassured that they usually voluntarily paid retired scientists for patent trial support but that legally they didn't have to and that they were obligated to tell me that.

Mercifully, they eventually settled the lawsuit (the vast majority of patent lawsuits are settled before trial but after spending a fortune in legal costs, etc).  Thus, I was allowed to retire in peace a few years ago.

It was in some ways an interesting experience, to see first hand what happens when opposing law firms have essentially unlimited budgets and do serious battle, but I was greatly relieved to be allowed to retire in peace. I learned a lot of patent law along the way.  After this experience I never use the common US phrase about "making a Federal Case about something".  

Just a few comments on why I feel especially badly for the X-Planes owner and staff about having gotten caught up in the US patent law system.  I hope they can settle for a small amount of money quickly and just get on with their lives.  As my experience shows, the alternative is to lose very large amounts of time and energy fighting the lawsuit.  It may not matter much if the case is strong or weak - the very involved and very time-consuming pre-trail phases of the lawsuit will continue until a settlement is reached, typically years down the road.  Maybe they'll be lucky and their lawyers will get the case thrown out quickly.  It may be cheaper to just quickly settle and cut their potential losses.

[Shiv Mathur]

Wow ... thanks, Phil - that's really fascinating ... and scary at the same time.

Thanks for sharing this.

shiv

[John Golin]

The US Patent AND Legal systems.... *sigh*

@hoppie - the system is broken when they give patents for 'obvious' things or things with prior art... a patent must be 'non-obvious' and 'novel'...

See http://en.wikipedia.org/wiki/Patentability

Also, patent law should require that purchasers of patents cannot begin enforcing patents where the originator had not done so - ie if the originator let the 'widget' into the public domain, the purchaser cannot go back and seek compensation.

[stekeller]

Phil:

Thank you for sharing your experience. It was not a rant but a calm explanation of your personal experience. Very, very insightful. I love the U.S. and we have a wonderful system here in many ways. However, the trend of taking every grievance to court - not as a legitimate way to fight injustice or secure freedoms, but as a tool to make money is downright scary.

As for the tactics involved, I wonder if juries know about it. I have managed to avoid jury duty (never been selected) but I will keep this in mind if I ever do. You can't put much stock in a single statement from a witness.

I am glad that you can retire in peace. Thank you for sharing!

- Stefan

[Phil Bunch]

The NY Times has published an interesting critical review of the US patent law situation:

https://www.nytimes.com/2012/10/08/technology/patent-wars-among-tech-giants-can-stifle-competition.html?ref=todayspaper&pagewanted=all

I can't think of a credible scenario in which the US Congress will reform the US patent law, partly due to idealogical gridlock and partly because it has become so strongly controlled by wealthy businesses and other special interests.

[Jeroen Hoppenbrouwers]

Isn't this basically stiffling ALL of the US system? The idealogical gridlock (combined with "no idea from the other side shall ever get support") plus the overwhelming interest in everything that could conceivably bring in money by wealthy businesses and other special interests?

I know I am nearly a communist because I am from Europe, but I still believe (hah) that some aspects of society should not be driven by monetary gain requirements. Well-educated people such as doctors should definitely earn a good income, but I hiccup against them putting their profession only where the big money is and forgetting that oath they once took. That was there not for nothing. Same for lawyers. Those professions were not invented just to make money, and that was for a reason.

Bankers were made just to make money.

Hoppie

[Hardy Heinlin]

Bankers were made just to make money.

Irony aside, I think even banking should be one of "those professions that were not invented just to make money". They connect people who need energy with people who have excessive energy. Money is nothing but an energy reservoir. You may work more than momentarily necessary, and you may use the result of this excessive work later or now for something else that you also need.

Someone who has too much apples but too little oranges needs to find someone who has too much oranges but too little apples. While these apple and orange experts work with their production, the bankers should work on their connection service and help those apple and orange experts to find each other for a fruitful exchange. For this service, the banker needs energy, too, and should also be powered by some apples and oranges.

I think, only casino owners were made just to make money. Their customers push a lot more energy into the casino than they pull out of it.

I'd say, there are bankers and there are bankers. And there are gamblers.


Cheers,

|-|ardy

[Jeroen D]

I know I am nearly a communist because I am from Europe, but I still believe (hah) that some aspects of society should not be driven by monetary gain requirements.

Interesting observation. One of the things I noticed living in the USA was that left and right are not "absolute". Let me explain; We lived in Kansas City, MO. I'd say most of our local friends were Republicans, because that's just the way it is in KC for this segment of the local population. You don't drive around with a "I voted Obama" sticker on your truck. You'll get shot!

Back in the Netherlands my friends and family for that matter, would call me pretty much right wing. However, if you would've asked my friends in Kansas City they would have told you I'm a raving 'leftie"!

[Will]

Many people say part of the reason for the financial crisis in the United States was that the government's repeal of Glass-Stegall Act. Glass-Seagall, enacted after the Great Depression, said that commercial banks (the money lenders) needed to be separate institutions than the investment banks (who financed trades in securities and investments). Commercial banks are not supposed to be risky, while investment banks by their nature carry increased risk.

[Phil Bunch]

Many people say part of the reason for the financial crisis in the United States was that the government's repeal of Glass-Stegall Act. Glass-Seagall, enacted after the Great Depression, said that commercial banks (the money lenders) needed to be separate institutions than the investment banks (who financed trades in securities and investments). Commercial banks are not supposed to be risky, while investment banks by their nature carry increased risk.

For a convincing, and reasonably brief discussion, see the book "13 Bankers" by Simon Johnson, a highly regarded MIT professor.  It's available inexpensively in Kindle, etc.

With the US political system now effectively owned by financial interests, and with the US Supreme Court recently ruling that a "one dollar, one vote" system is legal, I haven't a clue how we get out of this quagmire.   So, in the meantime, these interests just finish their looting, to the loss of the US as well as the rest of the world...

Somehow, I suspect that electing an former hedge fund CEO as our next President isn't a step in the right direction...George Bush's staff are certainly eager to move back into the White House and resume their wars, etc, etc.

[Jeroen D]

Somehow, I suspect that electing an former hedge fund CEO as our next President isn't a step in the right direction...George Bush's staff are certainly eager to move back into the White House and resume their wars, etc, etc.

Hi Will,
too true. I fail to understand why being a business man would qualify you as a president. Having run hedge funds doesn't make it better. Frankly speaking, when we were still living in the USA, i was really surprised to see so many people buying into this story that, apparently, a business man would know how to create jobs.

I've been working for a multinational for the last twenty years. Creating jobs isn't on our agenda. It's a result of what business we want to do and how, but it is never a goal in itself. There might be the odd cases where we are required or requested to create jobs locally and we would do so, if it makes sense to our business.

In the US politics and business are of course heavily entwined. For Europeans it's just incomprehensible that business can literally 'buy' votes. Whilst I was still was in the Netherlands I did study the crisis a bit. One of the things I became aware of is that these investment banks not only carry big risks. I have the feeling that their management simply didn't have a good understanding what risk they were really taking. Some of these financial products and services are incredibly complex. There have been numerous examples where management simply was disconnected from the reality of what their staff was putting together. When European government had to bail out a number of banks, it was next to impossible to really understand their value. A P&L simply doesn't reflect the complexity of the products and services some of these banks were offering.

I am very much in favor of splitting banking between investment and just commercial banks. Interestingly enough, the banks that kept themselves to pretty much straight forward commercials (E.g. Rabo Bank) have been doing pretty good during this crisis.

Republicans will curse me for this, but it takes a powerful, competent government to ensure that you have a banking system in place that accommodates both. Business simply doesn't regulate itself. You don't want to stifle it, but you do have to enforce regulation that ensures society at large gets a fair deal out of it.
 
of course, the above is just communist propaganda. But hey, I only lived in the USA for three years. I'm in Delhi now. Which gives one a whole different perspective on just about any topic.

Jeroen

[Will]

I read 13 Bankers, and I liked it very much. For a centrist, pragmatic take on how the United States might solve our debt and deficit problems, I'd recommend White House Burning, by Johnson and Kwak. It's refreshing to think about common sense solutions to our mess. But alas, it's been a long time since there's been any common sense in American politics.

[Jeroen Hoppenbrouwers]

To throw a one-liner around ( (C) JH 2012): "You may try to run a country like a business, but you cannot just fire 47% of your citizens to score a profit bonus."

[Phil Bunch]

To throw a one-liner around ( (C) JH 2012): "You may try to run a country like a business, but you cannot just fire 47% of your citizens to score a profit bonus."

I'm not so sure - many or perhaps most of the tea party/libertarian crowd would like to do just that in the name of some sort of bizarre notion of personal freedom.  So far, there are enough people now dependent on government-run programs (e.g., Social Security, military pensions, Medicare health insurance, etc, etc), that one wonders if the Republicans aren't just preaching hot air to solidify their political base, knowing full well that they can't possibly implement most of their plans.  I can't personally tell where their bs ends and their real intentions begin.

Also, the banksters haven't finished looting the country, much less the world.  Whatever would speed up that process seems to be the path the world is on by default, and thus I fear that it may not matter so much which party wins the US election.  Having said that, I have resolved never to vote for a Republican, barring some sort of miracle.  If only it were as simple as choosing a party one doesn't like or that one likes much less than the alternative(s)...

An example, but one in a sea of unethical business practices:

http://www.nytimes.com/2012/10/15/business/reverse-mortgages-costing-some-seniors-their-homes.html

and a mostly political editorial by the NY Times' Nobel Prize winning economist:

https://www.nytimes.com/2012/10/15/opinion/krugman-death-by-ideology.html?src=me&ref=general

Is political life this messed up in any of the major European countries?  I understand that the UK has strictly banned financial contributions of most types from their political processed, with a provision to remove someone from the ballot if they are caught taking too much money under the wrong circumstances.  In the US law, "money is speech" and thus money is free to control anything and everything, per a recent Supreme Court ruling.

Perhaps a moderator/admin should move this thread to the Pit, the non-aviation part of this forum?